What will be the economic results of the Supreme Court's decision to legalize gay marriage in all 50 states? Most financial experts right now are focusing on what it will mean for workplace spousal benefits, estate planning and joint property rights. That's a good place to start because those changes will likely be almost immediate and substantial.
But there's another outgrowth of this decision that could have massive financial implications, and that's the growing call from some groups to eliminate tax exemptions for houses of worship, religious schools, and other religious organizations. The implications of this battle are extremely far reaching, and if the "tax the church" movement continues to gain real steam, the anger and resentment it would create in America would make the gay marriage debate look like a polite dinner conversation.
The core logic behind the push to tax religious property is pretty simple. It argues that if churches, synagogues and mosques refuse to adhere to the law of the land like recognizing same sex marriage or performing same sex weddings, then they should not be allowed to receive the government favored status that comes from being tax exempt. That belief is often expanded to include arguments that the charity work religious institutions perform is too limited and inferior to government welfare, that churches in poor areas actually contribute to poverty, and that many religious non-profits abuse the rules to lavishly enrich the people who run them.
And it's not just a bunch of cranks pushing this movement. None other than Mark Oppenheimer, who writes the New York Times' Beliefs column, is now calling for rescinding religious tax exemptions and advancing many of the arguments against religious groups written above. The chance that this becomes a mainstream position for the Democratic Party isn't so far-fetched, especially when you remember the many boos the mention of "God" received at the Democratic National Convention in 2012. And if you think that religious liberal groups, like most many protestant churches and left-leaning Jewish organizations, would balk at this, remember that winning candidates could always promise to keep the tax exemption for some religious organizations and not others. It would all be a part of classic political wheeling and dealing.
If that scenario frightens you, it should. Because throwing the continued existence of everything from small neighborhood churches to large Catholic hospitals in America more into the shifting political winds than they already are is not only the epitome of violating the separation of church and state, it would hurt the nation financially as well. Here are some of the most important arguments the proponents of church taxation are forgetting:
1) It's not the government's money
Ever notice how the people arguing for higher taxes always seem to start with the assumption that all money belongs to the government in the first place? It's an erroneous argument that the government could do more good with a particular church's property than the church is doing. Even if it were true, it doesn't negate the fact that it's the church's property. You can't just take away someone's property based on such claims, otherwise a mugger on the street could say he has the right to rob you because he's going to take your money and do better things with it. The legal arguments and proof should always be the responsibility of the person or the entity that's taking the money away, not the other way around.
You don't need a Ph.D. in history to know about countless kings, dictators, and even democratic governments that went rogue and coveted the wealth and power held by churches and other religious groups. And it was never just about the money they wanted to grab for their own pockets. It's also always about snuffing out a very likely source of dissent. What religious groups have said to tyrants for centuries is the following: "there is a God, and you're not Him." So while King Henry VIII absolutely loved grabbing the Catholic Church's great abbeys for himself and his loyal supporters, killing the Church's power and making himself head of the Church of England conveniently made him the most powerful ruler in Europe. Too many people confuse the principle of separating church and state as being all about protecting the state from religion. In just as many cases, it's religion that needs protection from the state.
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And the economy needs that kind of protection too. Growing government power via taxes or regulation is already a millstone around the American free market. This goes beyond religious and cultural debates. It's about how healthy a free market economy can be while the government attains more and more power over private wealth. Taxing religious groups would weaken religion in favor of more government power and our democracy and our economy don't need that.
2) Welfare fails, charity succeeds
The argument that government takes care of the poor and the needy better than religious organizations is based on faulty assumptions. Because the government has trillions of our dollars at its disposal, of course it provides more meals, shelter, and education than private charitable organizations. But is that big government money used efficiently? Do public schools churn out better students than your local Catholic school? Public housing units give people a roof over their heads, but don't they also contribute to geographic segregation, economic isolation, and crime? Are impersonal food stamps better than personal connections you make when a synagogue houses a food pantry or hosts communal meals? Religious groups aren't saying the government should stop providing aid programs, they're just doing much better with what they have. They also see the people they're helping as human beings with a soul, not just some organism that can pull a lever on election day.
3) Do we really want a civil war?
Sure, the gay marriage debate led to some bad feelings, vicious hate speech on both sides, and plenty of, (gasp!), Facebook unfriendings. But if we start seeing churches and other houses of worship having to close their doors because of tax bills they can't pay, things are going to get seriously nasty in this country real fast. In some ways, it would potentially unite many Democrats and Republicans who are religious. But if the government exempts some politically aligned houses of worship and taxes others, there's a good chance enough religious people would support the idea as long as their churches aren't effected. I could go on, but isn't this scenario getting ugly enough? You'd have to really hate religion and peaceful coexistence in this country to want any of this to happen.
The sad history of our American tax code is that it has been repeatedly used by politicians to reward favored political allies and attack political enemies. The power to change the tax code accordingly is the biggest reason why politicians in both parties will never implement a flat tax that would effectively de-weaponize the their financial reach.
So make no mistake, the push to tax religion in this or any other country isn't about making things better for the poor or making society more welcoming. It's about money, power, and a destructive desire for vengeance.