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> Now the cat is out of the bag, and people no longer believe that a non-profit who can act at will is a trusted vehicle for the future. And maybe it’s not. Th

by bnralt 3y ago

> Now the cat is out of the bag, and people no longer believe that a non-profit who can act at will is a trusted vehicle for the future. And maybe it’s not. The big mistake people make is hearing non-profit and think it means there’s a greater amount of morality. It’s the same mistake as assuming everyone who is religious is therefore more moral (worth pointing out that religions are nonprofits as well). Most hospitals are nonprofits, yet they still make substantial profits and overcharge customers. People are still people, and still have motives; they don't suddenly become more moral when they join a non-prof board. In many ways, removing a motive that has the most direct connection to quantifiable results (profit) can actually make things worse. Anyone who has seen how nonprofits work know how dysfunctional they can be.

maksimur 3y ago
> Most hospitals are nonprofits, yet they still make substantial profits and overcharge customers. Are you talking about American hospitals?
- deaddodo 3y ago
  There are private hospitals all over the world. I would daresay, they're more common than public ones, from a global perspective. In addition, public hospitals still charge for their services, it's just who pays the bill that changes, in some nations (the government as the insuring body vs a private insuring body or the individual).
  - swagempire 3y ago
    Its about incentives though.
  - sangnoir 3y ago
    > There are private hospitals all over the world. I would daresay, they're more common than public ones, from a global perspective. Outside of the US, private hospitals tend to be overtly for-profit. Price-gauging "non-profit" hospitals are mostly an American phenomenon.
    - deaddodo 3y ago
      > Price-gauging "non-profit" hospitals are mostly an American phenomenon. That just sounds like a biased and overly emotive+naive response on your part. Again, most hospitals in the world operate the same way as the US. You can go almost anywhere in SE Asia, Latín América, África, etc and see this. There's a lot more to "outside the US" than Western+Central Europe/CANZUK/Japan. The only difference is that there are strong business incentives to keep the system in place since the entire industry (in the US) is valued at more than most nations' GDP. But feel free to keep twisting the definition or moving goalposts to somehow make the American system extra nefarious and unique.
      - sangnoir 3y ago
        There are 2 axes under discussion going back to the root of this thread: public/private and nonprofit/for-profit, and you seem to be missing that I'm mentioning a specific quadrant^w octant, after adding the cost axis that's uniquely American. There are not a lot of pricey nonprofit hospitals in Africa, for instance.
vel0city 3y ago
> Most hospitals are nonprofits, yet they still make substantial profits and overcharge customers. They don't make large profits otherwise they wouldn't be nonprofits. They do have massive revenues and will find ways to spend the money they receive or hoard it internally as much as they can. There are lots of games they can play with the money, but experiencing profits is one thing they can't do.
- bnralt 3y ago
  > They don't make large profits otherwise they wouldn't be nonprofits. This is a common misunderstanding. Non-profits/501(c)(3) can and often do make profits. 7 of the 10 most profitable hospitals in the U.S. are non-profits[1]. Non-profits can't funnel profits directly back to owners, the way other corporations can (such as when dividends are distributed). But they still make profits. But that's besides the point. Even in places that don't make profits, there are still plenty of personal interests at play. [1] https://www.nytimes.com/2020/02/20/opinion/nonprofit-hospitals.html https://www.nytimes.com/2020/02/20/opinion/nonprofit-hospita...
  - bbor 3y ago
    This seems like pedantics…? Yes, they technically make a profit, in that they bring in more money in revenue than they spent in expenditures. But it’s not going towards yachts, it’s going toward hospital supplies. Your comment seems to be using the word “profit” to imply a false equivalency
    - scythe 3y ago
      Understanding the particular meaning of each balance-sheet category is hardly pedantry at the level of business management. It's like knowing what the controls do when you're driving a car. Profit is money that ends up in the bank to be used later. Compensation is what gets spent on yachts. Anything spent on hospital supplies is an expense. This stuff matters.
      - vel0city 3y ago
throw__away7391 3y ago
I've worked with a lot of non-profits, especially with the upper management. Based on this experience I am mostly convinced that people being motivated by a desire for making money results in far better outcomes/working environment/decision-making than people being motivated by ego, power, and social status, which is basically always what you eventually end up with in any non-profit.
- bbor 3y ago
  Interesting - in my experience people working in non profits are exactly like those in for-profits. After all, if you’re not the business owner, then EVERY company is a non-profit to you
  - fatherzine 3y ago
    Upper management is usually compensated with financially meaningful ownership stakes.
  - golergka 3y ago
    People across very different positions take smaller paychecks in non-profits that they would do otherwise and compensate by feeling better about themselves, as well as getting social status. In a lot of social circles, working for a non-profit, especially one that people recognise, brings a lot of clout.
- fatherzine 3y ago
  This rings true, though I will throw in a bit of nuance. It's not greed, the desire of making as much money as possible, that is the shaping factor. Rather the critical factor is building a product for which people are willing to spend their hard earned money on. Making money is a byproduct of that process, and not making money is a sign that the product, and by extension the process leading to the product, is deficient at some level.
  - adverbly 3y ago
    Excellent to make that distinction. Totally agree. If only there was a type of company which could have the constraints and metrics of a for-profit company, but without the greed aspect...
campbel 3y ago
> removing a motive that has the most direct connection to quantifiable results (profit) can actually make things worse I totally agree. I don't think this is universally true of non-profits, but people are going to look for value in other ways if direct cash isn't an option.

by bnralt 3y ago

maksimur 3y ago

> Most hospitals are nonprofits, yet they still make substantial profits and overcharge customers. Are you talking about American hospitals?

deaddodo 3y ago
There are private hospitals all over the world. I would daresay, they're more common than public ones, from a global perspective. In addition, public hospitals still charge for their services, it's just who pays the bill that changes, in some nations (the government as the insuring body vs a private insuring body or the individual).
- swagempire 3y ago
  Its about incentives though.
- sangnoir 3y ago
  > There are private hospitals all over the world. I would daresay, they're more common than public ones, from a global perspective. Outside of the US, private hospitals tend to be overtly for-profit. Price-gauging "non-profit" hospitals are mostly an American phenomenon.
  - deaddodo 3y ago
    > Price-gauging "non-profit" hospitals are mostly an American phenomenon. That just sounds like a biased and overly emotive+naive response on your part. Again, most hospitals in the world operate the same way as the US. You can go almost anywhere in SE Asia, Latín América, África, etc and see this. There's a lot more to "outside the US" than Western+Central Europe/CANZUK/Japan. The only difference is that there are strong business incentives to keep the system in place since the entire industry (in the US) is valued at more than most nations' GDP. But feel free to keep twisting the definition or moving goalposts to somehow make the American system extra nefarious and unique.
    - sangnoir 3y ago
      There are 2 axes under discussion going back to the root of this thread: public/private and nonprofit/for-profit, and you seem to be missing that I'm mentioning a specific quadrant^w octant, after adding the cost axis that's uniquely American. There are not a lot of pricey nonprofit hospitals in Africa, for instance.

vel0city 3y ago

> Most hospitals are nonprofits, yet they still make substantial profits and overcharge customers. They don't make large profits otherwise they wouldn't be nonprofits. They do have massive revenues and will find ways to spend the money they receive or hoard it internally as much as they can. There are lots of games they can play with the money, but experiencing profits is one thing they can't do.

bnralt 3y ago
> They don't make large profits otherwise they wouldn't be nonprofits. This is a common misunderstanding. Non-profits/501(c)(3) can and often do make profits. 7 of the 10 most profitable hospitals in the U.S. are non-profits[1]. Non-profits can't funnel profits directly back to owners, the way other corporations can (such as when dividends are distributed). But they still make profits. But that's besides the point. Even in places that don't make profits, there are still plenty of personal interests at play. [1] https://www.nytimes.com/2020/02/20/opinion/nonprofit-hospitals.html https://www.nytimes.com/2020/02/20/opinion/nonprofit-hospita...
- bbor 3y ago
  This seems like pedantics…? Yes, they technically make a profit, in that they bring in more money in revenue than they spent in expenditures. But it’s not going towards yachts, it’s going toward hospital supplies. Your comment seems to be using the word “profit” to imply a false equivalency
  - scythe 3y ago
    Understanding the particular meaning of each balance-sheet category is hardly pedantry at the level of business management. It's like knowing what the controls do when you're driving a car. Profit is money that ends up in the bank to be used later. Compensation is what gets spent on yachts. Anything spent on hospital supplies is an expense. This stuff matters.
    - vel0city 3y ago

throw__away7391 3y ago

I've worked with a lot of non-profits, especially with the upper management. Based on this experience I am mostly convinced that people being motivated by a desire for making money results in far better outcomes/working environment/decision-making than people being motivated by ego, power, and social status, which is basically always what you eventually end up with in any non-profit.

bbor 3y ago
Interesting - in my experience people working in non profits are exactly like those in for-profits. After all, if you’re not the business owner, then EVERY company is a non-profit to you
- fatherzine 3y ago
  Upper management is usually compensated with financially meaningful ownership stakes.
- golergka 3y ago
  People across very different positions take smaller paychecks in non-profits that they would do otherwise and compensate by feeling better about themselves, as well as getting social status. In a lot of social circles, working for a non-profit, especially one that people recognise, brings a lot of clout.
fatherzine 3y ago
This rings true, though I will throw in a bit of nuance. It's not greed, the desire of making as much money as possible, that is the shaping factor. Rather the critical factor is building a product for which people are willing to spend their hard earned money on. Making money is a byproduct of that process, and not making money is a sign that the product, and by extension the process leading to the product, is deficient at some level.
- adverbly 3y ago
  Excellent to make that distinction. Totally agree. If only there was a type of company which could have the constraints and metrics of a for-profit company, but without the greed aspect...

campbel 3y ago

> removing a motive that has the most direct connection to quantifiable results (profit) can actually make things worse I totally agree. I don't think this is universally true of non-profits, but people are going to look for value in other ways if direct cash isn't an option.