Teancum Posted March 25, 2024 Posted March 25, 2024 18 hours ago, LoudmouthMormon said: k $1.3 billion is a wonderful number. It is a small number compared to the massive amount of wealth the church is accumulating.
smac97 Posted March 25, 2024 Author Posted March 25, 2024 (edited) 1 hour ago, Teancum said: So 5% is feckless. Right? The proposal for the Church to necessarily and reflexively spend 5% of its principal, with no regard for the effectiveness and wisdom of such expenditures, is feckless. 1 hour ago, Teancum said: Though it is a number that is routinely used as a best practice. It's "routinely used" because it is a guideline for private foundations issued by the IRS in 1981, and has since become entrenched and rationalized and labeled in some quarters as a "best practice" for non-profits. But is it? See, e.g., here: Endowments should rethink the 5% rule Quote For decades, most endowments and foundations have lived by the 5% payout rule, safe in knowing that such prudent spending safeguarded their financial health. However, with markets changing, many endowments find adhering to a government rule that demands how much of a portfolio must be spent annually to maintain tax-exempt status no longer makes sense. The 5% payout guideline was instituted in 1981 by the IRS. While it applies only to private foundations, it was broadly adopted by most non-profit organizations as a sensible baseline for spending. Now, it is the most widely used spending percentage by institutional investors today, setting the return they must exceed annually to ensure the endowment grows. If you have studies or evidence demonstrating the feasibility and coherence of the 5% rule as an organic principle, please provide it. Otherwise, it looks suspiciously like a "guideline" from the State as to private foundations that has morphed into a quasi-fiat for non-profits. Quote Employing a 5% spending policy means an organization must achieve a return of 5% plus the rate of inflation to preserve the portfolio's purchasing power and support the organization in perpetuity. Over much of the past 90 years, this has not typically been an issue. A decade ago, when cash was valuable, the 5% rule made sense. Endowments could make 4% annually on cash and use those funds as collateral for trading, making another 4% from investments such as U.S. Treasuries, top-rated municipal bonds and A-list dividend stocks. That conservative formula was a low-risk strategy to generate annual returns of 8% with ease. However, with the return on cash near zero for years, if an endowment generates only 4% profit from trading, it would shrink if spending stayed at 5%. Adjusting expenditures to address for market conditions and other real-world circumstances sure makes a lot of sense. Quote Market conditions now make the 5% rule problematic. According to the Wilshire Trust Universe Comparison Service, on average, U.S. endowments returned -0.74% for the year ended June 30, after returns of 2.8% for the 12 months ended June 30, 2015. While this fiscal year has definitely started off much better through Feb. 28, the three-year returns will be a far cry from the double-digit gains of the recent, post-recession, past. "Market conditions now make the 5% rule problematic." This article was written in 2017. Have economic conditions gotten better or worse since then? Has this article become more or less relevant in the ensuing years? Quote Many experts believe strong stock market returns have been inflated for the past seven years by low interest rates and the quantitative easing policies of global central banks. However, due to a number of factors — including current equity market valuations, current long-term interest rate levels and the likelihood that the U.S. Federal Reserve will have a more normalized interest rate policy in the future — many experts expect lower returns on stocks over the coming decade and weak returns for bonds and cash equivalents. That means the sensible move for most endowments is to budget appropriately for the realistic rate of return that can be earned on assets at this point in the market cycle. "{T}he sensible move for most endowments is to budget appropriately for the realistic rate of return that can be earned on assets at this point in the market cycle." What are your thoughts about this? Quote Review needed Investment committees should revisit spending policies, overall investment policies and their strategic asset allocations. That review will lead investment committees to opt for one of three options: Increase risk for higher returns. Reducing allocations to safer assets (such as investment-grade bonds) and into riskier assets (stocks), can increase a portfolio's expected long-term return. More risk does not automatically yield higher returns (especially in the short term), but it increases the probability of higher returns over the long run. It also exposes a portfolio to higher volatility and larger drawdowns in bear markets. Accept lower returns. For institutions with portfolios that have built a financial cushion above the core endowment value needed to keep the institution sustainable, investment committees might decide to stick with their existing investment policy and ride out years of lower expected returns in the hope investment gains eventually will return to historical averages. This option won't work for institutions that don't have an excess fund balance. Cut spending. Many committees overlook this option because it comes with the negative connotation of reducing the benefit to the organization. However, research shows lower spending benefits the longevity of an organization. A comparison of cumulative spending over 50 years of two identical portfolios, one with a 4% spending policy and one with a 5% spending policy, shows that after 42 years, the portfolio spending less generates more cumulative income because more assets are left in the portfolio and allowed to compound. This stuff makes sense to me. Much more than a rote 5% mandate (which, again, originated in 1981 as a "guideline" from the IRS, and has since morphed into a quasi-fiat for non-profits). Quote With lower expected capital market returns likely ahead, more and more institutions might find it difficult to fulfill their existing spending policies. While some investment committees might be tempted to increase portfolio risk or attempt to ride out the coming period of lower returns, for organizations not legally obliged to spend 5% of their portfolio each year, spending less might be the smart decision. Organizations that can find a way to reduce their spending levels now will ultimately position themselves for a stronger future. Well? Does this affect your perspective at all on the 5% proposal? Why or why not? You and Roger may think the Church ought to base expenditure decisions based on rote observance of an IRS rule for private foundations that has been, in some quarters, applied to or become expected of non-profits. I think reasonable minds can have differing perspectives on that. Here's an interesting article from 2010 by Burton Weisbrod and Evelyn D. Asch: Endowment for a Rainy Day Quote If the purpose of an endowment—that is, of holding down current expenditures in order to save for the future—is to limit tuition, hospital patient charges, or museum admission fees later, then the issue is one of intergenerational transfers. The holding, let alone the expansion, of endowment is a matter of weighing the relative importance of today’s and tomorrow’s users. With long-term economic growth of per capita income a virtual certainty, however, it is not clear why the present generations of college students, patients, and museum goers should pay higher charges and fees in order to preserve or expand endowment so that future generations of wealthier people will benefit via lower prices. Hmm. So institutions need to be thinking in "intergenerational" terms. Quote The primary goal of a college endowment should be to protect a school’s educational and research programs. Similarly, a hospital’s goal should be to treat patients and advance medical research. A museum’s goal should be to advance cultural education and preserve cultural heritage. Building an endowment is a means to sustain these programs. Hmm. So the purposes and objectives of an endowment vary according to the purposes and objectives of the institution. Quote It should not be the goal of the programs to protect the endowment, cutting them back to sustain or rebuild the endowment. “In conversation with our donors, their motive was to support the university, not to grow the endowment,” observed Sandy Wilcox, president of the University of Wisconsin Foundation.8 The basic rationale for adding resources to endowment rather than using them to achieve these immediate goals is simple: to save for a rainy day when revenue falls sharply. Hmm. "Rainy day" seems to be a descriptor for the same concept for which you use epithets like "hedge fund" and "hoarding." Quote Every nonprofit will, at some time, encounter a situation that is beyond its control and that has an immediate and substantial impact on its operations. It might be a natural disaster, like an earthquake or fi re, or it could be a financial collapse, such as the one that the world is currently undergoing. Nonprofits that have held money in reserve for just these sorts of situations—a rainy day fund—will be better able to weather these storms than those nonprofits that did not prepare. Hmm. I wonder if this can also be said about the Church of Jesus Christ of Latter-day Saints. Quote The principal motive for saving for the future rather than spending now is the same, whether for individuals or organizations, nonprofit or for-profit—uncertainty about the flow of future revenues. Hmm. I wonder if this can also be said about the Church of Jesus Christ of Latter-day Saints. Relatively speaking, the Brethren live decidedly modest, non-profligate lives. They have access to literally billions of dollars. They are in positions of authority which could allow them to allocate substantial portions of those funds to themselves. And yet . . . they are not doing this. Our leaders are by no means perfect. They make mistakes. They are human. But in terms of the financial management of the Church, they seem to be doing a very good job. I bring this issue up often because it tends to belie the implication - and even outright accusations - that the Church is greedy or unduly parsimonious. The Brethren are, cumulatively speaking, pretty smart, and they are not acting in their own best interests. I think they have in mind the long-term survival of the Church. And while our critics don't really care about that stuff, I am glad the Brethren are paying attention to it. Quote Endowment is not simply a sum of assets that is determined by outside forces. It is, instead, a fund that nonprofits have a great deal of control over. It is a mistake to assume that a school’s endowment is determined by donors’ decisions to require that most of their contributions be retained and only a small percentage of their yield be spent. Rather, hospitals, symphonies, colleges, and other nonprofits decide how much of their income from all sources to spend and how much to save. They decide how much revenue to generate via tuition, patient fees, or ticket sales, and how much to cut into that revenue by granting student financial aid, providing charity care, or giving free performances. They decide how much to spend on developing alumni giving or corporate gifts, on lobbying legislators for government grants, and on building luxury skyboxes at their football stadiums. We do not claim that nonprofits can have whatever endowment they want—only that they have significant control over how much they save for the future and how much they spend now. Contrary to common belief, there is no legal minimum or maximum amount that nonprofits must withdraw (payout rate) from their endowment each year. (Foundations are required to take a 5 percent payout rate.) The commonly used payout rate of 4.5 percent is chosen by the trustees, not by external authorities. Endowment can grow more rapidly if a school gives less fi nancial aid, if it drops unprofitable initiatives such as specialized science programs requiring costly laboratory facilities that bring in little grant revenue from government or private sources, or if it replaces expensive tenure-track faculty with cheaper adjunct and lecturer faculty. Or, endowment can grow more slowly, or even decline, if the school chooses to spend more money on current educational and research programs. "It is a mistake to assume that a school’s endowment is determined by donors’ decisions to require that most of their contributions be retained and only a small percentage of their yield be spent. Rather, hospitals, symphonies, colleges, and other nonprofits decide how much of their income from all sources to spend and how much to save." I think something similar can be said about the Church of Jesus Christ of Latter-day Saints. Quote Protection against a rainy day need not be the only reason for creating an endowment, but it should surely be a major reason. Real incomes will rise over the years, so nonprofits can, in general, look forward to increased revenue from donations and user fees. Squeezing today’s students, patients, and museumgoers to save money for future generations of users is misguided. But building endowment is not misguided if it is used as rainy day insurance, to preserve the stability and long term development of programs central to a nonprofit’s mission. The hard questions are these: “How large an endowment is enough?” and “What is the appropriate balance between spending now and saving for the future?” We do not have the answers to these questions. Indeed, we think there is no single answer, but we do see a number of issues that deserve careful attention by researchers, nonprofit managers, and public policy leaders. Because nonprofit organizations benefit handsomely from tax breaks on endowments—paying no tax on either the dividend and interest yields or the capital gains—society is justified in asking how much is enough. Should “enough” be measured by size of endowment or, as we prefer, by size of rainy day fund? The substantive question is how much saving by nonprofits should be encouraged. ... In today’s depressed economy, nonprofits are hurting. Falling college endowments have garnered the lion’s share of publicity, but hospitals, museums, foundations, and other nonprofits are suffering in similar ways. What can one learn from these experiences? Nonprofits with sizable endowments must understand that if they succumb to the attraction of riskier and less liquid investments in pursuit of higher returns, they should be prepared to deal with the inevitable fiscal rainy days. Nonprofits with endowments should be willing to spend down their endowment to sustain program expenditures. And those nonprofits that have little or no endowment need to find ways of diverting some of their even limited revenues to creating a rainy day endowment fund, because this is not the last rainy day "Protection against a rainy day need not be the only reason for creating an endowment, but it should surely be a major reason." Should this principle apply to the Church? "{B}uilding endowment is not misguided if it is used as rainy day insurance, to preserve the stability and long term development of programs central to a nonprofit’s mission." Should this principle apply to the Church? "The hard questions are these: 'How large an endowment is enough?' and 'What is the appropriate balance between spending now and saving for the future?' We do not have the answers to these questions. Indeed, we think there is no single answer, but we do see a number of issues that deserve careful attention by researchers, nonprofit managers, and public policy leaders." Are these questions "hard" when applied to the Church? Is there a "single answer" (such as your and Roger's "5%" proposal)? "{S}ociety is justified in asking how much is enough. Should 'enough' be measured by size of endowment or, as we prefer, by size of rainy day fund? The substantive question is how much saving by nonprofits should be encouraged." Weisbrod and Asch advocate a focus on saving, whereas you and Roger advocate a focus on spending. Which focus ought to be preeminent? "Nonprofits with sizable endowments must understand that if they succumb to the attraction of riskier and less liquid investments in pursuit of higher returns, they should be prepared to deal with the inevitable fiscal rainy days." Should the Church, with its many millions of members spread throughout the world, also prepare for "inevitable fiscal rainy days?" Or should it just reflexively spend a fixed percentage of its reserve because the IRS created it as a "guideline" for private foundations in 1981? "Nonprofits with endowments should be willing to spend down their endowment to sustain program expenditures." The Church is fortunate in that it can presently "sustain program expenditures" without needing to "spend down {its} endowment." And again, the Church is "not primarily a humanitarian organization. We are the Church of Jesus Christ, reestablished or restored upon the earth in the latter days in preparation for the Second Coming of the Lord Jesus Christ." 1 hour ago, Teancum said: And it is a statutory number that Private Charity Foundations are required to pay out to charities to maintain their tax exempt status. A few thoughts and observations and questions here: 1. The 5% payout requirement is mandated by the Internal Revenue Service (IRS) regulations under Section 4942 of the Internal Revenue Code. 2. Public charities, on the other hand, are generally funded by a broader base of support from the public and typically have a more diverse governance structure. While public charities are subject to other requirements and regulations under the tax code, such as those outlined in Section 501(c)(3), they are not subject to the same minimum distribution rules as private foundations outlined in Section 4942. Instead, public charities must ensure that they operate exclusively for charitable purposes and avoid activities that could jeopardize their tax-exempt status. 3. The Church of Jesus Christ of Latter-day Saints is a tax-exempt organization that is not subject o the spending requirements of Section 4942 of the Internal Revenue Code. 4. Have you publicly disparaged other non-profit entities which do not voluntarily comply with Section 4942 of the Internal Revenue Code? I suspect the answer to this question will be "no," but that you will not directly answer it. 5. Are you in the habit of voluntarily complying with spending provisions in laws that do not apply to you? Do you follow the 5% payout provision under Section 4942 of the Internal Revenue Code? I suspect the answer to this question will be "no," but that you will not directly answer it. 6. Assuming that you do not follow the foregoing 5% payout provision, you are demanding that the Church adhere to a standard that you do not apply to yourself. Is this correct? I suspect the answer to this question will be "yes," but that you will not directly answer it. 1 hour ago, Teancum said: But it is feckless and facile and so in just because SMAC thinks it is. Doo your think your silly, ludicrous, disingenuous, specious hyperbole is convining? I think you are too entrenched in your negative perspective on the Church to be willing to reconsider your position. I hold the same assessment of Roger. I don't know about Pogi. However, I think there may be readers in this thread who are not as entrenched as you, who are willing to evaluate their perspectives on the Church, particularly as to complex and difficult topics like its efforts in international humanitarian relief, and perhaps grant it some measure of credit, and grace, and patience, and maybe even support and admiration. The Church ain't perfect, but it's really good. I love it a lot. I think its members and leaders are working hard to make the world a better place. I think those who endlessly disparage it, who regularly cast it in the worst possible light and impute to it the worst possible motives, are doing a disservice to themselves, to the family of man, and even to themselves. They are fomenting cynicism and ill will against an organization that, while flawed, is pretty clearly a wonderful institution overall. Thanks, -Smac Edited March 25, 2024 by smac97
smac97 Posted March 25, 2024 Author Posted March 25, 2024 13 hours ago, ZealouslyStriving said: Seeing the writings of our resident ex-Mo crowd, this Brigham quote is quite prophetic: "As soon as you are overcome by the spirit of the world, you forget every good deed and kindness that has been extended to you, and you only remember the transpiring and infliction of what you deemed to be evil. You imagine a thousand things to be evil that would have resulted in good, had you done right. Can you believe that? “O, yes.” Those who have apostatized and left, cannot recollect a kindness that I have done them, but I can say to the praise of a few Gentiles, who have passed through here, they have recollected the kindnesses done to them by this people. Almost universally, after having received the greatest kindnesses they ever received, apostates and some Gentiles after they leave these valleys, vividly remember and proclaim, from Dan to Beersheba, Judg. 20:1 every fancied injury." I think I have some sense of understanding and empathy (if not "sympathy") for former or estranged Latter-day Saints. They have previously given much to the community of Saints, and have thereafter become estranged from it for a variety of reasons. The estrangement often involves justification or explanation (if only in the individual's mind), which in turn leads to a tendency to cast the Church in the worst possible light, impute to it the worst possible motives, etc. Thereafter the individual may cultivate sentiments of betrayal (by the Church) and allocate blame and fault (on the Church), such that the individual's perspective on the Church makes it (the Church) end up looking, skewed and warped, with all of its flaws made to look exaggerated and grotesque, and most or all of its virtues to be subdued or hidden. The folks I have a hard time understanding are those who have never been in the Church, but nevertheless harbor substantial and vocal and ongoing resentments and criticisms of it. Thanks, -Smac
SeekingUnderstanding Posted March 25, 2024 Posted March 25, 2024 (edited) 25 minutes ago, smac97 said: The proposal for the Church to necessarily and reflexively spend 5% of its principal, with no regard for the effectiveness and wisdom of such expenditures, is feckless. Which no one is suggesting. 25 minutes ago, smac97 said: 1 hour ago, Teancum said: Though it is a number that is routinely used as a best practice. It's "routinely used" because it is a guideline for private foundations issued by the IRS in 1981, and has since become entrenched and rationalized and labeled in some quarters as a "best practice" for non-profits. But is it? See, e.g., here: Endowments should rethink the 5% rule This would be an interesting counterpoint if the church was spending say 3.5 percent and wanted to justify it. But last I checked, our best information says the church is spending 0 percent each year of its endowment on any purpose. Indeed, they are doing the reverse - adding tithing funds into the endowment. If you have better information than that, I’d love to hear it. Edited March 25, 2024 by SeekingUnderstanding 1
pogi Posted March 25, 2024 Posted March 25, 2024 (edited) 2 hours ago, smac97 said: Neither he nor you are willing to answer basic questions about your demands of the Church. Again, this is a misrepresentation (man, you are good at that!) I am perfectly willing to answer basic questions. In fact, I clearly and specifically stated that I "would love" to respond to your post. So, why do you misrepresent me here, stating that I am not willing? I am perfectly willing, when you become willing to respect the very reasonable condition that I have placed. You are the one that seems unwilling. When you belligerently and relentlessly mischaracterize me and my position after receiving clear and unwavering explanations as to where I stand on the issue of "just throwing money at it", then it becomes a waste of breath because you will just twist what I say in order to preserve your unfriendly biased perspective of me. No thanks. I'll save my breath for people who are not intent on maligning my motives and position. Because I don't answer your questions, has nothing to do with the questions and everything to do with the behavior of who is asking. Also, I am not "demanding" anything of the church. I am simply asking questions about claims of that don’t add up to me. Edited March 25, 2024 by pogi 2
Teancum Posted March 25, 2024 Posted March 25, 2024 13 hours ago, smac97 said: Do I get to dictate to you what your humanitarian budget/goal is? And do I get to publicly berate you if you do not comply with my expectations? When we are a corporation that has tax exempt status and claims to to be to be the Church of Jesus Christ, and expects it members to donate substantial time and money to said church, while at the same time not being transparent with the members who make the donation, then you have an argument. Talk about a feckless and facile argument.
Teancum Posted March 25, 2024 Posted March 25, 2024 13 hours ago, smac97 said: The Brethren have made public statements about the Church's investment strategy for a few decades now. CFR where the church voluntarily disclosed the amount of wealth it was accumulating. 1
Teancum Posted March 25, 2024 Posted March 25, 2024 10 hours ago, Calm said: What is wrong with the Church doing the same that it has been doing, only casting a wider net, vetting more opportunities? There are likely an infinite number of opportunities out there and highly likely they could find a way to spend several billion more in the same way. They would likely have to expand their humanitarian department, expand their outreach, possibly increase their own presence in areas where there are gaps. But if they put a 1000 people to work where they only had 100 in vetting and overseeing efforts to identifying opportunities to help using the same process, why couldn’t they reach that goal? ANd this really has been my point all along. Why @smac97demands what seems tantamount to some major detailed business plan is beyond me. I am discussing conceptual issues. But if the church is offering me a job to help develop a plan to increase and vet organizations it can work with to increase humanitarian aid then I would be interested. 😁 I don't know that on a discussion board I am obligated to provide such a detailed plan. I though @Analytics5% of assets annually was a reasonable goal to plan and work towards. How to get there I do not know and I don't have access to the behind the scenes detail to even begin to plan out something like that. But the 5% annually is codified in the Internal Revenue Code for private foundations and it is used by many organizations with large endowments in deploying their assets. Why @smac97seems so incredibly hostile and even angry at such a suggestion is beyond me. So that is my position above, for the record. I do not advocate just throwing $$ at problems. I never have. I acknowledge it is difficult work and should be approached cautiously and carefully. I think the church has a lot of smart people who can help accomplish such a goal. I commend the church for beginning to increase what they do with humanitarian aid and relief while at the same time hoping they can do more given their vast resources. Maybe they are already doing that in plan to continue to grow such efforts. 3
pogi Posted March 25, 2024 Posted March 25, 2024 (edited) 2 hours ago, Teancum said: CFR where the church voluntarily disclosed the amount of wealth it was accumulating. Or, where they voluntarily disclosed the strategy to create shell companies to hide their earnings that they were legally obligated to disclose to the government and the public. Edited March 25, 2024 by pogi 1
smac97 Posted March 25, 2024 Author Posted March 25, 2024 13 minutes ago, SeekingUnderstanding said: Quote The proposal for the Church to necessarily and reflexively spend 5% of its principal, with no regard for the effectiveness and wisdom of such expenditures, is feckless. Which no one is suggesting. Roger/Analytics: Quote I believe that EPA ought to be taxed as a private foundation. In short, the U.S. government expects foundations to use their assets to benefit society and it enforces this through section 4942 of the Internal Revenue Code, which requires private foundations to distribute 5% of the fair market value of their endowment each year for charitable purposes. Teancum: Quote Quote Critics think that the Church ought to be distributing "more" of the funds generated from EPA's holdings. How much "more" is seldom specified or explained. How about 5% of ist assets per year? Roger/Analytics: Quote The 5% Rule Here are some sources that address that question. Investopia says "Some endowment funds have guidelines stating how much of each year's investment income can be spent. For many universities, this amount is approximately 5% of the endowment's total asset value." BYU Professor Aaron Miller says in Meridian Magazine "Many private foundations annually distribute the minimum 5% of their total assets, making endowments equal to 20 times an annual budget very common." Of course sophisticated financial people like to adjust the rules to fit their specific circumstances, and some examples of organizations that distribute something other than 5% include: University of Colorado: "On July 1 each year, 4 percent of the endowment’s fair market value as of the prior December 31 is distributed for spending in support that scholarship program." Harvard: "As a general rule, Harvard targets an annual endowment payout rate of 5.0 to 5.5% of market value." ... As I hope you can tell, I've spent a few hours researching this. I'll go on record as saying that I'd find any spending rule that is broadly in harmony with any of these rules to be perfectly commendable by the Church. I've suggested the simple "5% payout guideline" because of its simplicity and coherence. "I've suggested the simple '5% payout guideline' because of its simplicity and coherence." Roger/Analytics: Quote Come up with a plan to give away about 5% of the balance of their rainy day fund a year. Teancum (summarizing Roger) : "Do 5% per year for humanitarian aid." Teancum: Quote Your argument is really rather hollow and specious. Essentially for you it is God's fault that the LDS leaders are continue to grow the wealth of the Church rather than say putting 5% of EPA funds towards relieving human suffering. Roger/Analytics: Quote To put this into perspective, a general rule of thumb is that on an annual basis, endowments should spend 5% of their principal on their philanthropic mission, and leave the remainder to grow with interest. To the extent investment returns average at least 5%, this level of giving will allow the endowment to last into perpetuity without another dime of new contributions. ... To get in line with the general rule of thumb for how respectable endowments achieve a balance between accomplishing their mission now and and into the future, the Church would need to increase its annual spending by about $8 billion a year. Teancum: Quote Quote You have been advancing this "general rule of thumb" of "spend{ing} 5% of their principal on their philanthropic mission" for quite a while now. I find it facile and unreasonable when you propose that it be deployed on the scale at which the Church and its finances operate.... As an example, let's compare the Church to Harvard University. Harvard University has about $72.7 Billion in financial assets, which might be about half of what the Church now has. Its total operating expenses are about $5.4 billion, which might be about a billion less than what the Church spends each year on its religious, educational, and philanthropic missions. In its 2022 financial report, Harvard University says "As a general rule, Harvard targets an annual endowment payout rate of 5.0 to 5.5% of market value." ... Should the assets the Church has saved in Ensign Peak advisors be considered general reserves, or should they be considered an endowment? (If they are just "reserves", then a general rule of thumb is that they should be limited to about 1-2 years of expenses, e.g. they should be limited to about $10-15 billion. If they are endowment, then about 5% of the principal should be used to fund its mission on an annual basis. Roger/Analytics: Quote Quote You have been advancing this "general rule of thumb" of "spend{ing} 5% of their principal on their philanthropic mission" for quite a while now. I find it facile and unreasonable when you propose that it be deployed on the scale at which the Church and its finances operate.... As an example, let's compare the Church to Harvard University. Harvard University has about $72.7 Billion in financial assets, which might be about half of what the Church now has. Its total operating expenses are about $5.4 billion, which might be about a billion less than what the Church spends each year on its religious, educational, and philanthropic missions. In its 2022 financial report, Harvard University says "As a general rule, Harvard targets an annual endowment payout rate of 5.0 to 5.5% of market value." ... If they are endowment, then about 5% of the principal should be used to fund its mission on an annual basis. Roger/Analytics: Quote It's wonderful that the Church donated $10 million to a charity. If they followed Harvard University's example and set the goal of giving away 5% of the principle in their endowment on an annual basis, they could give deserving causes $10 million a day, twice a day, every workday of the year, into perpetuity. Roger/Analytics: Quote If a hedge-fund pretends it's a charity but doesn't do any charitable work, then it should be taxed as a hedge-fund, not a charity. If it wants to avoid taxes, just spend some of its money on something charitable. The law currently says 5%. Asking a "charity" with $100,000,000,000 in the bank and that makes $8,000,000,000 a year in income to spend a paltry $5,000,000,000 on doing some good in the world is a small ask in exchange for the tax-preferred status it somehow feels entitled to. Roger/Analytics: Quote The IRS doesn't want billionaires to dodge taxes by "donating" to private foundations that don't actually donate any money to charitable purposes. Because of that, there is a rule that says they must donate 5% of their principle to charity every year, otherwise it will be taxed on its investment income. If EPA doesn't want to donate 5% of its principal to charity purposes it doesn't have to, but it should be required to pay taxes on its income, just like any other hedge fund. Me (responding to Teancum on 11/16/23) : Quote Quote No it is not. It is a straw man. And now a lie. One of the nice thing about thread discussions such as this is that the reader can go back and review our conversation, what you have said, what I have said. I think I have established that, regarding your 5% proposal, which AFAICS you have never qualified or conditioned the 5% proposal on any consideration of the actual efficacy of such disbursements, or the competency and integrity of the recipients of such funds. ... Quote You insert this constantly in your arguments. It is something neither of us have said. You need to stop lying about it. "Just Throw Money At It!" is a pithy restatement of your feckless 5% proposal. It's a facile and unreasonable position to take. You could, of course, rebut it by showing us where you have qualified or conditioned the 5% proposal on any consideration of the actual efficacy of such disbursements, or the competency and integrity of the recipients of such funds. But at this point, it's pretty clear that you have not done this. I know it. You know it. The readers of this thread know it. So in the end, all you have an unadorned, unqualified declaration that the Church should should reflexively donate a percentage of its accumulated wealth, amounting to many billions of dollars, on an annualized basis, and it should do so with no regard for or consideration of the actual efficacy of such disbursements, or the competency and integrity of the recipients of such funds. I think I now understand why you are refusing to address this. Two reasons. First, your 5% proposal really is as facile and unreasoned as it looks, which makes your advocacy of it look bad. Second, you can't qualify or condition or your 5% proposal because as soon as you do, you are effectively conceding one of the points I have been making for quite a while, which is that responsible deployment of the Church's wealth in humanitarian efforts necessarily requires prudent and examination and "vetting" of projects, partners, and so on. And as soon as you concede that, our positions only differ in degree. You are blithely and summarily throwing out silly declarations about how all the Church needs to do to successfully utilize many billions of dollars annually is to - in your words - "find the talent needed to accomplish such things in a proper and helpful way." ... Quote SO CFR to you that either of us have ever said or argued this. See above. "Do 5% per year for humanitarian aid." "rather than say putting 5% of EPA funds..." "How about 5% of ist assets per year?" "then about 5% of the principal should be used to fund its mission on an annual basis" "a general rule of thumb is that on an annual basis, endowments should spend 5% of their principal on their philanthropic mission" "distribute 5% of the fair market value of their endowment each year for charitable purposes..." "a plan to give away about 5% of the balance of their rainy day fund a year." "set the goal of giving away 5% of the principle in their endowment on an annual basis..." "The law currently says 5%." "there is a rule that says they must donate 5% of their principle to charity every year..." "If EPA doesn't want to donate 5% of its principal to charity..." You and Roger have, AFAICS, never qualified or conditioned your 5% proposal. Quote In fact I have said the opposite of this. Then quit being coy and provide some links. Quote I have argued that the church could set up a group of smart people to deploy its potentially larger humanitarian aid in a responsible and helpful way and in a way where it could have the most impact. This is the functional equivalent of some politician saying "We should abolish the IRS and income tax! We can do this by setting up a group of smart people to, um, figure it out! And we can do this in a responsible and helpful way and in a way where it could have the most impact!" I am reminded of Vizzini in The Princess Bride as the boat he, Inigo, Fezzik and Buttercup are in is being pursued by the Man in Black in another boat: Quote INIGO: Look! He's right on top of us. I wonder if he is using the same wind we are using. VIZZINI: Whoever he is, he's too late -- (pointing ahead of them) -- see? The Cliffs of Insanity! (In a wild race for the Cliffs and the Man In Black is closing faster than ever, but not fast enough, the lead was too great to overcome, and as Inigo sails with great precision straight at the Cliffs.) Vizzini: Hurry up! Move ... the thing! And ... that other thing! Your blithe and absurdly simplistic proposal is that the Church should reflexively and automatically donate a set percentage of its reserves - 5% - every year, amounting to many billions of dollars, and that it should do this by "set{ting} up a group of smart people" and "find{ing} the talent needed to accomplish such things in a proper and helpful way." This is the functional equivalent of "Move ... the thing! And ... that other thing!" You have made an extraordinary and bombastic proposal, but you have nothing substantive or meaningful to say about how to implement it. Just vague and airy references to "set up a group of smart people" and "find the talent needed to accomplish such things in a proper and helpful way." However, i will nevertheless tweak my restatement of your position. For you, it's "Just Throw Money At It! Set up a group of smart people! Find the talent needed to accomplish such things! Do all this in a proper and helpful way! Do . . . the thing! And . . . that other thing! You just don't care about human suffering!" Yes, I am ridiculing your proposal, because what you have proposed, and how you have proposed it, is ridiculous. Unserious. Feckless. Facile. Unreasoned. Moreover, your proposal presupposes that the Church is not trying to meaningfully utilize its wealth to alleviate human suffering, and that there are no actual complexities and difficulties involved in administering the Church's humanitarian efforts on an international scale. . So your commentary is not only unreasoned and absurd, it's also mean-spirited and ignorant. To his credit, Teancum responded: Quote Based on current levels of assets the church holds in EPA, and based on accepted best practices, the church could increase it work in humanitarian aid to a level that approximates 5% of the funds in EPA. This would be around $5-$7 billion per year. I have never advocated that the church simply willy nilly toss and extra $5 billion per year at any organization that might fit the bill of humanitarian aid. Quite to the contrary I have suggested the church ramp up over time and do it prudently. "And do it prudently." Well, that's something. But it's not a lot of something. And it is, as far as i can tell, a single acknowledgment of logistical challenges amongst his (and yours, and Roger's) endless disparagements about the Church not caring about our fellow man. So you'll understand why one four-word phrase doesn't do much to rebut my observation that you guys want the Church to "necessarily and reflexively spend 5% of its principal, with no regard for the effectiveness and wisdom of such expenditures." 13 minutes ago, SeekingUnderstanding said: This would be an interesting counterpoint if the church was spending say 3.5 percent and wanted to justify it. But last I checked, our best information says the church is spending 0 percent each year of its endowment on any purpose. Indeed, they are doing the reverse - adding tithing funds into the endowment. If you have better information than that, I’d love to hear it. Oh. I see. So the Church spends $1.3 billion in a calendar year on humanitarian efforts, but it gets little or no credit for it because the money possibly did not come from reserve funds. For our critics, no matter what the Church does, it will always be... Thanks, -Smac
smac97 Posted March 25, 2024 Author Posted March 25, 2024 38 minutes ago, Teancum said: Quote The Brethren have made public statements about the Church's investment strategy for a few decades now. CFR where the church voluntarily disclosed the amount of wealth it was accumulating. Once more: The Brethren have made public statements about the Church's investment strategy for a few decades now. Thanks, -Smac
Teancum Posted March 25, 2024 Posted March 25, 2024 1 hour ago, smac97 said: The proposal for the Church to necessarily and reflexively spend 5% of its principal, with no regard for the effectiveness and wisdom of such expenditures, is feckless. WHich once again I have not argued that they should simply toss away 5%. But it is a reasonable goal to responsibly work toward, IMO. 1
pogi Posted March 25, 2024 Posted March 25, 2024 10 hours ago, Calm said: What is wrong with the Church doing the same that it has been doing, only casting a wider net, vetting more opportunities? There are likely an infinite number of opportunities out there and highly likely they could find a way to spend several billion more in the same way. They would likely have to expand their humanitarian department, expand their outreach, possibly increase their own presence in areas where there are gaps. But if they put a 1000 people to work where they only had 100 in vetting and overseeing efforts to identifying opportunities to help using the same process, why couldn’t they reach that goal? Calm, you are on the verge of becoming part of the "just throw money at it" gang. Be careful. Don't ask why! The church is doing all they can. PERIOD! Anything more would unreasonable and cause more harm than good (stand by for painstaking efforts to list all if the reasons that NFP's are practically the devil, with no acknowledgment of the good that they do). There is a balance of giving and any more than what the church gives crosses an unacceptable line. Just accept that there is an unavoidable bottleneck without a solution or workaround that is inhibiting the church from doing ANYTHING more than they already are. They can't reasonably do anything more than they already are...just accept it. Don't ask questions. 1
Calm Posted March 25, 2024 Posted March 25, 2024 (edited) 3 hours ago, ZealouslyStriving said: Seeing as Temples cost between $7 and $70 million to build depending on size and location and the Church only seems to be ramping up Temple building.... So, average cost $30 million x (will say) 200 (at present)= $7 billion With about 25-30 new Temples announced each year. I'm guessing that's where some of the money will go. They could build 200 a year with the alleged 5%. (I don’t believe we actually know it’s 150$ billion, this is a projection of an alleged past claim that may or may not have been accurate.) Edited March 25, 2024 by Calm
Calm Posted March 25, 2024 Posted March 25, 2024 (edited) 16 minutes ago, pogi said: Calm, you are on the verge of becoming part of the "just throw money at it" gang. Be careful. Don't ask why! The church is doing all they can. PERIOD! Anything more would unreasonable and cause more harm than good (stand by for painstaking efforts to list all if the reasons that NFP's are practically the devil, with no acknowledgment of the good that they do). There is a balance of giving and any more than what the church gives crosses an unacceptable line. Just accept that there is an unavoidable bottleneck without a solution or workaround that is inhibiting the church from doing ANYTHING more than they already are. They can't reasonably do anything more than they already are...just accept it. Don't ask questions. I am not saying this is what the Church should do. I would have to know what they are currently doing and why to feel comfortable making that judgment. Since the Church doesn’t share enough of that information, I won’t make that judgment. I was critiquing Smac’s claim that saying 5% equates to “throwing money at it” claiming there is no regard to how it should be spent when posters are saying it needs to be vetted, etc makes that part of his argument highly inaccurate imo. I don’t understand why he is ignoring those statements as part of their critiques. Edited March 25, 2024 by Calm 1
Rain Posted March 25, 2024 Posted March 25, 2024 I wonder if everyone could agree to this statement written as is with no assumptions of hints, intentions, hidden agendas, accusations etc. Just purely written as it is. "It would be cool if the EPA donated 5% of its invested funds to charities which help the poor and the needy and which have been vetted by the church as being wise stewards." 2
smac97 Posted March 25, 2024 Author Posted March 25, 2024 (edited) 1 hour ago, Teancum said: Why @smac97seems so incredibly hostile and even angry at such a suggestion is beyond me. I am determined the defend the Church against unreasoned, unreasonable, undue, unfair, etc. criticisms. I acknowledge that I don't like critics of my faith using humanitarian aid as a brickbat. I don't think such things ought to be weaponized and used as a pretext for justifying endless efforts to cast the Church in a bad light, to impute to it terrible motives, to characterize it mostly or entirely by its flaws (with little or no acknowledgment of its virtues, efforts, successes, etc.). 1 hour ago, Teancum said: So that is my position above, for the record. I do not advocate just throwing $$ at problems. I never have. I acknowledge it is difficult work and should be approached cautiously and carefully. I asked you last November to document this. You didn't. You subsequently shifted your rhetoric, but not by much. 1 hour ago, Teancum said: I think the church has a lot of smart people who can help accomplish such a goal. I commend the church for beginning to increase what they do with humanitarian aid and relief while at the same time hoping they can do more given their vast resources. Maybe they are already doing that in plan to continue to grow such efforts. "Maybe." The mind reels. I have linked to and quoted this 2020 article a few times: Quote Deseret News: Church finances — Presiding Bishopric offers unique look inside financial operations of growing faith The Church has doubled its humanitarian donations over the past five years, spending almost $1 billion annually to care for the poor and the needy. The costs associated with running the Church are also increasing. The organization provides support for 30,000 congregations, educates 850,000 students in seminary and institute, and is engaged in aggressive temple construction — maintaining 167 temples with another 50 announced or under construction. And the cumulative expenditures of the Church’s universities is about $1.5 billion per year, said Bishop Caussé. And this one (also from 2020) : Quote Humanitarian and welfare spending The three bishops challenged some of what they’ve seen in previous reports. “The people who say we’re not doing our part, that is just not true,” Bishop Waddell said. “We’re talking close to $1 billion in that welfare/humanitarian area on an annual basis. Yes, we are using our resources to bless the poor and the needy as well as all of the other responsibilities we have as a church.” The figure includes all humanitarian and welfare expenditures, including fast offering aid. The budget for humanitarian work “has gone up dramatically,” Bishop Waddell said. In fact, Bishop Caussé added, humanitarian expenditures have doubled in the past five years. “And we believe they are going to increase fast,” he said. And this one (also from 2020) : Quote In addition to responding to disasters across the globe, Church humanitarian funds have been used to provide food programs, vision care, maternal and newborn care, clean water and sanitation, immunizations, wheelchairs, and help for refugees. However, reaching out and helping those in need is “a very complex endeavor,” he said. The Church can’t just send out cash and checks to people, he said. “It has to be done in an organized way, and with follow up, with training, a lot of expertise and good partners. Otherwise, you just don’t get any results.” Bishop Davies said the Church is careful to select humanitarian projects and partners that will make the best use of the Church’s funds. “We are very careful with the widow’s mite,” referring to the biblical parable by the Savior. “We recognize that this comes from the faith of Church members and we want to make certain that they have the trust and confidence that their donations are being managed in a careful and thoughtful and very safe way for them and for the Church,” said Bishop Davies. Leaders often ask themselves “what else can we do, where else can we go, who else can we work with,” said Bishop Waddell. Every time the Church reaches out, the objective is to bless both the giver and the receiver, added Bishop Caussé. So in addition to selecting good humanitarian projects, Church leaders are always mindful of providing service opportunities for Church members. “It’s not just a matter of money,” he said. It’s also done as members “devote time and resources and efforts to help others.” ... As to the question, is the Church doing enough, Bishop Caussé said, “We hope we can do more and more in the future, and as the Church grows, there will be more opportunities for doing good.” The Church in 2020: "The Church has doubled its humanitarian donations over the past five years." "The budget for humanitarian work 'has gone up dramatically,' Bishop Waddell said. In fact, Bishop Caussé added, humanitarian expenditures have doubled in the past five years. 'And we believe they are going to increase fast,' he said." "As to the question, is the Church doing enough, Bishop Caussé said, 'We hope we can do more and more in the future, and as the Church grows, there will be more opportunities for doing good.'" Teancum in 2023-2024: "They just did not want anyone knowing how much cash they were raking in and accumulating and how little in comparison they were using to ease human suffering." "If you think a church that claims to be the Church of Jesus Christ sitting on such wealth is quite fine then you are as immoral as they are as far as Christian values goes. If you think patting themselves on the back about giving a billion away compared to their massive wealth than you have priority problems." "For those who are really serious about donating their $$ to relieve humansuffiering I suggest you take the money you donate the church and find organizations whose priority is relieving human suffering." "I commend the church for beginning to increase what they do with humanitarian aid and relief while at the same time hoping they can do more given their vast resources. Maybe they are already doing that in plan to continue to grow such efforts." "You are as immoral as they are." "Maybe they are already doing that..." There is no placating faultfinders. They will never be satisfied. Thanks, -Smac Edited March 25, 2024 by smac97
Calm Posted March 25, 2024 Posted March 25, 2024 (edited) 3 hours ago, smac97 said: Faultfinding critics will likely never be placated with the Church's efforts. Aren’t you the one who doesn’t like to do “what if” questions? Why are you then comfortable with accusing critics on the board of the Church’s apparent spending habits of behaviour that hasn’t yet occurred and may never occur? Edited March 25, 2024 by Calm
Calm Posted March 25, 2024 Posted March 25, 2024 (edited) 3 hours ago, smac97 said: 11 hours ago, Calm said: Right. We've seen that play out in California. Without substantial vetting and oversight, these efforts would end up very poorly. And if anyone on this board was actually pushing for the Church to do this, then this point would be relevant in the discussion. But no one is. Quote And they are endlessly cagey and evasive about their proposals, Not seeing that behaviour myself. Just as a side note in case anyone assumes wrongly, I do not agree the Church is hoarding, though this is an issue of trust for me since I don’t have the financial info or know of detailed future spending plans. I would have given quite a few more points to posts as I thought they were thoughtful presentations of the issues even if I didn’t agree with parts except that they have included the accusation of hoarding, which I believe takes judgment too far. Edited March 25, 2024 by Calm 2
pogi Posted March 25, 2024 Posted March 25, 2024 (edited) 17 minutes ago, Calm said: I am not saying this is what the Church should do. I would have to know what they are currently doing and why to feel comfortable making that judgment. Since the Church doesn’t share that information, I won’t make that judgment. I was critiquing Smac’s claim that saying 5% equates to “throwing money at it” claiming there is no regard to how it should be spent when posters are saying it needs to be vetted, etc makes that part of his argument highly inaccurate imo. Yes, it is not worth engaging him anymore. I think it is wise to reserve judgment, but I think that we should expect answers as to why this isn't possible. I think many are too eager to just accept that everything that can be done has been done. "It's hard" to vet organizations isn't good enough. Tell me why we don't have the manpower (a church of millions of willing volunteers and professionals) and/or resources to increase our efforts of vetting and donating if we wanted. Edited March 25, 2024 by pogi
smac97 Posted March 25, 2024 Author Posted March 25, 2024 27 minutes ago, Teancum said: WHich once again I have not argued that they should simply toss away 5%. But it is a reasonable goal to responsibly work toward, IMO. How much the Church (which, again, is "not primarily a humanitarian organization") spends on humanitarian efforts will always be a judgment call. Always. And our critics and gainsayers and armchair quarterbacks will always dispute, disparage and diminish the Church's efforts. Always. Again, our Stormin' Mormon makes a solid point: Quote This is why critics of the Church's charitable giving earn the reputation of never being satisfied. The Church IS making great progress in relieving human suffering. It's charitable donations went from $900 million in 2021 to $1 billion in 2022 to $1.3 billion in 2023. We know that deploying large resources is doable because the CHURCH ACTUALLY HAS BEEN DEPLOYING LARGE RESOURCES AT AN EVER INCREASING RATE. And even after this increase, Teancum is still disparaging the Church, calling it "immoral" and lacking in (or even devoid of) "Christian values" for not spending as much as he thinks it ought to spend, and only hinting that the Church "maybe" improving its humanitarian efforts. There is no placating faultfinders. They will never be satisfied. Thanks, -Smac
smac97 Posted March 25, 2024 Author Posted March 25, 2024 5 minutes ago, Calm said: Aren’t you the one who does t like to do “what if” questions? Why are you then comfortable with accusing critics on the board of the Church’s apparent spending habits of behaviour that hasn’t yet occurred and may never occur? We've been discussing this topic for a few years now. The Church said some things publicly in 2020 about our humanitarian efforts increasing and improving in the future, and since then our efforts and expenditures have improved. And yet despite this track record, Teancum is still disparaging the Church, calling it "immoral" and lacking in (or even devoid of) "Christian values" for not spending as much as he thinks it ought to spend, and only hinting that the Church "maybe" improving its humanitarian efforts. If Teancum changes course and stops doing what he's been doing for the past several years - the Church's efforts during that period notwithstanding - I will happily eat crow. Until then, I will take his calumnies against the Church at face value, and as indicative of what he will be doing in the future. Thanks, -Smac -1
Calm Posted March 25, 2024 Posted March 25, 2024 3 minutes ago, smac97 said: And yet despite this track record, Teancum is still disparaging the Church, calling it "immoral" and lacking in (or even devoid of) "Christian values" for not spending as much as he thinks it ought to spend, and only hinting that the Church "maybe" improving its humanitarian efforts. If the Church had been spending 5% of its wealth, I think you would have a point. It does not appear it has yet, so you appear to me overeager to make this accusation. 1
Analytics Posted March 25, 2024 Posted March 25, 2024 1 hour ago, smac97 said: The proposal for the Church to necessarily and reflexively spend 5% of its principal, with no regard for the effectiveness and wisdom of such expenditures, is feckless. That proposal you outline here is a straw man. Nobody here has argued that the Church should "necessarily and reflexively spend 5% of its principal, with no regard for the effectiveness and wisdom of such expenditures." Ever. 1 hour ago, smac97 said: It's "routinely used" because it is a guideline for private foundations issued by the IRS in 1981, and has since become entrenched and rationalized and labeled in some quarters as a "best practice" for non-profits. But is it? See, e.g., here: Endowments should rethink the 5% rule According to that link, the 5% rule has been "broadly adopted by most non-profit organizations as a sensible baseline for spending." Yet based upon zero research, zero education, zero expertise, and zero experience, you choose to disparage most non-profit organizations as being feckless, facile, unreasonable, utterly uninformed, naive, absurdly simplistic, blithe, ridiculous, unserious, and unreasoned. I'd like to suggest that maybe, just maybe, you are the one who is utterly uninformed. You'll note that while you like the title "Endowments should rethink the 5% rule," the article is completely in line with what I've been arguing, and is totally at odds with the Church's fixed principle of living on 90% of its tithing revenue and investing the rest for a rainy day, into perpertuity. Specifically, the article argues that if an endowment spends 4% of its assets every year instead of 5%, it will grow bigger and will thus be able to give more. This is in line with, for example, the "CU Guide to Endowments" that I linked to, which says, "Distributions are calculated as an amount equal to 4% of an endowment’s trailing 36-month average fair market value as of the December 31 of the year preceding the distribution." And you'll also notice that my actual position is that "any spending rule that is broadly in harmony with any of these rules to be perfectly commendable by the Church." This broad net of what I think would be reasonable explicitly includes the CU guidelines, and fully contains every suggestion made in the article that you linked to. This article supports my position. And it does not support yours; nowhere in that article does it support what the Church has been doing (i.e. not making withdrawals) nor what you have been advocating (not spending very much because doing that effectively is too difficult). 1 hour ago, smac97 said: If you have studies or evidence demonstrating the feasibility and coherence of the 5% rule as an organic principle, please provide it. I've already done this. Of course you wouldn't know that, because you don't actually read what I say. But for the record, I'll repeat it. In his seminal book Capital in the Twenty-First Century, Thomas Piketty says "For the sake of concreteness, let us note, too, that the average rate of return on land in rural societies is typically on the order of 4–5 percent. In the novels of Jane Austen and Honoré de Balzac, the fact that land (like government bonds) yields roughly 5 percent of the amount of capital invested (or, equivalently, that the value of capital corresponds to roughly twenty years of annual rent) is so taken for granted that it often goes unmentioned. Contemporary readers were well aware that it took capital on the order of 1 million francs to produce an annual rent of 50,000 francs. For nineteenth-century novelists and their readers, the relation between capital and annual rent was self-evident, and the two measuring scales were used interchangeably, as if rent and capital were synonymous, or perfect equivalents in two different languages." Piketty, Thomas. Capital in the Twenty-First Century (pp. 53-54). Harvard University Press. Kindle Edition. I know that you have zero interest in understanding modern economics, but if you did, you'd read Capital in the Twenty-First Century and learn that the reason that the 5% rule has worked so well over the last 45 years is because it is in fact rooted in organic economic principles regarding the return invested capital can really be expected to make over the long haul. I know you don't believe this, but there are actually economists that know more than you that set up Harvard's guidelines for saving and spending its trust. 1 hour ago, smac97 said: Otherwise, it looks suspiciously like a "guideline" from the State as to private foundations that has morphed into a quasi-fiat for non-profits. Very sophisticated thinkers have devised the investment strategies for the endowments we are talking about (Harvard University, for crying out loud!). Yet you feel qualified to tell these people that their guidelines are a senseless quasi-fiat? Your arrogance is only matched by your ignorance. 1 hour ago, smac97 said: You and Roger may think the Church ought to base expenditure decisions based on rote observance of an IRS rule for private foundations that has been, in some quarters, applied to or become expected of non-profits. I think reasonable minds can have differing perspectives on that. Serious question, Spencer. Are you intellectually incapable of making a good-faith effort to understand what I think and why? Or is this topic so emotionally painful to you that it clouds your ability to think? Or are you simply lying? I can't tell. I've provided a broad survey of what reasonable minds think about the capital allocation decisions endowments make. I have stated that if the Church's position was anywhere within that constellation, it would be commendable. So far, all you've done is attacked a strawman. Reasonable people can disagree, but they have to offer reasonable positions. 1 hour ago, smac97 said: Here's an interesting article from 2010 by Burton Weisbrod and Evelyn D. Asch: Endowment for a Rainy Day This is rich. The article begins thusly: In recent decades, nonprofits have significantly increased the size of their endowments. Yet during the current economic crisis, they made scant use of their sizable holdings. Instead of drawing down their endowments to offset losses of income, nonprofits resorted to cutting programs and personnel, sometimes dramatically. To prepare for future financial downturns, nonprofits should treat endowments as rainy day funds, not cut programs to preserve the endowment. President Hinckley said the Church lives on a basic and fixed principle: "the Church will live within its means. It will not spend more than it receives." In order to accomplish that, when the latest economic crises hit, it lowered its expenses. The Church has done exactly the opposite of what this article recommends--it has "made scat use of their sizable holdings." Again, you provided a link that supports my actual position and contradicts yours. 1 hour ago, smac97 said: I think you are too entrenched in your negative perspective on the Church to be willing to reconsider your position. I hold the same assessment of Roger. I think it is easier for you to personally attack us than to read, understand, and respond to what we actually say. 2
smac97 Posted March 25, 2024 Author Posted March 25, 2024 8 minutes ago, Calm said: And if anyone on this board was actually pushing for the Church to do this, then this point would be relevant in the discussion. But no one is. Well, yes, they are. Roger/Analytics has been pushing the rote 5% thing for years no. He has, AFAICS, never qualified or conditioned this benchmark on the expenditures being efficient and effective, on the Church using vetting and oversight procedures in its partnerships with other organizations. The benchmark is a percentage of the Church's reserve. That's it. California has taken a feckless, "Just Throw Money At It!" approach to homelessness, with disastrous results. I think Roger's 5% idea would yield similarly feckless, and bear similarly terrible results. 8 minutes ago, Calm said: Quote And they are endlessly cagey and evasive about their proposals, Not seeing that behaviour myself. Okay. I have repeatedly asked some basic questions about these proposals, and have not seen any substantive response to them. 8 minutes ago, Calm said: Just as a side note in case anyone assumes wrongly, I do not agree the Church is hoarding, though this is an issue of trust for me since I don’t have the financial info or know of detailed future spending plans. "Hoarding" is a risible term (as is "hedge fund"). Roger and others use these things for the pejorative, not descriptive, value. Nobody is getting rich off the Church. Nobody is enjoying a profligate lifestyle on the Church's dime. Rather, both the leaders and the observant membership of the Church are trying to make the world a better place. And it looks like folks are starting to acknowledge the logistical and other challenges inherent in the Church's administration of huge sums of money in international humanitarian aid (an industry rife with corruption, graft, incompetence, creating unintended-yet-still-terrible consequences, etc.). So the constant disparagements of the Church as greedy, parsimonious, unconcerned about human suffering, "immoral" (Teancum's descriptor), lacking in "Christian values" (also Teancum) are unfair and nonsensical. 8 minutes ago, Calm said: I would have given quite a few more points to posts as I thought they were thoughtful presentations of the issues except that they have included the accusation of hoarding, which I believe takes judgment too far. I find myself glossing over Teancum's and Roger's and SeekingUnderstanding's and Pogi's calumnies against us because they are too frequent, and so tend to have less of a risible or provocative effect. But then I go back and read Teancum's slander of the Latter-day Saints as being "immoral," and lacking "Christian values," and being indifferent and/or unserious about "relieving human suffering" and so on. Thanks, -Smac -1
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