Conrad, you are looking at folk music as a performance-based entity that is part of the larger "show business". That's only a small part. The larger view is that folk music is already free because there is no copyright restriction on public domain songs.

If there is any claimant for authorship on a traditional folk song, that needs to be taken up in court.

A free festival, however, must be based on an anti-commercial business model. This is what socialists have been advocating for years. You privatize a folk festival, you get a Capitalist
business model.

The problem of the music industry today is that they haven't figured out how to completely bleed the consumer dry of their money. Most of the money doesn't go to the artist in publishing houses and recording companies. It goes to the lawyers, managers, agents and bookers. Music business today is another corporate boondoggle. Copyright laws have to be changed and updated to accommodate today's music.