Why are Mormons so capitalistic?
This post — written by a devoted, lifelong member of the Church of Jesus Christ of Latter-day Saints and believer in Jesus Christ — provides doctrinal and cultural answers to the titular question posed by Tyler Cowen in a January 2021 interview with Harvard Professor Benjamin Friedman:
COWEN: Why are Mormons so capitalistic?
FRIEDMAN: I don’t know. That’s a very interesting question. Mormons have been very successful economically in the United States, and the history of the Mormon church only goes back to the first half of the 19th century. Instead of Judaism and Christianity and Islam, we’re now talking about something that goes back not even 200 years, so it ought to be possible for people who are knowledgeable about Mormonism to have a lot to say about it.
But it is certainly true that in our American society, Mormons have been extremely successful economically.
In general, Cowen’s and Friedman’s assessment is correct. However, the extent to which Mormons are capitalistic is much more nuanced. Here, I review data on Mormons’ economic success, lay out doctrinal and cultural explanations for Mormon capitalism, and conclude with a discussion of why doctrinal and cultural factors go against the “Mormons as pure capitalists” characterization.
Are American Mormons so economically successful?
Friedman claims that “Mormons have been extremely successful economically.” Below, I briefly look at some existing data to test this claim. The main takeaway is that American Mormons are less likely to be at the bottom of the income or education distributions, but not overly likely to be at the top of these distributions. Thus, they are more heavily represented among the middle and upper-middle classes.
Income and Education
According to Pew, American Mormons skew more middle class than the rest of the US, both in terms of income and education. This is most pronounced in their absence from the bottom of these distributions. By contrast, Jews have much higher incomes and are the richest religious group in the US.
Another source — the college income mobility report cards on Danny Yagan’s website — reinforces this point. The income distribution of Brigham Young University closely resembles that of large public universities like the Arizona system or Michigan State, albeit with a tad more students coming from the top 1%.
Entrepreneurship
Beyond income and education, there is a strong entrepreneurial aspect to Mormon culture, which could be a form of “extreme economic success” that Friedman is referring to. Unfortunately, I couldn’t find any data on entrepreneurial differences by religion to evaluate this claim. However, there are of course well-known successes here, such as Mitt Romney and J. Willard Marriott among many others.
It is well-documented that Utah is a hub for multi-level marketing (MLM) companies (see this excellent academic journal article by Lofthouse and Storr). However, I wouldn’t consider that a positive marker for entrepreneurship per se.
Occupational Prestige
Do Mormons find themselves disproportionately in high-prestige occupations such as business administration, law, medicine, science or academia? Unfortunately, I couldn’t find any data with reasonable enough sample sizes to adequately evaluate this claim.
It is certainly true that Church leaders tend to come from this set of backgrounds. Of the 15 men that globally lead the Church, four are former business executives, four are former academics, three are former lawyers, and two are former medical doctors. In fact, local leaders also tend to come from these high-prestige occupations, although there is no official requirement. My own congregation in Oklahoma is headed by two dentists and a successful small business owner. I, an academic, also hold a leadership role in the congregation.
While those who are economically successful may find themselves asked to volunteer additional time as leaders, this does not necessarily imply that Mormons overall are more successful in terms of occupational prestige. The income figures cited above further support this idea.
Doctrinal and Cultural Support for Capitalism
Doctrine: Choice and Accountability
Fundamental doctrines of the Church include moral agency and accountability. The second Article of Faith states, “We believe that men will be punished for their own sins, and not for Adam’s transgression.” While this is a denunciation of Original Sin, it also establishes the importance of individual accountability.
This doctrine is further emphasized in the Book of Mormon: “Wherefore, men … are free to choose liberty and eternal life, through the great Mediator of all men, or to choose captivity and death” (2 Ne. 2:27; emphasis added). Those familiar with Milton Friedman’s work will recognize the phrase emphasized above, though it is interesting to note that the Book of Mormon was published 150 years before Free To Choose.
In early 2021, Dallin H. Oaks — the Church’s second in command — said, “The most desirable condition for the exercise of [moral] agency is maximum freedom for men and women to act according to their individual choices.” It is not difficult to see how a religion that views individual choice as a fundamental doctrine would be supportive of capitalism.
Doctrine: Post-mortal retention of intelligence
Another doctrinal tenet is the belief that any knowledge or skill gained in one’s life will remain with that person after death and resurrection. A revelation received by the Church’s founder Joseph Smith in 1843 states that, “Whatever principle of intelligence we attain unto in this life, it will rise with us in the resurrection. And if a person gains more knowledge and intelligence in this life through his diligence and obedience than another, he will have so much the advantage in the world to come” (Doctrine & Covenants 130:18–19).
This doctrine explains why Mormon culture heavily emphasizes education and other forms of skill development. Naturally, those who have spent more time investing in skill building would want to ensure that their hard work receives its maximal reward.
Doctrine: The divinely inspired US Constitution
Mormon doctrine also places special emphasis on the United States constitution. In 1833 — shortly after his followers had been expelled by mobs from their lands in Jackson County, Missouri — Joseph Smith received a revelation that God “established” the Constitution “for the rights and protection of all flesh” and that the framers were “wise men whom [God] raised up unto [that] very purpose” (Doctrine & Covenants 101:77–80).
To the extent that the United States Constitution is a capitalistic document, Mormons are capitalistic. In fact, Ezra T. Benson, who led the church from 1985–1993, taught that the Constitution was specifically established by divine intervention so that the Church of Jesus Christ of Latter-day Saints could be established on the earth. In this same sermon, Benson also taught that the Monroe Doctrine was another instance of divine intervention in order to make the world more free and thus more receptive to the Church’s teachings.
Doctrine: Honesty and lawfulness
The Church’s last two Articles of Faith include statements that “we believe in … obeying, honoring, and sustaining the law” and “we believe in being honest.” It is easy to see how these doctrines would support a society where individual liberty is fundamental, where property rights are strictly enforced, and where corruption and other dishonest activities are condemned. An environment such as this coincides with the ideal conditions for capitalism.
Culture and Church Policy
Aside from doctrines, the Church also enacts certain policies and encourages members to hold certain values that are favorable towards capitalism. I label these as “culture” because they do not have direct doctrinal foundation, but are discussed often in church meetings and families.
Self-reliance
A major cultural tenet is self-reliance, which is the idea that a person and his/her family should be able to provide for themselves and prepare against any adverse circumstances that may beset them.
Principles of self-reliance include getting education or making other human capital investments, staying out of debt, precautionary saving, living within one’s means, staying healthy, and living off the land or maintaining an excess supply of food.
For this reason, blanket social welfare programs generally go against these teachings. However, the Church does fundamentally believe in caring for the poor and needy, so the operative word here is “blanket.” I will discuss Church welfare programs later on.
The Church invests many resources into helping its members become self-reliant. These include groups that support upskilling of job seekers and prospective entrepreneurs, as well as programs that provide an online-only college education through BYU-Idaho, English language education, educational loans for indigent members, and other job training programs.
The idea of self-reliance has historical roots dating back to the early years of Utah territory. By the 1860s, enough non-Mormon merchants had moved into the territory that they began price discriminating on religious grounds by charging higher prices to Mormon customers. Brigham Young established a mercantile business called ZCMI as a way to pool resources and reduce prices. The Church continues this day to have a mercantile presence in downtown Salt Lake City, with the construction of City Creek Center having been completed in 2012. It also owns and operates several large ranches in Florida.
It is also interesting to note that the Church as an entity continues to abide by principles of self-reliance. In response to claims of the Church having excess of $100b in savings, the Church responded by stating, “Over many years, a portion is methodically safeguarded through wise financial management and the building of a prudent reserve for the future.”
Valuing work
Emphasis on self-reliance naturally results in a high value on work. Most Mormon youth grow up being expected to work either in the home or holding a part-time job, and Church publications regularly provide tips to parents on how to instill this value in their children. As with the doctrinal emphasis on education, it is understandable that a group that emphasizes hard work would want to ensure that their work is appropriately rewarded.
Doctrinal and Cultural Opposition to Capitalism
Doctrine: Salvation only through Jesus Christ
The great doctrinal paradox of “Mormon capitalism” is that, although we believe “men will be punished for their own sins,” we also believe that men cannot receive salvation through any of their own merits. The third Article of Faith states that “We believe that through the Atonement of Christ, all mankind may be saved, by obedience to the laws and ordinances of the Gospel.” Additionally, well known scriptures in the New Testament and Book of Mormon affirm the saving power of grace (Ephesians 2:8–9; 2 Nephi 25:23).
This sole reliance on a Savior for salvation puts a damper on the “every man for himself” mentality typically associated with capitalism.
Doctrine: Caring for those in need
A fundamental mission of the Church is “caring for those in need.” The doctrinal basis for this is, of course, rooted in many of Jesus Christ’s teachings (see Mark 10:17–25; Luke 16:19–31) as well as in the Book of Mormon, where righteous King Benjamin exclaims, “Are we not all beggars?” (Mosiah 4:19). It was also reinforced in revelation to Joseph Smith that Church members are to “remember in all things the poor and the needy, the sick and the afflicted” (Doctrine & Covenants 52:40). The fact that we all require mercy from Jesus Christ to be saved further strengthens the focus on giving that mercy to others.
To fulfill this fundamental mission, the Church has a welfare system wherein members in need can receive assistance with food, clothing or lodging. Where this system departs from traditional government welfare is that a key principle of caring for those in need is “helping others become self-reliant.” The handbook for local leaders emphasizes that “Church assistance is intended to help members develop independence, not dependence.”
The primary gatekeeper for Church financial resources is the bishop (pastor of the local congregation). The handbook referred to above states that “Bishops should exercise good judgment and seek spiritual direction when considering the amount and duration of the assistance given. They should be compassionate and generous while not creating dependence.” These financial resources are funded by voluntary contributions from members of the same congregation, called fast offerings. Fast offerings differ from tithing and other global humanitarian aid philanthropy.
It is interesting to note that, even though Church members are directed to make financial and in-kind donations to care for those in need, the system by which these resources are managed is “capitalistic” in the sense of limiting as much as possible the moral hazard problem associated with safety nets.
Doctrine: The cankering power of greed and pride
A final doctrinal foundation against capitalism is the idea that love of riches, greed and pride are quick tickets to eternal damnation. In this sense, Mormonism is anti-capitalism to the extent that capitalism celebrates materialism.
Scriptural references to the evils of materialism are abundant, but principal citations include Jesus’ admonition to “seek ye the kingdom of God; and all these things shall be added unto you” (Luke 12:31) and a similar teaching by the Book of Mormon prophet Jacob: “But before ye seek for riches, seek ye for the kingdom of God. And after ye have obtained a hope in Christ ye shall obtain riches, if ye seek them; and ye will seek them for the intent to do good — to clothe the naked, and to feed the hungry, and to liberate the captive, and administer relief to the sick and the afflicted” (Jacob 2:18–19).
According to these doctrines, the ideal follower of Christ is meek, humble, and charitable but also self-reliant. This is a compelling explanation for why the data shows that Mormons are over-represented among the middle-class.
The topic of consumerism vs. capitalism is a controversial one, given the Church’s investments in commerce (such as City Creek Center). See here for excellent further discussion on this topic.
Culture: Family-centric values
One significant obstacle that restricts Mormons’ economic success is the strong emphasis on family. This focus limits career ambitions, since there is pressure to make time for family and child-rearing.
The most famous quote along these lines, which continues to be regularly referenced, is a statement by then-President David O. McKay who, quoting a 1924 book, said, “No success can compensate for failure in the home.” (If you do an internet search for this phrase, you will find many associated memes and merchandise.)
Culture: Norms of serving in the Church
Along with being expected to serve family, members are also expected to serve in the Church. This can be anything from supervising young children to mentoring youth to teaching Sunday school to presiding over the flock. However, those who are the most financially secure — and hence those who can spare the extra “leisure” time — tend to be the ones who are asked to do the most. (See the section on occupational prestige above.) The correlation is far from perfect, but it is positive. This tendency to demand the largest time commitment from those who have the most autonomy in their careers is a kind of progressive tax. And it is more salient in other areas of the world where the median Church member has lower income than in the US.
Acknowledgment: I thank three close friends for their helpful comments on earlier drafts of this story.
Disclaimer: The views in this story are solely mine and do not represent those of The Church of Jesus Christ of Latter-day Saints, my employer, or any other person or entity.
