GOD’S BANKERS: A History of Money and Power at the Vatican
GERALD POSNER
Simon & Schuster, 2015, 732 pages
Review by Phil Shannon
For an institution which proclaims that it is not possible to worship both God and Mammon, the Catholic Church has managed to do so just fine, according to the writer and attorney (and Catholic), Gerald Posner, in God’s Bankers.
The comfortable pomp-filled lifestyle of the ecclesiastical elite was vastly enhanced from the sixth century with the sale of indulgences to the lay faithful, which promised freedom from punishment for sin. This monetising of salvation financed the building of the Sistine Chapel and St. Peter’s Cathedral.
With Italian unification in the 19th century, the Catholic Church lost its vast and wealthy feudal empire in central Italy (the Papal States), leaving the remnant micro-state of the Vatican teetering on bankruptcy. The bailout came from fleecing the poor through ‘Peter’s Pence’ (morally-coerced donations from the laity) and user-pays charges for Church services such as weddings and funerals.
Money from ‘Christ-killers’ was also acceptable as the doctrinally anti-Semitic Catholic Church took out loans from the Jewish Rothschild’s bank, where it was later joined by money from authentic Jew-killers - the Vatican was the first state to recognise Nazi Germany which reciprocated by collecting, and making mandatory, the Church’s tax on German Catholics.
This tax, which alone paid for almost all the Vatican’s operating expenses, influenced the Church’s complicity in the Holocaust. Despite Hitler’s brutal reign of terror, the Pope and his most powerful cardinals stood by whilst the Vatican Bank, which was founded during the war, remained open to Third Reich circumvention of Allied anti-Nazi economic sanctions. God’s bank went on to become a covert conduit and repository for Nazi wartime plunder, including gold coins, rings and dental fillings from death camp victims smelted down into gold bars emblazoned with swastikas.
In the Vatican’s host country, the anti-communist Catholic Church had struck a similarly ideological and mercenary deal with Mussolini’s fascists. In return for granting tax-exempt status to the Vatican, compensation for the confiscation of the Papal States, and payment of the salaries of all Italy’s 25,000 parish priests, the fascists, in the 98% Catholic nation, got Vatican-bestowed political legitimacy and Church-delivered electoral support.
Financial self-interest also operated, along with anti-socialist animus, in the Vatican’s reactionary politics after the war. Conservative Italian governments earmarked 1% of income tax as a direct subsidy to its Cold War religious ally whose opposition to the Italian Communist Party was in part motivated by fear of a communist government nationalising major industries and wiping out the Church’s vast corporate investments.
With exquisite hypocrisy, the morally-stern Catholic bank chased further dividend returns by investing in casinos, arms manufacturing, printing firms that published pornographic magazines, and pharmaceutical companies that made birth control pills.
The Pope-appointed private financiers in charge of the Vatican Bank were also vectors for a host of financial scandals, including political bribes fuelled with Church funds, corrupt joint ventures with corporate criminals, and money laundering for Illegal arms traders, narco-traffickers and Mafia bosses who took advantage of the Vatican Bank’s no-questions-asked policies and its opaque audit trail. The Vatican Bank became one of the world’s ten most popular destinations for dirty money and offshore tax evasion.
Posner concludes his exhaustively-detailed forensic indictment of the Vatican Bank and its top moneymen on an optimistic note that the dismal Papal succession of doddering old reactionaries has ended with Pope Francis (the “People’s Pope”) and his appointment of the former Autralian Cardinal, George Pell, as the “uber-cleric of the Vatican’s money” heading a newly-created Secretariat of the Economy, to cleanse the bank of its financial abuses.
This rosy prognosis, however, seems more prayer than expectation. Francis’ reformist zeal is much more about creating an impression of doctrinal modernisation and a tweaking at the policy margins than actually changing fundamental Church teaching or institutional culture.
Pell has been reported in L’Espresso as spending lavishly on offices, salaries, business class travel and champagne, quite out of keeping with Francis’ avowed advocacy of a Church of the poor, for the poor. His record of denial and cover-up of clerical sexual abuse of children in Australia, in part driven by a concern that legal settlement costs would open the Catholic Church in Australia to massive financial exposure, should also be cautionary.
Francis’ denunciations of ‘the mentality of profit at any price’ is likely to be just pious rhetoric, given that the aim of Pell’s new outfit is to generate more income from its assets, swelling the sheer inertial mass of Church wealth - the Vatican Bank has a $60 billion real state and share portfolio, whilst, worldwide, the real-estate assets of the Catholic Church are around $2 trillion dollars, equivalent to the G.D.P. of Russia.
None of this inspires confidence that the money-changers will be tossed out of the temple any time soon. If the Catholic Church really wants to get a fix on sin, they’ll find it sitting right under their pecuniary noses, in their bank’s ledgers, in their Bible of capitalist wealth accumulation, in their God of Profit.