Share This Episode
Viewpoint on Mormonism Bill McKeever  Logo

Saints: The Standard of Truth Part 14: The Kirtland Bank Scandal

Viewpoint on Mormonism / Bill McKeever
The Truth Network Radio
February 19, 2020 8:56 pm

Saints: The Standard of Truth Part 14: The Kirtland Bank Scandal

Viewpoint on Mormonism / Bill McKeever

On-Demand Podcasts NEW!

This broadcaster has 662 podcast archives available on-demand.

Broadcaster's Links

Keep up-to-date with this broadcaster on social media and their website.


February 19, 2020 8:56 pm

This is the third week of this series on issues discussed in the LDS Church-published book Saints. Today we will discuss the Kirtland Bank Scandal, an event that diminishes the integrity of Joseph Smith.

YOU MIGHT ALSO LIKE

.1 Mormonism examined the teachings of the Church of Jesus Christ of Latter Day Saints viewpoint when Mormonism is sponsored by Mormonism research ministry since 1979 Mormonism research ministry has been dedicated to equipping the body of Christ with answers regarding the Christian faith in a manner that expresses gentleness and respect. And now, your host for today's viewpoint on Mormonism. What was the Kirkland's safety society. Welcome to this edition of viewpoint on Mormonism. I'm your host, Bill McKeever, founder director Mormonism research ministry with me today is Eric Johnson. My colleague at MRM we continue looking at the book Saints. The standard of truth.

It was published in 2018 by the Church of Jesus Christ of Latter Day Saints. It's a new way of looking at Mormon history and as we said in this series. It does seem to be much more transparent in its telling of Mormon history and what I mean by that is if this is to show Joseph Smith. Not only is having his human failures but in many cases you might think doing a lot of stupid things in today were going to discuss what I think is probably one of the dumbest things that Joseph Smith ever did, and that had to do with the starting of what was called the Kirtland safety society. Now this starts in chapter 23 and as I mentioned earlier were not necessarily going chapter by chapter.

Mostly topic by topic, but on page 260. It opens with this line.

Jonathan Crosby worked on his new home in Kirtland throughout the fall of 1836, you might ask who is Jonathan Crosby he's not a major player in Mormon history, but the fact that Jonathan Crosby's name is mentioned seems to prove at least to us to me and Eric that much of what we see in the book Saints is taken from the writings of a Mormon historian by the name of Richard Lyman bushman, who wrote a book called rough Stone rolling that we cited rough Stone rolling in this series but certainly Eric you would agree that it seems like a lot of what we find in Saints is taken from rough Stone rolling perhaps not word for word, and not in this much detail, but certainly it looks like bushman is a big influence in this new volume neuritis, not word for word, but the keywords are often there, and a guy like Jonathan Crosby talked about on page 331 of bushman's book is fascinating that they start off chapter 23 in the very same section dealing with the Kirtland safety society. Well, this is how the Kirtland safety society is introduced on page 260 it says well Jonathan this would be Jonathan Crosby labored feverishly to make the house livable before the baby came. Church leaders announced their plans to start the Kirtland safety society of village bank to sign the boost Kirtland struggling economy and raise money for the church so that was the motive for starting this. It was to boost Kirtland. This is Kirtland Ohio Kirtland struggling economy and raise money for the church. Now it's interesting is on page 261 at the bottom of the page it says Joseph felt that God approved of their efforts and he promised that all would be well if the Saints heeded the Lord's commandment.

So here's a case Eric of Joseph Smith using his authority as the prophet's ear and revel later over this church basically saying look, if you follow the Lord's commandments and you invest in this.

This bank safety society.

Things would be well now, wouldn't you agree that most people looking to Joseph Smith as a prophet. They would almost be disobedient to God.

If they didn't do what he told him to do so you can see how the people are put in this awkward situation.

It's not that Smith himself is not investing in this also because he does but we find out it becomes a disaster. It's something that Joseph Smith not only has control of their spiritual welfare but also of their welfare here on the earth and and so if something like this this society that he puts together the bank that he is going to fail is renter talk about is going to take away people's money. He's nothing more than selling a Ponzi scheme.

I mean, isn't that what we have a problem here in Utah we have people who take advantage of other people by taking their money and telling them about this wonderful opportunity of an investment, and it turns out that is the whole thing is a scam. Well, it turns out that this is going to be a complete failure, and people are going to lose a lot of money on page 262 it says winter enveloped Kirtland and in January 1837 the Kirtland safety society open for business. But yet you just turn over a few pages and you find on page 266 by the end of January. However, the safety society was facing a crisis so we don't even have a month go by when all of a sudden now this bank that Joseph Smith begins his starting to have problems, but this is what it says on page 266, fearing failure. Joseph and Sidney. This would be Sidney Rigdon temporarily shut down the safety society and travel to another city to try to partner with an established bank there, but the safety society's poor start had shaken the faith of many saints leading them to question the prophet spiritual leadership that had spurred their investment. Bushman talks about the very same thing were talking about on page 330 I want to read this because he gives more details. He writes in a simpler and more isolated society where mutual trust was high. This scheme might have worked in Kirtland, the bank failed within a month business started on January 2, 1837. Three weeks later the bank was floundering skeptical and perhaps mean-spirited customers presented their notes for redemption and the bank's pitiful supply of liquid capital was exhausted within days.

On January 23 were talking 21 days after it started its his payments stopped. From then on the value of the notes plummeted, falling to 1/8 of their face value. By February, all the investors lost their capital. Joseph is much as anyone he had bought more stock than 85% of the investors as treasurer and secretary and signers of the notes Joseph and Rigdon begged the noteholders to keep them promising the economy would benefit in June. Faced with complete collapse. Both resigned in August. Joseph publicly disavowed the Kirtland notes in the church newspaper.

The bank staggered on until November long since moribund and so the idea that said, Joseph had this great idea that God gave him. It certainly doesn't last very long. On page 331 of rough Stone rolling bushman writes that everyone who accepted safety society notes at face value suffered from the collapse. Losses are estimated at $40,000 about the cost of the Kirtland Temple Mormons who invested in the bank and trust of the notes suffered most think about that folks $40,000 is a lot of money back in 1837. It's a lot of money today, but you can imagine how much it would've been worth in 1837 in the way that this was built they were using land. That's not liquid to be able to say will it's worth this much and so when people start to bring their bills back and expecting to get the money that they thought it was worth, and they just don't have enough money to support it. It's like what happened in 1929 people buying on margin, you have nothing to back it up.

And so there's a complete collapse and it created a terrible situation for the early Latter Day Saints church.

This is what bushman says. He says the bank episode not only hurt the Saints financially it tried their faith, the notes had their profit signature on the face and so you have Joseph Smith writing a signature on every bill that people would've had that they were trusting in this profit to be able to give them good guidance and then this is an incredible paragraph on page 332 of rough Stone rolling widespread apostasy resulted see people were losing money and it was causing them to leave the church. The volatility in prices. The pressure to collect debts. The implication of bad faith were too much for some of the sturdiest believers.

The stalwarts Harley and Orson Pratt faltered for a few months, David Patton, a leading apostle raise so many insulting questions that Joseph slapped him in the face and kicked them out of the yard Joseph counselor Frederick G.

Williams was alienated and removed from office.

One of the prophets favorites.

His clerk Warren Parrish tried to depose him. Heber C. Kimball claimed that by June 1837, six months after the bank had started, not 20 men in Kirtland believe Joseph was a prophet now so Mormons would like to blame Grandison Newell for a lot of the failure because grandson Newell was an enemy of Joseph Smith and he bought up a lot of these notes and the purpose behind buying up all these noses. He wanted to cash them all at once, knowing that they did not have the capital to back up the notes, but to blame it on Grandison Newell I think is quite a stretch, though that may have had something to do with this problem. It certainly wasn't the downfall they should've had the capital backing up these notes in the first place and the fact that they didn't show that Joseph Smith was certainly not using a lot of wisdom when it came to the starting of the society. But here's what it says on page 268 of saints and again we do commend this book for being much more transparent in showing some of the humanity of Joseph Smith that many Latter Day Saints probably didn't even know was part of their history. It does show that Joseph Smith, though he is giving credit to God for doing this. God certainly wasn't behind it, but this is what it says on page 268.

In this climate, a struggling institution like the Kirtland safety society stood little chance Joseph could not do much to fix the dilemma yet. Some found it easier to blame him than the national economic panic soon creditors were hounding Joseph and Sidney constantly one man filed a lawsuit against them over an unpaid debt and Grandison Newell brought false criminal charges against Joseph claiming the prophet was conspiring against him. With each passing day the prophet grew more concerned that he would be arrested or killed. Now what is Joseph Smith do in light of these threats.

Though the Talks about Wilford Woodruff who is engaged to a woman by the name of Phoebe and it says that Wilford and Phoebe, who were now engaged.

They asked Joseph to marry them.

But on the day of their wedding. He Joseph Smith was nowhere to be found, leaving Frederick Williams to perform the ceremony and the It says that he and Sydney Sydney Rigdon had fled Kirtland putting distance between themselves and those who wished to harm them.

So Joseph Smith doesn't even hang around during this this problem. He decides to to leave the situation that eventually comes back, that's for sure, but it only makes you wonder Eric, what were the people thinking that were left behind knowing that their profit in their eyes who caused this problem for them now abandons them bill again.

I want to read on page 268.

Joseph could not do much to fix this dilemma yet. Some found it easier to blame him than the national economic panic that we should mention there was a national panic going on at this time there was a big recession that took place in the country. With all the more should tell Joseph Smith this is not a good time to start something like this. There were already rumblings of this going on but yet to say that some found it easier to blame him.

Then the national economic panic did a lot of things to cause this problem in Kirtland, so I would think that the members would have every right to blame Joseph Smith for getting them into this dilemma. Thank you for listening.

If you would like more information we guarding his research ministry. We encourage you to visit our website www.mrm.org you can request our free newsletter research. We hope you will join us again as we look at another viewpoint is sharing your faith with the light of day, saying it helps to know what their church is taught in several basic topics. For this reason, this research ministry has provided its crash course is a crash course, Mormonism includes concise articles highlighting what LDS leaders and church manuals have taught one issues that will probably come up in a typical conversation. You can find these informative articles and crash course Mormonism.com that's crash course Mormonism.com


Get The Truth Mobile App and Listen to your Favorite Station Anytime