6 ms·

Yes, truly terrible that non-profit organisations serving the common good should provide high salaries. Founder and employees should just go into banking, becau

by kharak 7y ago

Yes, truly terrible that non-profit organisations serving the common good should provide high salaries. Founder and employees should just go into banking, because those guys absolutely deserve their high pay. Imagine, just imagine a society, where doing non-profit could be a valid career option without a disadvantage in the income department. The horror.

dmayle 7y ago
It's not about paying a salary. I've worked in non-profits before, all of the employees themselves are taking pay cuts to work for the greater good. He's asking people to give up their money in order to provide this service. A salary half that size provides an extravagant lifestyle, what he's taking is exorbitant.
- kharak 7y ago
  What CEO's and many other people in for-profit industries are getting, is also quit exorbitant. But that's generally accepted. Why do some people go nuts if they see non-profits demanding high pay? Khan Academy has done something unique, helpful and truly excellent, but how dare Salman Khan wanting a cut similar to for-profits. (If it is similar, properly still less).
  - mikekchar 7y ago
    I think the key here is that most people equate "non-profit" with "charity". The idea is that as much money as possible is used to fund the services provided by the entity. However, there are many businesses run as non-profit entities that are not in it to provide a charity. It's just that the entity of the company is designed to take no profit. Often these entities invest heavily into growth as opposed to taking profit (and often this is even the stated goal of the organization). If you take donations, it sounds like you should be a charity, but there are lots of examples of organizations that rely on donations, but are not charities. Basically anybody living off Patreon, for example. Having said that, I don't think it is wrong for a donator to decide that they don't want to donate because one person is taking the lion's share of the wealth. In fact, there are for profit organisations that I will avoid simply because they don't seem to provide a service other than to line some fat cat executives' pockets. People are free to choose how they want to spend their money.
    - deleted 7y ago
      [deleted]
    - toto444 7y ago
      Some economists show in the paper linked below that being not for profit can be seen as a commitment for quality since you have removed from the company the incentives to exploit your consumers. Abstract : Entrepreneurs who start new firms may choose not-for-profit status as a means of committing to soft incentives. Such incentives protect donors, volunteers, consumers and employees from ex post expropriation of profits by the entrepreneur. https://scholar.harvard.edu/shleifer/publications/not-profit-entrepreneurs https://scholar.harvard.edu/shleifer/publications/not-profit...
      - dillonmckay 7y ago
        I disagree with that. Most US universities are non-profits and use undergrad revenues for real estate development.
        mikekchar 7y ago
        While absolutely true, a good counter example are various co-ops that are run as non-profits. Often they can not only be the best place to get high quality good, but also the only place, since they are driven by what their members want rather than trying to make the highest possible profit. However, wherever there is a lot of money, you will find people who are trying desperately to shove that money into their pockets.
JensRex 7y ago
Try arguing with less snark. Every comment like yours attacks the strawman that the CEO and employees should not get paid. Nobody is saying that. But I'm absolutely not going to donate anything while the CEO takes out over 800000 dollars in pay, and it looks distasteful to me to go around begging for donations.
- dmayle 7y ago
  Thank you. This is exactly what I meant, as well.
- kharak 7y ago
  I hold the position represented by Dan Palotta in this Ted Talk: https://www.ted.com/talks/dan_pallotta_the_way_we_think_about_charity_is_dead_wrong https://www.ted.com/talks/dan_pallotta_the_way_we_think_abou... There is nothing distasteful about non-profit CEOs wanting high pay. We're speaking about the founder of something that has and is helping millions of people around the world with arguably one of the most difficult and important educational needs. Khan Academy wouldn't be here without Khan himself and the world would be lesser for it. I see absolutely no reason why the CEO of such an organizations shouldn't paid in the same manner as for-profits. I'm snarky, because the implied notion of "people doing good instead of chasing profits don't deserve the same pay/good life" is nothing short of crazy to me.
  - dirtydroog 7y ago
    There is something distasteful about them wanting high pay and extra donations to cover an unseen expense.
    - kharak 7y ago
      And you know already that Khan is going to take the same salary this year? This is just rationalization, be honest with yourself, you simply dislike the idea of Khan getting this much for himself, no matter what.
    - lern_too_spel 7y ago
threatofrain 7y ago
But Khan Academy is a non-profit. In a business, the relationships between various parties are structured in a locally rational manner. When someone offers $1000 to a business they expect value back. Khan Academy is soliciting donations, an avenue of human interaction which asks us to suspend this local rationality and instead transact on hope and trust. That's the difference to me between a business transaction and a donation.
- inimino 7y ago
  > When someone offers $1000 to a business they expect [...] > [...] transact on hope and trust. These two things are not as dissimilar as you seem to think. There is nothing irrational about donating to a non-profit, and nothing irrational about paying high salaries to irreplaceable employees or executives.
- gnomewascool 7y ago
  But Khan Academy is already providing immense value to students — actually now they're (arguably) providing 150% more value than normally. Hence, you're not being asked to "transact on hope and trust". The main difference between donating to KA and a typical business transaction, is that the value of the goods/services provided does not necessarily go to the person providing the payment. There is an understandable worry about over-payment of executives, but I don't think that the "threat model" is significantly different between for-profits and non-profits. You could argue that in the case of for-profits, competition will weed out companies that over-pay their executives, but internal, corporate politics is likely to trump the market mechanism — at least that's what seems to be happening. As a result, I don't think that it makes sense to excessively harp on executive pay at non-profits you donate to, or at least not more so than you care about the pay of the CEO at a company whose products you buy.
hnarn 7y ago
> Imagine, just imagine a society, where doing non-profit could be a valid career option without a disadvantage in the income department. The horror. I don't feel like I should have to explain this, but the difference between a non-profit and a profit driven corporation is that: 1) The NPO is likely doing some kind of activity for the greater good, which means that the more money you take out for administration and profit, the less good you can do. 2) The Corporation is likely doing some kind of profit-driven activity for the primary benefit of increasing the value of the company. Corporations generate profit by their very nature since their purpose is not primarily to solve (profit-wise) unattractive problems or to perform charitable work: the purpose is primarily to generate profit. Anyone that understands the difference between these two should be able to draw the conclusion that: 1) If an NPO is burdened by excessive expenses, such as administrative cost, it will have less money to spend against the objective of "greater good". 2) If a Corporation is burdened by excessive expenses, such as bonuses, salaries or is otherwise mismanaged financially, this only affects the corporations capability of making a profit. It should be plain to see that the complaint against NPO salaries is not equivalent to a complaint of a for-profit corporate counterpart. Since I was immediately downvoted I'd also like to add that this logic also applies to questioning public expenses. Taxes are allegedly levied to supply common services and serve the "common good", would you also argue that politicians should be salaried on par with profit driven corporations, in the name of ensuring competence of public officials, even if that means less common good can be taken out from your taxes?
- yomly 7y ago
  Right, but this mentality leads to greater good type causes to require martyrs amongst other types of people. A failure mode of this is brain drain - see most civil service jobs in the west or NHS doctors in the UK. Additionally can create brain drain which the beleaguers the original cause. I guess you can see personnel as an investment towards the cause too
- kharak 7y ago
  Strongly disagree. The more money is in being part of a NPO, the more talent will go into NPOs. Hence, your first point 1) isn't as clear-cut as you make it out to be. Right now, if I'd want to work for a NPO, it would only come with a severe pay cut. So I stay with FPOs, although I believe that many NPOs are way more important in what they are doing.

by kharak 7y ago

dmayle 7y ago

It's not about paying a salary. I've worked in non-profits before, all of the employees themselves are taking pay cuts to work for the greater good. He's asking people to give up their money in order to provide this service. A salary half that size provides an extravagant lifestyle, what he's taking is exorbitant.

kharak 7y ago
What CEO's and many other people in for-profit industries are getting, is also quit exorbitant. But that's generally accepted. Why do some people go nuts if they see non-profits demanding high pay? Khan Academy has done something unique, helpful and truly excellent, but how dare Salman Khan wanting a cut similar to for-profits. (If it is similar, properly still less).
- mikekchar 7y ago
  I think the key here is that most people equate "non-profit" with "charity". The idea is that as much money as possible is used to fund the services provided by the entity. However, there are many businesses run as non-profit entities that are not in it to provide a charity. It's just that the entity of the company is designed to take no profit. Often these entities invest heavily into growth as opposed to taking profit (and often this is even the stated goal of the organization). If you take donations, it sounds like you should be a charity, but there are lots of examples of organizations that rely on donations, but are not charities. Basically anybody living off Patreon, for example. Having said that, I don't think it is wrong for a donator to decide that they don't want to donate because one person is taking the lion's share of the wealth. In fact, there are for profit organisations that I will avoid simply because they don't seem to provide a service other than to line some fat cat executives' pockets. People are free to choose how they want to spend their money.
  - deleted 7y ago
    [deleted]
  - toto444 7y ago
    Some economists show in the paper linked below that being not for profit can be seen as a commitment for quality since you have removed from the company the incentives to exploit your consumers. Abstract : Entrepreneurs who start new firms may choose not-for-profit status as a means of committing to soft incentives. Such incentives protect donors, volunteers, consumers and employees from ex post expropriation of profits by the entrepreneur. https://scholar.harvard.edu/shleifer/publications/not-profit-entrepreneurs https://scholar.harvard.edu/shleifer/publications/not-profit...
    - dillonmckay 7y ago
      I disagree with that. Most US universities are non-profits and use undergrad revenues for real estate development.
      - mikekchar 7y ago
        While absolutely true, a good counter example are various co-ops that are run as non-profits. Often they can not only be the best place to get high quality good, but also the only place, since they are driven by what their members want rather than trying to make the highest possible profit. However, wherever there is a lot of money, you will find people who are trying desperately to shove that money into their pockets.

JensRex 7y ago

Try arguing with less snark. Every comment like yours attacks the strawman that the CEO and employees should not get paid. Nobody is saying that. But I'm absolutely not going to donate anything while the CEO takes out over 800000 dollars in pay, and it looks distasteful to me to go around begging for donations.

dmayle 7y ago
Thank you. This is exactly what I meant, as well.
kharak 7y ago
I hold the position represented by Dan Palotta in this Ted Talk: https://www.ted.com/talks/dan_pallotta_the_way_we_think_about_charity_is_dead_wrong https://www.ted.com/talks/dan_pallotta_the_way_we_think_abou... There is nothing distasteful about non-profit CEOs wanting high pay. We're speaking about the founder of something that has and is helping millions of people around the world with arguably one of the most difficult and important educational needs. Khan Academy wouldn't be here without Khan himself and the world would be lesser for it. I see absolutely no reason why the CEO of such an organizations shouldn't paid in the same manner as for-profits. I'm snarky, because the implied notion of "people doing good instead of chasing profits don't deserve the same pay/good life" is nothing short of crazy to me.
- dirtydroog 7y ago
  There is something distasteful about them wanting high pay and extra donations to cover an unseen expense.
  - kharak 7y ago
    And you know already that Khan is going to take the same salary this year? This is just rationalization, be honest with yourself, you simply dislike the idea of Khan getting this much for himself, no matter what.
  - lern_too_spel 7y ago

threatofrain 7y ago

But Khan Academy is a non-profit. In a business, the relationships between various parties are structured in a locally rational manner. When someone offers $1000 to a business they expect value back. Khan Academy is soliciting donations, an avenue of human interaction which asks us to suspend this local rationality and instead transact on hope and trust. That's the difference to me between a business transaction and a donation.

inimino 7y ago
> When someone offers $1000 to a business they expect [...] > [...] transact on hope and trust. These two things are not as dissimilar as you seem to think. There is nothing irrational about donating to a non-profit, and nothing irrational about paying high salaries to irreplaceable employees or executives.
gnomewascool 7y ago
But Khan Academy is already providing immense value to students — actually now they're (arguably) providing 150% more value than normally. Hence, you're not being asked to "transact on hope and trust". The main difference between donating to KA and a typical business transaction, is that the value of the goods/services provided does not necessarily go to the person providing the payment. There is an understandable worry about over-payment of executives, but I don't think that the "threat model" is significantly different between for-profits and non-profits. You could argue that in the case of for-profits, competition will weed out companies that over-pay their executives, but internal, corporate politics is likely to trump the market mechanism — at least that's what seems to be happening. As a result, I don't think that it makes sense to excessively harp on executive pay at non-profits you donate to, or at least not more so than you care about the pay of the CEO at a company whose products you buy.

hnarn 7y ago

> Imagine, just imagine a society, where doing non-profit could be a valid career option without a disadvantage in the income department. The horror. I don't feel like I should have to explain this, but the difference between a non-profit and a profit driven corporation is that: 1) The NPO is likely doing some kind of activity for the greater good, which means that the more money you take out for administration and profit, the less good you can do. 2) The Corporation is likely doing some kind of profit-driven activity for the primary benefit of increasing the value of the company. Corporations generate profit by their very nature since their purpose is not primarily to solve (profit-wise) unattractive problems or to perform charitable work: the purpose is primarily to generate profit. Anyone that understands the difference between these two should be able to draw the conclusion that: 1) If an NPO is burdened by excessive expenses, such as administrative cost, it will have less money to spend against the objective of "greater good". 2) If a Corporation is burdened by excessive expenses, such as bonuses, salaries or is otherwise mismanaged financially, this only affects the corporations capability of making a profit. It should be plain to see that the complaint against NPO salaries is not equivalent to a complaint of a for-profit corporate counterpart. Since I was immediately downvoted I'd also like to add that this logic also applies to questioning public expenses. Taxes are allegedly levied to supply common services and serve the "common good", would you also argue that politicians should be salaried on par with profit driven corporations, in the name of ensuring competence of public officials, even if that means less common good can be taken out from your taxes?

yomly 7y ago
Right, but this mentality leads to greater good type causes to require martyrs amongst other types of people. A failure mode of this is brain drain - see most civil service jobs in the west or NHS doctors in the UK. Additionally can create brain drain which the beleaguers the original cause. I guess you can see personnel as an investment towards the cause too
kharak 7y ago
Strongly disagree. The more money is in being part of a NPO, the more talent will go into NPOs. Hence, your first point 1) isn't as clear-cut as you make it out to be. Right now, if I'd want to work for a NPO, it would only come with a severe pay cut. So I stay with FPOs, although I believe that many NPOs are way more important in what they are doing.