Why Not For-Profit Govt?

An organization has: more than one person, some resources, and a process for making decisions about them. An org owned and controlled by a single person need not declare a purpose, as that owner will use it to achieve their usual complex personal ends. But other orgs tend to declare official purposes, to coordinate their leaders, members, employees, investors, donors, partners, suppliers, and customers. 

Of course orgs often fail to induce org leaders to fully pursue declared purposes, with leaders to some degree instead pursuing their complex personal ends. This is more possible when purposes are multiple, vaguely-defined, hard to control, and hard to measure. Which helps explain why the most common declared purpose, by far, is to make money. This “capitalist” purpose is robust, quite measurable at all org levels, and generally induces orgs to well serve all their members and associates. Such orgs are the foundation of our rich modern economies, and provide most of our key products and services, such as food, clothing, housing, transportation, etc. 

“Non-profits” are orgs with some other declared purpose, often because that gives the org a tax exception. From US tax code: 

The exempt purposes set forth in section 501(c)(3) are charitable, religious, educational, scientific, literary, testing for public safety, fostering national or international amateur sports competition, and preventing cruelty to children or animals. The term charitable is used in its generally accepted legal sense and includes relief of the poor, the distressed, or the underprivileged; advancement of religion; advancement of education or science; erecting or maintaining public buildings, monuments, or works; lessening the burdens of government; lessening neighborhood tensions; eliminating prejudice and discrimination; defending human and civil rights secured by law; and combating community deterioration and juvenile delinquency.

Note that these are relatively sacred purposes. We apparently dislike sacred purposes being pursued by for-profit orgs, and so often create and subsidize other orgs to pursue them, even if they achieve such purposes less cost-effectively than would for-profit orgs. 

Now consider our especially-big “government” orgs, which coordinate much of the “infrastructure” that supports or underlies other orgs. Such as law, defense, roads, regulation, standards, etc. A great many of these are run by autocrats who give some degree of lip service to vaguely-defined “community” purposes, while to a large degree running the nation to achieve their complex person ends. And most of the rest of these orgs define complex processes, typically “democratic”, by which many parties can influence their decisions, but they declare no official purposes. 

Which raises a huge puzzle: why don’t we have a lot more for-profit orgs that run cities, states, nations, etc.? This type of org is generally the best at most of our smaller-scale org tasks, and we also have many for-profit orgs that now do well at government-like tasks. Such as for-profit corporate campuses, housing complexes, resorts, cruise ships, company towns, and startup cities. And existing governments often hire for-profit orgs to do key tasks. But not only do we have almost no for-profit cities or nations, the idea almost never even occurs to anyone. For example, I got a whole Ph.D. in formal political theory without the concept ever being mentioned. Even today, the literature on the topic is small and unprestigious.

Now, yes, there are a few consistent differences between the org tasks of big governments, and those of smaller scale analogues. Big governments tend to be fewer and older, they more use physical force, they are more expensive to leave, and they can rely less on government-like orgs shaping a larger context in which they operate. (Yes, impossible to leave would be a problem, but not just somewhat expensive to leave.) But it is far from obvious to me why such features would even suggest that for-profit orgs could not function well in such roles. 

What seems more obvious to me is that most people strongly dislike the idea of for-profit government. They actually greatly prefer autocrats who substantially serve personal ends! Even thought most people would not go out of their way to buy their food, clothes, or cars from such sources. And my best guess as to why is the same as why we have other non-profits: government seems to them sacred, while money is profane. So to many even autocrats seem more appropriate as priests of this kind of sacred than do profit-driven executives. 

If so, this suggests that sacred money might be the key to governance reform. If we can get people to accept sacred orgs funded and driven by sacred-money incentives in other areas, then maybe we might get them to accept for-sacred-profit run governments as well. And then we might get much more efficient government.