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"Sure, it's a policy question. That does not automatically make it government business" We grant something non-profit status because we think it's in the publi

• JoshTriplett 11y ago
  > Certainly. And we change those laws over time to reflect changing circumstances. Which would be quite different from the article's positioning that acts entitled to that money in the first place. But at that point, it would be reasonable to ask why such a change should target non-profit educational institutions in particular, rather than non-profits in general. (Obvious answer: because that would be wildly unpopular, and would threaten some of the primary organizations that non-profit laws were created for, which have enormous lobbying power.) > That blanket statement is as true as the statement that companies have no problem spending more money than they have. And those companies doing so typically go out of business, which is strong encouragement not to do that. Government departments have no such controls or requirements in place to enforce fiscal responsibility; when they spend more than they have, they still get more to spend in the future. And lo and behold, they often demonstrate extreme fiscal irresponsibility. > I mentioned Cooper Union as an example of how non-profit universities are also not immune. And they very nearly went under due to (as far as I can tell) epic mismanagement, yes. Mismanagement occurs in many places. It's worse when it happens with other people's voluntarily donated money, and even worse when it happens with taxes. > Who am I likely to believe more, you or Piketty? I'm hardly the first or only person to argue against what is commonly euphemized "wealth redistribution" on moral/ethical grounds. Whether you're inclined to believe those arguments depends rather heavily on your political beliefs and morals, as it's a question not solely decidable based on economics. Sounds like you've already made up your mind that "wealth redistribution" is acceptable to you, which is a political viewpoint, not solely an economic one.
  • dalke 11y ago
    "strong encouragement not to do that" I would expect that if governments had the same fiscal responsibility as businesses then they would have about the same failure rates. The failure rate in companies that end up with the investors losing money or some other form of debt is, what, 30%? (Number is from 'Redefining Business Success: Distinguishing Between Closure and Failure', Headd (2003)). If governments had the same failure rate as businesses we would be up in arms. Yes, some city governments are bankrupt, but it's not true that even 10% of them are failures. http://www.governing.com/gov-data/municipal-cities-counties-bankruptcies-and-defaults.html http://www.governing.com/gov-data/municipal-cities-counties-... says it's more like 1:2000. That is not a sign of 'extreme fiscal irresponsibility'. "Sounds like you've already made up your mind that "wealth redistribution" is acceptable to you, which is a political viewpoint, not solely an economic one." You make it sound like political viewpoints should not be a consideration. The existence of non-profit status, the choice of what can be non-profit, and the rules that apply (eg, the 5 percent payout requirement for foundations) also also influenced by politics. Since you appear to support special non-profit status for schools, you and I are in agreement that political views are indeed an important aspect of this discussion. I therefore don't understand why your comment is useful.
    • JoshTriplett 11y ago
      > If governments had the same failure rate as businesses we would be up in arms. So governments should take less risks, and in particular incur even less debt. > That is not a sign of 'extreme fiscal irresponsibility'. I'm not talking about failure rates, I'm talking about utter failure to spend within means, or even recognize a boundary of means. > You make it sound like political viewpoints should not be a consideration. Not at all; rather, I was suggesting that citing one economist to support a political viewpoint doesn't make that viewpoint right, and in particular doesn't provide any evidence whatsoever about whether that viewpoint is ethically right. > Since you appear to support special non-profit status for schools I wasn't taking a stance on that here; rather, I was suggesting that it doesn't make sense to specifically call out private universities for consideration of revoking that status, without broader consideration of non-profits in general, simply to prop up public universities. More specifically, I was complaining about the entitled stance taken in the article.