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April 04, 2004

Ineeffiency of Private Charity

At least one piece of rhetoric by the rightwing is that government is inefficient, and social services and public goods would be better provided by private charity.

No better example of the advantages of government bureaucracy over private charity are the actions of the nonprofit Statue of Liberty-Ellis Island Foundation.

Because of that nonprofit's need for self-interested fundraising, the opening of the Statue of Liberty was delayed:

interviews with two dozen current and former federal officials, fund-raisers and major donors, as well as a review of documents from the nonprofit foundation that is raising the money, show that the statue, the world's most recognizable symbol of freedom, could have been opened much earlier...

The foundation, while choosing not to provide enough endowment money for the emergency exits and upgraded fire system necessary for the statue's reopening, at the same time paid $345,000 to its president, far more than is paid to chief executives at nonprofit foundations that support other parks.

Essentially, the nonprofit decided to keep the statue closed to keep donations flowing in from the public, so it could keep paying its CEO an outrageous salary for decades more off the endowment.

Just as contractors like Halliburton end up "capturing" the procurement processes of the military through too close association, these kinds of elite-dominated nonprofits end up distorting the agenda of government agencies like the Park Service. Even many Republicans are appalled:

Donald P. Hodel, a Republican who was secretary of the interior during the major restoration of the statue during the 1980's, said in an interview that he had watched as the Park Service had "very much fallen under the sway of the foundation." He said he disagreed with the foundation's decision to raise more money instead of spending what it already had.
There is much abuse of career government employees, but these kinds of outrageous salaries and sloth in government contractors, whether private or nonprofit, should remind people why strengthening public service, not expanding privatization, is in the best interest of the public.

Posted by Nathan at April 4, 2004 08:12 AM