Trump and the “Johnson Amendment”

Donald Trump recently made it part of his campaign platform to allow churches the ability to speak for/against candidates and freely engage in political lobbying. Many things…often conflicting things…tumble from Mr. Trumps lips and we’ve no way of knowing whether this is truly a important issue for him or whether it is pandering to some evangelicals. What I am sure he doesn’t understand is that he would have to strip religious institutions of their tax-exempt status…and least if he is playing by the rules as intended. Of course Mr. Trump never feels the need to follow [or even understand] the rules. NO tax-exempt organization is permitted to engage in political lobbying. The restriction is not limited to religious institutions. Below is a piece I wrote on this subject back in 2012 (with minor updates). ……

A recent analysis by University of Tampa Sociology professor Ryan Cragun estimates that the U.S. misses out on $71 billion dollars annually because of tax exemptions for religious institutions. I’ve seen other estimates of $82 billion dollars annually. [Though too narrow a term, I will be using “church” in lieu of “religious institutions/organizations” out of convenience.]

Is the study authoritative and unbiased? Maybe. Maybe not. But the great majority of those dollars are easily documented. There are clearly some big bucks involved with religious tax exemptions. In this environment of substantial national debt, this seems like some pretty low hanging fruit to divert a pretty nice chunk of change into coffers of local and federal government and reduce the burden on general taxpayers. I would argue it warrants some consideration.

Students of arcane political history might recall that the church exemption took its current form fairly recently. It was Senator Lyndon Johnson that, through amendment, allowed churches to register as 501c3 organizations and receive blanket tax exemptions…but it came at a pretty stiff price (at least on its face) …a price that is paid by every tax-exempt 501c3 organization..

To obtain that monetary windfall, churches were forbidden to participate in the electoral process that, at the time, they were manipulating to their ends. They may not endorse political candidates and, through later, stronger language, may not even speak against a candidate. So…how has THAT worked out? Anyone even casually familiar with contemporary political discourse knows that those restrictions are trod all over. Moreover; I was unable to find any church that lost its 501c3 status as a result of political activities.

Knowing this history, the study got me thinking about what this exemption is for, how it benefits society, and whether it make sense to provide such blanket exemptions to churches. It should be self evident that the federal government is not in the business of promoting religion over non-religion. The First Amendment is consistently interpreted the our government is officially and constitutionally neutral on the matter of religion. But let’s not forget that these exemptions also subsidize charitable services that the federal government might have to provide anyway.

Allowing and subsidizing non-governmental organizations to provide such public services [sometimes with volunteer labor] is probably a fair money saver since providing them through a government bureaucracy would likely be less efficient. In the case of religious charities, though, we don’t know how much of these uncollected tax dollars reach the needy. The books are not necessarily open to public scrutiny in these organizations. I am sure that certain churches would rather not want the public to know just how much it is spending (of your taxpayer dollars) to defend themselves against sexual abuse charges.

Some argue that religion (Christian, Scientology, Catholic, Muslim, Judaism, Mormonism, et al.) is intrinsically good in and of itself and that society is simply better off with religion than without religion and that those subsidies yield greater soft returns than the financial burden.

Unfortunately the evidence says otherwise and the Catholic Jesuit Creighton University, seeking to document those soft societal benefits of religion, found just the opposite (sometimes dramatically so). (AWK-ward!!) Moreover; U.S. prison population demographics showed that most all religious denominations were commensurately represented. One of the significant outliers in the prison population analysis is the NON-religious…being grossly UNDER-represented amongst the incarcerated. If one is really trying to argue that religion…any religion…is an intrinsic good and a benefit to society, then one would have to ignore a pretty compelling body of evidence.

In this environment of fiscal prudence, it should be obvious that we shouldn’t be subsidizing religion and religious institutions unless those subsidies provide a positive return to the taxpayer. With a recent Pew survey released that shows a dramatic decline in religious adherence and “none” being the fastest growing “religious” demographic in the U.S., why should all taxpayers pay for the religious accouterments of some?

I propose the following that would fully respect religious liberty (of which I am a proponent) and permit the religiously motivated to clothe, educate, feed and care for the needy. A religious institution would simply form a company that would be the charitable arm of the organization. All monies that go to these charitable companies would enjoy the same tax exemptions that the churches (or any other 501c3 organization) presently enjoy.

To comply with the First Amendment of the Constitution, these charitable arms would be prohibited from prosthelytizing or discriminating and no expectation of religious adherence would be demanded. Public tax dollars must benefit every citizen and the First Amendment precludes endorsing one religion (or even non-religion) over another. Monies not specifically in support of those non-denominational public services would not be tax exempt. That means the church pays property taxes on facilities not dedicated to charity, the clergy pay income taxes and buying carpet for the rectory would be taxed just like me buying carpet for my basement.

“But Mike!”, some would say, “that would mean far less monies go to charity.” To which I say; “Only if you don’t give money to those charitable arms.” If your motivation is for charity, then you still have that option. In fact; those charitable organizations would probably see a surge in revenues because now the broader public would know that monies donated would actually go, in its entirety, to the needy instead of some being siphoned off for centers of worship or legal defense funds. If your charity is motivated by the opportunity to recruit the needy into your particular religion, I would suggest that to be ignoble at best.

So let’s help clean up our financial house. Let’s make sure charitable dollars help the intended recipients. Let’s make sure that the First Amendment is respected. And let’s have churches pay their own way. As Ben Franklin wisely said, “When a Religion is good, I conceive that it will support itself; and, when it cannot support itself, and God does not take care to support, so that its Professors are oblig’d to call for the help of the Civil Power, it is a sign, I apprehend, of its being a bad one.”


About Mike Bruno

I live in Geneva, Illinois and enjoy discussing contentious topics (what's the point otherwise?). I am very involved in my community and historic preservation. I write here as a way to explore my own positions. I am a computer engineer that has been in the business since floppy disks had a capacity of 720 KILObytes...and were actually floppy. I am something of a science evangelist. If you like (or really dislike) what you read here, say so...and point your friends here. Thanks! The opinions expressed here are my own and do not necessarily reflect any persons or organizations with which I might be affiliated.
This entry was posted in Donald Trump, Islam, morality, Politics, religious liberty, Taxes, Uncategorized. Bookmark the permalink.

5 Responses to Trump and the “Johnson Amendment”

  1. Let me start with the 1st amendment first. I had always thought that the tax exemption for the religious organization itself was to prevent government from interfering, through taxation, with a church, to satisfy the 1st Amendment prohibition. And if that were the rationale, then it would also prevent the government from interfering with the right of a preacher to support a candidate from the pulpit.

    The tax-exemption for contributions is a whole other matter. Basically, it is the government encouraging contributions that it favors (those that it imagines are in the public interest). And no one with sufficient income to contribute part of it to a church, a charity, or any other project, is in need of a government “discount” or “refund” to encourage it. As per Ben Franklin’s quote, let all charities, religious or not, stand upon their own two feet, and sell their product at full price, and return to its contributors valid satisfaction in the quality of its product.

    And if there is a charity that is in fact serving the public interest at a cheaper cost than can be done through the executive branch of government, then government should not be embarrassed to be directly funding (or sub-contracting) it with taxpayer monies.

    • Mike Bruno says:

      The tax exemption for religious institutions was a pretty contemporary thing and it was a bone to throw that would keep them out of electoral politics.

      I am all for charitable deductions for (as I said in the post) anything that delivers net positive value to the taxpayers. Providing non-discriminatory social services for which the government may eventually be on the hook is great. The government should, as you say, be eager to support such things.

      Any use of taxpayer money (or non-collection of taxes which shifts the burden to other taxpayers) that promotes/subsidizes religion does NOT deliver value and gets into a murky area of the 1st Amd..

      • I generally agree with your philosophy about religion. But I think that tax simplification (to save me $50 for software each year) is also a worthwhile goal, and I’d gladly give up all manipulative deductions for a little more simplicity. I place a high value on that.

      • Mike Bruno says:

        I would certainly appreciate simplicity. I hate doing taxes. Part of me likes the idea of a universal sales/consumption tax. We’d vastly shrink the IRS, never have to worry about April 15th, capture black markets and fairly spread the burden. (I would like a universal “pre-bate” to help the low income). Sadly, my research shows economists not being great fans because, I think, of revenue instability.

      • The income tax is still the fairest way to tax. A property tax is harder on retired people with fixed income who may or may not be able to afford a tax that rises with inflation. A sales tax is closer to an income tax, but it allows those with high incomes to grow their money for many years untaxed through savings and investments. But the income tax is best, because the person can always afford it since it is based upon money we know he has.

        We already have a form of “pre-bate” in the Earned Income Tax Credit. But this is basically a government subsidy making up for low wages. It would be better to raise the minimum wage above the poverty line (any product is only worth producing if it’s price can command sufficient wages to support the worker who produces it).

        But this is probably all a different discussion from the Johnson amendment and the charitable deduction. Your article is very good and makes some important points about our presumption of benefits from giving tax-break inducements for religious contributions.

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