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This article considers the development of cultural policy as part of New Labour’s Third Way governance and identifies three rhetorics of state-funded art: art as a form of cultural democracy; art as an economic driver; and art providing solutions for social amelioration. The text describes how the liberal conception of art and culture, i.e., having universal benefit as a public good, was extended to function within wider policy directives that were ultimately aimed at driving Third Way conceptions of public good. It provides a critique of the positivist claims for state-funded art as producing social transformation and instead points to how art commissioned as part of culture-led regeneration was instrumental and complicit with an agenda of privatization and marketization. It suggests that this has had negative consequences for democracy.