NPOs vs the government

Many people view NPOs as the government's competitor, and the government, like an NPO, does not pay taxes - it only collects them. The difference between the two is that one can vote not to pay the government for any particular activity, but whether you do or not is not your personal decision. With NPOs, the funders decide exactly what they think it's worth. That actually makes them, weighted by total income, more responsive than the government. It's also true that many smaller or younger NPOs are incredibly wasteful and essentially do very little good for the dollar, counting on the relative ignorance of their contributing audience and their obscurity to shield them from scrutiny.

As a contributor, writing off that portion of your money you gave to this alternate government is not usually profitable. If one pays 50% of one's income in taxes, then one effectively gets refunded 50% of one's contributions (assuming one itemizes). That only softens the loss. A person must believe in what (they think)the organization is doing.

Of course, it's still taking diverting income from the government, which has well established and controls responsive to democratic ideals despite its unwieldy size and lack of fair competition. What can this money be used to do when used by NPOs? Anything not specifically illegal. If you want to make an NPO for the manufacturing of fingernail clippers (but not for profit) then you're good to go. Of course, then at least you're producing something. What does a television evangelist produce except broken promises and loyalty to a figment and a demagogue?

NPOs have many of the virtues and weaknesses of a direct democracy versus a representative one. NPOs must court their funders directly, but they can do this as often by misleading them because those funders are not professional funders, they are merely people who have wider lives to live. Of course, in the case of religious organizations, it's even worse...