Certainly the fact that some really awful charities are untruthful doesn’t mean SI shouldn’t be held accountable merely because it managed to tell the truth.
I think you’re missing Luke’s implied argument that more than ‘some’ charities are untruthful, but quite a lot of them are. The situation is the same as with, say, corporations getting hacked: they have no incentive to report it because only bad things will happen, and this leads to systematic underreporting, which reinforces the equilibrium as anyone reporting honestly will be seen as an outlier (as indeed they are) and punished. A vicious circle.
(Given the frequency of corporations having problems, and the lack of market discipline for nonprofits and how they depend on patrons, I could well believe that nonprofits routinely have problems with corruption, embezzlement, self-dealing, etc.)
Charities tend to be a trusting lot and not think of this sort of thing until it happens to them. Because they don’t hear about it, for the reasons Luke sets out above. I just found out about another charity that got done in a similar manner to SIAI, though for not nearly as much money, and is presently going through the pains of disclosure.
I think you’re missing Luke’s implied argument that more than ‘some’ charities are untruthful, but quite a lot of them are. The situation is the same as with, say, corporations getting hacked: they have no incentive to report it because only bad things will happen, and this leads to systematic underreporting, which reinforces the equilibrium as anyone reporting honestly will be seen as an outlier (as indeed they are) and punished. A vicious circle.
(Given the frequency of corporations having problems, and the lack of market discipline for nonprofits and how they depend on patrons, I could well believe that nonprofits routinely have problems with corruption, embezzlement, self-dealing, etc.)
Charities tend to be a trusting lot and not think of this sort of thing until it happens to them. Because they don’t hear about it, for the reasons Luke sets out above. I just found out about another charity that got done in a similar manner to SIAI, though for not nearly as much money, and is presently going through the pains of disclosure.