An Evangelical Review of “The Book of Mammon”

I recently finished reading “The Book of Mammon by Daymon Smith. David provides an excellent summary and I suggest you read his review rather than mine. My comments are too long to fit under David’s review, so I’m regrettably posting them here as its own post.

The book is funny. It unfortunately is nearly impossible to answer “What’s so funny?” when you’re reading the book. The book is dense, layered and self-referential and so are the best jokes.

About 20% of the book is a complaint against Human Resources. Anyone who’s worked in any sort of American corporation will know exactly what he’s talking about and I have to say, I don’t think these parts really hit their mark as hard as the rest. His complaints are valid and likely accurate but they’re the same everywhere. The thing that makes them cogent to the book is that they are always wrapped in the language of the church and frequently make use of the “Inspired” trump card. Being exactly the same as every other American corporation that makes them even more insidious.

Another 10-15% of the book is clearly an attempt to put the book into the catalogs of Anti-Mormon literature. Because the COB(LDS Corporate Headquarters), as presented in the book, is more devoted to Mammon than the things of God, I can see why Smith calls this Anti-Mammonism rather than Anti-Mormonism. If the LDS church is not devoted to Mammon, then there is no threat to it from this book. If it is, it deserves to have it’s dirty laundry waived. Seriously, as “Anti-Mormon” as anything else out there (but no more revealing than “Rough Stone Rolling”). Pretty early in the book I thought “there’s no way this guy is an active Mormon.”

These are the two biggest things I think anyone in the COB should be concerned about:

1) The COB is an absolute echo chamber and no one wants it any other way. I doubt a successful marketing campaign has been created by the LDS church in 20 years. There was a lot of talk in the bloggernacle about how the “I am a Mormon” ad series seems to target Mormons more than anyone else; intentionally or not, that’s probably the case. The producing departments only care about one thing; making the sponsoring departments happy so that can justify their own positions by invoicing for cob-cash. The sponsoring departments don’t seem to have the tools or the interest in knowing if their “products” are actually fulfilling their goals. “Inspiration” and priesthood hierarchy seem to offer enough justifications for anyone.

2) A scandal will eventually emerge from a lack of public financial accountability. Smith provides a few snapshots at corruptions from within the church. He indicates that others within the church passed this information on to him, that means other people are seeing it too. Smith wasn’t really in a position to discover anything that would be truly scandalous, but someone else, equally dissatisfied probably is, and that person is probably making quite a collection for himself.

I’ve heard Mormons pass over this lack of financial accountability by saying that it is their duty to pay their tithing and any thing that happens after that is between God and the criminal. One thing Smith repeats through the book is “silence is consent”.

A financial scandal will eventually emerge that will harm the church. As devoted members who care about the message of Mormonism, Mormons shouldn’t let this happen. It will hurt the church and as a result destroy souls. There seems to be a lot of bluster in the COB about being industry leaders. It’s not only appropriate as industry leaders AND representatives of Christ, it’s necessary for the LDS church to practice financial accountability.

By remaining silent, Mormons are giving their consent to financial dishonesty and eventual scandal.

I enjoyed reading the book. It can be difficult to read at times because Smith intentionally makes it hard to read. In a weird way, that made it fun rather than frustrating.

Advertisements

96 thoughts on “An Evangelical Review of “The Book of Mammon”

  1. On a side note, President Hinckely once said that the church’s finances are a matter for the members of the church and not the public. He stated that the church shares its financial information with its membership. Smith explains that the LDS church legally speaking only has one member, the president of the church. So Hinckley was actually telling the truth. THE member of the church sees the financial information whenever HE wants.

  2. I think you confuse “financial accountability” with “financial transparency.” Although in fairness, you introduce the concept with the correct term “public financial accountability.” Still, the way you apparently use the terms synonymously suggests that you don’t see the difference.

    “By remaining silent, Mormons are giving their consent to financial dishonesty and eventual scandal.”

    That’s a huge stretch. No, I take that back—it’s even huger than a stretch.

  3. My understanding is that Smith makes the concept of Corporation Sole out to be some arcane, mysterious legal loophole of a thing. It’s not. It’s fairly standard legal arrangement for churches to be able to maintain legal property ownership as the leadership position changes from person to person. The Archbishop of Canterbury is a corporation sole, for crying out loud. Lots of Catholic dioceses are corporations sole.

    In general, his big “insidious” revelations about the Church’s history as a legal entity make mountains out of molehills.

    On the other hand, this:

    The thing that makes them cogent to the book is that they are always wrapped in the language of the church and frequently make use of the “Inspired” trump card. Being exactly the same as every other American corporation that makes them even more insidious.

    Is the real problem.

  4. Yes, I meant financial transparency.

    So you don’t buy “silence is consent”? Or just not in this instance?

  5. He actually doesn’t make THAT big of a deal out of the Corporation Sole thing. He doesn’t treat it as a conspiracy. It’s more of just a way for him to explain that the membership doesn’t really have a voice in anything related to Mammon.

  6. My understanding is that Smith makes the concept of Corporation Sole out to be some arcane, mysterious legal loophole of a thing. It’s not. It’s fairly standard legal arrangement for churches to be able to maintain legal property ownership as the leadership position changes from person to person. The Archbishop of Canterbury is a corporation sole, for crying out loud. Lots of Catholic dioceses are corporations sole.

    He makes more hay out of this in his Mormon Stories interview than he does in the book. The main point is that the members of the church not only have no say in the church, they also have no legal status, and in a legal sense cannot be members.

    As for the archbishop of Canterbury, that actually goes towards his point. The Archbishop of Canterbury was incorporated many moons ago, thus the incorporation used the laws of the time, which by now are more arcane (as in ancient). But in another sense the Archbishop of Canterbury has very limited powers vis-a-vis other bishops and is limited by the fact that the Church of England is an official state church, which allows the government some measure of oversight. My point is that the ABC, though organized under the same legal framework, is limited in many ways the LDS President is not, and that’s part of the problem.

    As for Catholic dioceses being corporation soles, I would actually welcome the LDS church incorporating each stake as a corporation sole as a gigantic step forward. First, is would lessen the impact of any financial scandal, as the scandal would be local and limited. Second, and more importantly, it would give local members some real power and would force church headquarters to be better and more responsive leaders. Nothing forces accountability like controlling the purse strings.

  7. Tim: Silence is sometimes consent. Silence can can also be trust, or disinterest, or fear, or prudence, etc.

  8. Silence is sometimes consent. Silence can can also be trust, or disinterest, or fear, or prudence, etc.

    Trust that they are doing the right thing with your money = consent.

    Disinterest in how they administer your money = consent.

    Fear that they will do something to you if you speak out against their administering of your tithing money = consent.

    Prudence to keep your mouth shut about how they administer your money = consent.

    No matter how you slice it, it’s consent.

  9. Given how much obvious spending there is on national and international charities
    Given the acquisition and construction of expensive real estate
    Given the huge number of wards that have been built and maintained
    Given that they are heavily subsidizing tens of thousands of college educations ever year
    Given how expensive the international missions program is
    Given that the church has purchased for profit businesses with the surpluses
    Given that there is no history of leaders living in obscene luxury ever

    I think there is a pretty good reason to suspect the money is pretty much going to the sorts of things people think it is going to. If anything I suspect the “scandal” would be that the church is running surpluses in the USA to fund an a very expensive missions program in other countries, planting seeds for Mormonism to be a 100m person denomination/religion by the end of the century.

    But there is too much evidence for the money going where it should be to think much (as a percentage) is being lost to theft.

  10. Let’s redefine every word to mean consent. We could go on:

    Taking a nap = consent.

    Leaving the church = consent.

    Peanut butter and jelly = consent.

    Gotta hand it to you: that’s a pretty unassailable argument there.

    And yet somehow I’m still not convinced that I’m consenting to financial dishonesty and eventual scandal.

  11. Um, CD, regarding growth, the LDS have pretty much lost the twenty somethings, who won’t be noticed missing by the fossils who run things until the kids of the lost don’t show up. It’s clearly a church facing major decline.

  12. CD Host,

    And given that you have no clue about any of the church’s income, assets, or expenditures (because they don’t tell anyone), you are clearly speculating wildly with absolutely no data to back it up.

    Just to be clear I’m not saying they run the church well or poorly. There simply isn’t much data to go on.

  13. OK Brian, I’ll play along. Riddle me this one. When you send in your tithing to the LDS church, with no expectation of financial disclosure and no way to verify independent audits, how is that not consent?

  14. He makes more hay out of this in his Mormon Stories interview than he does in the book. The main point is that the members of the church not only have no say in the church, they also have no legal status, and in a legal sense cannot be members.

    In the sense that church membership doesn’t give you any ownership interest the way owning shares in a corporation, being partner in a partnership, or a member in an LLC does, sure.

    But the thing is, all of those are actually an ownership interest in the entity. Nobody thinks they have an ownership interest in the Church. Nobody thinks that Church membership is a security.

  15. Steve —

    All the evangelical churches are hurting with that age group. The 4th great awakening is over that was last generation. The only major “religious” group doing well is the non-religious group: atheist, agnostic, none, don’t know, don’t care. So the 5.5m in the US they have problems that are difficult to solve. I think they might be able to do better in terms of population but for now the focus is not so heavy in terms of membership. I’d love to have a serious conversation about what their strategy really is.

    My thinking is this has more to do with the other 7.5m that are abroad. The LDS is buying growth in better countries for their long term future. Look at these growth 5 year growth rates:

    Countries with more than 250,000 members

    Peru—21.3
    Brazil—19.7
    Mexico—18.1
    Philippines—17.6
    Argentina—16.9

    Countries with 30,001–250,000 members

    Nicaragua—50
    Nigeria—48.3
    Taiwan—43.8
    Venezuela—39.2

    Those are impressive. On the OTOH I’d heard that 5 year attendance is around 25% in most of the 3rd world. So Mormons are getting converts baptized but having trouble keeping them. But that is where the money is going.

    I’m not sure why the church has bad youth retention.

  16. Just to be clear I’m not saying they run the church well or poorly. There simply isn’t much data to go on.

    The original issue was theft/embezzlement, not poor management. Theft of any substantial percentage of the kinds of money we are talking about would have been noticeable. Bad spending, inefficient use of resources…. I’m not making any claims there.

  17. But the thing is, all of those are actually an ownership interest in the entity. Nobody thinks they have an ownership interest in the Church. Nobody thinks that Church membership is a security.

    The main point is that LDS church members have no legal rights. In other churches, members can influence financial decisions or fire the pastor. In some cases the churches do have legal rights. Take the episcopal church, right now many parishes are leaving and exercising their legal rights to keep their buildings because they have the legal standing to do this.

  18. CD, the church has tithing revenues around $6 billion a year. How much graft would be necessary to be noticeable?

    I’d like to point out that there are two kinds of potential financial scandal : misuse of funds and personal corruption.

  19. The fact that a church actually makes financial decisions based on a democratic process does not necessarily mean that the members of the church have any enforceable legal rights.

    I’m saying, from a legal standpoint (and a significant portion of my practice centers around the administration of tax exempt organizations, so I am not out of my element here), it’s not a given that an organization’s “membership,” whatever that means, should be able to influence anything at all. “Membership in an organization” has no legal significance except to the extent that the organizations bylaws or some kind of contractul relationship says it does.

    Shareholders in a corporation (partners in a partnership, members of an LLC) actually have an ownership interest in the entity, so they have legally enforceable rights.

    In order for a church, as an organization, to be able to own property, it has to be organized as a legal entity of some kind. Without being organized as a legal entity, the church as an organization can’t own property. One common option is organization as a charitable corporation. Another option is a corporation sole.

    A nonprofit corporation typically has a board of directors and then a class of members (who might be a narrow class that functions like another board of directors or may be the general “membership” of the organization in the common sense of the word–it would all depend on how the nonprofit corporation’s bylaws are written), and the members elect the directors the way shareholders of a for-profit corporation do. But the “members” who can elect the directors are not necessarily the “members” you think of in terms of “everyone who has joined the church.”

    In a corporation sole, the organization as a legal entity consists of the office of the person in charge, i.e., the prophet/president/archbishop/etc. So when the person in the office changes, the office still owns all of the property, not the person in the office personally. Sort of like how a trustee owns property in their capacity as trustee, but not personally, so if the trustee changes, the property is still held in trust and owned by the replacement trustee (except that a trust is not an entity and a corporation sole is an entity).

  20. The OP’s two biggest takeaways were the same as mine. Hard to read that book and not wonder why more Mormons aren’t asking how many companies in the COB vendor database are owned by friends and family of the folks who work in the COB? Then again, most Mormons don’t seem bothered even when information *is* made publicly available and so maybe the LDS apparatchiks are right that the risk is low of scandal flaring in the absence of the oxygen of outrage.

  21. The main point is that LDS church members have no legal rights. In other churches, members can influence financial decisions or fire the pastor. In some cases the churches do have legal rights. Take the episcopal church, right now many parishes are leaving and exercising their legal rights to keep their buildings because they have the legal standing to do this.

    Well actually that’s a pretty bad example. Most of the time when churches want to leave the Episcopal church the property is owned by the bishop. But there are other denominations, Gundeck’s being a great example, where as a matter of policy a church cannot be owned by any higher level organization so that property threats cannot be used. The reason being that when the PCA churches broke off from the PCUSA they generally did lose their property.

    And remember wards are churches, they don’t pay property taxes. The church members if they acted in a coordinated fashion most likely do have legal rights to them. The issue for Mormons are that the wards aren’t really worth very much. The national assets are where the real value is. Now if another organization arose claiming to be the real Mormon church, with a substantial majority of the membership behind them…. then there could be a winnable court fight. So yes in a collective sense the members have rights.

    But to be clear, the leadership is rather unified, you don’t have wide open fights between various church leaders with the leaders denouncing and excommunicating one another, holding rival boards… that you would need for a legal schism. That is, the members “don’t have rights” because there is no disagreement about who the Mormon church is and who is in charge. The members would have legal rights if that agreement didn’t exist.

    Even religiously, forgetting about organizationally, forgetting property, the LDS doesn’t even have any serious splinter groups. The CoC is like 2% of the size, the ones on the right are even smaller. And that CoC split happened almost 200 years ago, the LDS and CoC don’t claim each other’s congregations.

    So really your issue seems to be you like weak denominations not strong ones. Well the LDS is an ultra strong denomination. There are plusses and minus to strong denominations. But in an age when the denominational structures have been getting weaker in most churches for a century part of what makes the LDS special is the advantages those strong structures provide. If you don’t like those advantages why would you join the LDS?

    As an aside, I think the structures are likely too strong in the sense that the assets aren’t split up so something like legal seizure (for example if Brazil and the US went to war) is going to be a problem for the LDS over the centuries. The church got rich and large in a time of relative world peace, a desire for strong cooperation nationally and internationally and profound respect for property rights. I think they may have to learn the hard way what the downside of their structures are in times when those advantages aren’t present.

  22. Not to side track the conversation but the PCA formed out of the old PCUS (the Southern denomination resulting from the Civil War) not the PC(USA). There were only a few property disputes in the formation of the PCA stemming mostly from people who were opposed departing the PCUS.

    Since reunification of the PCUS and the UPCUSA in 1983 the PC(USA) has continued to shift its governing emphasis away from the local church to a more centrally controlled form of Presbyterianism, a trend that started in the North in the late 19th century. The PCA on the other hand places more emphasis on the confessional unity of inter-dependent local churches where the “authority of the Church is moral and spiritual, ministerial and declarative” not civil.

    That being said an individual, family, or an entire church may depart the PCA without coercion.

    On the topic of the post financial accountability and transparency are an issue for the LDS to handle how they please. It is a voluntary organization after all, if the members are pleased to have no earthly clue about the denominations financial dealings, more power to them.

  23. And remember wards are churches, they don’t pay property taxes. The church members if they acted in a coordinated fashion most likely do have legal rights to them.

    Completely wrong. It’s dangerous to argue from what is “most likely” when you are dealing with legal matters. “Most likely” = “you just lost your case” most of the time in my experience.

    The bottom line is that the members have no legal title or rights to any of their local properties. The members can agitate all they want (and probably face church discipline as a result), but they will get nowhere. The Corporation of the First Presidency, or one if its subsidiary corporations owns everything.

    The issue for Mormons are that the wards aren’t really worth very much. The national assets are where the real value is.

    Again, BS. Some ward houses are standing on very valuable real estate. That goes double for where the temples usually are. You are however correct about the liquid assets being held on a national level. All local monies are sent to Salt Lake City within 24 hours of being received. Local bank accounts usually show a zero balance as all monies are sent to Salt Lake and wired back in on an as needed basis. The one exception is the Fast Offering Fund. This is held on a local basis, but it a pittance compared to how much is collected for tithing.

    Now if another organization arose claiming to be the real Mormon church, with a substantial majority of the membership behind them…. then there could be a winnable court fight. So yes in a collective sense the members have rights.

    Sorry, the Corporation of the First Presidency, or one of its subsidiaries, is the sole title holder of all assets for the church. The church collectively could agitate as a group all they want, and they will lose because they have no legal rights. The church members wouldn’t even have a case.

  24. Kullervo,

    I think we are agreed on the legal matters, insofar as my limited legal understanding allows me to make an informed assent.

    Daymon Smith’s point is more rhetorical than legal. And thinking more about it, the more I think his rhetorical point is wrong. His main point is that the LDS church is a large corporation where the members have no rights and church headquarters is not responsive to the needs of the members. As evidence for this he trots out the fact that legally the church is a corporation sole, which he claims gives evidence that the church’s legal organization mirrors how it actually functions. I’ll grant that on legal grounds he may by factually incorrect. The organization’s legal structure may or may not give or remove legal rights from church members, that would have to be determined on a case by case basis. However, even if the argument fails on legal grounds, it mainly functions as a rhetorical point: corporation sole sounds despotic to the average person.

    This is related to my main criticism of the book. When I have read or listened to Daymon Smith, my impression is that this is actually part of his apologia for why he still maintains active church membership. His basic idea seems to be this. He feels that in the 19th century the church was much more communitarian and less despotic. I get the sense that his testimony of the LDS church is of what it used to be, not what it is, and that his continued membership is mainly a longing for the good old days and a hope that the church will reform to be like those good old days.

    He sees the transition period for the church going from good to bad in the years 1890-1920. This is why the organization of the church as a corporation sole holds rhetorical power for his argument. It’s during that period that the church was organized as a corporation sole, prior to that it was not. Thus he sees the transition to corporation sole as both a partial cause of the problems and as emblematic of the transition. Even if it fails as a legal argument, it still would hold symbolic and rhetorical power for his argument.

    My critique is that I don’t see any sharp transition in how the church was run. The legal arrangements of the church have changed over time, but the actual practice of the church has not. In Joseph Smith’s time, Joseph Smith basically held all or most of the church property in his name. During the period of territorial Utah, the church ran the territory politically, so there really wasn’t much of a need to organize the church as a corporation sole. The organization of the church as a corporation sole simply allowed the church to continue with the same practices as always, but since the legal and political climate had changed post 1896, new legal arrangements had to be made. The fact that the church is organized as a corporation sole is a red herring, at least as it pertains to Daymon Smith’s argument.

  25. I agree, from a legal and rhetorical standpoint, there isn’t much of a “there” there. Everyone who participates in any sort of non-profit enterprise faces the same sort of lack of ownership. Even in a congregational church, a group of people could swoop in, become members and with a majority vote do something contrary to your best interest.

    It’s an interesting tidbit about the LDS church but I don’t think it’s much more than that. In theory Thomas S. Monson could fire everyone and redirect all the assets of the church into his own bank account. Legally there would be nothing that could stop him. But I’m not for certain the Elder Board in my church couldn’t do the same. And as I mentioned, even being a congregationalist only gives you one vote.

  26. David and Tim: Setting the legal nitty-gritties aside, I think we’re all basically on the same page. The membership of the church indeed has no ownership interest in the Church as a legal entity, and thus only has legal rights over the operations of the Church insofar as the corporation sole’s bylaws (or whatever organizational or regularoty document the Church uses) grant them.

    Also, this is more of a rhetorical point than a big deal. It does sound despotic. And it kind of is. But it’s not like, a legal loophole or a trick the Church played on people, except to the extent that the membership confuses the Church’s ecclesiastical organization with the Church’s organization as a legal business entity, and the extent to which the Church allows or perpetuates the confusion.

    Also, David, you are correct: CD Host is just, phenomenally and hilariously wrong about the legal rights to ownership of Church assets in almost every single way. He doesn’t even lose his case; he gets his case dismissed on summary judgment for failure to have a case at all.

    If Church property is titled in the Corporation’s name, no amount of agitating will change that. The legal organizational structure is not similar enough to the other cases with schismatic congregations being able to keep property for you to get similar results. The only way to challenge it would be to find a way to claim someone else was the President of the Church (and thus clothed in the corporation sole). But that’s wickedly problematic (the court won’t decide questions like that if they require the court to decide matters of religious doctrine, so it’s easier to decide those kinds of questions for older churches like the Roman Catholic or Episcopal Church who have established ecclesiastical codes of governance that can be examined by the court and decided under neutral principles of law).

  27. All right I guess I’m going to have to respond. The Mormon church is not the first church in the history of the republic that claims to own assets. The situation with property in the LDS is not all that unique. There is a church, it has a leadership and that leadership has property. The law holds that church leadership has custodianship not ownership of assets. If it was ownership they would be paying full taxes and be subject to extensive audits and for that matter tithes wouldn’t be deductible.

    The law generally wants to avoid defines a church in terms it defines itself as long as that is clear. If it isn’t clear then the issue become murky like any other dispute about who controls a trust. But your theory, that the leadership claims some sort of outright ownership unconnected with the church itself would have them owing huge tax bill.

    Hence there is going to be a tie between the LDS and the first president. That’s what prevents a few top guys from walking off with a few billion. In theory the trust is pretty tightly controlled. In practice courts break into trust agreement all the time. California decided a bunch of similar cases in favor of congregations during the 90s where they felt the denomination was not respecting the intent of the custodianship.

  28. The only way to challenge it would be to find a way to claim someone else was the President of the Church (and thus clothed in the corporation sole).

    Of course that’s what would happen! You would have multiple competing claims to who is the authority for the church, who is the custodian of the assets. This would be like the situations in Catholic history where there were multiple valid Popes.

  29. The law holds that church leadership has custodianship not ownership of assets.

    That’s absolute nonsense. What law?

    If it was ownership they would be paying full taxes and be subject to extensive audits and for that matter tithes wouldn’t be deductible.

    That’s also absolute nonsense. Where are you even getting this? You are just making laws up now.

    The law generally wants to avoid defines a church in terms it defines itself as long as that is clear. If it isn’t clear then the issue become murky like any other dispute about who controls a trust. But your theory, that the leadership claims some sort of outright ownership unconnected with the church itself would have them owing huge tax bill.

    What? You’re not making sense. You’re not even using these words right. You are just typing jibber-jabber.

    Hence there is going to be a tie between the LDS and the first president. That’s what prevents a few top guys from walking off with a few billion. In theory the trust is pretty tightly controlled. In practice courts break into trust agreement all the time. California decided a bunch of similar cases in favor of congregations during the 90s where they felt the denomination was not respecting the intent of the custodianship.

    Do you mean in the 2000’s California decided a bunch of cases regarding Episcopal churches? Those cases had facts entirely unlike the LDS Church’s. They depended on the specific organization of those churches as legal entities. As I indicated above, there is more than one way a Church can organize as a legal entity, and the LDS church is not organized at all like the Episcopal churches in those cases.

    Of course that’s what would happen! You would have multiple competing claims to who is the authority for the church, who is the custodian of the assets. This would be like the situations in Catholic history where there were multiple valid Popes.

    Except it would be nothing like that at all because the issue we’re talking about would be property ownership, not spiritual authority (it would be a spiritual authority issue too but we’re not interested in that for these purposes), and unlike the popes in the middle ages, this imaginary schism’s property disputes would happen in the context of the Anglo-American legal tradition, the US Constitution and legal system, and the laws of whatever state the CotPotCoJCoLDS is incorporated in. So, it would be nothing like that at all really.

  30. In theory Thomas S. Monson could fire everyone and redirect all the assets of the church into his own bank account. Legally there would be nothing that could stop him. But I’m not for certain the Elder Board in my church couldn’t do the same.

    Well, there are criminal laws against fraud.

  31. Kullervo —

    You are trying to have it both ways. Watson v. Jones:

    If the property was acquired in the ordinary way of purchase or gift for the use of a religious society, the court will inquire who constitute that society or its legitimate successors and award to them the use of the property. In case of the independent order of the congregation, this is to be determined by the majority of the society, or by such organization of the society as by its own rules constitute its government.

  32. My position is simple. There are two sets of laws:

    Watson v. Jones which tries to determine who the legitimate authority is based on secular criteria. The underlying legal structures don’t matter. That’s why local congregations in the Episcopal church are losing, because the court doesn’t recognize their ownership.

    Jones v. Wolf which allows the court to examine the legal structures.

    ____

    As an aside in 2008 Virginia ruled that state statues governing divisions (Virginia Code § 57-9) were constitutional which basically says in the case of a division the congregation votes on which side of the division to side with and the property goes with them.

    IANAL and other people are, but I don’t see this as so clear cut at all.

  33. No no no. Watson v Jones stands for the proposition that the first amendment forbids the court from deciding questions of religious doctrine. To the extent that the court has to resort to doctrinal questions in order to resolve a civil dispute (like property ownership), the court is required to defer to the church’s highest authority’s decision on the matter (similar to how the US supreme court is bound by a state supreme courts determination or interpretation of that state’s laws).

    Jones v Wolf says that courts have to use a neutral-principles approach, which means, subject to the limitations of Watson v Jones, a court has to decide internal civil disputes of a church the same way it would decide the internal civil disputes of any other voluntary association, such as a partnership or corporation, i.e., with reference to governing law and the organizations duly adopted internal governing documents.

    In the Episcopal church cases, the parishes as registered California religious corporations had legal title to the property, but the internal governing canons of the Episcopal Church, incorporated by reference into the parishes’ bylaws, say that all property is held in trust for the benefit of the diocese. That’s how trusts work: a trustee holds legal title, but the beneficial ownership actually belongs to someone else. But trusts are only created under specific circumstances (including for example the express ctearoom if a trust which was found to have happened in the Episcopal cases).

    So although the parishes had legal title, the court applied the Jones v Wolf neutral principles approach to look at the parishes’ governing documents and the Episcopal Church’s canons to determine that the parishes only owned the property in trust, and thus could not just take the property as it’s own.

  34. In all of these cases where there is a dispute, legal title is held by the local congregation as some kind of legal entity, and the question is whether the local congregation holds title for itself or in trust fir the higher denominational organization, based on whether the church’s internal organizational documents create a trust or not.

    In the LDS church, local wards and stakes are not organized as legal entities and thus do nor hold property at all. The property us titled in the name of the corporation of the president of the church, or one of it’s subsidiaries. The local congregations are not legal entities–they can’t own property at all and they can’t, as congregations, be beneficiaries of a trust. So the facts that give a legal dispute in the cases you cite are simply not present in the LDS church.

  35. “By remaining silent, Mormons are giving their consent to financial dishonesty and eventual scandal.”

    I disagree. This statement incriminates everyone who gives to the church as being party to fraud if there is one. People aren’t giving their consent to it. Nobody is giving it a stamp of approval. People might not be preventing it from happening… but that’s completely different from saying they consent to it.

    When I gave money to the church, I did so knowing that I didn’t know exactly how it was spent, that I couldn’t really find out, and I was okay with that. Mostly because giving the money wasn’t me approving anything-I wasn’t really giving the money for the benefit of the LDS Church. I was giving money to God, as I was commanded to do. And when I’ve visited other churches, I have given money there, not knowing or caring about their finances. What happens after I give that money away is not something that concerns me in the slightest–the fact that I sacrificed for God is what matters.

    Similarly, when I give money to homeless people, I don’t know if they’re going to buy food or drugs. And I don’t care (although I despise drug use, perhaps more than many). I give people money because I think it’s the right thing to do, and it’s an example I want to set for my kids. When appropriate, I also give food, or clothing, but that’s not the point. The point is the edifying nature of giving.

  36. Trust that they are doing the right thing with your money = consent.

    Disinterest in how they administer your money = consent.

    Fear that they will do something to you if you speak out against their administering of your tithing money = consent.

    Prudence to keep your mouth shut about how they administer your money = consent.

    No matter how you slice it, it’s consent.

    Can we apply this logic to all things?

    Trust that my husband won’t have an affair (will do the right thing with my marriage) = consent for him to have an affair

    Fear that your abusive boyfriend will do something to you if you speak out against their abusing you = consent for the abuse to continue

    Prudence to keep your mouth shut (and/or disinterest) when someone is doing something you cannot control or change = consent.

    Yeah, I’m not buying it. IF you knew there was fraud happening and you didn’t report it or try to stop it, THAT would be consent. IF you had some power to change how the church manages its finances and didn’t exercise it, THAT would possibly be consent.

    Paying your tithing to your church is not consent for that to be abused. Absolutely not. Just as you can’t blame the members of the churches with huge financial scandals for the actions of the people who perpetrated the frauds, you shouldn’t be able to blame the members of the church without huge public financial scandals because you don’t like how they do their business (which you’re not contributing to, anyway).

  37. Can we apply this logic to all things?

    Obviously not, in fact most of your examples fail because they are inappropriate analogies. My sole point was this, when you give money voluntarily, with no strings attached, and with no oversight, you are giving consent for the receiving party to do what they want with it. If they use it to feed the hungry, you gave consent. And if they spend it on booze, hookers, and bribes, you gave consent for that as well. If any of those three conditions, fail to obtain, then you did not give consent.

  38. Well, then, next time I fill out a tithing form I’ll make sure to put this note on it: “By endorsing the accompanying check, recipient acknowledges and ensures that this donation shall not be spent on booze, hookers or bribes.”

  39. Again, David, you are making a rhetorical argument in order to bully people into activism. “Silence is consent” is not somehow self evident.

  40. Well, then, next time I fill out a tithing form I’ll make sure to put this note on it: “By endorsing the accompanying check, recipient acknowledges and ensures that this donation shall not be spent on booze, hookers or bribes.”

    Cute, but it doesn’t cut it. The big wigs at church headquarters never see your check nor your tithing form.

  41. Again, David, you are making a rhetorical argument in order to bully people into activism.

    What am I trying to get people active about? The only thing I would encourage people to do is that when they give money to non-profits, give the money to non-profits which are transparent about what they do with their money. I don’t think this is radical advice. The unfortunate thing is that all too often when talking about the LDS church, this is seen as radical advice.

    “Silence is consent” is not somehow self evident.

    Look I agree that “Silence is consent” is not a universal truth. It depends on situation and context. I just happen to think that in this situation, it is the case. But I guess that sharing of my opinion is probably more bullying people into activism.

  42. I dropped this “conversation” a while ago because it was clear to me that David Clark is wed to his idea and won’t budge, and thus it was clear that I couldn’t learn anything from him. Still, it’s nice to see that other rational minds agree with me that his arguments requires one to accept a truism without question. There’s no way to argue against him because he’s chosen a definition for “consent” the way people choose their favorite no, better yet, “the best” flavor of ice cream.

    When I give money to someone with no public oversight, the only thing that can really be said is that I give my consent to them to use my money and not tell me how they spend it. By DC’s (il)logic, I better hope that my friend, whom I loaned $20 to just because he asked, didn’t go out and buy a knife with it and plunge it into someone’s chest—otherwise, I clearly gave my consent to murder!

    In fairness, it looked like he was starting to back down from his position:

    My sole point was this, when you give money voluntarily, with no strings attached, and with no oversight, you are giving consent for the receiving party to do what they want with it.

    But even then, he misses the point that we only give consent for the “receiving party to do what they want with it,” if there is no agreement beforehand about what to do with the money. If, on the other hand, the receiving party promised to “use it to feed the hungry,” then by giving the money all we have given consent to is for the receiving party to—you guessed it!—use it to feed the hungry.

  43. CD-Host:

    As an aside in 2008 Virginia ruled that state statues governing divisions (Virginia Code § 57-9) were constitutional which basically says in the case of a division the congregation votes on which side of the division to side with and the property goes with them.

    57-9 is a little more interesting. Keeping in mind that it would only apply to church property held in Virginia, and that other states probably don’t have similar statutes, it at least opens up the possibility that a breakaway stake could petition the state of Virginia to keep their buildings and meetinghouses. Given the Virginia Supreme Court’s intensive breakdown of the language in the statute in the Truro case, and in particular the issues that have been left unresolved, I don’t think this statute would be a slam dunk for our hypothetical breakaway stake, but it would at least give a breakaway stake a colorable legal claim to take to court to be decided, which is more than they would get in other states.

    As above, the fact that the LDS church’s property is titled in the corporation sole and the individual congregations are not legal entities that can hold property may or may not make a difference.

    IANAL and other people are, but I don’t see this as so clear cut at all.

    Hey, I apologize for being dismissive and snide with you over this. It’s kind of not fair, because I am a lawyer, and I specifically practice trust law, tax law, and tax-exempt organization law. So this sort of thing is actually what I do for a living.

    I do think it’s admirable that you have clearly done your homework here, and this stuff is not always

    One thing to keep in mind is that legal decisions are decided within the context of an existing conceptual framework, and without a good grounding in that conceptual framework, it’s easy to read a decision and totally misunderstand it, or to understand it but misapply it because you missed the broader context.

    I’m not saying you have to be a lawyer to understand the law; I’m just saying that when you go into something like this, you need to go in realizing that words and contexts will not necessarily mean what you assume they mean, and it’s worth your time, if you want to grok these issues, to dig a bit deeper and wrap your head around the conceptual background.

  44. As far as “Silence is consent” goes. . . that may not be the rules you play by. But Daymon Smith is letting you know, those are the rules at the COB. If you’re interacting with them, that is THEIR assumption.

    Katyjane said

    What happens after I give that money away is not something that concerns me in the slightest–the fact that I sacrificed for God is what matters.

    Similarly, when I give money to homeless people, I don’t know if they’re going to buy food or drugs. And I don’t care (although I despise drug use, perhaps more than many). I give people money because I think it’s the right thing to do, and it’s an example I want to set for my kids.

    We are absolutely commanded to be generous. But we’re also commanded to be wise. Generosity does not absolve us of the requirement to be wise. You absolutely SHOULD care if the beneficiary is going to misuse the money. If you have some reason to think there will be misuse, you have some culpability in it.

    Wisdom doesn’t absolve us from generosity, it just makes generosity a more difficult task. I don’t have any stats to back it up but I bet that people who research where their money goes also happen to be the people who give more. They’ve got something more than loose change invested in their charity.

    Wise Christian-givers know that financial transparency is now the baseline for large non-profits. The size and structure of large non-profits is reason enough to think there will be some misuse and the only way to combat that is through transparency.

    As I stated originally, scandal IS coming. When the dust settles and you see the people around you who have left their faith because of it, will you be glad that you remained silent when you knew that financial transparency was the right thing for the church to do? When some of your leaders are disgraced, will you be glad you didn’t give them the protection that transparency offers?

    If the LDS church doesn’t think financial transparency is appropriate for them, they should mind the company they keep.

  45. Wise Christian-givers know that financial transparency is now the baseline for large non-profits. The size and structure of large non-profits is reason enough to think there will be some misuse and the only way to combat that is through transparency.

    As I stated originally, scandal IS coming. When the dust settles and you see the people around you who have left their faith because of it, will you be glad that you remained silent when you knew that financial transparency was the right thing for the church to do? When some of your leaders are disgraced, will you be glad you didn’t give them the protection that transparency offers?

    Katyjane can speak more to this, since she has a lot of experience as a CPA in independent auditing, but my understanding is that where there is opportunity for fraud, it’s only a matter of time before someone’s personal condition and situation motivates them to commit it.

    At the same time, I think that the Church’s financial transparency problems are a separate issue from whether or not members should give to the Church. Paying tithing is unambiguously a commandment in Mormonism. Whether or not you think the Church is going to minsmanage the funds, and whether or not you think the Church has a perverse incentive to emphasize the commandment’s importance, if you are a believing Mormon, there’s not really much of a way around the fact that you have got to pay your tithing, end of story.

    So in that sense, it is different from other voluntary charitable giving, and from the believer’s perspective, more like paying taxes to the government. You won’t go to jail for not paying your tithing, but you also won’t go to the temple or the Celestial Kingdom, and one kind of coercion (and I mean “coercion” in the most neutral, descriptive way possible) is as good as another.

    But the fact that you are required to tithe doesn’t mean the story ends there. As with paying taxes, the fact that you are required to pay is itself a motivation to insist on financial transparency. We want to government to be financially accountable because we pay our taxes, but even if it wasn’t, we would still have to pay our taxes. And the decision to not be financiallly transparent is a policy decision, not a spiritual one or a commandment from God. Even from a believer’s perspective, there is no reason to not insist on better financial transparency (although, from the believer’s perspective, when the authoritative answer is “no,” you’ve got to accept it).

  46. But the fact that you are required to tithe doesn’t mean the story ends there. . . . And the decision to not be financiallly transparent is a policy decision, not a spiritual one or a commandment from God. Even from a believer’s perspective, there is no reason to not insist on better financial transparency

    THIS

  47. At the same time, the LDS Church is a profoundly undemocratic organization, so it’s not clear to me what the mechanism for insisting on anything would be. And the problem is compounded by the Church’s teachings on obedience, sustaining leadership, and not “speaking ill of the Lord’s anointed.”

    Granted, those teachings are wildly self-serving, but they’re there nonetheless, and they’re backed up by the stick of church discipline.

  48. Obedience, sustaining your leaders and not speaking ill of the Lord’s anointed aren’t necessarily real barriers to asking for financial transparency.

    If merely asking for it in a sustained and unified voice, is perceived as a violating all of those things. . . .that’s a real problem. I’m not one to use the C word, but again, mind the company you keep.

  49. But the fact that you are required to tithe doesn’t mean the story ends there. . . . And the decision to not be financiallly transparent is a policy decision, not a spiritual one or a commandment from God. Even from a believer’s perspective, there is no reason to not insist on better financial transparency

    Yeah, I can agree with that. (Although, I don’t really know that some church leader wasn’t commanded to keep financial records secret—at any rate, it’s not a canonized commandment.)

    “If merely asking for it in a sustained and unified voice….”

    I honestly can’t see a problem with that—except that in my case, I just don’t care enough. Or rather, there are other things I care about far more.

  50. I agree with what Katyjane said on July 26, 2011, at 8:39 pm. But as I’ve said before in this forum, even though I don’t have any qualms about giving to the Church I agree with Tim that maintaining a lack of transparency is asking for trouble in the long run. At some time, I have no idea when, there will be a scandal as a result, and it will be damaging.

    (Of course, like BrianJ, I have no idea whether Church leaders have received revelation to keep financial matters opaque, or if that’s merely a human policy.)

    That said, I know on a local level how strong are the internal checks on financial chicanery, and I have no doubt that the Church’s books are thoroughly audited. But transparency would provide additional check beyond what auditing can do, as well as act as a restraint on some matters that aren’t typically addressed by audits.

    This is one area where, I’d say, evangelicals as a whole are doing better than we LDS are. Most evangelical denominations and independent churches do maintain transparency; there have been, of course, some notable exceptions, and some well-publicized cases have involved church leaders becoming personally wealthy by misusing donations.

    I have seen no indication that Church leaders have done anything similar — and I know for a fact that various news media and some organizations have tried to find examples of such, but to no avail. I hope, and even suspect, that’s because Church leaders have been and are persons of high integrity (plus many of them have done quite well financially on their own).

    But we can’t count on that always being the case (see D&C 121), and transparency, while not guaranteeing a scandal-free future, would at least reduce the temptation to participate in those types of actions that result in scandal.

  51. Eric: two lines of questioning for you.

    1) “…maintaining a lack of transparency is asking for trouble in the long run. At some time, I have no idea when, there will be a scandal as a result, and it will be damaging.” Suppose that the President is the only one who sees all the financial reports—he even has accounts that he has sole access to. Now, that’s as non-transparent as it gets—actually, no, let me go one further: Suppose that lots of Church leaders (Qo12, etc.) have their own accounts and no one else gets to see how they spend the money. With that degree of non-transparency, the only guard against fraud (etc.) is the integrity of the individual leaders—which requires a lot of trust, no doubt, and certainly would make one feel as you do: the scandal is inevitable.

    But now suppose that every Church leader from the GA level up can view any and all Church accounts. Even though the public cannot view the records, is that still enough eyes watching, say, the Presiding Bishop to deter him from siphoning tithe monies into his personal retirement account (never mind that “retirement” is a silly notion for someone at that level of LDS leadership)? (I have no idea whether this is in fact the set up.) Would more eyes (i.e., the public) increase the security?

    2) What do you see as the costs of the LDS Church following the financial transparency models of evangelical denominations, which you see as superior?

  52. In addition to preventing personal graft, transparency would also ensure the church is spending it’s resources the way it says it does AND ensure that relatives of general authorities are not being given preferential treatment and no-bid contracts.

    Two follow up questions:

    If 25% of tithing money were being funneled into private for-profit business ventures would this be a problem for people?

    If the church was only giving 1.5% of its income to humanitarian purposes, would this be a problem for people?

  53. In fact transparency is more important for the reasons I just mentioned than in protecting against individual corruption.

  54. “ensure the church is spending it’s resources the way it says it does”

    Well, it doesn’t even really say how it’s spending the money, so…
    😉

    “If 25% of tithing money were being funneled into private for-profit business ventures would this be a problem for people?”

    Why would they do that?

    “If the church was only giving 1.5% of its income to humanitarian purposes, would this be a problem for people?”

    How much does it cost to run/build/maintain all the churches and temples? Is BYU tuition reduction considered humanitarian? Is PEF? etc. etc. etc.

  55. PS. In my comment to Eric, I had nepotism in mind, but just included it in my “etc.” So my question is still the same.

  56. Why would they do that?

    According to Daymon Smith because they’re a corporation devoted to Mammon rather than a church devoted to Christ.

  57. That’s an a priori answer. If Smith is correct—that it’s a corporation devoted to Mammon—then we wouldn’t ever get to your question, “If 25% of tithing money were being funneled into private for-profit business…”!

  58. According to Daymon Smith because they’re a corporation devoted to Mammon rather than a church devoted to Christ.

    Which still doesn’t make sense. They are a non profit. With a for profit corporations they could pay huge dividends. They can’t do that. Evan assuming it were true they have to put the profits right back into the church trust.

  59. Which still doesn’t make sense. They are a non profit. With a for profit corporations they could pay huge dividends. They can’t do that. Evan assuming it were true they have to put the profits right back into the church trust.

    First, you are using the word “trust” wrong here. A non-profit corporation is a different thing than a trust. There is no “church trust.”

    Second, you are right that a non-profit corporation cannot pay dividends (it has no shareholders, so it has nobody to pay dividends to), but still, you might be surprised how many non-profit corporations are absolutely obsessed with money. Yes, there are fairly tight restrictions in the tax code as to what their money can be spent on, but still, they are often obsessed with money nonetheless. This is in my experience as a lawyer working with non-profit organizations all the time. They can be greedy, greedy bastards.

  60. Ah, so many questions. … I’ll answer what I have time for now and get to the rest later.

    BrianJ asked me:

    … But now suppose that every Church leader from the GA level up can view any and all Church accounts. Even though the public cannot view the records, is that still enough eyes watching, say, the Presiding Bishop to deter him from siphoning tithe monies into his personal retirement account (never mind that “retirement” is a silly notion for someone at that level of LDS leadership)? (I have no idea whether this is in fact the set up.) Would more eyes (i.e., the public) increase the security?

    To go to what Tim said since I wrote my last comments, there are certainly bigger issues that transparency addresses than scandals along the lines of embezzlement, and I failed to explicitly address those (namely, the Church’s priorities as revealed by its spending). It’s kind of hard to answer this exact question, because I’m uncertain who has access to what now. But in general (and this is a bias of mine), I’d say that the more that have access to such info the better.

    (Just to clarify a bit, I’m not suggesting to ignore personal privacy. I don’t think it’s necessary to reveal, for example, the salaries of individual seminary teachers (in areas where they’re paid) or that of, say, the temple janitor. So I wouldn’t necessary make public all the books. But I would, at the very lease, reveal pay ranges and information about how the salaries are determined, as well as the average pay for GAs, apostles and the First Presidency.)

    Anyway, as Tim as suggested, there are two interests involved in transparency. One is outright graft or questionable activities such as those you mention. I’ll admit that can happen with or without transparency (see the example of Bell, Calif., were the state’s open-records laws didn’t make much difference for years in city government). Audits are supposed to help prevent that short of thing. I’d probably agree with the suggestion that opening up books to the church membership at large wouldn’t add a lot in terms of preventing embezzlement if they’re already available to GAs (and they already may be, I don’t know).

    But it could make a difference in the issues that Tim brought up. I’ll probably comment on that tomorrow.

    BrianJ also asked:

    What do you see as the costs of the LDS Church following the financial transparency models of evangelical denominations, which you see as superior?

    Do you mean financial costs? If so, next to nothing. Reports already have to be made for auditing and tax purposes, and to keep the apostles informed, so I don’t see transparency adding much cost to that.

    Other costs? Honestly, they could be considerable. If there had been transparency all along, people would have grown up with it and expected it. But a sudden switch in policy would invite considerable scrutiny, second-guessing and the like. Third World members (and probably some in the U.S. too) would be stunned at how much some church leaders earn. The media would find reason to be appalled. It would probably be a PR nightmare, even if everything done is fully defensible.

    It could also have some effect in reducing the “mystery” around church leaders, making them seem more human and perhaps even less inspired. I don’t really know, but there’d certainly be some impact in the way members view the Church.

    It would definitely be an interesting development!

  61. Eric: thanks for your responses. I’m still unclear on your answer to the first question: Assuming that a great number of GAs see the financial records (which I don’t actually assume, I just do here for argument), what problems do you think would be lessened by opening the records up to even more scrutiny? I’m interested in any problems you’re concerned about: graft, misuse, incompetency, low pay for janitors, etc.

    As for the second question: yes, I meant non-financial costs. The financial costs would be negligible. You answered clearly. Thanks.

  62. BrianJ said about my response to his first question:

    I’m still unclear on your answer

    I’m unclear too, because I haven’t thought about that very much at that level of specificity.

    What I’d probably say is that opening the records beyond the GAs (assuming that that they already were open to GAs) probably wouldn’t make a lot of difference in terms of preventing outright graft; I’m assuming that there are GAs who wouldn’t stand for activity such as hiring close relatives of the top leaders for high-paying positions, for example.

    I think where it could make a difference, and this is something that Tim has alluded to, is that transparency might affect the church’s spending priorities. Just to pick a not-true hypothetical example, if it became widely known that the church was spending millions of dollars for gold-plating of the apostles’ offices, pressure would probably come to bear on the church leaders to change that. More generally, if it were revealed that church spending priorities didn’t have much to do with the gospel, transparency might help remedy the situation, and I would think that over time the priorities would change. Although the church is as hierarchical as they come, church leaders aren’t immune to wanting to be seen as being faithful to the church’s stated principles.

    (This is all theoretical, of course I don’t really know much about what the current spending priorities are, although I’ve been told by a somewhat reliable source that the Church Educational System is responsible for about a third of the church’s budget, which is plausible. )

  63. What I’d probably say is that opening the records beyond the GAs (assuming that that they already were open to GAs) probably wouldn’t make a lot of difference in terms of preventing outright graft; I’m assuming that there are GAs who wouldn’t stand for activity such as hiring close relatives of the top leaders for high-paying positions, for example.

    Eh, I don’t know. I’m not accusing GAs of doing anything like this at all, but it seems like the kind of situation where a culture of graft can develop within a small group. New GAs learn quickly that this is the way things are done. Closed groups with no accountability to anyone outside breed that kind of thing.

    So again, I am not suggesting that the GAs are going that; I am merely suggesting that it would be extremely fertile soil for that kind of thing.

  64. The percentage spent on humanitarian efforts would probably be a bee in someone’s bonnet. No matter how high or low it is, it wouldn’t be enough for someone.

    That’s not to say that it doesn’t matter; just that it would definitely attract criticism, and that the criticism would be more or less deserved, depending on what the % really is.

  65. Tim said:

    In fact transparency is more important for the reasons I just mentioned [transparency would also ensure the church is spending it’s resources the way it says it does AND ensure that relatives of general authorities are not being given preferential treatment and no-bid contracts], than in protecting against individual corruption.

    I agree but neglected to say so in my earlier comments, and my emphasis on personal corruption may have been misleading about the main reasons I support transparency.

    Tim asked:

    If 25% of tithing money were being funneled into private for-profit business ventures would this be a problem for people?

    It depends on what those numbers mean, but obviously that figure sounds extremely high.

    President Hinckley’s comments in 1991 on church-owned enterprises shed a tiny amount of light on the subject: The State of the Church. (The info is toward the bottom.)

    I have no objection to the Church (or any church) owning commercial enterprises, assuming, of course, that they pay taxes on their profits and operate responsibly. Doing so can provide for some efficiencies; for example, the Church almost certainly is better off owning Bonneville Communications and using its resources for broadcasting General Conference than it would be to maintain a huge part-time electronic communications department or to hire outsiders to do the work. And while I’m not going to defend everything Deseret Book has done, it certainly provides for the needs of many members in a way that might not be happening otherwise. And the company does pay taxes and is required to follow most laws that apply to publicly held or independently owned companies. And I agree with President Hinckley that owning farms (the Church has huge holdings near Disney World in Florida, for example) can be a suitable way of preparing for calamity.

    I’m not saying there are no problems with a church owning businesses; it would certainly be possible for them to take attention away from eternal matters. And there could be problems if (as has been reported), plum jobs (such as high-paying seats on a board of directors that meets seldom) are awarded as perks of performing ecclesiastical duties.

    Probably every major denomination in the country has a significant investment in private enterprise; such investments are commonly used to provide for employee retirement, insurance needs, financial stability and the like. Conceptually, I see little difference in owning stock and in owning a company outright. And it isn’t uncommon at all for churches to run smaller enterprises; the closest megachurch to where I live, for example, runs a bookstore and a coffee shop in its narthex.

    But if a church were pouring 25 percent of its donations into speculative enterprises, or subsidizing private enterprises so that certain people could become wealthy as a result … yeah, that would be a problem.

    Tim also asked:

    If the church was only giving 1.5% of its income to humanitarian purposes, would this be a problem for people?

    It’s been well-publicized that millions of dollars the Church has provided in humanitarian assistance are, in terms of percentage of total income, not much. We can probably do better.

    On the other hand, I have seen firsthand the enormous support that many people have received through fast offerings. I’ve known people who have had their entire rent or mortgage payments made by the Church. I’ve known people who have had needed surgeries paid for by the Church. I’ve known of a case where fast-offering funds paid for a tutor for a struggling middle school student. The church’s welfare and fast-offering program isn’t perfect, but it has helped countless people.

    Also, there’s no question that the Church takes in less tithing than its expenses are outside the United States, Canada and perhaps one or two other countries. I have visited LDS churches in the Third World, and there’s no doubt that those churches couldn’t function, much less build their own buildings, without a heavy subsidy. While this subsidy isn’t considered humanitarian assistance, it is a type of support that helps meet both temporal and spiritual needs. I am more than pleased to see a portion of the money I give being used to support those people in that way.

  66. There’s not much more we can say because we don’t know the specific numbers. As you suggest, all kinds of financial activities can be justified, it’s the actual numbers that make those numbers salacious.

    What would you think of the church sending missionaries to work, for free, at church owned businesses?

  67. I might also suggest that you read Smith’s book. He says that many of the things you say would be a problem are, in fact, happening.

  68. Conceptually, I see little difference in owning stock and in owning a company outright.

    Well, owning a company “outright” just means owning all of the stock. The main conceptual–and legal–difference comes between having an interest in a company and having a controlling interest in a company. Not that the Church is forbidden from having a controlling interest, just that the market forces that drive stockholder decisions when nobody has a controlling share may be absent, for better or worse, when someone has control.

  69. Tim asked me:

    What would you think of the church sending missionaries to work, for free, at church owned businesses?

    Under most circumstances, I would consider that inappropriate at best.

    He also said:

    I might also suggest that you read Smith’s book.

    When you ran the review a year ago or whenever it was, I tried reading the preview at Amazon. To be honest, I found the book to be too much work to read, and I didn’t care for the writing style at all. I don’t get to read all the books I want to read, so I’m probably not going to spend my time and/or money reading something I find laborious.

  70. The church finances are audited. It always annoyed me because it’s done by Priesthood holders… so I would never have been able to be on the Church audit committee.

    They also have to report their income to the government–probably of many countries, depending on the tax laws.

    Honestly, if there was transparency in their finances, most people wouldn’t look at the financial statements, of the small percentage who did, most of those wouldn’t understand it (accounting for not-for-profits is really different than the financial statements for, say, public corporations).

    Heck, our government finances are public and available–when was the last time you went to the library to look up your state’s financial statements? Your county’s? Your city’s? There was a study done a number of years back (before the internet was as prevalent as it is now) where someone put $20 bills into the library copies of government financials (I’m not sure of the level) with a note that said to feel free to take it… after a year, nobody had touched them… in any state… in any library.

    And our states are taking OUR money, without us really having a choice about it, managing it poorly, and doing it publicly. We can’t stop them and efforts to change it have been ruined by politicking. Why focus on the LDS Church, which at least appears to pay its bills, and not on how to change the financial crisis that is our government?

  71. I would venture that if the church’s finances were public, the people most interested in the financial decisions would be non-members. Which is part of the reason they will not be anytime soon. Members are happy not to worry about what the church is doing financially. Those that do, are a small minority of the current membership, mainly centered in Utah because that is where the church is significantly commercially involved. The centralized structure takes away a lot of this sort of care in the congregations.

    Many members, especially in Latin America, are just happy they get many resources that they never could afford on their. i.e. a nice new american chapel in the middle of the Guatemalan jungle. In Kansas where I grew up, many congregations have buildings that exceed what they take in.

  72. “A nice new American chapel…”

    That is probably the most culturally insensitive comment I’ve heard since I last listened to Glen Beck. Maybe it’s my Presbyterian high view of the local church but isn’t it special that you toss those poor Guatemalans a bone.

  73. They also have to report their income to the government–probably of many countries, depending on the tax laws.

    I’m pretty sure churches don’t have to file tax returns at all. I know they’re exempt from filing Form 990.

    Heck, our government finances are public and available–when was the last time you went to the library to look up your state’s financial statements? Your county’s? Your city’s? There was a study done a number of years back (before the internet was as prevalent as it is now) where someone put $20 bills into the library copies of government financials (I’m not sure of the level) with a note that said to feel free to take it… after a year, nobody had touched them… in any state… in any library.

    Hilarious!

  74. “That is probably the most culturally insensitive comment I’ve heard since I last listened to Glen Beck. “

    Hmm. … I can’t see how giving Guatemalan Mormons a shiny new American-Style Mormon chapel is any more culturally insensitive than giving a Guatemalan subsistence farmer a new John Deere.

    They may be out of place, but the Mormons in third world countries do very much appreciate the resources they get from headquarters.

  75. I think it it pretty obvious that a “new american chapel in the middle of the Guatemalan jungle…” has nothing to do with a John Deere tractor.

    To explain away finical transparency because the jungle dwelling in saints in “Latin America, are just happy they get many resources that they never could afford” is condescending and dismissive of the sacrifice (Luke 21:1-4) these people are making both financially and culturally. If this is an acceptable way to refer your fellow saints I’m beginning to understand the LDS overseas retention rates.

  76. They may be out of place, but the Mormons in third world countries do very much appreciate the resources they get from headquarters.

    Have you read The Book of Mammon?

  77. gundek: I’m not clear anymore on what you found so culturally offensive. At first I thought it was the jcg210 brought up the fact that many third world congregations receive more in funding than they collect in donations—“Them jungle dwellers won’t never be asking any finance questions ’cause them’s minds’ is too blown just from having four walls and flush toilets.” And yeah, that’s condescending and wrong—and therefore also stupid. (Although I recognize that that’s possibly not how jcg210 meant it. Maybe.)

    But then Jared saw your offense a different way, and you responded to his comment without correcting his understanding, so now I think maybe I misunderstood. See, Jared seems to be saying simply that members in low-income wards are grateful for the financial help they get from wealthy wards, even if that help takes on some of the cultural characteristics of the wealthy wards; i.e., they appreciate the help and aren’t prone to look the gift horse in the mouth; e.g., an American-style building in rural Guatemala. I don’t see what’s offensive about that (especially because, based on my limited experience, it’s absolutely true.)

    Or perhaps you find the American-style chapels in and of themselves offensive? i.e., even if a rural Guatemalan ward was wealthy and could pay for it entirely themselves, just the act of building American-style building outside of the US is “culturally insensitive”?

  78. I am not particularly concerned with Mormon architecture and I am not all that offended but if I was a Latin American or Guatemalan Mormon I would be disturbed to find out that I should not be interested in the financial dealing of my church because I have a nice new american chapel that I could have never afforded with my pittance of a contribution.

    Like I said it may be that as a Presbyterian we support local church led by local leaders that I find this as condescending and dismissive of your fellow believers at best or religious imperialism at worst.

  79. Ahh, so it was my first understanding (of what jcg210 wrote) that you found insensitive, and not what Jared wrote. Thanks for clarifying.

    Oh, and I don’t think seeing it that way requires any background in Presbyterianism 🙂

  80. I should add that I don’t think jgc210jgc210 meant to claim that Guatemalan Mormons were to stupid or impressed by an american chapel to ask questions about finances. Although if he had spent any time at all in Central or South America he would know how offensive calling the United States, “America” is to Central and South Americans.

    In fact I don’t think he was trying to be offensive and I am sure that many people are grateful for a place to worship their God, but this does not mean that they don’t have a right financial transparency. The widow’s mite is substantially more than 10% of a rich man’s gross in my God’s Kingdom.

    Odd that I would be defending Mormons, but having spent an afternoon or two down South I sometimes feel myself understanding their contempt for Yankees.

  81. but having spent an afternoon or two down South I sometimes feel myself understanding their contempt for Yankees

    This sentence means something geographically very different to me than I think you meant it.

  82. Of course, in South America everyone from the United States is a Yankee. Even those of us from Dixie. It took some getting used to.

  83. Haven’t read the book of Mammon. . . but I can’t see how it could be an authoritative source on how the third world accepts church resources.

    My point was not that Guatemalans shouldn’t care about transparency, or that Mormons shouldn’t care about transparency, but that transparency would not necessarily solve the problem of misuse. If Mormons didn’t trust their leaders they wouldn’t send their money. Even if transparency revealed that the Church was not wise in a lot of the way they spend money I can’t see how it would change the way the Church does business. Mormons that receive more resources than they give, are bound to be happier with how the church spends their money than those that don’t. And that has nothing to do with culture. Mormons, in theory devote all their resources to building the church and kingdom.

    Voluntary transparency would not solve the problem of corruption, Enron was required to disclose all of their financials. . . .

    I suppose my main conclusion is that the church has internal, cultural guards against major corruption, as well as intractable, cultural, and religious stops on actual effective oversight.

  84. Also, the “right” to transparency is pure fiction. It may be a good idea, but there is no right in law or by God. It ain’t a democracy. If the Church is not spending your money properly you have the “right” not to contribute.

  85. Of course, in South America everyone from the United States is a Yankee.

    And in much of Latin America, Mormons are evangelicals. The term evangélico is frequently used to apply to Christians (in the dictionary sense) who aren’t Catholic, especially those who place an emphasis on spreading (their version of) the gospel. So evangélicos include not only evangelicals in the sense we use the word here, but also to Mormons, JWs, Adventists, Pentecostals and many others.

  86. Really, read the book.

    Haven’t read the book of Mammon. . . but I can’t see how it could be an authoritative source on how the third world accepts church resources.

    Actually, the best chapter in the entire book deals with this issue. In fact it’s a major theme of the entire book. One of the major problems with the COB, is that sure they provide solutions, but they are not very interested in figuring out what the problems are, nor in providing solutions to those problems. Often you end up with expensive and attractive solutions to non-existent problems, while real problems go unaddressed.

    Mormons that receive more resources than they give, are bound to be happier with how the church spends their money than those that don’t.

    I know you mean well with this sentence, but I think it simply shows you don’t know what problem the book is addressing. You are assuming that they are receiving things they need. Sure, they might be really expensive and shiny things, which cost a great deal of money (thus making the statement technically true that they are receiving more than they get). But, an expensive and attractive solution to a non-problem, and no solutions to real problems is not helpful.

    Voluntary transparency would not solve the problem of corruption, Enron was required to disclose all of their financials. . .

    This is a pretty bad comparison. Again read the book. The fallacy of the comparison is that Enron was a for profit corporation subject to market forces. Because of this, eventually the BS came due and Enron collapsed. The point is that eventually the market washed them out. One of the points of the book, and a major theme of my review, is that the LDS church is not subject to market forces. This has two ramifications for the purposes of this post. First, there won’t be market forces which eventually stop the scam (assuming that there is a scam, this is purely theoretical). This is what makes the Enron comparison not useful. Second, the COB acts AS IF it is subject to market forces as a management philosophy. Not only is this very unnecessary, it is part of what leads to the COB producing stuff that is not helpful to the church members. It does this because managing a corporation by market principles only works if an actual market exists for the product the corporation is producing.

  87. And if you really can’t read the book, listen to his Mormon Stories interview. He discusses it the third world issues there.

  88. One of the major problems with the COB, is that sure they provide solutions, but they are not very interested in figuring out what the problems are, nor in providing solutions to those problems. Often you end up with expensive and attractive solutions to non-existent problems, while real problems go unaddressed.

    I feel like this reflects a broader failure of Mormonism. In a lot of ways I feel like its missionary efforts are still trying real hard to meet the perceived spiritual needs of early 19th century frontier America without formal education, and competing against churches that only exist in Joseph Smith: History.

  89. Kullervo —

    I’m watching an hour long version of the Manti Miracle pageant. The criticisms the pageant makes against the churches of his day hold just as much today.

    (*) What is the purpose of creation? If people exists to glorify God what need does God have for glory. If it is for each individual’s benefit then why create people deficient in having given glory in the first place?

    (*) If the bible is the sole guide to faith and perspicuous why are there so many equally compelling but irreconcilable variants or Protestantism? What church should I join?

    (*) If the Catholic church is not the true church when did it fall? Why? What can we trust that came from it?

    (*) What is the role of religious authority? And in a protestant context how does one avoid each man being his own pope?

    (*) If God is meaningful sovereign why does creation give so little indication of that, the problem of pain?

    (*) What good does hell serve? Why would an omnibenevelent God choose to create a realm of eternal torture?

    The problem for the Mormon church IMHO is it is impossible to simultaneously say:
    1) We are just another evangelical church
    2) We have radically different answers than evangelical Christianity to these questions.

    They have to decide whether they want to regain their status as a radical church; or be boring.

  90. I may read the book,

    However, I do believe the Church is subject to market forces. The product it delivers is its religious message. So long as that induces faith to pay tithing, and as long as they can continue to pay the bills and have money to spare the Church will continue to be economically prosperous and wasteful.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s