The Non-Profit Problem

Non-profit organizations all around the world, although earnest in their goals, should be monitored and regulated to ensure that the money they receive is being used efficiently. Many of the billions of dollars donated to charity each year go toward excessive management costs and in fact do not end up helping those in need. The idea of non-profit organizations makes sense. Having a centralized organization that can purchase food or supplies can probably receive a bulk rate. It is far more cost-effective (and better for the environment) to transport 50 turkeys to a soup kitchen in a car than for you to transport one turkey from the store to the soup kitchen by car on Thanksgiving Day. Nonetheless, people don’t do things for free, and non-profits need donations in order to function. There need to be people to manage funds and logistics so that those in need can receive appropriate aid. But how much money should charities use that does not directly aid their causes? We have to begin by analyzing how this kind of organization would work. Are they going to operate a 24-hour health clinic or are they a church? These kinds of organizations need skilled labor at nearly all hours of the day. Are these people going to help victims of natural disasters? Disaster -relief efforts require skilled laborers such as pilots and specialized truck drivers. We also have to take into consideration the amount of money it takes for fuel and supplies needed to run an office. You have to have someone fill out tax returns and manage the money that is being spent, especially if you are dealing with hundreds of millions of dollars. All of the labor and other expenses add up very quickly. The people who run these charities also need money in order to survive. But how much should these people receive? Many of their paychecks amount to hundreds of thousands of dollars, which seems somewhat hypocritical. According to IRS tax forms, Brian A. Gallagher, CEO and president of United Way, was paid over $600,000 in 2005. Marsh Evans, President and CEO of the Red Cross, was paid a little more than Gallagher, with his salary amounting to about $650,000. Running any company is a full time job, especially when you are dealing with millions of dollars, and clearly these executives are being paid with this consideration in mind. There are other non-profit organizations that are more immediately relevant to us students. The College Entrance Examination Board (CEEB), better known simply as the College Board, administers the SATs, ACTs, and APs. Every year, students across the country pay up to $80 for AP exams and $40 for SATs. I went online to see how much money the CEEB got from our test fees, and was surprised to find out that the amount totaled almost half a billion dollars. Also on these forms were the salaries of key members. Greg Caperton, the CEO of the College Board, made more than $700,000 in 2005. The payroll of all College Board employees (including printing and publications) totaled approximately $112 million. Non-profit organizations are not required by the government to report all of their transactions like other traditional companies. Some executives of non-profit organizations have questionable morals, and often abuse this protection by using it to beat the tax system. Non-profits, contrary to popular belief, can make an unreasonable profit. We live in a time when many people in positions of power are corrupt. Choose where your money goes properly, or better yet, make the world a better place by donating your time instead of your cash. Do your research and choose to support the right causes. Paul Chan is a two-year Lower.