If people create useful original content, others can reward them so as to promote future development. Donating to your favorite artist or an emerging talent should be the nature of our cultural progress, rather than the selfish strive for exuberant compensation. If money is actually necessary to produce better than what you'd call "mediocre" content, we can establish public systems to direct money for those purposes.
I highly doubt money is so necessary anyway, considering audio and video equipment and editing software are easier and easier to attain. There are kids creating music and uploading it to Soundcloud every single day, giving it away, and forming networks to distribute this content with their friends. Some of them can produce some really amazing music with _very_ cheap equipment. I could produce objectively more sophisticated music in thirty minutes with a kaossilator I've had sitting in my garage for five years, than probably any song in the top-100 charts right now -- sans auto tuned vocals.
I know that's "mainstream" hit piece, but it's true. You can't honestly tell me when you think "progress in culture" you imagine that most of our cultural funding should go toward "artists" who do not actually produce their own content, but rather sell their public image. Somebody with barely any experience in music production can produce a pop song similar to most of the popular content out there. It's all being dumbed down to the lowest common denominator, who is then conditioned to expect even dumber content in the future.
How easy is it for actually creative music to be accepted by a wider audience? Not easy, when the distribution channels are owned by the people representing the distributors and producers of the content. Then the Cable companies also are owned by those organizations too, and it becomes a sick and twisted mess.
Further proof is shown in television. BBC and NOVA and NPR and other organizations have far more accurate and superior scientific and culturally educational programming and journalism, but they're publicly funded. Whereas the History channel probably hasn't played a single history program for years, and runs "Modern Marvels" reruns every hour on the weekend until the next primetime spot for "Ice Road Truckers" opens up. The Science and discovery channels almost never produce unique or interesting content.
These organizations and their strangleholds on our legislative process keep the status quo of copyright intact, even despite grave consequences to our personal liberties, knowing full well that their financial benefit has a more immediate and self-perpetuating impact on society. It's disgraceful.
Why can't a more universal public funding system be embraced, considering we have the technology to do it? If we care about personal liberties and advances in communication, we should take innovative steps in that direction.
Conflating the recording industry with art and culture (or even music) in general is like conflating Amtrak with the concept of 'transportation' in general. Losing the recording industry won't deny us music any more than the loss of Amtrak will deny us transportation.
There are even better (as in, economically more efficient) ways of financing culture production with technology. For example, consider a situation where playback devices were (perhaps intermittently) connected to the internet, were able to track audio fingerprints of music they played back, and had a tax on their sale. The proceeds of that tax could be redirected in proportion to the popularity of particular works. You wouldn't have to worry about sharing or lending. Everyone could consume as much as they wanted to, and there would still be the benefits of competition.
But instead, we have anti-free-market approaches that institute monopolies. And companies have massive vested interests in perpetuating those government-granted monopolies. The purpose of copyright is to incentivize the creation of works of art. Extending the copyright term for existing works has no such justification; but that's exactly what corporations were able to convince Congress to do with the Sonny-Bono act.
Books aren't scarce anymore. You could not, in several life times, read all the books on project Gutenberg. Yet not a single one of those is protected by copyright today.