If all the resources that go into supporting religion in the United States were channeled into productive enterprises, the domestic economy would expand by an estimated $465 billion a year, a study by the Federal Reserve finds.
“Religion is a big part of the identity of many Americans, and certainly is embedded in our heritage as a country, but from a purely economic standpoint, it’s a disaster,” says Alfred Smith, a senior Fed economist.
The study by Smith and a team of researchers is the most detailed yet of the economic toll religion takes on the U.S economy. It has sought to factor in virtually every way religion intersects with the economy, from lost tax revenue to states and localities, lost investment into goods and services that grow the economy, lost productivity by having people employed in religious institutions instead of companies and organizations that produce goods and services, and the cost of violence perpetrated in the name of religious belief.
“What you have with religion is essentially a non-productive sector of the economy, and it’s a big sector, probably a good seven or eight percent of the U.S. gross domestic product ,” says Smith. “That’s a huge chunk of the economy that basically adds no value to GDP.”
Peter Noyles, an economist with Lehman Brothers, says religion is based on myths, so you’re effectively diverting eight percent of the economy to accommodate myths involving talking snakes, virgin births, and the creation of half the population from a rib bone.
“We have productive things like cars, trains, computers, and flushable toilets because of science,” says Noyles. “These things materially improve lives and create value. Believing in virgin births and getting thrown out of the Garden of Eden because a snake tells a woman born from a man’s rib to eat it doesn’t create anything. It doesn’t invent sanitation systems, cure diseases, or produce warm coats for the winter and cool shirts for the summer. So, all of the money, time, and energy put into perpetuating these myths amounts to a big diversion of resources that could otherwise be deployed in the name of making life materially better for people. So, from an economic standpoint, it really is a big loss to our country’s value proposition.”
Smith says he has nothing against religion, “but someone who donates a couple thousand dollars a year to a temple or a church might actually help improve people’s lives more if he invested it in a new company instead.”
Noyles points out that the Abrahamic religions that dominate in the United States are essentially based on the tribal rules of desert goat herders from 2,000 years ago, “and that doesn’t lead to a lot of material advancement,” he says. “Desert goat herders are not known for providing goods and services that make people’s lives better. They didn’t invent air conditioning, even though they live in the desert. And they didn’t invent sunglasses, even though they spend a lot of their day under the blazing sun. If you want to improve people’s lives, investing in companies and people that make useful things, or that improve upon useful things that are already being made, is a better way to do that than providing money to people and institutions that perpetuate myths and that, in many cases, assign bad names to people who don’t believe in or fit into the myths. So, the question is, do we make people’s lives materially better or do we perpetuate myths? Strictly from an economic standpoint, the answer is pretty clear.”
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