The Non-Profit Scam
Arnold Kling writes on non-profits:
My general view on non-profits is that their status is too high relative to profit-seeking firms. In the for-profit sector, I think of the example of Elizabeth Holmes, the founder of Theranos. The company had a noble vision, and she made compelling presentations, but the product didn’t work. Because she claimed that the product worked better than it did, she got in trouble. She was ousted as CEO, and she faces a lot of legal jeopardy.
In the non-profit world, there are no end-users to hold you accountable if what you are doing doesn’t work. Just having the noble
From my direct experience, I would go further. There is a tranche (I don't know how large) of non-profits that are close to outright scams, providing most of their benefits to their managers and employees rather to anyone outside the organization. These benefits include 1) a salary with few performance expectations; 2) expense-paid parties and travel; 3) myriad virtue-signalling opportunities; 4) opportunities to build personal networks. This isn't just criticizing theoretical institutions -- people I know are in such jobs in these organizations.
Advice to commenters -- please do not purposely misunderstand the point I am making. Clearly great non-profits doing good work exist, but their existence does not invalidate the point I am making. And I think their ability to continue to survive without creating value beyond that they provide for their employees is closely related to the point that Kling makes.
