{"id":33388,"date":"2023-03-28T02:54:00","date_gmt":"2023-03-28T02:54:00","guid":{"rendered":"https:\/\/www.lifeandnews.com\/articles\/?p=33388"},"modified":"2023-03-29T03:01:14","modified_gmt":"2023-03-29T03:01:14","slug":"behind-the-latter-day-saint-churchs-vast-wealth-are-two-centuries-of-financial-hits-and-misses","status":"publish","type":"post","link":"https:\/\/www.lifeandnews.com\/articles\/behind-the-latter-day-saint-churchs-vast-wealth-are-two-centuries-of-financial-hits-and-misses\/","title":{"rendered":"Behind the Latter-day Saint church\u2019s vast wealth are two centuries of financial hits and\u00a0misses"},"content":{"rendered":"\n

Benjamin Park<\/a>, Sam Houston State University<\/a><\/em><\/p>\n\n\n\n

During the first weekend of April 2023, the Church of Jesus Christ of Latter-day Saints will hold its semiannual General Conference<\/a> in Salt Lake City. Tens of thousands of members will attend in person, with millions watching from home.<\/p>\n\n\n\n

Over two days, Latter-day Saints \u2013 often called \u201cMormons\u201d \u2013 will hear an array of talks from religious leadership. But another speaker will likely be a member of the church\u2019s auditing department, who, if he follows tradition<\/a>, will state that the institution\u2019s financial activities from the past year were \u201cadministered in accordance with Church-approved budgets, accounting practices, and policies.\u201d No further specifics are typically provided.<\/p>\n\n\n\n

This yearly ritual may seem striking in the face of the church\u2019s February 2023 agreement to pay a US$5 million fine<\/a> in a settlement with the U.S. Securities and Exchange Commission. According to its press release, the SEC concluded that the church went to \u201cgreat lengths\u201d to \u201cobscure\u201d its investment portfolio<\/a>. A church statement<\/a> expressed \u201cregret\u201d that its leaders had followed faulty legal counsel and insisted that the fine would be paid through \u201cinvestment returns\u201d rather than members\u2019 donations.<\/p>\n\n\n\n

The settlement came on the heels of other controversies<\/a> about the church\u2019s taxes and financial portfolio, which journalists and whistleblowers have estimated at around $100 billion<\/a>.<\/p>\n\n\n\n

These revelations have raised questions concerning the ethics of a religious organization amassing such a large amount of wealth, and how it is balanced with charitable giving. But headlines often overlook the long and surprising history<\/a> of the modern church\u2019s financial success \u2013 as well as the continued anxiety surrounding its economic reserves.<\/p>\n\n\n\n

Share and share alike<\/h2>\n\n\n\n

Mormonism was born through the spiritual quest of Joseph Smith<\/a>, who was raised amid America\u2019s Second Great Awakening<\/a> during the early 1800s, a period of Christian revivals. His parents were religious seekers who struggled to find a fulfilling church, and tussled with the young country\u2019s financial turbulence. Smith\u2019s father had lost savings in an ill-fated ginseng deal<\/a>, plunging the family into two decades of poverty.<\/p>\n\n\n\n

It is no surprise, then, that when Smith formed his own church, its teachings included a sharp critique of the capitalist system. Early converts to what was originally called the Church of Christ, organized in 1830, were encouraged to consecrate all their goods<\/a> to their new religious community so it could redistribute resources to those in need.<\/p>\n\n\n\n

It was one of many communal experiments<\/a> Americans attempted during the antebellum period as religious innovators offered alternatives to what they believed was a dangerous and uncaring economic system. Smith\u2019s earliest revelations denounced individualism and urged believers to share their property and resources with one another<\/a>.<\/p>\n\n\n\n

Yet financial difficulties, personal clashes and other challenges doomed the experiment from the start. Within just a few years, the new church\u2019s leaders had already abandoned the consecration ideal. In its stead, Smith directed members to donate \u201csurplus property<\/a>\u201d to help pay off the group\u2019s immediate debts and then to donate \u201cone tenth of all their interests annually.\u201d This commandment commenced a practice of tithing<\/a> that still exists today, though it has been interpreted in different ways over the years.<\/p>\n\n\n\n

Hardscrabble years<\/h2>\n\n\n\n

Over the first two decades of the church\u2019s existence, the Latter-day Saints had to relocate their headquarters multiple times \u2013 including seven years in Nauvoo, Illinois<\/a>, a focus of my historical research<\/a>. By the time the Saints reached Utah\u2019s Great Salt Lake<\/a> in 1847, leaders and members alike largely embraced the economic system that Smith had previously decried.<\/p>\n\n\n\n

\"A<\/a>
A drawing of Salt Lake City from a book published in 1875. Universal History Archive\/Universal Images Group via Getty Images<\/a><\/figcaption><\/figure>\n\n\n\n

A series of national economic crises<\/a> during the late 19th century further tested the church\u2019s finances and financial ideals. In addition, the government\u2019s decision to prosecute polygamists amid growing criticism of the church\u2019s \u201cplural marriages\u201d crippled the region\u2019s economy<\/a> until Latter-day Saint leaders renounced the practice<\/a> in 1890.<\/p>\n\n\n\n

Facing financial ruin, the church\u2019s prophet and president in 1899, Lorenzo Snow, urged members to redouble their commitment to tithing<\/a>. The church formalized its expectation that members donate 10% of their annual income to remain in good standing. To this day, Latter-day Saints are expected to meet with local bishops every year and state that they have paid a full tithe<\/a>.<\/p>\n\n\n\n

By 1907, Snow\u2019s successor, Joseph F. Smith, jubilantly announced<\/a> that tithing income had paid off all the church\u2019s loans. He even predicted that if the current rate continued, \u201cwe expect to see the day when we will not have to ask you for one dollar of donation for any purpose.\u201d<\/p>\n\n\n\n

Bust to boom<\/h2>\n\n\n\n

Donations only increased over the following decades, however, as the church continued to grow rapidly. The prosperity of the 1950s enabled an ambitious construction agenda<\/a> for the next decade, as the church built over a thousand new meetinghouses and temples for its exploding membership.<\/p>\n\n\n\n

Yet high spending, poor financial management and unwise or unlucky investments brought another financial crisis, and the church soon found itself cash-poor. By 1962, the budget had amassed a $32 million deficit. Leaders ceased offering detailed financial reports<\/a>, which had been inconsistent yet common staples at the church\u2019s General Conference.<\/p>\n\n\n\n

Things started looking up the next year when N. Eldon Tanner, a successful Canadian politician and businessman, joined the church\u2019s leadership<\/a> and modernized its financial structure<\/a>, investing any surplus. The church was once again on solid financial footing by the end of the 1960s, though it did not resume the release of detailed financial reports. Instead, Tanner empowered a private economic team to continue growing the faith\u2019s portfolio<\/a>.<\/p>\n\n\n\n

Decades of membership growth<\/a>, tithing donations and lucrative investments resulted in the modern church\u2019s massive accumulation of wealth. This financial success has enabled it to oversee a worldwide church with nearly 17 million members of record<\/a>, tens of thousands of employees and countless volunteer and charitable programs.<\/p>\n\n\n\n

\"A<\/a>
The Church of Jesus Christ of Latter-Day Saints\u2019 historic temple in Salt Lake City, Utah. George Frey\/Getty Images<\/a><\/figcaption><\/figure>\n\n\n\n

Its investments became so profitable in the early 2000s that, according to the SEC report<\/a>, church leaders explored ways to shield their success from the public. According to one whistleblower<\/a>, church authorities feared that greater transparency would discourage members from further tithing.<\/p>\n\n\n\n

Giving to God<\/h2>\n\n\n\n

While the church reports giving over $1 billion<\/a> in charitable aid last year, some members and observers alike critique leaders for not donating more, given the vast size of its investment portfolio, which is almost twice the size of Harvard\u2019s endowment<\/a>.<\/p>\n\n\n\n

The issue also raises important ethical questions regarding a religious institution\u2019s obligations toward its own members. Should Latter-day Saints, especially those who are struggling financially, still donate a tenth of their income to a church whose reserves are likely deep enough<\/a> to pay off more than a decade of expenses? The seeming discrepancy<\/a> between the transparency required of individual members and the church\u2019s own lack of accountability has unsettled some members.<\/p>\n\n\n\n

Yet many believers emphasize that their tithing\u2019s purpose is not merely to add to the church\u2019s coffers but to help build the kingdom of God \u2013 their donations are primarily offered for spiritual reasons, not worldly ones. And investments are also a safety net for the faith\u2019s growth: Leaders likely hope it can support rapidly growing membership<\/a> in lower-income countries.<\/p>\n\n\n\n

As absurd as it may be to call a $100 billion dollar portfolio a \u201crainy day\u201d fund<\/a>, the church\u2019s turbulent history may have led leaders to see it as just that.<\/p>\n\n\n\n

Benjamin Park<\/a>, Associate Professor of History, Sam Houston State University<\/a><\/em><\/p>\n\n\n\n

This article is republished from The Conversation<\/a> under a Creative Commons license. Read the original article<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Benjamin Park, Sam Houston State University During the first weekend of April 2023, the Church of Jesus Christ of Latter-day Saints will hold its semiannual General Conference in Salt Lake City. Tens of thousands of members will attend in person, with millions watching from home. Over two days, Latter-day Saints \u2013 often called \u201cMormons\u201d \u2013 […]<\/p>\n","protected":false},"author":44,"featured_media":33389,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[277,2450],"tags":[1829,13797,1724,1725,2973,6268,3050,6610,10927,13389,2047],"_links":{"self":[{"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/posts\/33388"}],"collection":[{"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/users\/44"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/comments?post=33388"}],"version-history":[{"count":1,"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/posts\/33388\/revisions"}],"predecessor-version":[{"id":33390,"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/posts\/33388\/revisions\/33390"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/media\/33389"}],"wp:attachment":[{"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/media?parent=33388"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/categories?post=33388"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/tags?post=33388"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}