Tuesday, July 9, 2013

Romney's Religion: The Mormon Corporate Empire

Romney's favorite "charity"

Recently, it was revealed that the vast majority of Mitt Romney's charitable donations have gone to the LDS Church.  According to Business Insider, in 2010, Romney took $3 million in charitable deductions on his tax return, 95% of which went to the LDS Church in one form or another.

According to Business WeekRomney and others at Bain Capital gave the Mormon Church millions in stock holdings obtained through Bain deals. Between 1997 and 2009, these included $2 million in Burger King and $1 million in Domino’s Pizza . Under U.S. law, churches can legally turn around and sell donated stock without paying capital-gains taxes, a clear advantage for both donor and receiver.  

Romney and his religion seem well-suited.  In a June 2011 cover story, Newsweek magazine stated that the LDS Church "resembles a sanctified multinational corporation—the General Electric of American religion, with global ambitions and an estimated net worth of $30 billion."  That estimate is probably low given the church's aversion to revealing its financial records.  The LDS Church has not publicly disclosed its financial statements in the United States since 1959, although it does so in Canada and the UK where such disclosure is required by law.  The PBS special 'The Mormons' estimated the LDS Church's worth at over $80 billion.  Other estimates have placed it in excess of $100 Billion, as it is the wealthiest per capita religion in the world with annual, mostly tax-free revenues estimated to be $6 billion per year (per Time Magazine in 1997).  

How does the LDS Church make its money?

Like most religions, the LDS Church receives donations from its members.  Mormons are required to pay 10% of their income to the LDS Church in order to remain in good standing. In fact, each Mormon must account for their tithing payments in an annual "tithing settlement," and any shortfall must be paid in order to continue to receive the benefits of full fellowship (including being able to attend the weddings of their children in Mormon temples).

The Mormon church is not above fleecing its poorest members. Recently, a prominent Mormon leader, in a speech delivered worldwide to the church membership titled "Tithing--a Commandment Even for the Destitute," stated:
One of the first things a bishop must do to help the needy is ask them to pay their tithing. Like the widow, if a destitute family is faced with the decision of paying their tithing or eating, they should pay their tithing
The Mormon church also makes a great deal of money on for-profit enterprises originally funded by tithing donations.  As noted by Business Week, first among its for-profit enterprises is Deseret Management Corporation (DMC), which reaps estimated annual revenues of $1.2 billion from six subsidiaries. Those subsidiaries run a newspaper, 11 radio stations, a TV station, a publishing and distribution company, a digital media company, a hospitality business, and an insurance business with assets worth $3.3 billion.  DMC has been 2,000 and 3,000 employees.

What does the LDS Church do with its money?

I previously discussed in "What would Jesus do with $5 billion" the construction by the LDS Church of a shopping mall and residential complex in Salt Lake City.  For a while, this was one of the largest construction projects in America.  

In addition to its mall-building ambitions, the LDS Church owns some 928,000 acres in North America, is the largest ranch land owner in Wyoming, is the 2nd largest land owner in Nebraska, has the largest cattle ranch in 48 states (adjacent to Disneyworld in Florida), and is the largest foreign landowner in the UK.

The LDS Church's holdings also include:

  • AgReserves Inc. - the largest producer of nuts in America. Outside the U.S., AgReserves operates in Britain, Canada, Australia, Mexico, Argentina, and Brazil. Its Australian property, valued at $61 million in 1997, has estimated annual sales of $276 million, according to Dun & Bradstreet. 
  • Hawaii Reserves, Inc. - Miscellaneous church holdings in Hawaii (including 6,000 prime acres on the North Shore of Oahu), the Polynesian Cultural Center (the leading paid visitor attraction in Hawaii), and Brigham Young University-Hawaii.  At the Polynesian Cultural Center (PCC),  general-admission adult tickets cost $49.95; VIP tickets cost up to $228.95.  In 2010, the PCC had net assets worth $70 million and collected $23 million in ticket sales alone, as well as $36 million in tax-free donations
  • Farmland Reserve Inc. - 228,000 acres (923 km²) in Nebraska; 51,600 acres in Osage County, Oklahoma 
  • Deseret Cattle and Citrus - over 312,000 acres (1,260 km²) in Florida
  • Bonneville International Corporation - the 14th largest radio chain in the U.S.
  • Deseret Morning News - a daily Utah newspaper, second-largest in the state of Utah.
  • Beneficial Financial Group - An insurance and financial services company with assets of $3.1 billion. 

How much actual charity does the LDS Church provide?

As I noted in "How atheists (and everyone else) subsidize religion in the United States," the LDS Church donated a relatively insignificant $1 billion to charitable causes in the 23 year time span between 1985 and 2008, which accounts for 0.7% of the church's income.   By contrast, the American Red Cross spends 92.1 percent of its revenue directly addressing the physical needs of those it intends to help; only 7.9 percent is spent on “operating expenses." I suppose the Mormon church might believe that spreading its racist, homophobic, and sexist message is a form of "charity," but I beg to differ. 

In what possible world does it make sense for an organization with assets on par with a large Fortune 500 company, which gives less than 1% of its "earnings" to charity, to be given all of the tax breaks discussed in my article? It truly is unconscionable.

1 comment:

  1. Clearly, it’s only gotten worse in the decade or so since the Time cover story was published.
    Exhibit A of where your treasure is, there will your heart be also: http://www.businessweek.com/articles/2012-07-10/how-the-mormons-make-money#p1