The masses have ceased to be the 'passive element' -- they have revolted. The industrial revolution made low culture profitable, indeed more profitable than high culture, for the first time in history. That is why hacks like The Painter of Light (tm) are worth millions while visionaries like Ugarte (whose artwork I posted in another thread) languor in obscurity. Hirst and his ilk are rich, too, but their overpriced readymades are as lowbrow as any kitsch painting. As Gasset points out, our elites are no less 'mass men' than the proles in the streets.
But I don't fetishize high culture, either, after the manner of status-striving SWPLs and canon-obsessed traditionalists. Valuing high culture for high culture's sake is an autistic overreaction to the proliferation of schlock. An artist needs to forget about 'culture' altogether and focus on expressing an original relation to the universe, in Emerson's famous words.
As for your second point, I think I can guess at the tack it's going to take -- we need to return to medieval artistic anonymity! -- and I think that's just an anachronistic fantasy. The West is bound up with individualism as part of its Faustian destiny...you can't put the genie back in the bottle. Besides, I disagree with this 'organic', neo-feudal conception of society, where nothing can ever be truly autonomous because we are all linked like the body parts of some great organism, part of a whole, etc. Modernity has taken atomization too far, but the divisions within society will never go away. There will always be elites versus proles, religion versus philosophy, art versus commerce, etc. This was true even in the middle ages. Better to just accept this and move on rather than pine for a harmony that never was.