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FBOs: Don't Hide Your Light Under a Bushel
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In a January decision, the National Labor Relations Board ruled that part-time faculty at Manhattan College in New York can unionize, because the Catholic college isn't sufficiently religious to be exempted from the unionization law.  (See the Religion News Service story by G. Jeffrey MacDonald here.)

Religious higher education institutions have the labor-law exemption to ensure that the government does not entangle itself in the internal affairs of religious organizations.  But to be exempt, the institution does have to be religious.  The NLRB said that Manhattan College was not, because its "stated purpose does not involve the propagation of a religious faith, teachers are not required to adhere to or promote religious tenets, (and) a religious order does not exercise control over hiring, firing, or day-to-day operations."

It's a troubling list of characteristics:  surely a religious liberal arts college is actually a religious institution even though its purpose is faith-shaped education and not "propagation of a religious faith" and even though the institution is itself religious, rather than being under the control of some other religious entity.  And isn't it an improper entanglement of government in religious matters for the government to set itself up as the judge of what kind of college is authentically Catholic?

Still, the decision ought to be a wake-up call for every faith-based organization.  If you expect the government to protect your religious identity, you had better be sure that the religious identity is evident in what you say and in how you operate. 

This is the message also of the recent Ninth Circuit decisions upholding the freedom of World Vision to hire and fire on a religious basis.  The government will only treat an organization as a religious organization if its religious character is visible in its operations and in its public face.

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Despite broad opposition from higher education institutions and little evidence of need, the federal Department of Education went ahead last October to adopt a series of regulations that are especially worrisome to faith-based colleges and universities.  One widely reported federal concern is for-profit colleges that in some instances are more intent on enrolling students to draw down federal education funds than to educate them. 

But the new federal regulations go far beyond that legitimate concern.  Particularly troubling to faith-based higher education is a new requirement that states establish procedures to authorize colleges and universities within their borders, rather than relying on the various private accreditation agencies.  The ostensible goal is to ensure that students and taxpayers get the education they are paying for.  But with the government's tendency these days to favor secular uniformity when it regulates, any new authorization requirement must prompt concern from faith-based organizations.  And note that many states have "Blaine" amendments that can be interpreted to require their governments not to aid "sectarian" education, creating an opening for mischief, even if a religious college has long been operating and even lauded in a state. 

The Department of Education did include an exemption for religious colleges from the new requirement of state approval--but to be exempted, an institution can award only "religious degrees or certificates":  it has to be a Bible college or a seminary!  That is, only a very tiny proportion of religious higher education institutions will be exempted; all the rest will be exposed to new oversight by states, some of whom may not look kindly on their odd non-secular ways.
 
For background, see Naomi Schaefer Reilly, "New Rules Worry Christian Colleges," Christianity Today Online, Nov. 1, 2010.

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For a long time, hard-nosed politicians and government accounting experts have insisted that tax deductions and exemptions are nothing more than "tax expenditures," hardly any different than actual government payments, because the deductions or exemptions "cost" the treasury all that uncollected money.

There is a different view:  not all money belongs, in principle, to the government.  Moreover, because the government must protect religious exercise and ought to encourage charitable activity, while "the power to tax is the power to destroy" (as the US Supreme Court said in an early case), taxation of charity, especially religious charity, is more likely to be illegitimate than appropriate. 

The "tax expenditure" view is, of course, very congenial to government.  It assumes that all the uncollected money is legitimately due to the government, which only because of its generosity has declined to take it away.  And since the untaxed money is, in this sense, really government or public money, anyway, activists are ever ready to attach conditions to it--to attach the "strings" of government requirements to the charities that are exempt from tax or that get tax-deductible contributions, just as activists are ever ready to attach new "strings" to government grants and contracts. 

Nevertheless, tax deductions and exemptions from tax (money not paid to government) are actually in fact not identical to government grants and contracts (money received from government)  That gives a firm basis for fending off the "strings" some would like to attach, such as a requirement that charities, to be able to receive tax-deductible gifts, must not "discriminate" on the basis of religion when hiring staff (even though the charity is religious and is legally free to hire by religion) or a requirement that the charity must provide every legal health "service" (even if, as a religious clinic, it has faith-based objections to offering abortions). 

But now, under the pressure to increase government revenue to help stem the tsunami of red ink, more and more politicians (state and local, as well as federal) are eager to cut back on those deductions and exemptions. (For an overview at the federal level, go here). 

Worse, the Debt Reduction Task Force of the Bipartisan Policy Center (co-chaired by Sen. Pete Domenici and Alice Rivlin) has proposed converting the charitable deduction--the supposed "tax expenditure"--into actual IRS payments to the various charitable causes the taxpayers favor!  As "Restoring America's Future," their proposal, explains, every taxpayer will be eligible for a 15% credit for charitable contributions.  But the credits will go not to the taxpayer but to the designated charities.  And then, as the paper delicately puts it, "qualifying charities" will apply to the IRS for a matching grant to supplement the taxpayer credits, "so that for every $85 the taxpayer gives, the charity will receive another $15." 

Slick!  "Structuring incentives in this way permits reductions in the costs of charitable giving . . . without requiring [taxpayers] to file a tax return if they otherwise wouldn't need to." 

Except that this would be actual government expenditures and not just "tax expenditures."  And you can bet that, to qualify for this brave new charitable incentive, charities will have to satisfy an ever-growing list of qualities favored by the latest progressive majority. 

Instead of this, Sen. Domenici and Dr. Rivlin, let's stick with actual tax deductions and keep reminding ourselves that "tax expenditures" and actual government expenditures are not identical. 

Further reading: 

Stephanie Strom, "Nonprofits Fear Losing Tax Benefit," New York Times, Dec. 2, 2010.

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A recent Wall Street Journal article notes a relentless and swift increase in the number of professions and occupations that require a state-issued license.  Such regulation can be good and even essential:  few of us are in a position to make our own judgment about the qualifications of a brain surgeon or lawyer, and each of us is better protected when the government ensures that professionals must know what they are doing when they deal with matters that affect our health and safety. 

But more and more occupations are subject to licensing.  In 1950, the article says, only 5% of US workers had to be licensed, but in 2008, 23% had to get a license!  In the mid-1980s, about 800 professions were licensed in one or more states; today at least 1,100 are.  Thus not just lawyers, surgeons, and psychiatrists have to take classes, pass a test, and pay a fee to get operating permission; so do florists, retailers of frozen desserts, "shampoo specialists" (150 hours of classes in Texas), glass installers, barbers, and many more.  Beyond health, safety, and competence concerns, as economists and others have noted, lurks the desire to restrict entry of others into a profession, thus preserving the power to raise prices.

Yet the mad dash to license ever more occupations has a worse negative consequence than the economic one.  To license a professional, the state sets qualifications and standards (in addition to fees!).  That's a way to screen out incompetent people and to require adherence to safety requirements, etc.  But, increasingly, it is also a way to require professionals to conduct themselves in line with a secular and sexually permissive perspective:  to require therapists to regard same-sex marriage to be the same as male-female marriage; to require doctors and nurses to perform medical procedures despite their religious scruples; and so on. 

Robert Vischer, University of St. Thomas Law School, points out that there has been "a shifting view of professional licenses." 

Traditionally, "the state's licensing authority has been viewed as a means by which to ensure a provider's competence.  As access to goods and services becomes an essential dimension of meaningful liberty (in progressives' eyes), there is a stronger justification for viewing licensed providers as quasi-public officials, and the license becomes a means of ensuring that governmental objectives are met." 

And, alas, those governmental objectives (and the passions of the progressives) rarely rank very high preservation of the religious freedom of religious institutions and individuals.

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The American Bar Association says it is "the most comprehensive guide of its kind" and "essential reading for anyone who wants to know their legal rights and responsibilities in the workplace." It purports to be a standard guide for employers and employees, with important information on discrimination laws as well as contracts and other job matters.  But in fact the ABA's Guide to Workplace Law (2nd edition, 2006) is entirely misleading for faith-based organizations-surely a major audience of employers.

Why misleading?  Because it is only in a brief paragraph tucked away in an appendix that the book acknowledges that religious organizations are free to consider religion when hiring and firing.  The rest of the book details how employers are prohibited from engaging in religious job discrimination--but without stressing that the prohibition applies only to secular employers! 

The book says, for example, that "A requirement that a job applicant be of a specific gender, national origin, religion, or age will almost always violate both federal and state anti-discrimination laws."  Yet if the employer is a religious organization, then it is not a violation of the law for it to specify that "a job applicant be of a specific . . . religion."  That's because federal and state law protects the ability of religious organizations to select employees based on religion--a vital freedom if they are to preserve their religious identity and faith-based standards. 

The ABA book is fine as a Guide to Workplace Law for Secular Employers.  Religious employers must read it with extreme caution.  If they simply follow its guidance, they are likely to end up as secular employers themselves.

Religious employers would do well to read The Freedom of Faith-Based Organizations to Staff on a Religious Basis, by Carl Esbeck, Stanley Carlson-Thies, and Ron Sider (Center for Public Justice, 2004). It isn't an equivalent handbook, but at least it is accurate on the key issue of religious employment by religious employers.

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Can A Business Be Religious? Courts and legislatures have a strong tendency to claim that only nonprofit organizations can be authentically religious and thus eligible for the legal exemption that permits selecting employees according to religious criteria.  What then about Chick-fil-A, Whole Foods, Tom's of Maine, Herman Miller, ServiceMaster, and other businesses that have a deliberate and identifiable religious motivation and character?  For more on religious companies, see Dan Gilgoff's blogpost for the CNN Belief Blog,"10 religious companies (besides Chick-fil-A)."

Canadian Association of University Teachers Goes After Religious Universities.  Under the guise of protecting academic freedom, CAUT has been "investigating" and condemning various Canadian religious institutions of higher education.  Those institutions are ably defended by a petition that says,

"We object in principle to CAUT's arbitrary restriction of academic freedom to individuals and its failure to consider the corporate dimensions of that freedom.  We note that the very concept of academic freedom arose historically in religiously founded institutions. In a time when colleges and universities are under great pressure to serve the interests of commercial and political initiatives, religious institutions can play a special role in preserving academic freedom.

"We also observe that the missional specificity of religious institutions is not without analogue in public institutions, which may contain within them institutes or research centres with their own acknowledged pre-commitments. Both remain free associations of scholars."

H.T. to Prof. David Koyzis, Redeemer University College

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