it is important for there to be a public, meaningful signal against efforts that are likely to fail.
He laments that there is no way to short a non-profit. But you can think of a short sale as a side bet. As Robin Hanson has repeatedly emphasized, betting markets in opinions can be used to extract information of the sort that Kingsland discusses. You could set up a betting market in which participants wager on the likely success of non-profit initiatives. Of course, whether managers of an initiative would heed the opinion of the betting market is another matter.
How would you know when they failed?
Arnold, what does it say (for example) that the moment China opens up that they absorb as much manufacturing as possible? I think it says our education systems at all levels are an obvious failure. And yet they just go on business as usual.