[whack]

The US government gets $0.16B less that it can control in social spending. But in return, a regulated non-profit institution gets $1.1B more in its budget. That's a pretty good tradeoff for the social good.

For an alternative way of looking at things - almost any economist would tell you that it is wise to tax negative externalities and subsidize positive externalities. This is one of the most foundational insights from microeconomics. And charitable giving is the closest to an ideal positive externality that you will find. Person spends money to a cause because it makes him feel good to do so. That transaction ends up helping other 3rd parties as well. Textbook positive externality.

https://www.economicshelp.org/micro-economic-essays/marketfa...

[wolverine876]

> The US government gets $0.16B less that it can control in social spending. But in return, a regulated non-profit institution gets $1.1B more in its budget.

There's no reason to think the non-profit accomplishes anything or doesn't accomplish negative things. And there is an opportunity cost to the non-profit getting that money rather than, for example, schools.

[whack]

> There's no reason to think the non-profit accomplishes anything or doesn't accomplish negative things

You could say the exact same thing about how the federal government spends its money.

> And there is an opportunity cost to the non-profit getting that money rather than, for example, schools.

There's also an opportunity cost to the government getting that money, rather than, for example, educational non-profits.

Overall, do I think the federal government would do more good with the same amount of money? Probably. But would the federal government do more good with $0.16B, as opposed to the non-profit sector with $1.1B? I highly doubt it.