In case you missed it, Caroline Winter at Bloomberg Business Week recently published an investigative piece on LDS Church finances that is pretty detailed. It’s pretty well-balanced, though I’m sure many Mormons will dismiss it as anti-Mormon based on the cover image alone:
Apparently the article hit a little too close to home for LDS Inc. They have now responded, at length: The Church and Its Financial Independence. Anyone care to estimate what percentage of Mormons are bothered by how opaque Mormon finances are?
Glad to see this receiving as much attention as possible. Although the cover image made me laugh and will not go over well with most TBM’s.
The article and the church’s response are most interesting because neither seems to ever connect with the other. They talk about some of the same issues, but it really feels like they were written in different languages, and then translated into English.
Ironically, the most distracting thing in the Business Week article is that the author’s skepticism came out in ways that may only be apparent to someone who has been part of the church. When referring to the “so-called Quorums of the Seventy” was distracting, while also making me laugh. I get that church hierarchies are not always easy to follow, but would she have written an article and said, “so-called Cardinals?”. Also only using quoted from former bishops was interesting, as if having held that calling at one time somehow made them more qualified to have an opinion. The biggest chuckle came from referencing Romney as a former bishop and not mentioning he was a former stake president.
Overall, I have no beef with the article, and learned a lot. I don’t think she missed the point of the church or it’s businesses, I just think she might not have finished the Mormon Rosetta Stone program before she say down to write. 😉
Well, I agree Julia that a few interviews with still-faithful bishops might have been nice. A few faithful intellectuals might have helped balance the article rather than pitting the intrepid Professors Quinn and Cragun against the “watery-eyed” aging LDS executive McMurrin with his shady-looking ruby pinky ring.
But overall, I found the article interesting and informative.
What I’m primarily interested in would be detailed policy arguments for why our tax code allows the specific religious exceptions it does. Usually whenever discussion of religious tax-exemptions comes up you don’t get very useful debate of the subject and the whole thing breaks down into a extremist debate about whether religion should lose ALL its tax exemptions or not. The debate becomes extreme because no one is educated enough in tax policy to debate the matter intelligently and with nuance. But I would be interested sometime in reading about where the cutoff lines are in what’s exempt and what isn’t, and why those cutoff lines were put where they are.
I note that the comparison with the United Methodist Church came up again. This is quite misleading. The central UMC organization doesn’t pay for Methodist buildings and local Methodist needs. When a church building needs to be built or land costs have to be paid, the UMC isn’t the one that does it. That is handled by the LOCAL units. Because the UMC is not financially centralized like the LDS Church is.
So making a comparison to how the UMC vs. LDS Church spends on charity is really an apples and oranges comparison. The UMC simply isn’t responsible for the lion’s share of Methodist expenses in the US.
Times and Seasons is currently hosting a lively debate on this article here:
Kaimi is basically of the opinion that Cragun’s conclusions on charitable giving are unfounded.
Cool article! I feel like Quinn has been writing his book on Mormon financials for years now. I’m sure it’ll be interesting when it comes out. Looks like one of the tidbits is that no one knows about all the LDS holdings these days — it’s basically a beehive with no queen.
What does this mean? Do you just insert the word “faithful” whenever you read something you don’t like?
“I support gay marriage.”
“That’s not a faithful position.”
“Um…actually I’m a Mormon.”
“No, you’re not.”
I do agree with you that it would be nice to get some solid information on the tax code, and how the religious/secular divide works with a umbrella organization like the Church. For example, does Deseret Book Co. pay no taxes?
Hahaha…this section of the Newsroom response:
Is this seriously how the Church expects the world to view its profits? That, if necessary, they’ll just be completely given up in acts of charity? Therefore, the fact that the numbers are hidden is actually righteousness in disguise?
And the TV/newspaper being used as “strategically valuable communication tools” … are they implying that America will soon be at war with China, so the assets will be available for a national (not communist, mind you) cause?
If they’re referring to the TV/newspaper as being strategic for the Church’s mission, then that is basically saying that the profit is good because growing the Church is good — which only makes sense if you’re a Mormon. Basically, the Newsroom is speaking to itself, while relying on (a) apocalyptic and (b) nationalist narratives to justify the Church’s behavior. But this isn’t the 1940s.
What people are going to see is a corporation that twists concepts like “charity” and “service” into a means to continue to not be transparent and to grow itself. Only when the money seems like it’s coming from nowhere does the charity feel pure because there are no numbers to compare it to. When it’s transparent, it is what it is: a capitalist endeavor, where numbers are compared by stakeholders and overseers: how much is for profit/non-profit/charity/etc.
Non-profits that stay afloat via donation MUST be transparent to maintain donors’ trust. The Church has a donor base (rather than a consumer base), so the fact that it’s not transparent makes me think the Church is afraid its numbers don’t speak too kindly to its mission.
“The bedrock principles underlying the Churchs welfare and humanitarian efforts are Christlike service and self-reliance…and growth…oops…Jesus was a poor man, you say? Oh, is the mic still on?”
Well Alan, charities are allowed to promote themselves, are they not? Every charity believes that what it is doing is right and useful. Are we going to start going around deciding who is and is not “charitable” based purely on personal aesthetics?
And however you slice it, you wouldn’t exactly call Quinn and Cragun still “faithful” LDS Church members, would you? I’m not sure even they would self-describe that way.
Sure, but the [non-profit] ones that last have their donors’ trust due to financial transparency. The Church decided somewhere along the way that its growth was more important than having “common consent.” I think the article said this happened around the 1960s — before the Church branched out internationally, perhaps?
I’m not so much interested in the people than in the narrative. What would be different about a faithful narrative? A support of the lack of transparency? That doesn’t seem fair, since plenty of Mormons want transparency.
I disagree Alan that transparency always equals success. However much you and I might value transparency, it’s not always a path to success. In fact a lot of the most successful organizations have not been transparent.
And any PR law firm can tell you that there are absolutely times when disclosure is the tactically incorrect choice.
It’s nice to have optimism about vague values like “truth” and “disclosure” and apple pie. But we need to acknowledge that that’s all it is – optimism.
Seth, you’re missing what I’m saying. Clearly the Church is successful; that’s not the point. Part of the reason it can get away with not being transparent is because it has a successful brand, and has its donors trust.
But, for example, let’s imagine that I’m a millionaire (specifically, I make exactly $1 million / yr). Each year, I give to charity $50,000. That is 5% of my income, and by most standards would make me a charitable person.
Notice how in order to consider me charitable, you also have to know know how much money I make. If each year I gave to charity $50,000, but you learn that I actually make $1 billion a year, you would consider me quite stingy.
The problem with the Church is that it is using the language of self-virtuousness without providing all the necessary details to justify itself. So, I can only see it as a cover-up of either a lack of virtue and/or embarrassing business practices.
I can see that point. I also don’t want to be in the position of defending the (what I consider kind of knee-jerk) LDS corporate stance on non-transparency, so I don’t want to play devil’s advocate too long on this one.
Glad to see nobody here is a Joehadist intent on squelching secular curiosity with a fatwa.
Nah, that’s the Unitarians down the hall, third door on your left.
As long as I get credit for coining Joehadist
TM, I’m cool with letting the Unitarians show up to defend themselves.
P.S. This sh*t cracks me up: http://i.qkme.me/3q2tbv.jpg
Joanna Brooks brings up an interesting point:
Okay, but what about the lack of transparency? Given that the transparency disappeared in the 60s, was there a conversation among church leaders that it would be better to close the books prior to the international expansion?
Was it the case that the leaders knew that white, Republican Mormons wouldn’t want to watch their hard-earned money being sent to Latin America year after year, so it was better if the growth appeared to happen spontaneously?
Is there concern now that transparency would bring to light embarrassing business decisions — that, for non-profits, would have certainly spelt doom?
From Joanna’s piece:
Just because the Church might have to soon (or already) use, *sob* for-profit ventures instead of tithing to maintain itself does not mean it’s time to play victim. What it means that the Church should have concerned itself more with wealth inequality between the global North and South as opposed to making sure the Gospel is practised by people in every spoken language.
I think the BW cover is fine. Something is allowed to be “offensive” if it leads to questioning bad ethics/misplaced priorities.
The LDS leadership shares a worldview with folks like the Chalcedon Foundation and Paul Weyrich. Soft-headed appeals to “transparency” are as easily dismissed by this crowd as good government was in Weyrich’s famous “goo goo syndrome” formulation.
I know little about tax law, but perhaps at some future date, a “Goo Goo” Congress will crack down on the Church and other religious orgs that engage in things like owning shopping malls. I’m sure profit-making enterprises of the Church aren’t tax-exempt presently, but the flow of money among the profit, non-profit and ecclesiastical arms can’t stay opaque forever.
From what little I’ve researched, the Tax Reform Act of 1986 (the same law that disposed of the honor system for individual citizens claiming dependents) opened up space for the IRS to audit a church if it has reasonable belief that it doesn’t meet exemption requirements. It looks like a lengthy procedure, though, and which “appropriate high-level Treasury official” would take initiative? How many Mormons/other religious folk work in the Treasury?