Learn English – the meaning of the phrase `to be dangerous`

Soul is a complicated word since it has spiritual and religious connections. But to gain a simple meaning of soul-sapping, we can work with this:

soul

5. a: the moral and emotional nature of human beings

I assume you understood sapping. So all together, I took soul-sapping to meaning something like exhausting or demoralizing.

exhaust
: to use all of someone's mental or physical energy : to tire out or wear out (someone) completely
demoralize
: to weaken the morale of (a person or group)

So it is like weakening the mind, the body, the heart, etc.

Manage was an excellent choice here, since it suggests that officials struggle to deal with the lack of resources emotionally (personally) and meet the limitations set by the lack of resources.

Juggling basically means making many adjustments here and there in order to achieve something.

So in simple terms, the author is asking (rhetorically) if the officials adopt these tactics in order to be able to make the adjustments needed to meet the limitations set by the lack of resources.

The phrase 'out of' can be used to talk about manufacturing or creating something by using one or more ingredients or constituents. We make an omelette out of eggs and butter. We can make a house out of (among other things) bricks, stone blocks, etc. In the 1980s a British insurance company advertised its fuss-free approach to claims with the slogan "We won't make a drama out of a crisis".

You did not state the source of your sentence. It is from a short story called 'Rain' by W Somerset Maugham. A Christian missionary is talking about converting the indigenous inhabitants of a Pacific island to Christianity. One of the central beliefs of the Christian religion is that everyone is a 'sinner'. A 'sin' is an action forbidden by the Christian god, and for which the sinner is required to obtain forgiveness from the god, or else go to a bad place after they die. Since the islanders previously had no idea of 'sin', missionaries tried to make them believe that some natural actions that they did were forbidden by God. Thus 'sins' were manufactured in their minds. The Christian churches often made sins out of natural (e.g. sexual) actions which provided a source of guilty feelings. Maugham is being cynical here.