The Papal States Supplied
Most of the Church’s Funds
for More Than 1,000 Years

By Kevin Orlin Johnson, Ph.D.

You sometimes still hear the old story that in the sixteenth century the popes paid for the construction of the new St. Peter’s by selling indulgences, tickets out of Purgatory at a price.  That’s not quite true.  There were abuses of indulgences at that time, but they didn’t pay for the new St. Peter’s.  

For one thing, those ill-gotten gains weren’t nearly enough to cover those costs, and almost none of them reached Rome.  Most of the money stayed with the corrupt clerics and lay fraudsters who sold the things in the first place.
 
For another thing, the Church’s finances didn’t work that way.  Our great episcopal palaces, universities, cathedrals, abbeys and oratories weren’t always built with contributions from the people in the pews.  They were funded, as a rule, with the regular, secular income from the state ruled by the local Ordinary ― taxes, of course, and rents from tenants on particular properties.  

That wasn’t at all unusual in those days.  Some mitered abbots all over Christendom ruled monastic holdings the size of an American county.  And it wasn’t at all unusual for a bishop to serve ex officio as a secular ruler, like the powerful Prince-Bishops of Mainz, Cologne and Trier, three of the seven Electors who got to appoint the Holy Roman Emperors.  Wurzburg in Bavaria was ruled by a Prince-Bishop since the eighth century.  

These states were run like any other.  Keeping an ecclesial territory in the family was common practice, as princely dynasties usually put a younger son or two into the priesthood and managed their election.  From the late seventeenth century the bishopric of Wurzburg was often held by cadets of the Schonborn family, who made their principality prosperous, learned, and sophisticated.  You can still see their immense and glorious palace there, commissioned by one prince-bishop who followed his uncle in the office and completed by his successor, who was also his brother.  It’s a major monument of our art and architecture, and the economic and cultural prominence of other prince-bishoprics like Salzburg, Augsburg, Durham, Coimbra or Laon, or Prince-Abbacies like Fulda testifies to their enlightened administration over the centuries.  

The pattern was the same with Rome, of course.  In fact, the Church ran largely on income from the papacy’s territorial holdings, the Papal States.  Those states extended in a wide band across the peninsula of Italy from the Tyrrhenian Sea on the west to the Adriatic on the east, from near Gaeta in the south to Ravenna in the north ― sometimes all the way up to Ferrara, almost to Venice.  

All of these towns, all of those dozens of little counties and principalities, came under papal rule by grant from other monarchs, by bequest or by outright conquest, but the Bishop of Rome, ex officio, was the head of government of each.  They, too, were run as any other states of the time were run.  Most of the officials were laymen, with maybe only three to five out of a hundred being priests or bishops. 

Naturally many of the popes were from Rome, and most were raised up in the prince business, past masters of conquest and politics, and diplomacy.  Martin V Colonna, elected in 1417, was the scion of a family that ruled the rough-and-tumble city, off and on, for five centuries.  He was well equipped to end the Western Schism that had afflicted the Church for forty years.  He also used his diplomatic skills to add the great city of Bologna to the Papal States and his financial acumen to reform the rules on interest and loans, stimulating businesses across his domains.  

The family of Paul III Farnese, the reformer who convened the Council of Trent in 1545, had been expanding their holdings north of the Papal States since at least the year 1000.  He himself opened the ports of the Papal States to wider commerce, increasing their prosperity for at least two centuries, right up until the Napoleonic wars disrupted trade across Europe.  

Other princely popes were also ambitious foreigners, but just as qualified.  Paul V Borghese, elected in 1605, was from an indescribably rich family of bankers who came to Rome from Siena.  A brilliant financial manager, he ran the States well, carried forward the reforms of Trent, encouraged the studies of Galileo and other advanced scientists and built the nave of St. Peter’s, which is why you see his name in the dedicatory inscription front and center.  
Like their northern counterparts, these families tried to keep the papacy in the family, too, you know.  It almost never worked out that way for them, but when it did we still got some excellent popes.  The Medici from Florence were both rich and princely, with four popes to their credit, Leo X, Clement VII, Pius IV, and Leo XI.  They all came to the throne ready to rule the States.  The Della Rovere family from the distant little town of Savona supplied only two popes, but they were Sixtus IV and his nephew Julius II, both of them commanders fierce enough to defend the Papal States and the papacy itself from invasions by foreign powers on all sides.  Sixtus IV built new fortifications around the Vatican, including the Sistine Chapel, which Julius II finished with a new paint job, you know.  

And Julius was the one who had the astonishing idea of demolishing the decrepit old St. Peter’s and replacing it with the biggest building in the known world.  He financed the project in sort of the same way the federal government financed the Capitol in Washington or your state paid for its own state house, devoting almost all of the income from the Papal States to the purpose.  

As a prince, and an extraordinarily intelligent prince too, Julius II had the vision to conceive of such a plan and the administrative genius to make it real, and a project that ambitious was just what the Church needed at that moment, as an unanswerable assertion of confidence.  By the grace of the Holy Spirit popes from poor families were exactly the right men for the job, too.  St. Pius V Ghislieri rallied the other monarchs of Christendom to turn back the Turkish invasion at Lepanto in 1571.  They weren’t princes, though, and they weren’t necessarily good rulers of the Papal States.   

Gregory XVI Capellari, elected in 1831, was the son of an obscure lawyer from the remote mountain village of Belluno near Venice.  He was a brilliant scholar, but he absolutely prohibited the construction of railways in the Papal States, the introduction of gas lighting and the maintenance of what we’d call infrastructure in general, on the express ground that these would increase commerce and make the residents rich enough to become troublesome.  Indeed, his policy of keeping his subjects poor provoked revolts, which he suppressed severely and just as clumsily.  

The old princely pattern was restored with Gregory’s successor Pius IX Ferretti, born of a noble family from Senigallia and elected in 1846.  As a native of the Papal States, he knew what had to be done to an extraordinary level of detail.  He abolished a whole morass of outdated laws, rationalized the administration from top to bottom and issued the dominions' first written constitution.  His reforms brought about unprecedented prosperity in the Papal States, and unprecedented income to the Holy See.  But if he was a prince in the old style, he was the last of them.  

Starting in 1821 a new resurgence of enthusiasm for a united Italy arose; by 1870 the armies of the new Kingdom of Italy had occupied Rome and seized the Papal States.  But each of those states still belonged, by law, to the Bishop of Rome.  To protest the occupation, Pius IX shut himself up in the Apostolic Palace and refused to leave the enclave of St. Peter’s, calling himself the prisoner of the Vatican.  

His successor Leo XIII Pecci, another brilliant scholar and diplomatic strategist, also never left the Vatican during his long pontificate.  But he recognized that the Papal States were gone forever and restructured the papacy in the role of teacher and guide rather than monarch and politician.  

Leo’s successor, Pope St. Pius X Sarto, elected in 1903, carried forward Leo’s reforms toward the Church’s new role in world affairs, insisting on doctrinal exactitude and quietly removing a lot of the pomp and circumstance of princely status from papal protocol, while his status as spiritual leader was underscored by a surprisingly constant series of miracles during his lifetime ― diseased and even paralyzed children were healed instantly at his touch, for example.  But he never set foot outside the Vatican, either.

His successor, Benedict XV della Chiesa, elected in 1914, also continued the reconstruction of the Church by promulgating the new Code of Canon Law.  But for the first time in a thousand years the Pope was unable to participate in the war then raging in Europe, although citizens of the former Papal States fought in the armed forces of the Kingdom of Italy.  About all that Benedict could do was to issue encyclicals calling for truces and armistice, all of which were ignored.  So too were his offers to stand as arbiter to negotiate a settlement and his seven-point plan for peace, issued when hostilities at last had ceased.  

Benedict’s humanitarian initiatives met with better success, but without the income from the Papal States they were severely limited.  The only income that the Holy See was getting at the time came from the ancient practice of Peter’s Pence, which Pius IX had revived and expanded:  for the first time the little donations of the lay Faithful from all over Christendom were forwarded directly to the Holy See.  

It was barely enough to maintain the Pope’s operations, even as severely reduced as they were.  But Benedict XV took one other step that proved pivotal to the restoration of the Church’s finances:  he lifted the ban on Catholics’ participation in the government of the Kingdom of Italy, whether as officials or as voters.  Most cleverly, he said that it would be all right with him if women were allowed to vote.  

The Kingdom hadn’t permitted that at the time, but these moves brought Italians into new sympathy with the papacy and opened the way for settlement of the long-standing “Roman question” that had kept the popes confined to the Vatican.  Finally the Kingdom of Italy approached Benedict’s successor, Pius XI Ratti, elected in 1922, to conclude the Lateran Treaties.

In those treaties, signed in 1929, the Bishop of Rome formally recognized the Kingdom of Italy and its right to rule the former Papal States, except for the enclave established by the original recognition of the sovereignty of the Bishop of Rome by Pepin the Short, King of the Franks, 1,173 years before, in the year 756.  That left the Bishop of Rome undisputed sovereign of only the hundred-odd acres of the State of the City of the Vatican, and he’d hold a few other ecclesial properties in Italy such as the cathedral of St. John Lateran.  

In return, the Kingdom paid the Bishop an indemnity of 750 million lire in cash and a billion more in 5-percent negotiable government bonds, effectively buying the rest of the Papal States from the Pope.  These funds became the Patrimony of Peter, invested largely in those bonds and the stock markets of Italy and other Western countries.  The income that the Patrimony generates replaces the taxes and rents from the old Papal States, supplying most of the funds for the operations of the Holy See.  But now those operations don’t include the administration or defense of a civil state stretching from sea to sea.  No, today the papacy continues the pastoral and spiritual missions as Leo XIII envisioned them after those territories were lost, missions now expanded to encompass the whole world.
 

Illustration:  Giovanni Paolo Panini, Interior of St. Peter's (1735).  Wikimedia Commons.

[One-run reproduction rights are granted provided that it includes the byline above and the notice “Kevin Orlin Johnson is the author of Why Do Catholics Do That?, now available in its twenty-fifth anniversary expanded edition at whydocatholicsdothat.org.]