IN A POST PUT UP BOTH here and at Eternity Road, I tossed off, as a tangential aside, my personal contention that the notion of “non-profit” is a bad one. Twice, first by Alex Vander Woude, then by our own Neanderpundit, Og, that was challenged in comments. Enough so, and with substance enough, to make me want to expand on the idea.
Let us lay this out as an informal thesis. I will begin by attempting to explain my premises, then move on from there. Given my not being of a rigorous bent, this might get a little hairy, so please bear with.
First, I believe in God. Not, perhaps, as some bearded patriarch with powers of prestidigitation, but… The structure and history of the Universe as Man has been able to apprehend it fairly demands a creator.
I do suspect that mankind, playing the losing game of trying to apprehend the mind of God, has gotten the facts wrong on most points, which is why I probably can’t be a true Christian — I don’t do well in churches, where hewing to an accepted theology is pretty much a requirement for membership. But, here and there in all the tall tales and jeremiads of all religions, I get glimpses of notions that seem to have managed to duct tape a flimsy handle on some slick surface of The Truth, and that, taken together, they seem to form a fairly coherent cosmological and theological world view. No rigor, understand — I’m too lazy for that — but occasional flashes of insight.
One of those can be encapsulated in the Biblical notion that Man was/is/has been created in the image of God. Now, unless God is an upright, bipedal ape, I suspect that means the mind of Man is made in the image (like the image of a hard drive) of the mind of God. That every one of us — individuals — is so made. The mind of the individual is the apotheosis of humanity — that which makes us in apprehension so like a god. It follows, therefore, that that which denies the divinity of the individual — including especially collectivist political philosophies — is blasphemous. Perhaps one might tentatively think to consider thinking about saying, “affirmatively evil.”
Or, one might make that assertion more … um … assertively.
Now, I’m going to make a little leap that must sometimes leave my readers’ heads spinning. There is a connection, I promise. But, if I took the time to “show my work” as your math teachers used to say, I’d never get to the point. Just… trust me on this. Or go do your own research and come to the same conclusion on your own.
The graduated Federal Income Tax.
See? Dolly’s head is spinning around like a hoot owl’s.
Those of you who have done the research into Marxism understand that the income tax is a specific prescription, direct from the great Marxman himself, for the “progress” of society toward a communist utopia. Its purpose is manifold. First: to provide the state, which is to be taken over from within by good socialist revolutionaries, with aready source of cash which citizens of a country in the grip of income taxes cannot lawfully avoid. (And it doesn’t matter to the revolutionary which choice a People might take — whether to suffer the slings and arrows, or to become outlaws by evading them. Es macht nichts — either way, the revolutionary thinks, he wins.) Second: the income tax is meant to provide a levelling of classes, by impoverishing the wealthy and enriching the less-wealthy, through the largesse of the state. That the fact it only has the effect of impoverishing the entire society seems to have escaped our revolutionary geniuses is a tart bit of mordant irony.
You may see this next as a bit of a leap. You can trust me on it or you can do your own research. Es macht mir nichts.
The Federal graduated income tax is the paymaster of both the leviathan nanny state and the Gramscian Marxist Long March through the institutions of Western Civilization. And the core perversion it proposes is that income — profits — are evil and subject to state confiscation on that basis alone.
One of its subsidiaries (yet no less odious for all of that) is the requirement that organizations — free associations of notionally free individuals for their own, non-nefarious purposes — submit to a financial anal exam by — of all people — tax collectors (for Christ’s sake!) in order to be permitted by the government to continue in their purposes for another year.
How odious is that?
When I asked Alex Vander Woude in comments over at Eternity Road, “Why is it that your school is non-profit?” the answer I was looking for is, “Because of the perverse incentives in the Internal Revenue Code.” There is no other reason that a private, co-op school should not be a for-profit entity. And, indeed, there are myriad reasons it should be.
The same mind-set which embraces income taxes, class warfare, wealth-envy, and anti-free-market ideas also sees profit as a dirty word. It is somehow seen as unearned or “found” money. A windfall. A close examination of this notion reveals to an open mind exactly how wrong-headed it is. Absent coercion — of the type that, in a free republic, only a government can muster — a profit will always be earned — albeit perhaps sometimes less-than-honorably. One cannot have a return on investment greater than 1.0 unless one has provided goods and services that people are willing and able to pay for. The only way you can get around that rule is by collusion with government to distort the laws of the natural marketplace. If the merchant is behaving honestly and the government is doing its job, coercive monopolies, price-fixing, barriers to entry, and the like are virtually impossible. But, these days, economic ignorance is widespread (by design, I hasten to add), and so, when demagogues inveigh against profits — obscene, record, unheard-of, windfall — they have a ready audience.
Profit, well-earned by a cleanly-run enterprise, is an indicator of good performance, of prudent operation of the enterprise, and of how well said enterprise serves its purpose, and of its perceived value to the individuals who purchase its goods or services. Profits are, in part and in one sense, the votes made flesh of the individual customers of an enterprise. Profit is increase: in value, in strength, in reach, in ability. In this, profit can be seen to be analogous to nature’s drive to increase. Nature understands (in a metaphorical sense: obviously nature collectively has no brain to understand anything literally) that to diminish is to die, that survival demands growth, demands increase — demands profits.
As such, profit must be seen as being godly. As being demanded of us by nature’s God. In the Parable of the Talents, which which I tasked Alex Vander Woude in the comments to the earlier post, I see the master as being a standin for God. Each of us is given a lot in life, and what we do with it tells how we serve ourselves, our fellow man, and our God. His (or hers or its) judgement of our lives (or perhaps, our own judgement of our lives, seen in the light of the perfect knowledge we suppose will be ours in the next life), must surely rest at least in part on what we did with our God-given talents (either in the monetary or moral sense) in this one. When we meet with Him again, by whatever myth you choose to call it, the question we will face is, “What have you done with that which I gave you?”
And, even if you are an atheist or an agnostic, unless you are an amoral lackwit, you must surely recognize that your own self-worth stems, at least in part, from how you have played the hand Fate has dealt you.
I don’t doubt that all of this has been recognized by collectivist theorists down through the years — as much as they must despise it — and that it is one of many reasons such people act to degrade the moral sense of their target societies — the societies they seek to bring down by their subversion.
Thus the income tax. Thus the special requirements for tax exemptions for churches, charities, et al. Thus the requirement that such entities not make a profit.
That’s not to say that a private association be required to make a profit, merely that it’s odious that the state require that it not. Except that the state has arrogated to itself the power to tax incomes — as insidious as that is — what business is it of the state whether an enterprise earns a profit?
A school, as in Alex’s example, could use profits for much the same things a commercial enterprise might: maintaining and improving its physical plant; making other capital improvments, such as buying lab equipment, text books, library books; giving raises to its staff, or hiring additional staff; saving for the future. The organization of such an enterprise so as to allow it to make a profit — to require it, even — would give the “owners” (or stewards) real, clear, and invaluable signals as to the health of the enterprise.
“But, Alger,” Dolly says, being a good little shill, “Wouldn’t that lead to decisions’ being made with an eye toward profitability? Wouldn’t that in turn lead to facets of the organization’s life — facets that are desirable, even required by the organization for its charter purpose — being given short shrift because they contribute little to the bottom line?”
In a poorly-run enterprise, Dolly, that might be so. But why is it that such an enterprise deserves to survive — sometimes at the expense or to the detriment of a better-run one? Surely you’re not claiming that every for-profit commercial enterprise, all activities in which it engages must contribute directly to the bottom line? That no business anywhere ever does anything that might, in the short run, or in a purely local sense, can be seen as a pure cost center? That all businesses are all profit-center?
Er… No. I guess not. Not when you put it that way.
Of course. This whole post is an exercise in “putting it that way.”
So, we’ve established that profits are a good thing, and that there is nothing inherent in the mission of a religious, charitable, or cooperative venture that requires it to abjure profits, and that there is much to be said against that requirement. Can we not therefore flip the coin over and argue the opposite — that an organization which fundamentally abjures profit can be seen to be failing at its godly duty to increase its patrimony — to be (in effect) pissing it down a rathole?
Not if it serves its purpose?
OK. Fair enough. If an ad hoc organization fulfills its purpose and thereafter folds its tents, it need not show a profit. Its profits, in a sense, might be seen to be being distributed among the recipients of its largesse. But any organization which perceives its mission as being ongoing — as being, for all intents and purposes, permanent — owes it to its mission to grow, to increase, to — in a phrase — show a profit. Be it the Prairie Home Co-operative Comprehensive School, or the Knights of Columbus, or the ASPCA … or General Motors, or Microsoft, or Mom and Pop’s Corner Independent Grocery — any enterprise which serves the public good owes it to itself, its mission, its employees, its beneficiaries, and its stakeholders to earn a positive return on the money invested in it.
And the only reason it cannot is due to the perverse provisions of the tax code — a tax code which, as we can see, is driven by an evil ideology.
As a perspicacious reader may detect, this thesis, as long as it is for this medium, is sketchy, leaves a great deal of its argument unexplicated. Some of that is doubtless due to my not having as thoroughly explored all the nooks and crannies of my basic, aphoristic notion that “Non-profit is a dirty word.” Some of it is surely due to my own human limitations. After all, who among us can apprehend the mind of God? Yet, surely, fully understanding the structure of the Universe and the natural laws which govern it, requires that one do just that. In the aid of developing (or debunking) this notion, of refining it and any possible corrolaries, I would be churlish to not invite discussion — even a lively and contentious one. So, have at it. I will not, however, brook ad hominems at BTB and would attempt to prevail on Fran to remove them at Eternity Road. Keep it clean, keep it civil, or I’ll knock your heads together (to quote my sainted Mother).
Cross-posted at Eternity Road.