Entitlements and American politics

I like entitlements.

I know that’s somehow a terrible thing to say. “Entitlement” has become a dirty four-syllable word in our deranged political culture. On Fox News, they spit the word out like a rotted pistachio nut. The very obvious and universally accepted truth that our system of entitlements is broken is being taken to mean, or being used to mean, that entitlements are in and of themselves bad. But they’re not. They’re good.

People who have worked their entire lives should be able to live out their nonworking years in dignity. Children of workers who’ve died need help, as do people with disabilities. That’s why we have Social Security. Older people, the disabled,  the poor and those who, like Nick Kristof's now-famous college roomate Scott, just make mistakes,  need to be certain they will have access to good medical care — that’s why we created Medicare and Medicaid. 

Is that so terrible?

On Fox, they rail about what kind of America we will leave our grandchildren if we keep incurring massive debt. They don’t ask what kind of America we will leave our grandchildren if the poor, old and sick suffer and die of neglect in a nation of plenty.

When you read accounts of America before entitlement programs were created, and extended, it was a more miserable place. It was a crueler place.

Then came the New Deal and the Great Society, and the elderly, the sick, the poor, the disabled — “the widow and the orphan,” to use the biblical shorthand — had somewhere to turn.

I drag the Bible into this because Jewish tradition makes it very clear that helping those in need is not charity, it is tzedakah, whose root, in Hebrew, means justice. Charity is optional; justice is not.

The Hebrew word for entitlement is זכאות — zcha’ut. In English, entitlement carries an almost wholly negative connotation (unless, of course, the entitlement is your own). People who feel entitled annoy us. But the Hebrew word connotes “innocent,” as well as “right, merit, prerogative.” 

The distinction reminds me of the line in the movie “Unforgiven,” when Gene Hackman tells Clint Eastwood, “I don’t deserve this … to die like this.” “Deserve’s got nothing to do with it,” Eastwood replies (and then, you know, shoots him). It is our obligation, in the name of justice, to care for the poor, sick, disabled and elderly among us who cannot at the moment take care of themselves — deserve’s got nothing to do with it.

That said, it’s obvious the entitlement system is horribly broken. The “transfer state,” as the historian Niall Ferguson calls it, is not sustainable.

The most humane social safety net we can build is gossamer if there’s no cash to pay for it, or if its cost, whether from borrowing or taxes, depresses investment and growth.

We also know that entitlements, whether welfare for the poor or medical care for seniors, has to be managed in a way that doesn’t create dependency or fraud. In Jewish tradition, tzedakah cuts both ways — you are entitled to help from others only when you help yourself first. The Talmud admonishes that even for scholars it is better to take a job “skinning animals” than to receive charity. Tzedakah, as Rabbi Joseph Telushkin points out, has to be apportioned justly — people must not cheat or abuse the system, and they must live within their means. 

I know that, at least among Jews, I’m not alone in feeling this way. That’s why the American Jewish Committee poll of Jewish attitudes found that the top three concerns for Jewish voters in this election are the economy, health care and Social Security. For the majority of Jewish voters, this election will come down to this question: Which candidate is most likely to fix what is broken in our economy without destroying what is right about our system? 

These voters are not leftie-zombie-Democrats, as some commentators would tell you. They are far more like Ed Koch than Dennis Kucinich. They want bipartisan solutions that link solvency with compassion. They are pragmatists who understand that a system that truly protects the weak is actually better for the strong. They understand that being tough on international issues, including Israel, doesn’t matter if you have a nation of struggling, underemployed, undereducated people.

Last week, the Jewish Journal published our first book, “The Jewish Vote: Obama vs. Romney: A Jewish Voter’s Guide.” It’s by Shmuel Rosner, our senior political editor. Read Rosner, available at amazon.com, if you want one of the most penetrating sets of insights into this election. But if you want the ideals on which to base your “Jewish” vote, let me offer my go-to political consultant, the prophet Isaiah.

“If you reach out to the soul of the hungry,” Isaiah wrote, “if you ease the soul of the bruised, then your light will shine forth in the darkness, and your shadows will turn into noon. The Lord will guide you forever. … You will become a well-watered garden, an unfailing source of fresh water.”

When the issue is entitlements, my Jewish Voters Guide is Isaiah.

Rethinking the system: How Federations might adjust

North American federations could and should be doing much better than they are. They matter. They are important. They embody the ideas of community, common cause and the ability to respond to collective concerns. They are vital institutions, and we want them to succeed.

Federations have been the hub of a vast system that involves community centers, family services, bureaus of Jewish education and so many more organizations. But this system is becoming unglued, and changes need to be made.

This call for action comes from someone who has worked for three decades with more than 70 federations, including New York, Los Angeles, Cleveland and Baltimore. I have worked as a consultant with the Council of Jewish Federations, the United Jewish Appeal and scores of constituent and beneficiary agencies. I believe that federations are essential. I don’t have all the right answers. But I think I have some of the right questions.

Telling the Truth About Endowments

Endowments are a big federation success story, but trouble is bubbling both on and below the surface. Many federations proudly promote the size of their endowments, noting how much money is under federation management.

Is it real? Touting an amazing growth of funds under the federation roof paints a not-quite-honest picture. Here are some of the key issues that need to be addressed:

  • Part of or apart from the federation? More and more federations are losing control of their endowment funds as they evolve into quasi-independent entities or completely separate organizations. Should endowments be part of the federation? Separation may not be good for federations. But is it good for Jewish philanthropy and the community?
  • Are endowments Jewish philanthropies or not? A close examination of federation endowment funds shows many, if not most, of the grants and dollars from donor-advised funds and supporting foundations go to non-Jewish causes. Is this good, bad or unimportant for federations? How much do these funds actually help the Jewish community?
  • How should endowments report their holdings? Endowment funds are really a mixed bag of unrestricted and restricted funds under federation oversight. Philanthropic funds and supporting foundations are donor-controlled, not federation-controlled. How can these funds be described more honestly and accurately? How can endowments more truthfully report their giving?
  • How do endowments measure success? Are endowments doing well if they manage more and more money, give money to secular causes or give more to Jewish causes? How do we assess what the outcomes should be for endowments?
  • Should endowments spend down? Endowment advocates will tell you that the money they hold on to is for an emergency or a rainy day. Exactly how hard does it have to rain to loosen up dollars? And where does it need to rain — and upon
  • Endowment directors and federation executives — who’s in charge? Any healthy business has to have a clearly functioning chain of command. What happens when the endowment director has more perceived power and authority than the federation executive, as is the case in a number of communities? How can federations align their professional leadership to avoid dysfunctional management?

Retooling the Broken Federation-Agency System

The federation-agency relationship, the core of the federation allocation system, is outmoded. It does not work anymore, especially in the context of a single umbrella campaign.

Most of the money that federations give away through the allocations process are entitlements, with the largest amounts going to the same agencies year after year. How can federations develop new, more flexible ways of allocating funds?
There has been an explosive growth in the number of innovative programs and organizations, only some of which now get small, leftover grants. What should the federations’ relationship be to these new and growing networks of Jewish organizations at the local, national and international level? Who should be in and who should be out? Does the constituent-beneficiary agency structure make sense any more?

One example of a regular recipient is the Jewish Agency for Israel, which is one of the major beneficiaries of overseas funds from the federation system. Many donors have no idea what the Jewish Agency is or what it does, and others are openly hostile to it.

What should the federations’ relationship be to the Jewish Agency? Are there other organizations in Israel that should be supported as well, or even substituted?

Coming to Terms With the Annual Campaign

The annual campaign is what built the federation and generates hundreds of millions of dollars annually. But in real dollars, it has declined precipitously since 1967, when adjusted for inflation. The donor base is aging, especially for the largest gifts. Among the real questions facing the annual campaign:

  • Does an umbrella campaign still make sense? Federations provide a small percentage of the annual operating budgets of many agencies. Should federations raise and distribute money to local agencies, or would it be better to simply help them raise it themselves?
    Should federations once again consider running one campaign for local needs and a separate one for Israel, as they used to? Donors increasingly want to control where their money goes. Would federations increase the number of donors and how much they give by once again splitting up the campaign?
    And what about the American Jewish Joint Distribution Committee (JDC)? The JDC is well respected by its donors and serves a particular role in helping needy Jews around the world. Is it time for JDC to go its separate way and run its own national campaign?

  • How can federations turn around their shrinking donor base?
    The number of donors to the annual campaign is down over the past 20 years. Individual federations may see small blips upward from time to time, especially after a crisis in Israel. Federations invest very little in developing, acquiring and managing donor lists. How can local federations and the United Jewish Communities (UJC) invest in a national database system?
    One potential source of new donations are non-Jews. The vast majority of Americans are supportive of Israel, and many use Jewish community centers, Jewish vocational services and other Jewish organizations. How can federations expand their donor base and annual campaign by reaching out to tens of millions of Americans, especially those who support Israel?
    Part of the problem is name recognition. The United Jewish Appeal (UJA) once was the most recognized name or acronym in Jewish life. Should the federation system reclaim the UJA name as part of its effort to revitalize its national campaign?
    The annual campaign is built on a pyramid, with the largest gifts setting the scale for all gifts. Major gifts have been stagnant at the top, and the pyramid is not high enough anymore.
    Donors capable of giving $5 million or $10 million to the annual campaign do not do so. How can UJC create national and international peer groups of the wealthiest donors to radically change the standards of giving?

Administration and Function

Federations are shooting themselves in the foot on some basic administrative issues that seriously harm their image. Some internal housekeeping measures will help them better relate to donors, other Jewish organizations and the Jewish public in a healthier way.

  • Overhead issues: Federations perform many services, including community relations, Jewish education and others, as programs within the federation that are viewed as administrative overhead and make the bottom-line fundraising costs look much higher than they really are. How can federations structure themselves so that programs and services are delivered by separate agencies or subagencies?
  • Consensus or paralysis? Federations rely on a consensus model to get things done, trying to get the most people representing the most points of view to reach some common ground. The result is often the least common denominator, with the fewest people terribly unhappy, but nobody really happy either. Is this still a good model? Is it efficient? Getting everyone to buy in may bring community harmony but also paralysis.
  • Finding the right executive: Federations often seek the impossible — someone who knows the federation business as an insider, and someone with fresh, new perspectives, who is unsaddled by the old way of doing business, i.e., an outsider. What is the mix of skills and experience necessary to run a federation? What do federations really want in their executives — besides establishing better relationships with private foundations: In a number of communities, private Jewish foundations give away more money than the federation, and in a growing number of places, a single Jewish foundation does so. Many foundations often complain that federations are too slow to respond to changing needs and are too bureaucratic.
    Federations complain that foundations start projects that they do not finish and leave the mess for federations to clean up. How can federations work closer and more effectively with private foundations?

The bottom line is that federations need to change. We will make a better system by tackling the real issues, not hiding from them. If not, federations will remain part of the Jewish philanthropic landscape but nowhere near as important as they ought to be.

While federations have evolved significantly in recent years, the change is not happening comprehensively or quickly enough for them to be the powerhouses in Jewish philanthropy they would like to be or have been in the past.

Courtesy Jewish Telegraphic Agency.

Gary Tobin is president of the Institute for Jewish & Community Research and writes frequently about American and Jewish philanthropy.