Wednesday Morning Rant

There is perhaps no greater misnomer in modern English than "Non-Governmental Organization," or "NGO." NGOs very rarely are actually non-governmental. Vast quantities of taxpayer money are sluiced through the NGO complex, and many if not most NGOs are anything but "non-governmental." There are almost no true NGOs, and tons of taxpayer money is involved with these non-NGOs.

The appropriateness of government sponsorship of ostensible charity notwithstanding, the last few months have underscored yet another problem with the idea of government-supported NGOs: accountability. There appears to be none. Enormous quantities of money are being stolen through the NGO complex. Even where it isn't outright stolen, it is likely money poorly spent. Our pseudo-NGOs are out agitating for all things awful, working against the interests of the Republic - and using the Republic's money and various allies in the political and bureaucratic complexes to do it.

This needs to stop. Justice and other agencies are starting (publicly, at least - I have no idea if it is sincere) to tackle some of the fraud, but there is likely no way they can contain it. They can punish specific wrongdoers in specific frauds, but the overall system is conducive to fraud. The way the NGO complex is constructed virtually demands fraud, and all but guarantees it. The entire point is to slosh money around outside of accountability systems. The system itself is deeply flawed and designed from the ground up to be exploited. That system needs to be abolished.

There does not need to be cessation of particular projects or programs, or punishment of specific wrongdoers. The wrongdoers must be punished, of course, but that will not solve the problem. New wrongdoers will do the same things - and why not? The system is designed to be abused. That system is what needs to go, not some particular recipient. What we need is a rethink on how taxpayer is spent at all.

What I think needs to happen is a new law around how the government is permitted to spend money. It should be restricted to four categories:
1. Goods purchased by and for the government, under contract
2. Services purchased by and for the government, under contract
3. State block grants for various programs (Medicaid, Section 8, etc.), with hard requirements that all block-grant funds are directly attributable to a specific end consumer (recipient), however it is delivered, and that records are available to the federal government on demand.
4. Direct welfare payments to named recipients - disability, social security, medicare, etc.

The welfare programs are not going to be abolished, but there must be accountability within the government for them. Any dollar that goes out must go out to or on behalf of a known, named, enrolled individual. No organizations. If an organization is paid on behalf of an individual - say, medical transportation for a Medicaid recipient - it must be via a company under legitimate and valid contract per federal standards for bidding and selection, with specific recipient recorded and audited. No cash to anyone else for anything.

The government is itself a customer for many businesses, and that can continue. When some agency buys toilet paper under contract, that's fine. When a contractor operates a government facility on behalf of an agency, that's fine. When a supplier or vendor provides services to the government under contract, that's fine. But there must be no more non-contract activity paid for with taxpayer money. No more grants or non-contract outlays.

If there is, for example, some research project that people think ought to be undertaken, the government either needs to do it itself at one of its laboratories or the organization doing it needs to bid and negotiate a contract - and that contract must be subject to the same bidding and procurement requirements as any other contract. No more research grants, no more "development" grants, no more grants to universities or hospitals or NGOs not doing specific, named work for the US government under competitive contract.

These requirements are bureaucratic and onerous. That is the point. If an organization receives so much as a single penny of federal taxpayer money, it must be for a stated, known purpose under a valid contract and all that this entails. It must be auditable, accountable and transparent. If an NGO, university or other organization doesn't want to both convince someone in government that something is a good idea and then go through competitive bidding to do it, it is welcome to not participate. If an NGO wants to operate without accountability, it is welcome to do so with no victims but its own suckers who gave them money.

There is no way to get the fraud problem under control while the current NGO system remains intact. The flow of cash into the NGOs must be stopped in order to reduce the amount of flagrant theft and dishonesty in the system. The government has by now amply demonstrated that it is both unwilling and unable to determine how it spends money without aggressive oversight. The problem has to be cut out at the root, and that is in the standards and requirements for all government outlays.

One way to stop this hemorrhaging cash flow into NGOs is to change the law to explicitly define how the government is permitted to spend money, and on what. No payments without specific, named purpose and competitive contract. No transfers without accountability. Make the NGOs into actual non-government entities and let them sink or swim on their own.

posted by Joe Mannix at 11:00 AM

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