Justice as Fittingness

Law and Philosophy -     

Decentralising to Villages in Indonesia: Money (and Other) Mistakes

Nearly 15 years after embarking on its large‐scale decentralisation programme, Indonesia has decided to extend its efforts to the village level. Decentralising to villages is intended to improve service delivery performance at the lowest administrative tier and reduce social inequality and poverty. A number of potential difficulties with the design of Indonesia's nascent village decentralisation initiative have already become apparent. Methods used to allocate funds to villages are particularly problematic. Oddly, fund distribution procedures insist to a large extent on equal per village allocations, despite the significant heterogeneity of villages. And they ignore other sources of revenue to which villages have access. In the event, village revenues will be very inequitably distributed: villages with high levels of poverty will receive less money than they need and villages with access to significant funding from oil and gas revenues will receive more than required. Also, village service responsibilities are unclearly defined, village financial management systems are inadequately prepared to handle large increases in funding, and mechanisms to monitor and control village spending are underdeveloped. These difficulties will severely constrain the achievement of official objectives and create further challenges for reformers in their attempts to combat corruption at the subnational level. Copyright © 2015 John Wiley & Sons, Ltd.     

Administrative Growth and Grant Payouts in Nonprofit Foundations: Fulfilling the Public Good amid Professionalization?

The Tax Reform Act of 1969 remains the core governing policy for the U.S. foundation sector, primarily for its qualifying distributions mandate, which ensures a baseline spending of foundation assets toward charitable purposes. However, implementation of this policy required additional foundation administrative resources and contributed to significant professionalization of the foundation sector. This article focuses on the payout requirement's potential paradox of accountability, as administrative expenses can be counted toward fulfilling foundations’ qualifying distributions. Using a 14‐year panel of grantmaking foundations, the analysis seeks to understand whether professionalization, measured by operating and administrative expenses, contributes to or crowds out grantmaking. Findings indicate that professionalization of the foundation sector has a small yet practically and statistically significant positive association with foundation grantmaking. From a policy perspective, the current structure of the qualifying distributions mandate does not appear to lead to a crowding out of grant allocations as administrative expenses grow.     

The Confidence Game: Roping in a Globalized World

This is the last in a series of five articles focusing on how Bernard Madoff’s confidence game (con game) worked. It examines the international money collecting activities by ropers for Bernard L. Madoff Investment Securities (BLMIS). Before globalization, Madoff’s con game brought him millions of dollars; after globalization, it began bringing him billions, making him remarkably successful until his run of luck was brought to a sudden halt by the worldwide economic downturn.