How the LDS church makes money.
I think it’s a good thing for the church to own income-producing assets. The Businessweek article attempts to paint some aspects of church finances and business interests as bad things, but I think it (the article) fails to do so. The things that the article points out, to which it points a finger and says “Ah ha!”, are actually good things in my opinion.
Charitable and other non-profit organizations, that intend to be around for multiple generations, need income-producing assets in order to protect their income-consuming assets (such as chapels, temples, mission offices, mission homes) during periods when donations drop off (such in recessions).
Multi-generational charitable organizations also need reserves. One of many ways to safely hold reserves is in a widely based stock portfolio. Another is in assets that tend to appreciate over time, such as land.
If those assets can both generate income (such as agricultural land, or even hunting preserves) and appreciate in value, so much the better.
The Businessweek article also fails to point out the many millions spent annually on the church’s direct welfare to church members when talking about the church’s humanitarian donations to non-members. (Though the church doesn’t publish that figure.) I consider the church’s welfare system that feeds and supports many members as humanitarian aid too.
Those who accuse the church of not making charitable donations to other organizations seem to forget that all the church’s expenditures on its core mission are charitable: building and maintaining chapels, temples, church schools, maintaining over 300 Mission Offices and 300 Mission homes around the world, flying 30,000 missionaries to/from their mission every year, feeding many members, etc. etc.
From my point of view, these income-producing assets have resulted in less financial requests being made of members.
When I first joined the church in the early 1980′s, members were requested to pay not only tithing, but also contribute a portion of local chapel construction, their ward budget, and a “temple assessment”.
There is currently a line item on the donation forms for temple construction, but it no longer is expected of members as it was back then. There is no longer a “your ward/stake must collectively donate/raise X dollars before construction” of your temple or chapel.
Line items no longer exist on the donation form for chapel construction or ward budget.
So in a very real sense, Mormons are being asked to pony up a lot less money today than 30 years ago. And I think the church’s investment income may have a large part in that.
The LDS Newsroom has a related article here.
Deseret News responds to the Businessweek article:
http://www.deseretnews.com/article/765589521/Out-of-bounds-Businessweek-cover-story-distorts.html
http://www.deseretnews.com/article/865558980/LDS-Church-explains-financial-history-philosophy.html
Filed under: Deseret Review | Tags: economics, LDS, Mormon, Mormonism, religion
John Mansfield
July 13, 2012
The article seemed quick and dirty, not particularly well done, but also not so terrible. The cover was astonishing though. When I first saw it, at the site of someone commenting on it, I thought it was a joking parody of what a cover to go with that article would look like. The sacrilege is over the top, but it’s also sloppily, amateurishly done. Since it really is the Businesswek cover, I guess the point was to signify that Mormonism is not a serious religion and lazy scorn is the most appropriate way of approaching it. This choice by the editors of Bloomberg Businessweek has a bit of the tribe vs. tribe vibe that I thought I sensed with the Harold Bloom piece months ago.
The Deseret News editorial also raised a good point: Businessweek of all places should run articles with less naive surprise that running businesses is a part of life.
John Mansfield
July 16, 2012
Another thought about the peculiarly amateurish style of the Bloomberg Businessweek cover: The artist’s main understanding of how to approach the Mormon church came from the recent Broadway musical. All those who congratulated themselves on how they broad-mindedly enjoyed that mockery should be really happy to see echoes of it bouncing around the New York publishing world.
Adam Greenwood
July 16, 2012
I’m rereading Tuchman’s The Distant Mirror right now. She talks about the rigorous asceticism of the new Celestine monastic order in the 14th century, and paradoxically how popular that made them with a corrupt and indulgent nobility.
The world is always wanting its religion to be powerless and wholly otherworldly.
John Mansfield
July 16, 2012
Here’s a little story I asked my wife to repeat to me last night. The father of one of her missionary companions had been a top executive with an apparel company, but left the job for a finance position with the LDS church. The daughter regretted his choice, not so much because the pay was much less, but more because he was instructed to not use his already accumulated wealth in a way that would make it look like the church was paying him a lot.
Bookslinger
July 16, 2012
John M:
re: connecting the magazine cover mockery to the musical mockery. Brigham Young said: “Every time you kick ‘Mormonism,’ you kick it up stairs: you never kick it down stairs.” (Journal of Discourses 7:145; Discourses of Brigham Young, p. 351.)
re: apparel finance man’s daughter. Isaiah had some choice things to say about women who engage in conspicuous consumption.