Latter-Day Anarchy

Better known as the Mormon Church, the Church of Jesus Christ of Latter-Day Saints is one of the fastest-growing religious institutions in the world.  They are best known for the young men and women who walk in pairs, door-to-door, sharing their “message of the gospel;” or perhaps for the Mormon Tabernacle Choir (esteemed as “America’s Choir”). As far as religion goes, it’s not the worst you can do.  The membership is largely intelligent and successful.  LDS members exceed their demographic counterparts in income and education.  There are aspects of this church that are particularly interesting in sociopolitical discourse; specifically, the welfare program, and abstractly, the overall organization and methodology.

Why, you may ask, would an atheist take the time to praise the virtues of a religious institution?  The answer is that it serves a higher ambition than my scruples with superstition: the cause of anarchy.  Of course, I have my problems with the doctrine and culture of the church, but I will save those for another time.  The virtue of the institution lies mainly in their practices regarding charity, frugality, and efficiency.  The success of the church’s private welfare program, and overall organization, is clear evidence that charity not only takes the place of government welfare in the absence of a state, but far exceeds it in achieving the stated goals of eliminating poverty, or to “promote the general welfare.”

Murray Rothbard offers a keen perspective on the matter.  On page 149 of his book, For a New Liberty, he writes, “A highly successful private welfare program in the present-day is the one conducted by the three-million-member [now much greater] Mormon Church. This remarkable people, hounded by poverty and persecution, emigrated to Utah and nearby states in the nineteenth century, and by thrift and hard work raised themselves to a general level of prosperity and affluence. Very few Mormons are on welfare; Mormons are taught to be independent, self-reliant, and to shun the public dole.  Mormons are devout believers and have therefore successfully internalized these admirable values. Furthermore, the Mormon Church operates an extensive private welfare plan for its members—based, again, on the principle of helping their members toward independence as rapidly as possible.”

Rothbard conducts a much more thorough economic analysis of government versus private welfare than I am going to provide here, and I can’t recommend his work more highly in this regard (and any other, for that matter).  This essay will act as more of an individual perspective, rather than an in-depth analysis.  Reading just this brief quote, however, it is easy to see how government welfare is different from private charity, and why the latter is almost always successful in reducing poverty, and why the former inevitably fails.  It comes down to a matter of economic incentive.

The congregation and leadership of the church, for instance, benefit greatly from lifting an individual out of poverty and placing them on the path of independent prosperity.  Such success grants credibility to the institution, and those thus improved are more likely to remain members of the church, and provide a higher tithe (since the church requires a 10% tithe on the income of all members whom can afford it, in order to receive the full “blessings of the gospel”).  Beyond the income tithe, the church requires a “fast offering” in order for a member to be considered in good standing.  A fast offering is collected from members once per month, and is meant to reflect the savings made by the household in foregoing two full meals on a given Sunday.  The LDS Church receives a substantial income from tithes and offerings, and it is worth emphasizing the voluntary nature of these transactions.

Furthermore, the members recognize the overall benefit to the economy that comes from self-sufficiency, as they are taught to appreciate such, and are therefore eager to help their neighbors achieve this status.  They also receive emotional gratification by securing their place in “god’s presence,” by fulfilling what they see as two of the most important commandments: love thy neighbor, and rejoice in charity.  Moreover, these values are promoted socially on a frequent basis.  Church members are discouraged from receiving benefits unnecessarily, and there is shame in taking undue advantage of the program.  The church members are thus incentivized to promote, and the leaders are incentivized to provide, efficient, effective welfare.  There is no benefit to the community or the institution in maintaining a downtrodden underclass with which to procure political support, as we find with government welfare.

Government welfare, by its very nature, creates and supports all sorts of perverse economic incentives; that is, incentives that tend to hinder the individual, their family, and their community both economically and morally.  The prime incentive created by government welfare is the incentive for the recipient to continue receiving welfare benefits beyond their need, for lack of social or legal consequence. In fact, welfare recipients are largely encouraged to take full advantage of the available benefits, to the furthest possible extent of the letter (if not the spirit) of the law.  Because government welfare holds such a low standard for refusal, and requires little to nothing in the way of accountability, it is easy to continue collecting it whilst avoiding the social and legal repercussions of freeloading and fraud.

Government welfare also creates the perverse incentive of vote-bribery.  Politicians that propose fewer barriers to receiving benefits are more likely to get the votes of those who are seeking or receiving welfare benefits.  Politicians who do not support welfare programs are at a severe disadvantage, considering the high percentage of individuals that receive benefits.  Mitt Romney was demonized in the 2012 presidential election for stating this simple economic fact, leading from the unpopular truth that people are largely driven by economic incentives.  This simply reflects the pervasive inconsistency regarding economic incentive and political affiliation.  Though the principle of fundamental economic incentive is accepted in the vast majority of social interactions, when it pertains to political affiliation, the correlation is vehemently rejected by advocates of welfare programs, with feigned moral apprehension, and an air of righteous indignation.

But wait!  There’s more!  Government welfare also incentivizes employers to pay their workers less.  The employers know the laws, and they know at what income level their employees are eligible for various benefits.  They are actually at an advantage paying their workers a little less on the lowest part of the income spectrum, because then their employees are eligible for more benefits, and are thus more likely to be satisfied with their income.  Wal-Mart has perfectly demonstrated the riding of this line.  Many people criticize Wal-Mart for providing such little compensation, but the ones actually receiving it are generally not among them--and those that are may only be interested in working fewer hours while maintaining their place just below the poverty line.  This is because those part-time employees around minimum wage can keep their income below the poverty line intentionally, in order to be eligible for an average of $40,000 in benefits annually.  This number is a federal average, and does not take into consideration those who may also be receiving benefits from state-funded programs.  So the result is employers and low-wage employees relying on welfare as a part of income.  Considering a Wal-Mart manager usually makes $36,000 to $69,000 annually, it makes sense that a part-time employee making around $12,000 per year, and receiving $40,000 in benefits would shirk the increased work-load that a manager takes on.  This is speculation, of course, as I could not possibly know for certain the ambitions and intentions of the employees of which I speak.  I only claim to draw rational conclusions from the inevitable market incentives of the current welfare system.

On the other hand, the LDS Church has had great success with their system, which facilitates lofty ambitions and strongly discourages exploitation.  The church welfare program almost always finds work for an individual seeking it, whether it be through one of their many businesses, such as the Deseret Industries thrift stores or food storage companies, or provided by a member who owns a business that is in need of entry-level labor.  If an individual is willing to work hard, they rise quickly through this system.  If they seek only to collect benefits, they are not necessarily shunned; rather, they are limited to a level of benefits that allows for subsistence living, which works as an economic incentive by itself.

The LDS Church has not only had monumental success with their employment services, but has also made a substantial impact with their humanitarian aid programs overseas-- much more so than the government.  Take, for example, government aid to Africa, which has been not only ineffective, but proactively disastrous.  Haiti is another good example of how detrimental foreign aid by government has become.  I could provide myriad examples of how government foreign aid has crippled impoverished nations, but there are already volumes on the subject, some of the most notable of which can be found in the links above, so I won’t dwell too much on that failure.  Instead, I will present the successes that private institutions have had.

Part of the success the LDS Church experiences is due to the ease with which they can summon volunteers in times of crisis.  With missionaries stationed all over the world, they can respond immediately to emergencies.  In fact, aid from church members often arrives at disaster sites before the Salvation Army or the Red Cross.  They also take care to stock emergency provisions at strategic locations, and have predetermined logistical strategies in place for emergency response, including allocation of food, water, shelter, transportation, and medical supplies.  In short, the fact that much of the congregation and leadership is made up of Boy Scouts is apparent in their approach to disaster relief.

Even outside The Church as an organization, the individual members are taught to be charitable, and tend to live up to this expectation in their private lives.  Many members volunteer for, or donate to, nonprofit organizations.  Some go so far as to create their own private charities.  I personally know of Mormons that have started nonprofit organizations promoting reform in education for children of low-income families, providing education, jobs, food, and housing for African orphans, as well as funding cancer research, arthritis research, and multiple sclerosis research.  

Wal-Mart effectively displayed the ability of private non-religious organizations to provide disaster relief most acutely in the aftermath of hurricane Katrina.  While FEMA was struggling to secure funding, resources, transportation, and approval, Wal-Mart delivered relief to the storm-struck area with few logistical barriers.  Not only did they provide truckloads of free merchandise, over 100,000 free meals, and job offers for any and all facing reallocation; they provided it without costing taxpayers a dime, and began deliveries days before the federal government.  Not only was the government ineffective; they were actually counterproductive the relief efforts by refusing to allow aid shipments into the affected area!  The attitude of each entity can be summed up in the following dialogues:

Wal-Mart’s response:

“When a district manager calls from the field to tell the operations manager in the center that he needs 10 trucks of water, the operations manager can turn to the person manning the replenishment systems.

The replenishment manager then checks his supplies. "He says, ’I can get you eight [trucks] today and two tomorrow,’" says Jackson. "He then tells the logistics guy. This all takes place in a matter of seconds."”  (source)

The LDS response:

“When Hurricane Andrew struck [in Miami-Dade County] in 2002, the stories went around that the Mormon relief trucks were on the way to Florida before the hurricane had even made landfall. In the Hurricane Katrina of 2005 we know that once again the trucks were there before the National Guard was even allowing relief through. So the response is incredibly fast, incredibly efficient.”  (source)

FEMA’s response:

“The only FEMA official on the scene in the early stages, Marty Bahamonde, has testified to Congress that he begged FEMA director Michael Brown for water, food, toilet paper and oxygen, saying that "many will die within hours." Brown's press secretary, Sharon Worthy, responded that the FEMA director needed more time to eat dinner at a Baton Rouge restaurant that evening. "He needs much more that [sic] 20 or 30 minutes," Worthy wrote. "Restaurants are getting busy," she said. "We now have traffic to encounter to go to and from a location of his choise [sic], followed by wait service from the restaurant staff, eating, etc."”  (source)

Faced with this overwhelming contrast, is there any question about the effectiveness of government initiatives?  Is there any question about the efficiency of the private sector?  Is there any evidence to fill the vacuous assertions of the nobility and necessity of government welfare programs?  I have found none, though I welcome any and all criticism on the subject.  If I am wrong, please help me overcome my bias.  If I am right, the next step is to dedicate time, money, and/or effort to the cause of private welfare programs.  If you still like the idea of government welfare,  it is up to you to provide a path of action that will reverse the contrary incentives and improve its dismal results; I can’t think of one.  If you don’t support government welfare programs, then invest heavily in alternatives with more productive results, in an effort to wean those dependent on it from public to private welfare.  As it stands, private welfare will not overtake the public dole in my lifetime, but it is up to us to take the first few steps; show what is possible, and discourage the perversion of charity by the state.  I admire the LDS Church in this regard, and hope they manage to continue to compete with the leviathan of government welfare.  I can’t say what charity would look like in a free society, but I imagine it would be very close to the practices implemented by this institution.