Jewish Money


Give Bernard Madoff credit for one good deed: As much as his self-confessed Ponzi scheme revealed weaknesses in the Jewish world, it also laid bare many ofour strengths.

Trials and tribulations tend to do just that — bring to light the good, the bad, the ugly. When some people behave at their worst, others are forced to, or revealed to, behave at their humanly best.

That’s what any fair look at the Madoff scandal shows. The standard worry is that Madoff’s actions will give rise to a vicious anti-Semitic backlash. But I don’t see it, despite the fact that all the cretinous Jew-haters have come forward online, using this scandal as proof of Jewish financial perfidy.

Complete Madoff CoverageEarlier this week, when I entered the search terms “Madoff” and “Jewish” into Google, the top responses included JewishJournal.com and stormfront.org, a neo-Nazi Web site. That should alarm no one: The only people more obsessed than neo-Nazis with a famous person’s specific degree of Jewishness are Jewish journalists.

But anti-Semites never need a reason to hate Jews. They were penning their poison before Madoff, and they’ll be spreading it long after he’s gone. Madoff doesn’t make anti-Semites more rational, just more topical.

But will their spew gain more traction in the wider community? I doubt it.

It’s not just that Madoff’s victims were disproportionately Jewish. (That fact alone should give pause to the idea that we possess some super-Spidey sense of financial acumen.)

It’s that the list of victims reveals something truly remarkable about the Jewish world: its deep and far-reaching philanthropy.

What, for instance, does this partial list of Madoff-afflicted charities have in common: Jewish Family Service of Los Angeles, the Chais Family Foundation, the Wunderkinder Foundation, Carl & Ruth Shapiro Family Foundation, The JEHT Foundation, Julian J. Levitt Foundation, Technion—The Israel Institute of Technology?

The answer is that they spend much, if not all, of their time and resources helping non-Jews.

Steven Spielberg’s Wunderkinder Foundation supports more than 75 diverse organizations and institutions, from the American Museum of Natural History to the Young Musicians Foundation. It gave generously to Vista Del Mar Child and Family Services and to Cedars-Sinai Medical Center, two institutions founded by Los Angeles Jews that serve a largely non-Jewish population.

A much-loved anti-Semitic trope is that “tentacles” of Jewish power encircle Wall Street, the White House, the media. But the truth is that it is the tentacles of Jewish philanthropy that reach far beyond our small, numerically insignificant community.

Public radio? The Carl & Ruth Shapiro Family Foundation gave millions to WGBH in Boston. According to The Boston Globe, the Shapiro Foundation gave more than $80.3 million over the past decade to hundreds of schools, hospitals, arts groups and community-based nonprofits in the Boston area and beyond.

Human rights? The JEHT Foundation in Massachusetts gave millions to the American Civil Liberties Union and Human Rights Watch, among many other organizations.

The arts? The Arthur I. and Sydelle F. Meyer Charitable Foundation of West Palm Beach, Fla., wiped out by Madoff, supported the Kravis Center for the Performing Arts, the Norton Museum of Art and a downtown Palm Beach amphitheater, among others. Tentacles indeed.

The list is much, much longer: The money that Madoff lost had done incalculable good, saving lives, advancing art and science, making the world a better place.

In his Sunday column, The New York Times’ Nicholas Kristof wrote that liberal Americans are less generous than conservative Americans. “Liberals show tremendous compassion in pushing for generous government spending to help the neediest people at home and abroad,” Kristof wrote, “yet when it comes to individual contributions to charitable causes, liberals are cheapskates.”

I don’t know if Jews, among the most liberal of voters, fall into the cheapskate category, or whether Jewish giving pushes up the liberal average. There is no comprehensive study of Jewish philanthropy to compare Jewish giving, whether to synagogues or for other purposes, to general American giving, according to Gary Tobin, director of the Institute for Jewish and Community Research.

But if you scroll through the list of Madoff’s philanthropic victims, you’ll find plenty of evidence that even Jews who have shed every vestige of their ancient practice short of circumcision still resonate to the prophetic call to heal the wider world.

In the second volume of his “Code of Jewish Ethics,” (Bell Tower, 2009), Rabbi Joseph Telushkin traces the textual roots for this precept back to the Talmud.

“The Talmud ruled that, ‘we provide financial support to the gentile poor as well as to the Jewish poor,'” recounts Telushkin. “This ruling was issued at a time when the non-Jews among whom the Jews lived were usually idolators with values antithetical and often hostile to Judaism.”

Telushkin concludes: “If we donate only to Jewish causes or to individual Jews in need, we may stop seeing everyone as being equally created in God’s image and therefore worthy of our help. After all, we are all members of one race, the human race.”

That’s something the Madoff scandal makes clear Jews haven’t forgotten.

Jewish Charities Get Favorable Rating


If you’re concerned that the money you donate to Los Angeles Jewish charities is eaten up by administrative and fundraising costs, fear not.

Most Jewish charities in Los Angeles have a favorable rating for the amount of dollars spent on their projects compared to dollars spent on costs, according to Charity Navigator, a new philanthropic watchdog. The group assessed some 130 Jewish nonprofits, including seven from Los Angeles, among 2,500 charities across the United States. It then rated the groups based on the Form 990 tax returns that all nonprofit charities, except religious institutions, must provide annually to the IRS.

Charity Navigator evaluated the groups’ overall financial health, fundraising and organizational efficiency. The goal was to equip potential donors with enough detail to “make more intelligent giving decisions,” spokeswoman Sandra Miniutti said.

Independent analysis of charities and philanthropies remains relatively rare, so many in the Jewish philanthropic world welcome the extra focus.

Such data “should serve as a reminder to donors that it is not enough to find a cause that tugs at your heart strings,” said Mark Charendoff, president of the Jewish Funders Network. “We have to hold charities we care about to higher standards of efficiency, effectiveness and transparency.”

Among all kinds of charities, Jewish and non-Jewish, the median fundraising costs were about $.08 of every dollar, she said — “pretty good” compared to the most efficient charities. Those charities deemed the most efficient spent no more than $.10 cents, or 10 percent, to raise each dollar. It’s estimated that there are between $25 billion and $50 billion in assets in the coffers of U.S. Jewish philanthropies, from foundations and federations to nonprofits and pension funds.

What the watchdog calls religious charities range from museums to universities to the U.S.-based fundraising arms of Israeli institutions to Jewish federations and political groups. Each charity was assigned up to 70 points and up to four stars, with better scores going to those showing greater financial health and streamlined bureaucracies.

The Jewish groups ranked similarly to other nonprofits when it came to areas such as fundraising and program expenses, but ranked poorly regarding money in the bank.

Checked for their “working-capital ratio,” or how much cash each group would have left if fundraising dried up, Jewish charities had enough to last for only 3.6 months on average, compared to 8.3 months for non-Jewish charities. Such “liquid assets” could be cash, stocks or easily sellable property such as real estate. The Jewish charities ranked lower because they typically raise the bulk of their money around the High Holidays and at the end of the year, but don’t have cash on hand year-round, Miniutti said.

In Los Angeles, the top rated Jewish charities were Jewish Family Services (JFS), Mazon: A Jewish Response to Hunger and the Skirball Cultural Center, which were all awarded four stars, and 62, 63, and 68 points respectively. According to Charity Navigator, JFS spends only $.02 to raise every dollar, Mazon spends $.07 and the Skirball spends $.04.

The charity with the next highest rating was the Simon Wiesenthal Center which was awarded three stars and 53 points, and spends $.17 cents to raise every dollar. The Bureau of Jewish Education, Jewish Federation of Greater Los Angeles and the Survivors of the Shoah Visual History Foundation were granted two stars.

Nationally, the top Jewish charity was the Shefa Fund, which won a four-star, 69-point rating. The fund, dedicated to advancing social responsibility through grants, spent $.04 cents to raise each dollar, according to its Form 990.

Jeffrey Dekro, president of the Shefa Fund, said his organization’s first-place ranking “is really consistent with the doctrine of our work.”

At the bottom of the Jewish heap sat the Jerusalem Fund of Aish HaTorah, which is dedicated to Jewish education and outreach. The group garnered only 19 points and zero stars, spending $.23 cents to raise each dollar.

In several cases, Charity Navigator ranked branches of the same charities separately because they were incorporated separately for nonprofit status and file different forms to the IRS. Aish HaTorah represented one such case, with its New York branch, which it says is dedicated to “wisdom for living,” gaining 53 points and three stars, spending only $.13 cents to bring in every dollar.

Irwin Katsof, the Los Angeles-based president of Aish HaTorah, said he couldn’t discuss the findings until he had studied them more closely.

“I’m not really going to comment until I’ve had a chance to analyze how they did it,” Katsof said.

Charendoff, whose Jewish Funders Network is an umbrella group for many of the more than 8,000 private Jewish family foundations in the United States, some of which were rated byc Navigator, said the rankings provide useful data but miss some subtleties.

While the rankings allow one to compare a range of similar charities for their efficiency, they offer only a snapshot that does not reflect an organization’s development over time.

Newer charities “may take a few years to achieve a balance between building the business and delivering the product,” he said.

The rankings also do not take into account the size of an organization, he added. A small foundation may have only one fundraising professional, accounting for a major share of its budget, compared to bigger organizations with more money and a few more fundraisers.

Charity Navigator’s rankings, compiled in August and updated Sept. 3, were based on federal reports from 2001 and 2002, but the group “looked back” to 1997 and 1998 to “calculate growth as well,” Miniutti said.

Other national Jewish nonprofits that got ranked for overall efficiency included Hillel: the Foundation for Jewish Campus Life, which ranked 10th, and the World Jewish Congress, which was listed 112th.

Staff Writer Gaby Wenig contributed to this report.

Dismay Over Tax Bill


Jewish charitable organizations are not going to get the help they were hoping for in the new tax bill, since the final version leaves out a proposal that might have boosted giving by billions of dollars.

The bill, signed by President Bush on June 6, grabbed headlines for its tax cuts and $1.35-trillion figure. But Jewish groups were surprised and dismayed that a plan to let people who do not itemize their tax returns deduct their charitable contributions was left out in last-minute negotiations.

“To say that we are disappointed is probably an understatement,” said Diana Aviv, vice president of public policy for United Jewish Communities, the Jewish community’s central fundraising and social services agency. “We thought the issue was dear to the president’s heart,” she added.

The White House’s larger faith-based initiative has always included a plan to expand the federal charitable deduction to 80 million non-itemizers.

In a speech on May 20, Bush was still touting that plan. “Everyone in America — whether they are well off or not — should have the same incentive and reward for giving,” Bush said.

But administration officials negotiating with Congress over the tax bill did not make the non-itemizing provision a priority as they fought for other parts of the bill: for example, reductions in the tax rate and marriage penalty and elimination of the estate tax.

The non-itemizing provision, it was thought, would have potentially encouraged almost $15 billion a year in new charitable giving. It is unclear how much Jewish charities would have benefited.

The White House says the president hopes the provision will function as part of the larger faith-based initiative, which is still in its working stages. An official at the Office of Faith-Based and Community Initiatives said the non-itemizing plan was, in fact, never intended to be included in the tax bill.

But Jewish groups, which had universally supported the provision, see the failure to include it in the tax bill as the probable end of the idea. “The tax bill is where you do tax policy,” said Hannah Rosenthal, executive director of the Jewish Council for Public Affairs.

Rosenthal said the provision could have been used to reach out to younger people, to get more non-givers to participate, and to change the culture of charitable giving in the country.

One issue of particular interest to the Jewish community that did make it into the tax bill was the expansion of education IRAs, or education savings accounts. For the first time, parents will be allowed to use the tax benefit of the savings account toward tuition at private and parochial elementary and secondary schools. Orthodox groups, in line with the White House, say the education savings accounts expand parental choice.

Other Jewish groups, such as the Religion Action Center for Reform Judaism, have opposed the accounts, not as a church-state issue but a public-policy one, saying the accounts siphon off money from the public school system.

Those Jewish groups opposed to the education IRAs did not make too much noise about its inclusion in the tax bill. A number of the groups had focused on what they see as the larger threat, direct government support for private schools, and so fought against the use of vouchers.

Vouchers were ultimately blocked in the education bill in the U.S. House of Representatives, and they are not thought to have much chance of passage in the Senate.

Opponents of the education savings accounts say lower-income families without thousands in savings cannot take advantage of the benefit, and those that can will find the annual benefit is nominal.

“Every little bit helps,” countered Abba Cohen, director and counsel of the Washington office of Agudath Israel of America, a fervently Orthodox group. He said that the accounts are not a government subsidy and that the Jewish community has to pursue every avenue to help parents who send their children to Jewish day schools.

Fundraising Fluctuations


The umbrella organization for North American Jewish federations is now the seventh largest charitable organization in the United States, according to the Chronicle of Philanthropy.

This marks the first time in recent years that a Jewish organization has ranked in the top 20 of the Chronicle’s annual listing of the 400 not-for-profit organizations with the largest revenues from individual contributors.

And, had the tabulation been done differently – to include all dollars raised by federations, instead of only those allocated to overseas needs – the ranking would have been considerably higher, say officials of the umbrella group, known as the United Jewish Communities (UJC).

According to the Chronicle, the UJC raised $524.3 million in 1999, but UJC officials say the federation system actually raised close to $2 billion.

The United Jewish Appeal, the largest of the three organizations that merged to form the UJC last year, regularly appeared on the Chronicle’s top 10 list until 1996, when it ranked No. 6. However, it was later removed from the list when the publication adopted a now-abandoned policy of excluding umbrella organizations, such as the UJA and United Way, that receive their money from other organizations on the list.

Gail Hyman, the UJC’s vice president of marketing and public affairs, said she is pleased the charity has been recognized in this year’s listing, noting that “we are among the leading and best fund-raising organizations nationally.”

But UJC’s high ranking comes as the overall number of Jewish organizations on the top-400 list has dropped from 27 to 25.

In addition, most Jewish groups, particularly federations, slipped in rank since last year, even if their overall revenues increased. This indicates that other philanthropies – which, according to the article, are enjoying average increases of 13 percent this year – are growing more rapidly than Jewish ones.

Among the few Jewish groups to increase in rank this year are some undergoing major endowment campaigns, like the Jewish Federation of Metropolitan Detroit; the Conservative movement’s Jewish Theological Seminary, which is in the middle of a capital campaign; and PEF Israel Endowment Funds, a group that funnels donor-designated gifts to a variety of Israeli organizations.

Observers of Jewish philanthropic trends say the overall drop is not surprising, given that, as American Jews assimilate, they contribute more money to secular causes and less to Jewish organizations.

“I suspect the greatest growth is into non-Jewish giving by Jews,” said Bruce Arbit, co-managing director of A.B. Data, a firm that assists many Jewish organizations in direct marketing campaigns.

American Jews, said Arbit, “feel less connectedness to the Jewish people” than they used to. In addition, intermarried households – which are growing in number – tend to give less to Jewish organizations than other Jewish families, said Arbit.

David Mersky, a senior lecturer in Jewish philanthropy at Brandeis University’s Hornstein Program in Jewish Communal Service, said the general decline in ranking for Jewish groups results from the relatively weak campaigns of Jewish federations.

Federation campaigns, in which donors contribute to a general pool, “have not kept pace with the rate of increase of other philanthropies,” said Mersky.

Federation annual campaigns increased 4 percent on average in 1999. But more than half of total federation giving was not to the annual campaign but to endowments.

Mersky said endowments and other campaigns that allow designated giving, in which donors can choose exactly where their money goes, do better – which may explain the success of PEF.

However, philanthropy experts caution against reading too much into fluctuations that occur from year to year.

“Fundraising, organization by organization, is very cyclical,” said Mersky. He pointed out that a major campaign one year may be followed by a drop the following year, and that in any given year, a one-time major gift like a bequest can “make all the difference in the world” and “rocket you forward.”

The rankings – in which 12 federations and communal funds appear, compared to 15 last year – are also consistent with trends away from federation giving and toward more specialized causes, like specific institutions and “friends of” Israeli organizations.

Ironically, one of the Jewish groups enjoying the most dramatic increase in ranking is one that does not do any fund raising at all.

“We never asked anybody for a dime. We have no fund-raising dinners. It’s just word of mouth,” said B. Harrison Frankel, president of PEF Israel Endowment Funds, which ranked 279 this year, up from 351 last year.

The organization channels funds to more than 1,000 nonpolitical organizations in Israel – ranging from the Magen David Adom relief agency to the Israel Women’s Network – and raised $38.5 million in 1999, up from $12 million in 1991. Run almost entirely by volunteers, PEF allows donors to earmark their contributions.

After the UJC, the New York, Chicago and Detroit federations were the largest Jewish organizations on the list. With revenues of $156.9 million, New York’s federation ranked 53 (down from 44 last year) and its Jewish Communal Fund – which allows donors to create their own charitable foundations – ranked 61.With $66.9 million, Hadassah: The Women’s Zionist Organization of America was the largest non-federation Jewish organization appearing on the list. It ranked 170, down from last year’s 133.

Six Jewish universities – including three American “friends of” Israeli institutions – also made the list.


The Top 10 Jewish Charities

Following are the top 10 Jewish philanthropies, according to the Chronicle of Philanthropy’s listing of 400 largest charities:

United Jewish Communities
Rank this year: 7
Rank last year: not listed because it was founded in 1999
Private support: $524.3 million

UJA-Federation of Greater New York
Rank this year: 53
Rank last year: 43
Private support: $156.9 million

Jewish Communal Fund (related toUJA-Federation of Greater New York)
Rank this year: 61
Rank last year: 54
Private support: $145.7 million

Jewish Federation/Jewish United Fund
of Metropolitan Chicago

Rank this year: 110
Rank last year: 91
Private support: $97.3 million

United Jewish Foundation and Jewish Federation of Metropolitan Detroit
Rank this year: 151
Rank last year: 155
Private support: $77.1 million

Hadassah, the Women’s Zionist
Organization of America
Rank this year: 170
Rank last year: 132
Private support: $66.9 million

Jewish Community Federation of San Francisco, the Peninsula, Marin and Sonoma Counties
Rank this year: 175
Rank last year: 138
Private support: $65.3 million

Jewish Federation
of Greater Philadelphia
Rank this year: 188
Rank last year: 242
Private support: $62.3 million

The Associated: Jewish Community Federation of Baltimore
Rank this year: 223
Rank last year: 218
Private support: $52.2 million

Jewish Federation of Greater Los Angeles
Rank this year: 231
Rank last year: 236
Private support: $50.1 million