The Economist finds messy finances in US Church

After an in-depth investigation of the finances of the Catholic Church in the United States, The Economist says its financial mismanagement and questionable business practices would have seen widespread resignations in any other public institution.

“Of all the organisations that serve America’s poor, few do more good work than the Catholic Church: its schools and hospitals provide a lifeline for millions. Yet even taking these virtues into account, the finances of the Catholic Church in America are an unholy mess,” the magazine says.

In a 4000-word article, The Economist says some parts of the church have indulged in “ungainly financial contortions” allegedly to divert funds away from uses intended by donors or to frustrate creditors with legitimate claims, including its own nuns and priests.

Sexual abuse settlements have led to a liquidity crisis, apparently encouraging a trend towards paying for the expansion and renovation of facilities through publicly raised debt rather than donations or contributions from the faithful.

Over the past eight years, eight dioceses in the US have declared bankruptcy. Often parishes that had commingled their funds with diocesan finances lost all their investments, even if they had been told it was being kept separate, and money was diverted from priests’ retirement funds.

The Economist estimates that annual spending by Church entities in the US was around $NZ210 billion in 2010 — 57% on health-care networks, 28% on colleges, 6% on parish and diocesan day-to-day operations, and 2.7% on national charitable activities.

The magazine says the American Church may account for as much as 60% of the Catholic Church’s wealth globally.

And it names Cardinal Timothy Dolan, Archbishop of New York, as “Manhattan’s largest landowner, if one includes the parishes and organisations that come under his jurisdiction”.


The Economist

Image: Baylor University

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News category: World.

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