The Catholic Church in America: Earthly Concerns

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 sins involved in its book-keeping are not as vivid or grotesque as those on display in the various sexual-abuse cases that have cost the American church more than $3 billion so far; but the financial mismanagement and questionable  business practices would have seen widespread resignations at the top of any other public institution.

The sexual-abuse scandals of the past 20 years have brought shame to the church around the world. In America they have also brought financial strains.

The picture that emerges is not flattering. The church’s finances look poorly co-ordinated considering (or perhaps because of) their complexity. The management of money is often sloppy. And some parts of the church have indulged in ungainly financial contortions in some cases—it is alleged—both to divert funds away from uses intended by donors and to frustrate creditors with legitimate claims, including its own nuns and priests. The dioceses that have filed for bankruptcy may not be typical of the church as a whole. But given the overall lack of openness there is no way of knowing to what extent they are outliers.

Thousands of claims for damages following sexual-abuse cases, which typically cost the church over $1m per victim, according to lawyers involved, have led to a liquidity crisis. This seems to have encouraged a pre-existing trend towards replacing dollars from the faithful with publicly raised debt as a way of financing church business.

The church is the largest single charitable organisation in the country. Catholic Charities USA, its main charity, and its subsidiaries employ over 65,000 paid staff and serve over 10m people. These organisations distributed $4.7 billion to the poor in 2010, of which 62% came from local, state and federal government agencies.

The American church may account for as much as 60% of the global institution’s wealth.

Where that money comes from is hard to say (the church does not release numbers on this either). Some of it is from the offerings of the faithful. Anecdotal evidence suggests that America’s Catholics give about $10 per week on average. More comes from elite groups of large donors...

Some influential Catholics are keen to see better management and more openness and accountability. Leon Panetta, America’s defence secretary, called for outside oversight of church finances when he was a director of the National Leadership Roundtable on Church Management, a position he relinquished in 2009 to become director of the CIA. Faced with competition from other churches and disgrace from the behaviour of some of its priests, there has never been a more important time to listen to such calls, and to invite in the help and scrutiny that the church’s finances seem so clearly to need.