I suppose that Jameson's tone comes from the Frankfurt school of cultural pessimism, but why does he have to sound so elegiac? Even limiting our concern to "Western classical music," it seems to me that more--rather than less--people all over the world have come to possess an ability to play the piano, the violin, etc. as well as the desire to "understand and appreciate" music as art (be it "high" or "low" or uncategorizable). The real history of "Western music," I think, doesn't fit into Jameson's narrative of decline (from active producer to passive consumer). Why does he ignore elements of "democratization" and "globalization" that are also part of this history? In other words, why is he so undialectical?
As to the disappearance of the "social need" to which (in Jameson's mind) "Western music" answered, I say, "good riddance!" Though the passage cited by Doug doesn't specify the nature of the said "social need," it must have had a lot to do with providing background music to the business of marriage (as in Jane Austen's novels).
Yoshie