In Support of NGOs

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Pranav Gupta, London School of Economics

It is easy to be cynical about NGOs. The two major sectors of our society are generally opposed or indifferent to the non-governmental organization sector. The public sector, or government, is often threatened by the ability of non-profits to attract international and local funding. The for-profit sector often looks down on NGOs as bottomless money pits that don't "create value." To add fuel to the fire, NGOs themselves are enamored of their for-profit counterparts who try to serve the community--while making money.

That said, the role of the NGO sector is often questioned. In fact, people employed in NGOs often question their own career choices, contributing to a high turnover rate among non-profits.

In this series of articles, we will try to put some questions to rest. 

First: Do we need NGOs? 
         The answer is undoubtedly YES.

For-profit companies provide goods and services that generate profits for company shareholders. The profit motive, ingenuity, and hard work of company owners has led to a wide array of consumer goods and services that help make our lives much easier. There are certain goods and services, however, that our society needs as a whole. Often private businesses are not incentivized to provide these goods and services, because (1) consumers are not willing to pay for them and/or (2) the goods and services require too much capital to build. Goods and services whose benefits cannot to attributed to any one individual or group are called "public goods." Such goods include non-vocational education and media, roads, telephone networks, arts and culture, defense, and theoretical research which has a very long time-to-market.

For many of these public goods, the government either levies taxes and provides the services directly, or enforces regulation that encourages the private sector to provide the services. For example, most governments around the world build their own roads but outsource the creation of telecommunications networks to for-profit players.

For free market stalwarts, all the world needs is corporations and government to provide all public goods. But, for people who live in the "real" world, there is an clear and present need for not-for-profit non-governmental organizations.

In particular, NGOs are needed in the following areas:

Media and Non-vocational Education: Individual consumers are not always willing to pay for information and education that will lead to a better informed and more intelligent populace. Thus, profit cannot necessarily be generated from publications such as that of the World Wildlife Federation or by secondary school classes on Greek history. Nonetheless, these publications and classes can lead to a better informed public that is better able to address future public issues.

Arts and Culture: The responsibility of preserving and communicating a society's art and culture is well placed in the hands of NGOs. Again, individual consumers are not necessarily willing to pay for the preservation of Magna Carta or Mayan music, but as a society, we would not like to see the destruction of such relics.

Scientific Research and Expertise Development: While pharmaceutical companies such as Merck and Pfizer have successfully commercialized much of their biochemical research, the majority of scientific and liberal arts research does not have commercial viability. Therefore, private companies do not always have the incentive to invest in R&D (research and development). As a result, the advancement of our society's collective intelligence is a burden often carried by NGOs. Higher education institutions and independent research institutes, for example, continue to produce experts and expertise in subjects ranging from behavioral pediatrics to Latin literature.

Social Services for the Underrepresented or Underserved: In the perfect democracy the will of the individual should not take a back seat to the will of the whole. In practice, however, the rights and requirements of minorities can be overlooked by the rights and requirements of the majority. Also, with a local taxation system, underprivileged enclaves can continue to starve for resources indefinitely. Where the government cannot provide social services to these minorities or where the government has consciously outsourced certain services, the role of NGOs is evident. In the state of Orissa, India, for example, an NGO named Gram Vicas provides health care and well-water services to remote tribal people. Based in Washington D.C., the renowned "Teach for America" NGO pays select college graduates to serve as teachers in America's poorer inner city classrooms.

Innovation in Social Services: NGOs have the freedom to experiment with new types of social programs. The recent trend of Information Computer Technology (ICT) for development has resulted in innovations in government transparency, primary education, and e-health care, to name a few. Such developments would have been unlikely in the for-profit or public sectors.

Advocacy and Civic Engagement: Participating in a democracy requires much more than just voting at the ballot. NGOs have the ability to educate and empower people about their rights and about various public issues. These NGO activities can place a check--or at least a camera--on government heavy handedness, as they have done during General Moi's reign in Kenya. Moreover, they can complement government efforts, such as those related to sex education, voter registration, and census collection.

That said, there is no reason to be apologetic about NGOs. Sure there are many ways in which NGOs can increase their impact and spend money more efficiently, but to let these limitations cloud the need for NGOs is a shame.

In the next issue, we will consider some of the limitations and inefficiencies of NGOs.

 

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