What can we do about free riders?
Wednesday, May 04, 2016
In economics, the free rider problem is described as a situation where some individuals in a population either consume more than their fair share of a common resource, or pay less than their fair share of the cost of a common resource.
In membership organizations working to advance or protect a profession, community or cause, a free rider benefits from the organization's work but makes no investment in dues or volunteering.
Free riders have a host of reasons why they don't join their professional, trade or community organization.
- "Why join when I can find everything I need on the Internet?"
- "You'll lobby for me whether I join or not."
- "If I want to attend, I'll just pay the nonmember price one time."
The problem is so prevalent that boards of directors have simply accepted the fact that free riders will never change — no matter how valuable the work of the organization.
What they refuse to acknowledge is that the rights to belong or associate should be seen as a gift. Around the globe, the majority of countries have no rights to freely convene, speak openly and lobby government. In the U.S., these privileges are afforded in the Constitution — and we have a responsibility to exercise them with care and understanding.
Beyond freedom to assemble, free speech and the right to petition government, there are other laws supporting the purpose for associations and chambers, they include:
- Exemption from federal income tax
- Volunteer immunity
- Deductions for charitable giving
The opportunity to join and lead a nonprofit organization is a right that should not be taken for granted.
Maybe President Teddy Roosevelt said it best: "Every man owes a part of his time and money to the business or industry in which he is engaged. No man has a moral right to withhold his support from an organization that is striving to improve conditions within his sphere."
In every case, a strong membership yields the best results. Purchasing power and political clout are enhanced if all potential members are represented.
It is said that associations and chambers of commerce do what regular people think "just happens." A few examples include standards of excellence, favorable public policy, scholarships and community festivals. Little thought is given to the work of the Rotary Club, for example, or the festival that increases tourism planned by the chamber, or the standards of safety proposed by an association.
Behind the scenes of improvement is a cadre of volunteers and staff, strategy and resources to get the job done. I've never met an exempt, nonprofit organization that was not working to improve communities — whether they be a community of professionals, trades, causes or geographic region.
It would be inaccurate for free riders, or the public, to think these private-sector organizations receive government funding. They diligently raise funds through programs and membership.
Most associations and chambers rely on two broad streams of income. The funds raised through membership investments, and events and education, are used to improve the community, profession or trade.
If 100 percent of the potential members joined the organization, the costs would be shared equally. But free riders refuse to lend support, leaving the burden on those who are committed to protecting and advancing their organization and community.
In other words, the smaller the membership market share of potential members, the greater the burden for those who support organization.
Free riders benefit from their colleagues who voluntarily work in the organization. The free riders give up their rights and responsibility to shape the future of their community through leadership.
The opposite of a free rider would be a shaper — a person committing his/her personal time and resources to ensure a healthy and vibrant community. The shapers occupy seats on committees and the board of directors.
In closing, the right to associate to advance and protect a community is a gift somewhat unique to western countries. Those who withhold their support can weaken its impact.
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