[Editor’s note: Latter-day Saint Charities just released their 2019 Annual Report, available here.]

FairMormon has a service where questions can be submitted and they are answered by volunteers. If you have a question, you can submit it at http://www.fairmormon.org/contact. We will occasionally publish answers here for questions that are commonly asked, or are on topics that are receiving a lot of attention. The question below has been edited for brevity.

Question:

A recent article in the Wall Street Journal said that Ensign Peak Advisors has amassed about 100 billion dollars for the Church of Jesus Christ of Latter-day Saints over the years because of prudent investment. I applaud the fact that the Church is fiscally conservative and stays out of debt, however “hoarding” 100 billion dollars seems very excessive given the fact that there is so much poverty in the world. I am concerned that too little (percentage wise compared to the overall revenue) is being given to the poor and needy.

Answer from FairMormon Volunteer Sarah Quan:

Frankly, we don’t know enough about Ensign Peak as a general populace to really say one way or another. The issue is nuanced, and a single whistleblower report is not enough for us to draw a good conclusion about the church’s financial situation or intentions. In response to the WSJ article, Bishop Waddell commented that the budget for humanitarian aid has increased to close to a billion dollars in welfare per year.[1] Here are four doctrinal considerations to help us better understand the church’s position.

1 – The principle of self-reliance: donating large amounts of aid without the infrastructure to support and organize aid distribution often contributes to aid-reliance instead of self-reliance.

The mindset of church leaders about charitable donations can be summarized through this insight by Elder Wilford W. Andersen: “The greater the distance between the giver and the receiver, the more the receiver develops a sense of entitlement.” Elder Renlund expands on this: “This principle underlies the Church’s welfare system. When members are not able to meet their own needs, they turn first to their families. Thereafter, if necessary, they can also turn to their local Church leaders for assistance with their temporal needs. Family members and local Church leaders are closest to those in need, frequently have faced similar circumstances, and understand best how to help. Because of their proximity to the givers, recipients who receive help according to this pattern are grateful and less likely to feel entitled.”

One of the biggest tenets of the church is temporal and spiritual self-reliance, or “the ability, commitment, and effort to provide for the spiritual and temporal well-being of ourselves and of our families.”[2] Part of the reason the church seems conservative in its donations is they try to not donate to causes that would violate principles of self-reliance that the church teaches.

Critics of aid go so far as to argue that “sowing horror to reap aid, and reaping aid to sow horror…is the logic of the humanitarian era.”[3] I don’t think church leaders are that pessimistic, but I would imagine church leaders argue donating money takes away local job opportunities and potentially harms the economies of the places we are trying to serve by creating aid reliance instead of self-reliance. Pouring billions of dollars into charitable aid could create more havoc than it relieves. For instance, if you donate $100 to “poor children in x country,” some of that goes to corruption, and perhaps part of that goes to an aid organization factory that creates clothing or shoes. This can put local salespeople out of business because people get these goods from the charity instead of local businesses. Thus, the economy is harmed and greater aid reliance is created.

2 – The sacred nature of tithing funds

The church takes the injunction of carefully using the “widow’s mite” very seriously and wants to hold every dollar accountable and go directly to those in need.[4] Oftentimes, this results in careful monetary distribution and increased amounts of time donated.

The church views all donations as extremely sacred and won’t put money towards anything where they think waste might happen. The church may have the monetary means to make large changes, but perhaps does not have adequate manpower to ensure the aid is used wisely. Often, aid tends to be given to countries which have weaker institutions and consequently are more corrupt. People often take charitable donations for themselves and because the church views the funds as sacred, the church tries not to donate to anything that has the potential for corruption which results in the church holding onto much more money than it otherwise would.[5] One recent example is a not yet published World Bank paper that shows that after aid to a country increases, funds in offshore bank accounts in Switzerland also increase (by around 5%), indicating the money intended to help people does not reach its intended recipients.[6] One of the most recent high profile examples was in the aftermath of the 2010 Haiti earthquake. After the earthquake, millions of shocked onlookers donated money, donating around $13 billion, yet conditions in Haiti have barely improved, contributing to mass protests because conditions are still so poor.[7] Most of that money clearly never went to the people it was intended to go to.

To ensure the integrity of donation use, the church tries their hardest to hold every dollar accountable and donate directly to the people in need. This is much harder than simply giving large monetary donations. For instance, in some cases, the church donates trees instead of just giving money or food that can be stolen.

3 – Planning for the continuing restoration

Church leaders have overwhelming confidence and faith in the future of the church. The church’s financial planning is extremely long term and the church is planning far beyond next quarters’ earnings, this “presidency,” or even this generation. The prophets plan for the church to stick around past the Second Coming and saving funds shows they are serious about future growth of the church. The church is budgeting for when Israel is being gathered at a pace that far exceeds what we are doing today. President Nelson is often quoted as saying “it is much easier to build a temple than to build a people prepared for a temple.”[8] As we become a populace prepared for more temples and even more ready to serve and as the church expands in countries where the church’s financial demands exceed tithing donations, those tithing funds will become a much needed resource.

Bishop Waddell put it well when he said, “There will come a time when all of these resources, reserves, will be necessary. We don’t know when, we don’t know exactly in what form, but you think of the (Bible story of the) seven fat years and the seven lean years, there’s so many examples in the scriptures that we strive to follow, whether it’s the parable of the talents and not to bury the talent. We saw what the Lord did to that individual. We want to be ready for any contingency.”[9]

4 – Purpose of tithing

All this being said, tithing is not meant for charitable donations to the poor and needy. It is meant to build temples and meetinghouses, sustain the missionary program, etc.–at least as far as is revealed to us today. Maybe President Nelson will receive revelation that the tithing is to be used a different way, but as of right now the church is acting in accordance with revelation as far as we know.

Best,

Sarah

[1] https://www.deseret.com/faith/2020/2/14/21133740/mormon-church-finances-billions-presiding-bishopric-ensign-peak-tithing-donations-byu-real-estate

[2] https://www.churchofjesuschrist.org/study/manual/gospel-topics/self-reliance?lang=eng

[3] https://www.newyorker.com/magazine/2010/10/11/alms-dealers

[4] https://newsroom.churchofjesuschrist.org/article/use-of-the-lords-sacred-funds

[5] Of course, this issue is much more nuanced than this. There are many forms of corruption and some would argue some corruption is inevitable and some abuse probably still occurs with church donations.

[6] https://ftalphaville.ft.com/2020/02/17/1581940412000/The-World-Bank-paper-at-the-centre-of-a-controversy/

[7] https://www.npr.org/2015/06/03/411524156/in-search-of-the-red-cross-500-million-in-haiti-relief

[8] https://www.churchofjesuschrist.org/study/general-conference/2019/10/57nelson?lang=eng

[9] https://www.deseret.com/faith/2020/2/14/21133740/mormon-church-finances-billions-presiding-bishopric-ensign-peak-tithing-donations-byu-real-estate