November 19, 2018

Finance: One of the Worst Jewish Stereotypes

Photo from Flickr.

The idea that Jews are innately good with money is among the oldest Jewish stereotypes, one that continues to impact perceptions of Jews today. In China, books touting the supposed secrets of Jewish financial success have been best-sellers. Worldwide, anti-Semites have long railed against Jews’ purported control of international banking.

As with many stereotypes, this one has its origins in actual events. Jews long have been well-represented in the fields of finance and business. This is commonly attributed to the fact that, for centuries, Jews were excluded from professional guilds and denied the right to own land, forcing them to work as merchants and financiers.

However, some academics contend that the historical evidence does not support this thesis and that Jewish financial success is instead due to the community’s high literacy rates.

Whatever its causes, Jewish business and financial success has been a major driver of anti-Semitism.

Shakespeare’s Shylock character in “The Merchant of Venice,” a money lender who demands a pound of flesh from a debtor who defaulted, is among history’s best-known caricatures of the Jewish businessman. That caricature lent a sinister undertone of greed and exploitation to Jewish financial dealings that would be invoked to justify anti-Jewish measures for centuries.

Over time, the Jewish community evolved into a uniquely educated population, incentivized to abandon farming in favor of better-paying professions and businesses.

Despite his Jewish ancestry (his parents converted their family to Protestantism when he was a child), Karl Marx, the philosopher who first popularized the idea that capitalism is inherently exploitative, singled out Jews for their role in promoting it.

Supposed Jewish control of the global financial system was a major theme of Hitler’s war against European Jews, Father Coughlin’s anti-Semitic rants and the czarist forgery of “The Protocols of the Elders of Zion.”

Jews have been associated with moneylending for at least a millennium.

Medieval Christian theology held that charging interest (known as usury) was sinful, which kept many Christians from becoming financiers. The field thus came to be dominated by Jews.

The historian Howard Sachar has estimated that in the 18th century, “perhaps as many as three-fourths of the Jews in Central and Western Europe were limited to the precarious occupations of retail peddling, hawking, and ‘street banking,’ that is, moneylending.” This fed the notion among Christians that Jews were morally deficient, willing to engage in unethical business practices that decent people had rejected.

An alternative explanation holds that the Jewish penchant for finance is a result of Jewish emphasis on learning and literacy. In their 2012 book, “The Chosen Few: How Education Shaped Jewish History, 70-1492,” economists Maristella Botticini and Zvi Eckstein contended that, with the destruction of the ancient temples in Jerusalem and the beginning of the Jewish Diaspora, Jewish continuity suddenly became dependent on widespread religious literacy.

Those who educated themselves remained Jews. Those who did not, assimilated or converted to other faiths.

As moneylending evolved into institutionalized banking, Jews continued to occupy major positions in the financial world. Across Europe in the 18th and 19th centuries, Jews built influential banks, further feeding anti-Semitic conspiracy theories. With mass-Jewish immigration to the United States beginning in the late 19th and early 20th centuries, Jews assumed prominent positions in the growing financial center of New York, establishing Salomon Brothers, Lehman Brothers, Goldman Sachs and others.

They also figured prominently in government financial positions. Four of the past eight U.S. Treasury secretaries have been Jews. Three of the 12 presidents of the World Bank have been Jewish.

How to Get a Loan With Poor Credit Rating

In the U.S., your credit score is a very important factor in applying for financial products, whether they are loans or advances. If you don’t have a good credit score, you might find it difficult to find loans and access other kinds of credit. Even if you get one, you might be in for higher interest rates than other people who have better credit. The reason is that lenders often worry about the ability of people with bad credit to pay a loan back and they want additional compensation based on the risk.

However, most people do not have a perfect credit score in reality. The truth is that a big portion of the United States has poor credit. So if you are someone who is having issues getting the financing you want for things in your life, do not give up. There are loans for people with bad credit available. There are multiple ways to get such a loan even if you don’t have great credit. A lot of lenders will give people a second chance, even with a spotty credit history.

What a Personal Loan Entails


A personal loan is one of the more popular kinds of financing from traditional lenders. This is also called a term loan. That means that you pay the loan back over a particular length of time. The interest rate can be fixed or variable. It is a fairly straightforward loan, making it easier for most people to understand and thus more common.

One of the primary benefits of a personal loan is that it less complicated than other types of credit. This is because you are typically provided with a fixed payment that does not change. You can pay this back easier because you know how to budget for it and exactly what to set aside.

What Can You Use a Personal Loan For?


You can use a personal loan for almost anything you want. A common example is using one for a car loan. This is usually a 5-year term and lets you afford the vehicle that meets your needs instead of having to settle.

You might also use a loan to get a laptop, phone, or even just some extra money while you look for work or move into a new house. The interest rates on personal loans can be much lower than a credit card so they are popular for certain purchases.

What Chance Do I Have Of Getting One?


If you have moderately bad credit, it will be easier to get a loan than if you have very bad credit. There are many factors that go into your loan chances. The first indicator is your credit score. But don’t worry, you can improve your chances in other ways too.

If you have a good income and other assets, these can factor into your likelihood of getting a personal loan. If you recently got a new job or expanded your business, you could be in luck. The key is to keep attempting to improve your income and assets while paying down previous debts that you may owe. That will make your chances improve so you can get the financing you’ve been wanting.

When it comes to getting personal loans, it can be difficult if you don’t have great credit. Luckily, however, you do have options. You don’t need to suffer the reality of not having access to additional funds. If you use the advice above, you can get the help you need. That way you can bridge the gap due to increased bills, loss of a job, or other life circumstances that may be causing you financial stress.

Financial Literacy Now or Calamity Later

The financial crisis of 2008 that roiled global financial markets and triggered the largest recession in modern American history had a number of causes. Experts put most of the blame on the housing bubble that caused an overvaluation of homes and featured banks that loosened lending policies to capitalize on the flood of potential homebuyers. Although there have been regulatory steps taken to stabilize the affected markets since then, there’s a worrying sign that points to a potential repeat in the offing.

In the run-up to the collapse in 2008, U.S. household debt had reached a total of $12.68 trillion. The damage to the credit of the average American family that resulted from the crisis caused that number to drop sharply in the following years. The troubling news is that the debt level has rebounded and has surpassed pre-crisis levels, rising to $12.73 trillion in the first quarter of 2017. The news calls to mind the old axiom that “Those who do not remember the past are condemned to repeat it.” The question is, have we learned anything since then, and are we in trouble?

Financial Literacy in the U.S


One measure of overall financial literacy in the U.S. is found in the public school system. The statistics are not encouraging. In 2016, only 17 states had mandatory personal finance courses in their public high schools. The lack of standardized education guarantees that the next generation of consumers will be woefully underprepared to manage their own finances and credit. It may lead to further increases in household debt, which may eventually imperil the economy again.

A Cloudy Economic Picture


The economic environment won’t be doing anyone any favors either. Economic data indicates that the median household income still hasn’t recovered to the levels reached at the time of the financial collapse. This would seem to indicate that the increase in debt can be attributed to need rather than largesse. It’s a continuation of the exact pattern that led to the previous collapse, but with a deceptive twist.

During the recovery, the stock market has soared and new wealth has been created. The trouble is that it’s been concentrated in the top 10% of earners. Everyone else has seen flat wages and a rise in low-paying jobs. It’s an environment that doesn’t bode well for the economic health of most Americans.

What can be done?


To survive in this economy, those in the middle and lower classes will have to manage their finances well and employ solid strategies to stay afloat. Since there’s a dearth of compulsory education on the subject, Americans must take it upon themselves to learn how to handle their money. There are plenty of resources available to help them do so. A great place to start is to do some research at the website of the U.S. Consumer Financial Protection Bureau.

There’s also a wealth of helpful information and educational material available at the Better Credit Blog. It’s a great place to learn tips and tricks from professional financial managers who are on top of the latest economic trends. For those that prefer a more academic approach, there are even free courses available online that cover everything the average person needs to know to manage their money.

The Time to Adapt is now


Economic conditions still aren’t great for the vast majority of Americans. The good news is that they have plenty of tools at their disposal to stay solvent and safe in any financial environment. If we all dedicate ourselves to becoming financially literate, we may well prevent another economic disaster. The costs of inaction are too high for us to leave it to chance for even a moment longer.


10 Easy Steps For Buying A Used Car

Buying a second-hand car should be a source of financial saving as much as it should be an easy experience. There are many challenges involved in the process that you should be aware of.

A recent survey on what individuals feared most of the idea of buying a used car, 0.19 percent mentioned haunted vehicle as a deal breaker, 0.28 percent were worried of spiders in their target cars, 18 percent indicated that problems on the asphalt would be an issue, while 20 percent revolved around the issue of whether or not the said car was a dud car. Clearly, various issues cloud the purchase of a used car and the following steps should get you to work around driving yourself one.

1. Financing


When money matters come into question, it involves much more than just the initial purchase amount. It encompasses the maintenance costs, insurance costs, and the fuel consumption aspect. The important question you should answer is how much you would be willing to spend on the above against your financial muscle. As a golden rule, your car expenditure should be no more than 20 percent of your monthly take-home pay.

2. Vehicle’s On Your Target List


You should consider vehicles that meet your budget needs while sorting the particular reasons you are buying the car. Listing the various vehicles that fit your needs and fall within your monetary limits is the first step. The list helps you make an informed choice.

3. Fine-Tune the Target List


So the list of cars fit the bill when money is concerned as well as the intended use of the vehicle. This stage will require researching on the customer reviews on the cars, and their ratings. If they fall within your comfort levels, check out for deals and offers that may include trade-ins or price discounts that increase savings from the initial asking price.

4. Identify Sellers


Under this, you get to select the areas you identified as those that sell one of your target vehicles. This could include individuals, dealerships or auctions. Get all the contact details, working hours and how long their offers are available.

5. Make Contact With The Seller


Get in touch with the seller and ask for the details that were not have mentioned. Such details border around the age of the car, reasons for selling the car, the car’s mechanical issues, payment terms and what other offers they may not have mentioned.

6. Checking the Car Out


Feed your eyes with what you may just end up purchasing. Check out for the interior’s condition, the exterior look, the defects, and dents the car may have, the tire condition, all while ensuring there are no oil leaks, among other conditions that you should not compromise on.

7. Schedule A Test Drive


At this stage, you would want to get in touch with your mechanic. The mechanic has a higher probability of identifying the technical issues of the vehicle with a run on the asphalt. Professional mechanics will go a step further in advising you of whether the vehicle is all that it is passed on as on paper as well as the condition of the vehicle.

8. The Car’s History


With the help of the car’s records, identifying some key areas in the vehicle’s history should not be at all difficult. You will need to identify the service schedule, the vehicle’s inspection and also ascertain the ownership of the car. You do not want to buy a car with a police record or a stolen vehicle.

9. Price Negotiations


Talk numbers with the selling party, agree on a price and a payment plan. Make sure you get the best deal that works for you.

10. Finalize the Purchase with Proper Documentation


You need to ensure you sign the relevant documents of sale for the vehicle, pay the necessary fees attached and smile after a job well done.

These easy steps will help you sidestep some of the major hurdles involved in buying a used car. Once you follow them you can get your keys and drive off. You earned it.
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Getting the Most out of Your Car and Your Business – Understanding Lease Terms

Leasing has become one of the most popular ways for people to acquire the use of high-cost items. Car leases and commercial leases are the two most popular types of leases. Here is a description of what they are and their most popular types.

A lease is a contract by which one party conveys land, property, services, auto, etc., to another for a specified time, usually in return for a periodic payment. The receiving party is called the lessee and the conveying party is called the lessor.

Property Leases

Property rental is always managed by a lease agreement. The tenant, in this case, is the lessee, and the landlord is the lessor. A lease typically guarantees that the lessee pays a specific amount of rent to the landlord for a specific number of years or months. The landlord agrees to provide the property in a specified condition, and under terms of the contract and the tenant agrees to pay the amount and follow the terms and conditions as specified in the contract. If either party does not hold up their end of the contract, there are consequences. There are two types of standard property leases:

  • Gross Lease: A gross lease typically means that the landlord pays for the building’s property taxes, insurance, and maintenance. It can, however, be modified so that the tenant pays for specific expenses such as utility bills. This type of lease can be erratic for tenants and needs to be reviewed carefully because often a landlord will overvalue costs to ensure all bills associated with the property are covered.
  • Net Lease: There are several different types of net leases. For example, a triple net lease means that the tenant has to pay for taxes, insurance, and maintenance in addition to rent. A double net lease only requires the tenant to pay taxes and insurance on top of rent, and a net lease means the tenant has to pay some or all of the taxes, insurance or maintenance. These leases allow the tenant to have some control over costs associated with the property (water, electric, etc.) and can often save the tenant some monthly costs. But again a tenant needs to be careful about calculating its overall cost.

Car Leases

More and more people are choosing to lease rather than purchase their automobile. Car leases typically run 36, 48, 60 or 72 months, allow the lessee to drive a certain amount of miles per year, and at the end of the term, the car is returned to the lessor. Leasing is available for both new and used cars. There are two types of car leases generally available:

  1. Closed-End: A closed-end lease is by far the most popular type of car lease. It allows lessees to return a vehicle at the end of the lease and either walk away or buy the vehicle for a pre-arranged amount. Unless there is physical damage to the car, excessive wear and tear or the agreed upon mileage allowance in the lease agreement exceeded, there are no additional charges due. All car manufacturers and many leasing companies offer closed-end leases for cars.
  2. Residual Obligation (Open End): An open-end lease carries the risk for the Lessee. The vehicle is leased and the lessee makes scheduled payments like in a closed-end lease. These payments are calculated based on the estimated value of the car when it will be returned. If the car’s value is less than estimated, the lessee must make up the difference when the car is returned. Open-end leases may have smaller monthly payments, but again there is a risk that there will be a lump sum payment (or additional monthly payments) due when the car is returned. The complexity of this calculation makes this type of lease substantially less popular than a closed-end lease

Leases are legally binding contracts and consumers should always fully understand the terms of a lease agreement before signing it.

Jonathan Medved: The venture activist

When it comes to Israel, Jonathan Medved has no interest in watching from the sidelines. 

A former political activist and UC Berkeley alum, Medved, a Los Angeles native and Jerusalem resident, was named by The New York Times in 2008 one of the most influential Americans impacting the Jewish state. His life has been one of identifying opportunities — starting small and growing fast.

As a college student in 1973, Medved returned to the San Francisco Bay Area one week before the start of the Yom Kippur War and found a campus awash in anti-Israel sentiment. Motivated to do something, the young Zionist became a campus activist for Israel, eventually becoming the Jewish Agency for Israel’s director of university services in the United States.

Although he’s still an ardent and outspoken supporter of Israel, Medved has come a long way since his undergraduate days, finding a less political means of supporting his beloved country — venture capital crowdfunding. 

Speaking in December in Santa Monica on what was the second leg of a whirlwind, worldwide tour, the uber-energetic, 58-year-old entrepreneur showcased his latest adventure in the financial world: OurCrowd. 

It’s a year-old “equity-based crowdfunding platform” that allows accredited investors to put as little as $10,000 — small for the venture capital world — into a select number of approved and vetted Israeli startups, all of which need cash to grow, and stay afloat, until business operations kick into full gear.

“You are able to take the best of venture capital — the professionalism, the diligence, the protection you get — and combine it with the fun, and discretion, and the freedom, and the low entry price of being an ‘angel’ [who invests after falling in love with a company],” he told a group of 80 at Cross Campus, a shared work space in Santa Monica. 

Here’s how it works: An Israeli startup in the early stage of fundraising applies to be listed as a company backed by OurCrowd. Then, a team of analysts studies the ins and outs of the business: When can it expect positive cash flow? How much debt does the company anticipate accumulating? Is the entrepreneur’s vision realistic?

If the startup is brought under OurCrowd’s wings — something that Medved said happens to only 2 or 3 percent of the 100-plus monthly applicants — it may find itself with a potential gold mine of capital. Since Medved launched the company in February 2013, he has helped 31 startups raise $30 million from about 3,000 investors. 

During his Dec. 13 presentation, he introduced local entrepreneurs and venture capitalists to several Israeli startups, including Takes and Easy Social Shop. Last year, OurCrowd investors raised $250,000 for Takes, a camera app that allows users to convert a series of photos into video. And since being funded by Medved’s group in 2012, Easy Social Shop, which makes it easy for e-commerce retailers to set up virtual storefronts on Facebook, has gone on to facilitate 80,000 shops listing more than 8 million products.

Jon Warner, a local venture capitalist who came to do some preliminary research on OurCrowd’s startups, said he was most intrigued by Easy Social Shop and “its potential to monetize” Facebook’s user base.

Not just anyone can invest through OurCrowd. Because many countries, including the United States, legally require investors in startups to already have plenty of their own cash, the players putting skin in the game tend to be experienced in identifying people and ideas that have serious potential.

This wasn’t a career Medved sought out. Born in San Diego, but raised in the Brentwood neighborhood of Los Angeles, he is one of four brothers in a family that seems to have a flair for jumping head-on into the public square. Michael, who lives in Seattle, is a best-selling author and nationally syndicated talk-show host. Harry is a spokesman for the movie Web site Fandango and lives in the Los Angeles area.

Kicked out of Sinai Temple’s Hebrew school as a youngster, Medved attended Palisades High School and was raised in what he termed a traditional Jewish family.

“This was an idyllic childhood,” he said, reminiscing about his Westside days. “Where I grew up was like ‘Leave It to Beaver.’ ”

Having no clue what he wanted to do professionally — just knowing that he didn’t want to be a spectator — Medved visited Israel for the first time in 1973. The Jewish state had the “Birthright effect” on him long before there was Birthright, and seven years later he made aliyah

“When everybody saw me going off to live in Israel, they said, ‘OK, well, he’s an idealist, he’ll be poor,” recalled Medved, who has a thick beard and wears a kippah.

In 1980, he said he still had no direction, other than knowing that he wanted to be “an actor and a player” in the Israeli experiment. Then, in stepped his late father, David Medved, a physicist who, in the 1950s, developed technology to destroy midflight intercontinental ballistic missiles. 

Trying to get a fiber optics communications startup off the ground, the elder Medved couldn’t have known that asking his son for help would lead to a successful venture capital career for the latter.

Even while working with his father, Medved thought his future would be in activism. That is, until an Israeli scientist he was dealing with on the project spoke to him like a fellow Israeli — no subtleties, no nonsense.

“What a waste,” the scientist remarked in Hebrew after speaking with Medved about his activist hopes.

Surprised, Medved shot back, “Ani boneh et ha medinah” (I’m building the country).

“What your father is doing is real Zionism,” responded the scientist. “Go build a factory for fiber optics.”

And in 1982, the father-son duo did just that, subleasing space in a Jerusalem building used by glassblowers. 

“People didn’t know what fiber optics were,” Medved said. “They’d see the glassblowers and figure that must be [fiber optics].”

For the next eight years, Medved built up the company, Meret Optical Communications, eventually selling it in the early 1990s to Amoco Corp., which later merged with BP.

A few years later, he started the venture capital fund Israel Seed Partners in Jerusalem. It went on to invest nearly $300 million in startup Israeli tech and life-science firms, and proved to be great preparation for OurCrowd. 

By the time Medved temporarily exited the venture capital world to found the mobile social apps company Vringo in 2006, he had invested in more than 100 Israeli startups, helping 12 of them reach a net worth of more than $100 million each.

“To sit and listen to people’s dreams and then to be, in a small way, able to help them make it come true is the most wonderful job,” he said. 

Unfortunately, he admitted, helping businesses grow, sometimes, means doing some less pleasant things.

“God forbid, if the business is not meeting its projections, you’ve got to cut the budget, which means fire people.”

Medved sits on the boards of many of OurCrowd’s startups, and for those that he doesn’t, he helps recruit experienced mentors, doing the best he can to make sure all of his companies succeed.

Medved knows that playing in the Israeli financial world also means factoring in risks unknown to many investors around the world, namely the volatile nature of the region.

“People have learned to discount this,” he said. “I’m not the only one who has somehow just learned to live with this kind of existential risk. It’s Microsoft; it’s Cisco; it’s Google; it’s Facebook.”

Following the event in Santa Monica, Medved was able to sum up his philosophy succinctly by referring to Pirke Avot:

“Who is wise? [He] who sees the yet-to-be.”

Federation pension fund struggles

A retirement plan run by The Jewish Federation of Greater Los Angeles is more than $25 million underfunded, according to financial statements filed in October. The statements say the pension fund, which holds savings for more than 2,000 employees working for eight different Jewish-affiliated organizations, hold assets equivalent to only 76.1 percent of its projected liabilities. Because that number is below 80 percent, the Internal Revenue Service considers the fund in “endangered status” or a “yellow zone.”

“The truth is, it’s very easy to see a big number and get alarmed,” Federation Chief Operating and Financial Officer Ivan Wolkind said when asked about the fund’s status. But, he said, “It’s almost where we need to be.”

Indeed, the fund’s position had been getting stronger, improved from 71.5 percent funded in 2009, to 76.4 percent in 2011. But the most recent disclosures showed a slight dip in 2012.

“It’s not cause for concern,” Wolkind said. “There are plans, in Detroit, that are 30 percent funded. We’re actually in a strong position.”

One might suggest that the City of Detroit, which recently filed for bankruptcy, represents an extreme point of comparison. Yet Jason Hsu, an adjunct professor at UCLA Anderson School of Management, said many state and municipal pension funds are less than 50 percent funded. 

In those cases, he said, “Unless the state or the city is able to come up with a significant amount of money, the likely outcome is there needs to be a major negotiation. And people are going to get reduced benefits.”

The Jewish Federation’s case is far less severe.

“It’s really not that bad,” said Mindy Gassman, a licensed pension actuary, although she added, “It’s not a perfect situation.”

Nearly two cents of every dollar contributed to the Jewish Federation in 2011 went into its employees’ retirement account. For two other of Los Angeles’ Jewish nonprofits that receive funding from Federation — Vista Del Mar and Bet Tzedek — that distribution was nearly five cents of every dollar. Over the last few years, each nonprofit has paid 16 cents of every dollar of payroll into the pension fund. Wolkind said Federation operates the fund as “one of the services [they] offer to the Jewish community.”

Eight L.A.-based Jewish nonprofit organizations participate in what’s called a defined benefit plan, meaning that each employee, upon retiring, will be entitled to a specific amount based on a formula of their highest salary, how old they are when they retire and how many years they worked for their organization. The nonprofits pay into the fund, and the money is invested in equities, bonds and elsewhere. If the fund does poorly, or if employee salaries go up too quickly, or if any number of other things go wrong, the plan can quickly become underfunded. 

Representatives from four of the six biggest nonprofits in the Federation pension plan — Bet Tzedek, Jewish Vocational Service, Aviva Family and Children’s Services, and Vista Del Mar Child and Family Services — all declined to comment for this article.

The Zimmer Children’s Museum, one of the smallest organizations participating, has only three employees in the plan, and therefore pays far less than Vista Del Mar and Federation. 

“It’s an amount that hits us,” said Esther Netter, the Zimmer museum’s CEO. “It isn’t inconsequential.” 

Jewish Family Service spokesman David Gershwin offered only this prepared statement: “Jewish Family Service pension contributions have been stable for the last few years. And JFS will continue to participate in the pension plan administered by the Jewish Federation.”

In fact, Jewish Family Service of Los Angeles has been increasing its payments into the fund every year — nearly $1.4 million in 2012, $170,000 more than the year before. The amount that each organization contributes to the fund is pegged to employee salary — 16 percent of payroll, in recent years — and a rise in salaries is just one of what Wolkind said were numerous causes pushing up contributions. Another is the effort to close the gap between the amount of money the pension fund has and the amount of money it owes to future retirees. 

Bet Tzedek’s contribution rose more than $100,000, as well, to more than $520,000 in 2012 — a significant sum for an organization that takes in around $8 million a year in revenue. One source within the nonprofit told the Jewish Journal that Bet Tzedek board members are worried, but not too worried, about retirement costs. Their bigger concern, reflected in ongoing contract negotiations with their employees union, is the cost of employee health care, which is up to roughly $900,000 a year and shows no signs of letting up.

Projected retirement costs, at least, are expected to level off. In 2006, organizations that are part of the Federation’s retirement plan began enrolling new employees into a defined contribution plan — an example of which is a 401(k) — which pays money into a worker’s retirement account but has no fixed output and is, therefore, not put in danger of insolvency if the financial markets crash. Such plans don’t guarantee employees a set amount when they retire.

“It’s unfortunate,” said Regina Birdsell, president of the Center for Nonprofit Management. “Our sector doesn’t think about taking care of ourselves as much as we think about taking care of others. The donor community has very little tolerance for the overhead price rage. They want to know that all their money is helping the cause without thinking about the margins it takes for getting things done.”

Many pension funds invest about 60 percent of their assets in the stock market, which meant they were hit especially hard during the financial collapse of 2008. But what followed hit them just as hard: In an attempt to stabilize the economy, the U.S. Federal Reserve lowered interest rates as much as possible. That has increased retirement funds’ “liabilities,” which are essentially an estimate of how much money future pensions will cost the fund. The estimate goes up when interest rates are low, as it’s generally harder to get a decent return on your investment when rates are low. 

“It’s been a double whammy,” said Hsu, referring to the drop in stock prices followed by the slashing of the interest rate. “It’s increased the funding gap between liabilities and assets tremendously.”

And the Jewish Federation may not have all the options available to it that a private company might have to close the pension gap.

“The Federation has no way of doing what companies normally need to do — increase productivity,” said Gabe Kahn, a co-director of the Media, Economics and Entrepreneurship program at USC. “They’re a fundraising organization. They’re just shaking a tree and passing it around.”

Private Bank of California: It’s not just about the money

The signs of Richard Smith’s success precede him: His 25th-floor office on Santa Monica Boulevard overlooks Los Angeles Country Club’s golf greens to the north and the spread of the city’s business districts to the south. The dizzying height of his headquarters at The Private Bank of California is emphasized by floor-to-ceiling windows and the luxurious quiet that accompanies real money, the kind that pays for service so good it doesn’t rattle, only hums.

Smith says this is the secret to his career, and especially his success at Private Bank, which he co-founded in 2004 with partners that include Richard Pachulski, a well-known bankruptcy attorney, and Stuart Rubin, a real estate big shot. 

“It’s not retail,” he said of the work he does for high-net-worth individuals, business owners and others involved in business management, entertainment and real estate. No, The Private Bank of California is another level entirely: “It’s concierge.” 

Smith, 60, has had years to hone his philosophy and cultivate connections, which helped make The Private Bank of California attractive enough to be purchased last year by First PacTrust Bancorp Inc., which changed its name to Banc of California Inc. in July. Earlier this week, the entire company, including subsidiary banks, relaunched as Banc of California.

After receiving a degree in marketing and finance from the University of Denver, he spent two years at Manufacturers Hanover, a bank holding company then based in New York, before moving to California with his Los Angeles-born wife, Dana, in 1977.

It’s instructive to listen to Smith rattle off the list of institutions he’s worked at over the years, to hear the names of businesses created and swallowed by other businesses as a matter of course in the moneylending world. It is precisely the variability of the banking industry that excites Smith, who grew up in New York assuming that, like his grandfathers on both sides — and his father and his uncles — he would end up in the city’s garment industry. 

“But it wasn’t really that attractive to me, so as a [college] junior, I ended up meeting somebody in the banking business who convinced me that banking would be a good career,” he said. 

Smith was game, but he didn’t have high hopes. 

“I really thought I would be in it for a couple of years, and then I’d go work for one of my grandfathers,” he said. “Well, what are we now, 38 years later?”

Despite doing well in his college courses, he was initially pigeonholed back into the garment ghetto. 

“I did really well in my credit class learning how to be an analyst in the banking business, and I had the pick of the litter where I’d go,” he said. “And of all places, they found out I was Jewish and put me in the garment district!” 

Smith has never shied away from his Jewish identity. His wife works in Encino at Valley Beth Shalom in the Conservative congregation’s infant and toddler program, and the couple sent their children to Northridge’s Abraham Joshua Heschel Day School, where Smith used to sit on the board. Smith also serves on the Zimmer Children’s Museum board.

Smith credits his Jewish upbringing, which was Conservative but not particularly observant, for instilling in him some of the values that have made him such a successful businessman and boss. Although Smith is at work more often than not — asked for a number of hours, he responded only “a lot” — he said he believes strongly in giving his employees time to enjoy their private lives and get involved in their communities. 

“I want them to have another life. I want them to be close to their families,” he said. “I try to get them involved in boards, charities. I want them to be involved philanthropically in something. … Giving back is something that I’ve been taught from the time I could understand, and I try to encourage my employees to do it because I think that it makes them better employees, because they’re happier.” 

Smith will take this ethos a step further in his new position as Banc of California’s president of private banking. He’s excited that Banc of California has hired former L.A. Mayor Antonio Villaraigosa to manage relationships between the bank and the community. Villaraigosa’s role, as strategic adviser to Banc of California’s chief executive officer, is to help create a community banking strategy that focuses on expanding home ownership as well as lending to entrepreneurs and creating service opportunities in the community. 

As for Smith, the proud grandfather to four grandchildren, he hopes to keep working as long as he feels valuable.

“If I were doing it just to be wealthy, I probably never would have done it,” he said of banking. “The money was not the issue, for sure. I always liked learning about different things. … To this day, it’s still my passion.”

Relationship advice: Marry young

I know the arguments that people give for delaying marriage: 

“I’m not ready.”

“I need to be financially secure first.”

“Right now, I’m preoccupied with ____” (fill in the blank).

“To tell you the truth, I’m having too much fun to settle down.” (This argument is usually offered by males — and generally told only to other males.)

Others cite data suggesting that marrying later means less likelihood of divorcing.

I would like to make some arguments on behalf of early marriage.

The first and best argument for early marriage — providing, of course, that one meets a good person and believes this person will also be a good parent and/or provider — is that it forces you to grow up.

Nothing — and I mean nothing — makes us grow up as much as marriage does. Children are a close second, but the maturity leap from singlehood to marriage is still greater than the maturity leap from marriage without children to marriage with children.

The problem today is that becoming mature is not even on the list of most young people’s life goals. If anything, staying immature — committing to no one and remaining dependent on others — is more of a goal.

That is what “not ready” usually means.

Putting aside the financial issue, which we will address, “not ready” almost always means not willing — not “not ready” — to take on the permanent commitment to someone else that marriage entails.

Why were people throughout history ready to commit to marriage at a much younger age than people today? Only because society expected them to become adults at a younger age than today. Nothing makes you an adult as much as responsibility does. And no responsibility makes you an adult as much as marital responsibility.

And why, even today, are religious Jewish and Christian young men and women ready to marry in their early 20s? Because their values and their culture expect them to.

Let’s be honest. “I’m not ready” is usually a statement of emotional immaturity even when the person is otherwise a wonderful and responsible man or woman. 

As for the financial aspect of “not ready,” this is puzzling. People who say this may be entirely sincere, but they may also be fooling themselves. For one thing, two people living together cuts many costs almost in half. For another, nothing spurs hard work as much as marriage (and family) does. Married men make more money than single men. Moreover, many of the happiest and most bonding memories of couples are the early days when they financially struggled.

Another argument pertains to each sex separately. 

To women, I would argue that:

a) More good marriageable men are available when a woman is 23 than when she is 33, not to mention 43. To deny this is to deny reality. To dismiss this as “sexist” is to complain that life is sexist. Moreover, it is irrelevant whether it is “sexist”; all that matters is whether it is true.

b) She will learn little more about men and relationships by either going from relationship to relationship after college or by living with a man for many years without marrying. In other words, all those years a woman spends avoiding looking for a man to marry are largely wasted. There is rarely major emotional growth — this is just as true for men — during those unmarried years. And, in the meantime, she might have been able to find a good man and begin the most satisfying thing in life — making a home and, hopefully, a family. 

c) The notion that marriage will interfere with her career means she believes that, in the long run, career success will bring her greater joy and happiness than marital success. For the vast majority of women, this is not true. Young women who do not believe this should speak to successful single women in their 40s.

To men, I would argue that:

Guys who spend their lives avoiding marriage are, as a general rule, not impressive. That is one reason committed bachelors rarely get elected to high office. Neither sex thinks much of them. I understand men “sowing their wild oats” in the belief that it can help later on in life if they are plagued with curiosity about what it would be like to be with another woman. But after a certain age, chasing women is quite pathetic, and men doing so are spinning their wheels in terms of personal growth. Unfortunately, not all men want to grow up — just ask all the women looking for a man who complain of a surfeit of “man-boys.” 

I learned all this first from traditional Judaism, and later from life and from callers to my radio show. 

In order to be a judge on the Jewish high court, the Sanhedrin, a man had to be married and a father. Also, in traditional Jewish life, a man could not wear a tallit (prayer shawl) in synagogue until he was married. It was the community’s unsubtle way of telling males that until they committed to a woman in marriage, they were still considered a boy.

There are, of course, exceptions. But in general, boys and girls stay single. If they want to become men and women, they marry.

Dennis Prager is a nationally syndicated radio talk-show host (AM 870 in Los Angeles) and founder of His latest book is the New York Times best seller “Still the Best Hope: Why the World Needs American Values to Triumph” (HarperCollins, 2012).

Desalination, Israeli-style

The subsidiary of an Israeli company has been selected to design the largest seawater-desalination plant in the Western Hemisphere. Located in northern San Diego County, the plant will be designed and operated by IDE Americas, part of IDE Technologies, headquartered in Kadima.

Announced in December, the plant — known as the Carlsbad Desalination Project — will be able to produce up to 54 million gallons of water every day and will help San Diego County’s goal of attaining 7 percent of its water supply from desalination efforts by 2020. Water authorities at the state and local levels have indicated that a greater focus on desalination efforts is critical to maintaining a sustainable water supply.

The plant will be owned by Poseidon Resources and operated in cooperation with San Diego County Water Authority (SDCWA), according to a water authority spokesperson. Poseidon will spend $954 million to build the project.

Construction on the plant, which will be built near the Encina Power Station in Carlsbad, Calif., is already under way. IDE Americas will operate and maintain the plant for 30 years after construction is completed in 2016. 

Since its inception in the early 1960s, IDE Technologies has been involved in more than 400 desalination projects in more than 40 countries. IDE’s newest Israeli project is a desalination plant slated to begin operating this year in Sorek, about 10 miles south of Tel Aviv. The Sorek plant will sell desalinated water at a rate of about 50 cents for 250 gallons.

SDCWA Director of Water Resources Ken Weinberg said that he thinks IDE’s involvement with the Carlsbad project was a major selling point in SDCWA’s decision to get on board.

“We’re very excited to have IDE Americas design and operate the new plant,” Weinberg said.  “[IDE Americas] is integral to the plant’s design and operation, and SDCWA and IDE will have a very close relationship over the coming years.”

Mark Lambert, CEO of IDE Americas, was unavailable for comment, but he said in a statement last month that the Carlsbad project will help shape the diversity of American water sources. 

“Our view is that the Carlsbad project that we’re about to embark upon will accelerate the visibility of desalination in North America,” he said. “The movement in the U.S. toward desalination has been a long time coming, and we’re ready to lead the charge.”

Weinberg also said that having a plant built and operated in San Diego would stimulate the local economy. Project officials estimate that construction will create 2,300 jobs and that operations at the plant will support 575 jobs.

“It’s going to have a big impact on the local community,” he said. “The new desalination plant, alone, will double the amount of locally produced water supplies in San Diego …”

Desalination is the process of purifying saltwater to make it suitable for human consumption. Today, desalination usually occurs through a process known as reverse osmosis, or membrane desalination. 

Practical membrane desalination was invented by Jewish chemical engineer Sidney Loeb, who, as a student at UCLA more than 50 years ago, helped develop semi-permeable membranes that allow water to pass through but not large molecules or ions. Loeb took his discovery to Israel and taught developed membrane desalination for two decades at what later became the Ben-Gurion University of the Negev.

According to Christopher Gasson, publisher at the water-industry analyst firm Global Water Intelligence, Loeb’s contribution to Israeli desalination, as well as millions of dollars in research grants from President Lyndon B. Johnson’s administration to IDE Technologies, helped IDE and Israel become world leaders in desalination efforts.

“IDE’s thermal plants remain dramatically cheaper than anything that the rest of the world has to offer, although the market is limited because of access issues with the Arab world,” Gasson said. “IDE also continues to innovate in membrane desalination — besides continuing to drive the cost of water down, it has also made desalination greener through its chemical-free desalination system.”

One challenge to the Carlsbad project came from the Surfrider Foundation, which filed a lawsuit arguing that the project violated a California water code law that requires seawater-based operations to ensure optimal circumstances for minimizing damage to marine life. The 4th District Court of Appeal, however, ruled in favor of the project in November.

Gasson said that the new San Diego desalination plant shows a change in the status quo for California, which he says has been resistant to desalination efforts in the past. 

“Despite being the birthplace of membrane desalination, California seems to be terrified of the technology,” he said. “The fact that they are now having to turn to an Israeli company to supply something as basic as water suggests that America does need to look at the way it supports innovation.” 

Money saving ideas: For richer, not poorer

Tying the knot doesn’t have to be synonymous with fastening a financial anchor around newlywed couples. It just requires great care, sufficient research and attention to detail.

Even with the best planning, however, it might be hard to believe you could pull off a dreamy wedding on a smart budget, given the average cost of a modern wedding. According to a recent report in USA Today, couples spend an average of $26,989 for their weddings. notes most couples spend between $19,223 and $32,039, not including the honeymoon. 

“Couples need to weigh their fantasy wedding against the financial realities of the fantasy wedding,” warns L.A.-based wedding planner Wayne Gurnick, who specializes in Jewish and kosher weddings. “We find that we are financial planners as much as event planners.”

Gurnick advises couples to engage in comparison-shopping for products and services, as the real goal should be getting the most value for the money. Even when couples have put together a budget, he points out that costs can still add up quickly if couples have not done their homework thoroughly.    

Here are several money-saving ideas to give couples a stronger start, according to Gurnick and fellow event planners Michele Schwartz, creator of, who boasts many L.A. clients; Los Angeles-based planner Sarajane Landun; and chef Jason Collis, an Oxnard resident and owner of Plated Events.

Food for Thought

Whether you choose to go the glatt kosher or kosher-style route with catering, there are several ways to stick to a budget without sacrificing flavor or being stingy.  

Many hotels will allow wedding parties to buy the use of  the entire kitchen, ideal for couples who have an affordable kosher caterer or a caterer through a family connection. In these cases, Gurnick says, the hotel provides the service staff, dishes and facilities, but allows outside caterers to use and prepare in their space.

Foodwise, consider serving heavy appetizers at the reception or stick with a dairy-based meal. Also, seated dinners are often less costly than buffets, as the hotel or caterer can account for the exact amount of food they need to prepare, Schwartz explains.

Instead of going the traditional cake route — which can run from $800 to $2,000 — Collis suggests trying a dessert table with a range of options for guests, along with a very small cake for the cake-cutting ceremony. 

Edible party favors that are part of the centerpiece can save money, too, according to Schwartz. A
cupcake bar and homemade party favors, such as preserves in pretty jars, are popular right now. Other examples of tasteful takeaways include personal cakes, teas and coffee, which can be packaged in do-it-yourself mason jars for added savings.

Location, Location, Location

Just as good movie-location scouts can sniff out ideal places to impart production value to an independent film, couples can find perfect backdrops for their nuptials and receptions without breaking the bank (after determining the size of the guest list, of course).

Look into city- or state-run venues, such as local beaches, parks, recreation centers, civic gardens and zoos. As each couple has its own unique personality, one of these nontraditional venues could be a perfect fit, Landun says.

Also, find a space that doesn’t require a lot of rentals and décor in order to spruce up the room.  Be able to work with what the venue already has in terms of chairs, linens, stage, etc., she says.

As for backyard weddings, they can save lots of money — if you get creative. Be forewarned, rental and décor costs may add up, and the backyard wedding can end up being more expensive due to the cost of bringing in tables, chairs, linens, dishes and other items, Gurnick says. 

No matter where the reception ends up, consider changing the “when.” Weekdays are less expensive than weekends and may be easier to negotiate with the venue, Landun says.  Think about getting married during non-peak times of the year instead of during peak season, which is generally the summer months.

Setting the Stage

Rather than go for broke on the décor — literally — with flowers, custom dance floors and pure silk linens, look for unusual alternatives. 

One hot new concept, Gurnick says, is a sophisticated picnic-style wedding where tables and chairs are replaced with beautiful, handcrafted quilts; elaborate gourmet picnic baskets take the place of a traditional sit-down meal. This also allows guests and the wedding party to dress in more casual attire.

According to Landun, reusing floral arrangements from the ceremony (chuppah, aisles) by putting them in the main reception area is cost-effective and eco-friendly. Collis directs couples to local growers and points out that neighborhood farmers markets can provide seasonal blooms. 

Bridesmaid bouquets can be used to line the edge of the sweetheart table, and the chuppah used in an outside ceremony can be recycled as a decoration for the bridal party table. 

It’s possible to save money on dance floors, too. Companies that provide custom portable dance floors may have a floor in stock made for another couple that can be rented at a fraction of the cost, Gurnick says.

Hidden Costs

Unexpected services beyond décor and food are just as important — and often expensive if they are not tracked carefully. That’s one reason why Schwartz says it’s worth it to invest in a planner who will help couples sniff out hidden costs, ask the right questions and negotiate contracts so there aren’t any surprises. 

Also, see if the venue can offer a self-parking arrangement. Self-parking costs typically run half that of a valet service, according to Gurnick.

Finally, he urges couples to keep in mind: Every 10 people added to a guest list incrementally adds a significant amount to the final tab. That’s 10 more people who will require newlyweds to spend money on meals, centerpieces and chairs. 

B’nai B’rith rejects listing among insolvent charities

B’nai B’rith International rejected as inaccurate its topping a well-known charity watchdog’s list of “charities in deep financial trouble.”

“B’nai B’rith International does not have $13 million negative capital and we are not in financial trouble,” the group said on Charity Navigator’s Web site. “The numbers Charity Navigator used to place B’nai B’rith on its ‘10 Charities in Deep Financial Trouble’ list were a year old.”  

It appears from the most recent of the organization’s International Revenue Service 990 forms posted on the B’nai B’rith Web site that Charity Navigator was working from 2010 figures, when B’nai B’rith recorded $13.5 million in negative capital.

The most recent form, for 2011, shows B’nai B’rith $154,145 in the black. The 2011 return also shows that donations to the organization spiked from $8.7 million in 2010 to $12.2 million last year.  

The B’nai B’rith statement cites the U.S. government’s takeover in September of B’nai B’rith International’s pension plan as a factor in the group’s improved fiscal outlook, noting that the decision to turn to the Pension Benefit Guaranty Corp. was a difficult one.

“The request was made for a greater good — to continue the good works we do, and to ensure former employees and current pension-eligible employees will have their pensions when they need them,” the statement said.

B’nai B’rith’s listing as the most insolvent of 10 charities was part of a Top 10 issue of Charity Navigator marking its 10th anniversary for December, when charitable giving tends to spike.

Avoiding the ‘Jewish fiscal cliff’

The main Capitol Hill sport these days (after obsessive coverage of the Petraeus scandal) is how the government can avoid the impending “fiscal cliff.” A similarly serious financial challenge lurks in the future of the Jewish community — namely, how do we better balance our books and continue to fund an engaging and vibrant Jewish community? We may not be running toward a cliff, but a long slide would leave us in the same place.

Unfortunately, the Jewish Fiscal Crisis (JFC) is more systemic and fragmented than even our government’s current dilemma and cannot be solved by fiat of raising taxes or cutting programs. Rather, the JFC will only be resolved through addressing three difficult issues:

1. How we are organized.

2. How we educate and motivate donors and collect monies.

3. How we deliver services through a complex structure of separate yet (ideally) nonduplicative organizations.

As a long-time participant and funder in Jewish life with a good sense of our history and our complicated communal psyche, I appreciate how fortunate we are relative to previous generations. The point of this commentary is not, “Woe is us.” Rather, the focus here is to present ideas and generate a discussion that leads to collaboration. These ideas are all rooted in my practical experience as a business strategist and nonprofit activist, and in a genuine concern that our community needs to develop strategies that increase overall communal resources for worthwhile initiatives, and generate and allocate our communal resources in the most efficient manner possible.

Background: The impending Jewish Fiscal Crisis explained

The Jewish community has always contended with some level of financial strain, but the situation has materially deteriorated due to numerous interrelated factors and trends, including:

1. Difficult macroeconomic times, which have increased demand for poverty services and annual subsidies (e.g., for synagogue membership and day school tuition).

2. Generational shift in funders, with groups like Avi Chai spending down and next generation mega-donors frequently focused on non-Jewish causes.

3. Limited growth to no growth in Federation ongoing campaigns (not including emergency disaster and crisis relief).

4. Continued inefficiencies as organizations duplicate services yet refuse to merge or coordinate.

5. Expanded reliance on “free” pricing practices (Birthright, PJ Library, Chabad, High Holy Days, etc.) spawning a communal entitlement psychology.

6. Inability to effectively leverage new technologies to materially lower operating and marketing cost structures.

7. Increased unaffiliation as individuals have weaker formal ties to religious organizations.

8. Lack of unity with certain funders and segments (e.g., ultra-Orthodox) with targeted giving on particular agenda and not broader needs.

Vision: Preserving our foundation while seeking innovation

To create the necessary economic foundation for the Nextgen Jewish community, we need a game-changing cooperative approach that disrupts the current economic paradigm while at the same time takes into account established organizations such as the UJA-Federation.

In this regard, the publishing industry serves as an instructive model of how to move forward. Publishers are investing heavily in innovation in the new world of e-books and online distribution while at the same time working to protect their core print businesses. Significant restructuring and mergers are just one visible manifestation of this dynamic process.

We should apply this separate-but-focused approach in the Jewish community. The Federation system and other large incumbent organizations are our printed books, and we need to ensure their continuing, valuable, bottom-line contribution. At the same time, we need to explore and master innovative “e-book” approaches in a way that does not jeopardize major components of the Jewish enterprise.

Plan: Alternative strategy group with focused initiatives

We will only achieve substantive improvement through a collaborative effort that leads to a select number of focused initiatives that ultimately disrupt and improve how the market system operates. Thus, the challenge is not just to envision and implement any one option, but also to achieve widespread community acceptance. With this goal in mind, we should empower a think-outside-of-the-box, Simpson-Bowles-style committee to brainstorm, create and help implement such game-changing initiatives.

The participants would need to include key funders and representatives of incumbent organizations with leadership by visionary participants inside the community — forward-thinking federations (Combined Jewish Philanthropies of Boston), philanthropic groups (Andrea & Charles Bronfman, Avi Chai or Schusterman Foundations), philanthropic resources (Jewish Funders Network) — as well as market-savvy outsiders (Steve Einhorn or Jeff Weiner of LinkedIn).

The critical ideas on the agenda for this group are not necessarily high-profile, exciting projects, but rather the spinach on the table. They may not be as fun to eat, but they will give the community the basic nutrients to increase resources across the board and allow donors to more efficiently allocate for our future.

Here are four initial ideas this committee should consider (more details are available on

Idea 1: A transparent marketplace

Our community needs to better collect and organize critical, baseline information on the financials, best practices and strategies/missions of Jewish nonprofit organizations. Information is power, and we need to make our donors smarter about their choices and allocations. Donors can’t maximize their efficiency if they can’t assess where the dollars are going and how they are being spent.

Idea 2: Empowered and informed donors

A “one-size-gives-all” mentality is no longer the only answer as donors become less focused on institutional fulfillment and more interested in individual giving based on personal interests. We need a charity information platform that educates, activates and connects the Jewish community and is a trusted source that provides independent, high-quality and conveniently accessible information. This is not just a stand-alone Web site but will be a larger initiative that includes online and offline elements, all designed to improve donor engagement.

Idea 3: Communal efficiency

There are many organizations working in similar areas that might benefit from a range of coordination and cooperation. More resources need to be devoted to helping organizations start joint-venture operations and merge where it makes sense. There should be a venture fund with access to experienced professionals to assist organizations with the leap to consolidation.

Idea 4: Jewish giving category campaign

Last but not least, we need to address how to increase the overall amount of money given to Jewish causes. This would be general campaign to generate awareness of the importance of Jewish giving and engage funders to increase their allocation to Jewish charities by addressing attitudes, the paradox of choice and informational requirements.

In the end, though, we need to keep in mind that we will not win over major sources of new money through a campaign, but rather through a thoughtful and organized approach to giving Jewishly. This will only be accomplished through the types of initiatives discussed in this article (and in more detail in the extended paper) and other ideas that arise through these discussions.

Mark Pearlman has served on numerous charitable boards. He created and most recently launched Sinai Live Books. On a professional basis, Pearlman is a business and marketing strategist focused primarily in the investment area.

Israel’s middle class increasingly squeezed

At Israeli weddings, gifts of china, silver and art are not welcome. Guests are expected to bring their checkbooks and contribute to a young couple’s purchase of their first home, often bought with substantial help from the newlyweds’ parents.

But a new report shows that only 65 percent of young couples in their 20s and 30s are able to buy a home, as compared with over 80 percent a decade ago.

These statistics are part of the State of the Nation Report 2011- 2012 published by the Taub Center for Social Policy Studies in Israel, which examines various aspects of Israel’s economy.

Director Dan Ben-David finds disturbing trends in Israel’s economy. “We are the ‘start-up nation’ with world-class universities, yet our productivity is falling further and further behind Western countries,” Ben-David told The Media Line.

While overall unemployment in Israel is relatively low, and employment rates among young and middle-aged Israeli men is much lower than in leading Western countries, tens of thousands of Orthodox yeshiva students receive government stipends for studying full-time instead of working.

Israel also has a lot of debt. The Taub Center found that the interest the country pays on its debt was more than its entire education budget last year, and double its health budget.

One bright sign is Israel’s national health care system. Almost all Israelis are members of one of four HMO’s and pay a percentage of their taxes for health insurance. Israeli Jews have one of the highest life expectancies in the world. However the report found that the number of hospital beds in Israel is continuing to drop, and is less than half the Western average.

The report also found that the government’s share of total health care spending in Israel has fallen, while private spending has risen.

“In essence, separate health care systems for the rich and for the poor have developed,” the report found.

Transportation is another problem. The congestion on Israel’s roads is 2.5 times higher than the Western average, although the number of cars per capita is much lower. Even though Israel has begun spending more money on its transportation infrastructure recently, traffic jams have gotten almost unbearable during rush hour.

But it is the plight of Israel’s middle class that economists find most disturbing.

Paul Rivlin, a professor of economics at Tel Aviv University, says the middle class is being squeezed all over the world. In Israel, he says, monopolies control important aspects of life.

“There is only one supplier of land because the State of Israel owns practically all of the land,” he told The Media Line. “There is only one supplier of cement. The food we buy is overwhelmingly sold or made or imported by monopolistic organizations that engage in price gouging.”

In the summer of 2011, socioeconomic demonstrations dubbed the “cottage cheese protests” swept the Jewish state. Hundreds of thousands, including Rivlin, went into the streets demanding lower food prices. Many items manufactured in Israel cost less when purchased abroad.

After those protests, prices of many commodities went down although they have crept up again over the past year. Rivlin says economic issues have often taken a back seat in Israel.

“The amount of time you can concentrate on social issues is limited because of security issues,” Rivlin said.

Taxes in Israel are also high, the income tax ranging from 10 percent to a whopping 48 percent.

“There have been some tax reforms that have benefited the bottom and the top, but the middle class still gets hit,” Rivlin says. “As you move up with moderate increases in income, you get pushed up into higher tax rates.”

“We are falling further and further behind in living standards and if we don’t do something soon, fewer Israelis will stay here,” Ben-David told The Media Line. “We are on some long-term social and economic trajectories that are simply unsustainable in the long run.”

Tens of millions of hackers target Israel government Web sites

More than 44 million hacking attempts have been made on Israeli government web sites since Wednesday when Israel began its Gaza air strikes, the government said on Sunday.

Finance Minister Yuval Steinitz said just one hacking attempt was successful on a site he did not want to name, but it was up and running after 10 minutes of downtime.

Typically, there are a few hundred hacking attempts a day on Israeli sites, the ministry said.

Attempts on defence-related sites have been the highest, while 10 million attempts have been made on the site of Israel's president, 7 million on the Foreign Ministry and 3 million on the site of the prime minister.

Screenshot from which was hacked by Pakistani hackers.

A ministry spokesman said while the attacks have come from around the world, most have been from Israel and the Palestinian territories.

“The ministry's computer division will continue to block the millions of cyber attacks,” Steinitz said. “We are enjoying the fruits of our investment in recent years in developing computerised defence systems.”

Steinitz has instructed his ministry to operate in emergency mode to counter attempts to undermine government sites.

Both sides in the Gaza conflict, but particularly Israel, are embracing the social media as one of their tools of warfare. The Israeli Defense Force has established a presence on nearly every platform available while Palestinian militants are active on Twitter.

“The war is taking place on three fronts. The first is physical, the second is on the world of social networks and the third is cyber,” said Carmela Avner, Israel's chief information officer.

Last month, U.S. Defence Secretary Leon Panetta said cyberspace is the battlefield of the future, with attackers already going after banks and other financial systems. U.S. banks have been under sustained attack by suspected Iranian hackers thought to be responding to economic sanctions aimed at forcing Tehran to negotiate over its nuclear program.

Reporting by Steven Scheer; Editing by Stephen Powell

Clinton: U.S. will push to help Palestinians with financial crisis

Secretary of State Hillary Clinton told the Palestinian and Jordanian that Washington is 'looking at every means possible' to alleviate the Palestinian financial crisis.

According to a  senior State Department official, Clinton made the comments Wednesday in New York during a one-hour working lunch with Jordan’s King Abdullah and Palestinian Authority President Mahmoud Abbas, who were there for the U.N. General Assembly.

The Obama administration currently has an assistance package on Capitol Hill that includes a $200 million direct budget request for the PA. The World Bank said last week that action was needed “urgently” to prevent a “deepening financial crisis” in Palestinian areas.

Earlier in the week, the semiannual meeting of the Ad Hoc Liason Committee, which coordinates aid for the Palestinians, convened to discuss the PA's financial dilemma. The group is chaired by Norway and co-chaired by the United States and the European Union.

Also Wednesday, Clinton urged Turkish Foreign Minister Davutoglu to have officials from his country meet with Israel to “sit down and work through the difficult issues that they have together” in light of the “enormous number of strategic interests and challenges” they share.

In a meeting with Lebanese Prime Minister Miqati and the U.N. Secretary-General’s special representative for Syria, Lakhdar Brahimi, Clinton said there is “more than a risk” in Southern Lebanon that Hezbollah is “using its areas as a platform for destabilizing Syria and also creating real challenges in other parts of the world as well.”

In addition, Clinton met with League of Arab States Secretary General Nabil Elaraby and signed a memorandum of understanding outlining a framework for future dialogue and technical cooperation between the United States and the organization.

Elaraby told Clinton that the resolution of most of the problems in the Middle East “depend on what the United States will do to resolve them.” He specifically noted that the Israeli-Palestinian conflict and the Syrian crisis need Washington’s “active participation.”

‘Like’ this Israeli site for jobs

Here’s a dirty little secret in the job-recruiting business: All those Web sites that help employers and potential employees match up don’t really work that well. Despite all the bells and whistles, the automatic résumé builders and the ability to search on keywords for specific skills and expertise, the best way to find the right candidate hasn’t changed much in the last 100 years. Word of mouth is still king, especially when a cash reward is offered.

Israeli startup Zao aims to bring the recruitment business into the 21st century. The company has built a “social recruiting” system that allows HR departments to get the word out virally about open positions and track the results from a single user-friendly dashboard (goodbye Excel) with all the analytics you’d expect in the age of Google.

Very often, the best source of referrals comes from a company’s vendors and business partners. Using Zao, companies can reach beyond their own staff and automatically pay the lucky referrers that cash bonus, even if they work for a third-party supplier.

Here’s how it works. If an employee doesn’t know someone who fits the job description, he or she can post it on Facebook or LinkedIn. If a friend or colleague makes a successful referral, both parties split the cash bonus. If a friend of a friend finds the right person for the job, everyone takes a piece. Zao handles the entire process, from e-mail to pay-out. Zao makes money by charging the employer an added 30 percent.

Founder and CEO Ziv Eliraz said he conceived of Zao after having the same troubles while recruiting for an Israeli company whose U.S. office he was managing. Job boards, external recruiters and even Craigslist were generating too many junk résumés. How about utilizing the power of the crowd? Eliraz thought.

“We all know hundreds of people,” he said. “But there was no good tool to get to them, no way to expand the circle beyond a company’s employees.”


Targeted recommendations

On Facebook, LinkedIn and Twitter, it’s considered good manners to let your friends and colleagues know about a job opening via a generic blast to everyone you know at once. To incentivize someone to target the message, the cash bonuses come in handy.

“They’re not a must,” Eliraz said. “But they increase engagement. And they’re respectful of people’s time. If you send a request to 20 people to forward a job listing, without a reward, maybe two out of those 20 will respond. With a reward, it might jump to five out of the 20.”

One more goodie: Once you let Zao access your Facebook or LinkedIn friends, Zao can scan their résumés and recommend to whom you should forward the job posting.

Eliraz, 42, was born in Israel but worked for 10 years in the United States for Israeli companies including InfoLink, Hotbar, Emblaze and Amobee — the latter of which was sold to Singapore Telecom for $320 million (Eliraz was VP of strategic alliances at the time). Zao is his first startup. He’s been programming since he was 12 but became a lawyer. After working for a big Tel Aviv law firm, he found he missed tech too much.

Zao recently announced financing of $1.3 million from Oren Zeev, the founding partner at Orens Capital and a former general partner at Apax, a venture capital firm. Other investors include executives from Audible and Time Warner.

Zao is not without competition, Jobvite being the most formidable. But that company doesn’t offer the cash rewards and bonus-splitting functionality that Zao does (at least not yet). If that’s important to a customer, Zao is the go-to address for juicing up the referral process.

Israeli water power that doesn’t give a dam

You don’t have to build dams to get hydroelectricity from water flowing through municipal pipes, says Dr. Daniel Farb, the Los Angeles immigrant who previously shook up the Israeli clean-tech power scene with his Leviathan Energy company’s award-winning Wind Tulip.

The ecologically conscious physician recently unveiled his latest brainchild, a turbine that turns excess pressure inside existing underground water pipes into energy for the electric grid.

The Negev-based Leviathan team is still fine-tuning the invention at its new testing site rented from Kibbutz Re’im. The Negev kibbutz’s Isralaser industry is fabricating many of the parts for the turbine, dubbed “Benkatina” in tribute to Second Temple High Priest Ben Katin, who made a machine to lower and raise the ancient Temple’s laver to and from the water table.

The modern version based on Farb’s vision was engineered by Avner Farkash, Leviathan’s vice president for research and development.


New, eco-friendly energy market

The Benkatina beta model already has been implemented in pilot areas by Israel’s national water carrier Mekorot as well as in the South Philippines. An Italian partner is lined up next, and Farb met recently with a power company in Mumbai that is interested in doing business.

He says that the invention is creating an international buzz because it opens a new energy market using existing infrastructure and even solves a problem in that infrastructure.

“Managers of water systems already know where there is excess pressure, and often they put pressure breakers in those locations to prevent leaks from forming. One of the great things about what we’re doing is that we are battling the water and energy shortage at the same time,” Farb said “An estimated $14 billion worth of water is wasted each year through leakage, and decreased pressure means decreased leaks.”

The company received a grant from the chief scientist of the Israeli Ministry of Industry, Trade and Labor under the Eureka program to develop the technology, as well as a grant from the Ness Fund for business development in the Negev.

Farb is optimistic that thousands of potential installation sites in Israel could start adding several more megawatts of power to the seriously overtaxed electricity grid by next summer.

A smaller version of the Benkatina turbine could provide off-grid electricity in remote areas of the world in need of moderate amounts of power, as long as there are nearby water pipes. This would be more consistently reliable than either solar or wind energy, Farb said.

And if a proposed Dead Sea canal ever gets built, the Leviathan technology could play a role.

“I can foresee desalinated water coming from the Gulf of Eilat or from the Mediterranean to the Dead Sea through pipes, and taking off some of the extra pressure in many points along the way to use for hydroelectricity,” Farb said.

Leviathan’s Benkatina turbine in use in the Philippines.

Radically different approach

The device is groundbreaking, according to Farb, because it is radically different from the way hydroelectric power has been accomplished for the last two centuries.

“In the past, they used a dam, used up all the pressure, worked in an environment of stable flow and used turbines that could be exposed to the air. In-pipe conditions are different, so there is no dam, which makes it more ecologically viable. Only the excess pressure is used so the integrity of the piping system can be maintained; the flow is variable; and it functions in a difficult, closed-system environment with splashing water,” he said.

The turbine would only be installed in parts of the piping known to have extra pressure. “We don’t want you to turn on the tap and have nothing come out,” Farb said.

He’s a firm believer in the need for a mix of wind, wave, water and solar energy alternatives.

“We’re in an energy crisis that will last at least 100 years, and we have to provide solutions in more than just one area,” he said. “Leviathan has provided a series of solutions that, when fully implemented with the right financial and bureaucratic support, can make a serious difference in the world we live in.”

Israel transfers money to PA to ease economic crisis

Israeli Prime Minister Benjamin Netanyahu ordered the transfer of some $63 million to the Palestinian Authority to help ease its economic crisis.

The transfer Tuesday evening came after Netanyahu consulted on the issue with Finance Minister Yuval Steinitz, and then asked his special envoy, Isaac Molho, to coordinate with the Palestinian leadership, according to a statement from the Prime Minister's Office.

The money is an advance on tax revenues collected for the Palestinian Authority by Israel.

“We are working on several fronts in order to help the Palestinian Authority cope with its economic problems,” Netanyahu said earlier Tuesday during a meeting with Bulgarian Prime Minister Boyko Borissov. “We have made several changes in the taxation agreements. We are advancing certain transfers. We have also helped with Palestinian workers and with a series of other steps in order to make things easier for them.

“Of course, there is a global reality and it is also related to the internal management of every economy, but for our part we are making efforts to help the Palestinian Authority survive this crisis. I hope that they will succeed in doing so; this is in our common interest.”

Palestinians have been staging demonstrations in the streets of the West Bank since last week to protest the extreme economic hardship. The protests turned violent and destructive late Monday, with thousands of protesters burning tires and attacking police in Hebron and Nablus. Protesters also reportedly smashed the windows of the municipal building and a police station in Hebron. Palestinian taxi, truck and bus drivers staged a one-day strike on Monday.

Civil servants did not receive paychecks for the month of August.

Palestinian Authority Prime Minister Salam Fayad announced measures Tuesday to ease the economic hardship, including lowering the value added tax and prices on diesel, gas and kerosene.

Israeli officials are concerned that the unrest over economics and frustration with the Palestinian leadership could turn into a third intifada directed at Israel, Reuters reported.

World Bank: PA economy not strong enough to support a state

The Palestinian economy is not yet strong enough to support a sovereign state because of its heavy reliance on foreign aid, according to a World Bank report.

“The Palestinian Authority has made steady progress in many years towards establishing the institutions required by a future state, but the economy is currently not strong enough to support such a state,” economist John Nasir said in a statement accompanying the report, which was released Wednesday.

The PA says it is facing its worst financial crisis since it was founded in 1994, with debts of $1.5 billion and an immediate cash shortfall of $500 million, the French news agency AFP reported. Donor countries have propped up the Palestinian economy with billions of dollars in assistance.

In the report, the World Bank said the aid has led to 7.7 percent gross domestic product growth between 2007 and 2011, but only in government services, real estate and other non-tradeable sectors.

“Economic sustainability cannot be based on foreign aid,” the Nasir statement said, “so it is critical for the PA to increase trade and spur private sector growth.”

National Jewish Democratic Council removes Adelson petition

The National Jewish Democratic Council, citing peace among Jewish groups, has taken down a petition calling on Republicans not to accept money from Sheldon Adelson.

“Accusations against Mr. Adelson were made not by us, but by others, including Senator John McCain (R-AZ),” said a statement sent late Wednesday by NJDC President David Harris and Chairman Marc Stanley. “Nonetheless, we regret the concern that this campaign has caused. And in the interest of shalom bayit (peace in our home/community), we are going to take down our petition today. Moving forward, we’ll continue to work hard to fight against the unique threat posed by the outsized influence of certain individual megadonors, which rightly concerns most Americans and most American Jews.”

The petition based the call on allegations by a former employee suing Adelson for firing him that the billionaire casino magnate agreed to allow prostitution at his casinos in Macau, China; on the claim by McCain that Adelson, with the tens of millions of dollars he has infused into the Republican side of this year’s elections, was effectively introducing Chinese money into the campaign; and on federal investigations into allegations that Adelson has paid bribes in China.

A number of Jewish groups and figures, including the Jewish Federations of North America, the Anti-Defamation League, the Republican Jewish Coalition and Alan Dershowitz called the allegations unconscionable, noting that all had yet to be proven.

Harris and Stanley said in the statement that “we don’t believe we engaged in character assassination. We stand by everything we said, which was sourced from current, credible news accounts.”

Adelson and his wife, Miriam, have given tens of millions of dollars this year to political committees supporting Republicans in general and Romney, the presumptive GOP presidential nominee, in particular, although it is not clear if he has directly given to Romney.

He is a major giver to Jewish causes, especially the Birthright Israel program bringing young people to Israel and Yad Vashem, Israel’s Holocaust memorial, and has donated to causes associated with or favored by those who have defended him in this case.

Sweet spot: The sugar rush of Dylan’s Candy Bar

Retro lollipops and salt-water taffy have always had a thing for crazy swirls of color, just like Los Angeles. Now one big business is about to serve the City of Angels a whopping rainbow of 7,500 treats from around the world. New York-based Dylan’s Candy Bar, the namesake brainchild of Jewish billionaire fashion mogul Ralph Lauren’s daughter, Dylan, plans to unveil its first local branch in late August.

“We opened our first store 10 years ago in New York City, fulfilling a childhood dream of mine to create the largest, most magical candy store,” said Dylan Lauren, founder and CEO. “Today, our stores have attracted so many fans of all ages and nationalities — it has truly been beyond my sweetest dreams. Now I’m thrilled to bring my love of color, design and the joy of candy from coast to coast.” 

Spanning 1,200 square feet in the former Bath & Body Works space at the Farmers Market at Third and Fairfax is where you’ll soon find this branch of the world’s largest candy emporium. Candy is a $30 billion-plus industry, and it has long been on the mind of this heir to the Lauren fashion throne. As a girl, she owned a pair of bunnies that she named Chocolate and Vanilla. 

An art history graduate of Duke University, Lauren founded the company at age 26 in 2001 with an undisclosed amount of her own funds and “a lot” of financial support from her family. Her partner at the time was Jeff Rubin, a veteran of F.A.O. Schwarz, who left the company in 2004. Dylan’s is already a mega-success. The original location, 15,000-square-feet positioned across from Bloomingdale’s on Manhattan’s Upper East Side, is a tourist destination in its own right, complete with its own cafe and bar and an extensive Web site.

In her 2010 book, “Dylan’s Candy Bar: Unwrap Your Sweet Life” (Clarkson Potter), Lauren further outlines her love of fashion, art and pop (candy) culture. In addition to the New York flagship, a mini store operates in East Hampton, and a store and cafe are up and running in Houston’s Galleria Mall. Miami is planned for winter 2012. Although Lauren has not yet announced its official start of business, the first satellite shop on the West Coast is meanwhile hiring for a variety of positions and is accepting resumes.

You can practically hear the cash register singing. The L.A. store plans to offer a personal shopper for customized shopping experiences, one-of-a-kind gift baskets and an expert “Celebrations Team” to sweeten events by bringing the whimsical store experience to private homes and other venues.

Although doors were still closed as this story went to press, the local shop is clearly destined to reinforce the mothership’s strong branding. And that means Los Angeles is in for a Willy Wonka-sized treat. Dylan’s Candy Bar is known for offering nearly every kind of candy from childhood and beyond. Like a version of the “Candy Land” board game brought to life, there are snack bar nostalgic brands like Leaf’s Astro Pops and bulk candies, whose low price points are practically recession proof. There are novelty items, including massive tins of edible candy trash. Fresh, warm snacks are available at the chocolate fondue fountain for a small cost per dipped marshmallow, pretzel stick or graham cracker. And as no surprise to true candy aficionados, much of the stuff is kosher certified: Lemonheads, Twizzlers, Jelly Belly jellybeans, signature Dylan chocolate bars and much more. 

The New York store is as much a treat for the eyes as the mouth. At every turn, there is more to feast on: Giant pop art-style installations of oversized candy adorn the walls, and furniture molded to look like massive colorful strips of dots form tables serving up bountiful gifts, including a brilliantly colored gowned Dylan Barbie doll and Dylan’s own book. A massive wall display features autographed Lucite boxes signed by Madonna and other celebrities revealing their favorite candies. Massive pillows with candy logos, such as Bubble Yum and other brands, perch over a life-size bathtub of bright bubble gum balls, gifts of all kinds, apparel and a bevy of logo merchandise. Lauren has apparently thought of almost everything. Even the portrait of the queen of this fantastic realm is rendered in Jelly Belly jellybeans.

For a mug that reads Candy Girl, your own custom blend of Jelly Bellys or M&Ms, or satisfying cravings for a chocolate smoke (sans nicotine), this is the place. 

For more information, visit

Lisa Alcalay Klug is the author of “Cool Jew: The Ultimate Guide for Every Member of the Tribe.” Her new book, “Hot Mamalah: The Ultimate Guide for Every Woman of the Tribe,” debuts in October. Klug is online at

Israel’s whiz kids

Mickey Haslavsky of Holon is only 18, but he’s already on his second startup.

“When I began my first startup at 16, I thought I was the only one creating Web sites at this age, but I was amazed to discover a huge community between [the ages of] 10 and 18 around the world, and I know of about 10 startups by Israelis my age,” Haslavsky said.

By invitation of Israeli high-tech godfather Yossi Vardi, Haslavsky recently gave a TEDx Youth@Holon presentation, “Teenage Nation,” about how he founded an online youth magazine.

One thousand people registered the day Haslavsky launched his second site, Machbesa (Laundry), this past spring. It’s a viral scheme for racking up genuine “Likes” on Facebook, pluses in Google Plus and views on YouTube.

“I want to bring the system to Brazil next because it has 51 million Facebook users and it’s spreading all the time,” said Haslavsky, who needs to find someone to run his enterprises come November, when he gets drafted for military service.

That shouldn’t be hard, as he is at the older end of the spectrum of Israeli teens helming a surprising number of high-tech ventures.

Mickey Haslavsky, 18, presenting at TEDx Youth@Holon.

Tal Hoffman of Haifa says Israel’s designation as the “Startup Nation” has encouraged young business developers. “Israel’s entrepreneur community is really big among my age,” said the 15-year-old founder of Itimdi, a not-yet-launched site where teens can meet and interact based on their interests.

Another 15-year-old, Gal Harth of Herzliya, was interviewed at TechCrunch Disrupt last year in San Francisco about his Doweet Web site (motto: “So, what do you want to do?”), described as “a fun and easy way to create activities with your friends.”

Harth said he founded Doweet with his pal Nir Ohayon in reaction to all their friends playing Xbox and PlayStation instead of engaging in social and physical activities. “This is a way to get together easily to go to the gym, go swimming, play soccer. It’s an app that links everyone in one spot.”

Harth and Ohayon got initial funding from Israel’s Rhodium, the first venture capital firm they approached.

“My passion is startups,” Harth said. “My passion is to change the world.”

Nurturing whiz kids

Enterprising Israeli teenagers have plenty of role models. Gil Schwed, founder of Israel’s Check Point Software Technologies and one of the world’s youngest billionaires, is a prime example. Schwed was taking computer courses at the Hebrew University before graduating high school. Drawing on experience gained in the Israel Defense Forces’ Unit 8200 intelligence corps, he invented the modern firewall at just 26.

Many up-and-coming entrepreneurs are eager to follow the same path, knowing that their military service can pave the way to successful careers. It’s no coincidence that many Israeli startups are co-founded by former army buddies.

However, programs to recruit high school students for high-tech military units focus on top achievers and tend to miss a considerable number of kids whose tech abilities far surpass their grades. Finding and cultivating these diamonds-in-the-rough has become a priority for StartupSeeds, a 1,300-member community for entrepreneurial Israeli teens founded in 2007 as a private philanthropy-supported project of the MadaTech-Israel National Museum of Science in Haifa.

One of its original members, Ido Tal, created a wildly popular Flash video game at the age of 14, but — perhaps because of his addiction to video games, he said — wasn’t exactly a model student. Likewise, Haslavsky, whose math teacher once told Haslavsky’s mother that the boy wasn’t going to amount to anything.

“From our research, nobody is dealing with this population of kids,” StartupSeeds Director Saar Cohen said. The organization is hoping to fill that gap by reaching out to parents of teens who show a talent for coding, Web design, video editing, animation, social media, security and other needed skills.

Through contacts in the military and academia, StartupSeeds brings these teens out from under the radar for the benefit of themselves and their country. “Everybody wants their kid in a special unit because if you get in, you’re set for life.”

This is just one of the organization’s programs devised to nurture and encourage Israeli whiz kids, with support from Israel’s high-tech industry and academia. In 2008, StartupSeeds was invited to lead a panel on entrepreneurial youth at the prestigious Israeli Presidential Conference.

“StartupSeeds promotes excellence, entrepreneurship and innovation among technological youth,” Cohen said. “We believe in strengthening their existing strengths by giving them tools and a platform for them to reach their potential. We help them make connections through an online community as well as physical forums.”

Every two weeks, StartupSeeds hosts meetings and lectures along with social activities. There are periodic regional conventions and field trips to army units and high-tech industries. Members get access to events such as TEDx, groups such as MIT Forum and competitions such as BigGeek, a live broadcast from the Microsoft R&D Center in Herzliya where four teams of techies scramble to develop a working application within 24 hours.

What is special about Israel that seems to encourage what Cohen calls a technological youth phenomenon?

“Everything here happens fast,” Cohen said. “Kids are encouraged from an early age to think on their feet, ask questions, be curious and not be afraid to try anything. The high-tech industry and the startup industry in Israel are very strong, and they take great pride in that, so it’s contagious. The army helps, too, because a large percentage of those in high-tech startups went to these special tech units.”

Boys and girls together

StartupSeeds, as well as Israel’s military, academic and industrial leaders, are eager to get more girls into the high-tech mix.

“Research shows there’s an early age at which kids decide what to go into, and everyone wants to get girls to choose technological fields,” Cohen said. “We recently decided to target this audience by starting an all-girls forum, offering meetings with female leaders in industry, to see if we can create a community. Our goal is to get to 30 percent girls [in our membership]. We think they are out there, and we are approaching them at the perfect age.”

For now, most teen entrepreneurs are boys, including recent immigrants such as Ben Lang, 18, who co-founded the Innovation Israel community for startups, entrepreneurs and investors; and, most recently, Mapped in Israel, a Web site pinpointing Israel’s many startups.

In March, Lang and three young colleagues ran a successful Hackathon Israel event, sponsored by Carmel Ventures and ROI Community; their stated vision was “to share the incredible high-tech scene in Israel with the entire world.”

“Because Israel is so small, it’s easy to create a startup and give life to an idea,” Haslavsky said. “In the media you see every day how startups sell their companies for millions of dollars, and that also encourages us. Every young entrepreneur wants to be a CEO. I think Israel is amazing in this field.”

Madoff associate Merkin agrees to hand over $400 million

Former money manager J. Ezra Merkin has agreed to turn over hundreds of millions of dollars to duped investors in Bernard Madoff’s Ponzi scheme.

In a settlement announced Monday by New York Attorney General Eric Schneiderman, Mirkin agreed to pay $405 million to compensate investors over a three-year
period, and $5 million to the State of New York to cover fees and costs. It is the first settlement resulting from a government action against Merkin.

Merkin, a close business associate of Madoff’s, controlled four funds that invested more than $2 billion with Madoff on behalf of hundreds of investors, including many New Yorkers and charitable organizations.

While investors in Ariel Fund Ltd., Gabriel Capital LP, Ascot Fund Ltd. and Ascot Partners LP, whose assets were largely handled by Madoff, lost in excess of $1.2 billion, Merkin received hundreds of millions of dollars in management fees.

“By holding Mr. Merkin accountable, this settlement will help bring justice for the people and institutions that lost millions of dollars,” Schneiderman said in a statement.

According to the statement, for nearly two decades Merkin presented himself as a skilled money manager and used his social and charitable connections to raise more than $4 billion from hundreds of individuals, charities and other investors. Merkin turned over to Madoff all of the money in the Ascot Funds, and a substantial portion of the Ariel and Gabriel Funds.

In misleading offering documents and quarterly reports, Merkin concealed Madoff’s role and misrepresented the role he was playing in managing the funds, the statement said. Acting primarily as a marketer and middleman, Merkin obtained hundreds of millions of dollars in management and incentive fees from his investors.

Investors could regain more than 40 percent of their cash losses. Investors who were not aware of Madoff’s role will receive a higher percentage of their losses, while
those who were aware of Madoff’s role will be eligible to receive a smaller percentage.

Among the victims, according to The Associated Press, were the the Metropolitan Council on Jewish Poverty, New York Law School, Bard College, Harlem Children’s Zone and Homes for the Homeless.

Merkin also is being pursued by Irving Picard, the court-appointed trustee charged with returning money to Madoff’s victims. Picard is trying to claw back $500 million from Merkin and the funds.

TV for dogs reaches prime time

Bark if you love DogTV.

The new made-in-Israel U.S. cable channel is scientifically programmed to keep pooches stimulated, happy and comforted when they’re home alone.

When dogs are left alone, they can get depressed, lose their appetite and their desire to play, says DogTV CEO Gilad Neumann. There are 46 million households with dogs in the United States, encompassing a total of 78.2 million pet canines.

“That’s quite a few potential viewers and many lonely dogs,” he said. “It’s all very scientific, although I know it sounds like a joke. When you dig deeper, you see it’s a serious business.”

Time Warner Cable and Cox Communications began a six-month free trial of the 24-hour digital channel on Feb. 13 for their one million viewers in San Diego. If it is successful, DogTV will be distributed more widely as a subscription-based service, Neumann said.

The concept came from Ron Levi, a New York-born dog lover and chief content officer at Jasmine Group, a private media communications company in Ramat Gan.

At the time, Neumann was CEO of Jasmine TV, one of several subsidiaries of the Jasmine media conglomerate whose July-August Productions recently sold the format for the hit game show “Who’s Still Standing?” to NBC Universal.

“We’re always seeking interesting ideas with an emphasis on international expansion. So when Ron approached me with this idea, I thought it was crazy enough to look into,” Neumann said. He suggested that Jasmine invest some seed money to explore the idea.

Their research revealed that the American Society for the Prevention of Cruelty to Animals (ASPCA), the American Veterinary Medical Association and the Humane Society of the United States all recommend leaving the TV on for dogs home alone, to provide stimulation and keep away stress and depression.

“We combined this with a lot of science on the effects of video on dogs, how they react to TV and what kind of visuals, music and sounds they enjoy,” Neumann said.

He recruited professor Nicholas Dodman of Tufts University’s animal behavior department as DogTV’s program director and chief scientist. Dodman explains on DogTV’s Web site that dogs won’t sit on the couch for hours at a time watching the channel. It’s more like a backdrop with a pleasing soundtrack that they can choose to view as long as they wish.

British trainer Victoria Stilwell, from the Animal Planet series “It’s Me or the Dog,” and Warren Eckstein, an animal rights activist and pet trainer, round out the crew of DogTV experts.

“They added their knowledge to our production experience,” said Neumann, who holds an MBA from Pepperdine University and a law degree from the Israeli College of Management.

As good as the idea was, it couldn’t have been put into action if not for the introduction of LCD television technology. Neumann explains that dogs’ eyes are bothered by the flickering frames on old analog televisions, though humans don’t notice them.

“Now they can see perfectly fine on LCD, but they can only see blue and yellow, so we enhance and recolor the contents for them,” Neumann explained.

As content developer, Levi organized the channel’s programming into three categories: shows meant to relax dogs, shows that stimulate them and shows intended to expose them gently to situations with which they may need to get more comfortable — such as a running vacuum cleaner or street traffic.

“This creates a companionship environment,” Neumann said, “a channel that is fully suitable for dogs. ”

This is hardly the first instance of an Israeli TV show hitting prime time in the United States. “In Treatment,” “Homeland,” “Traffic Light” and “The Ex List” went first. However, it is the first time a programming concept has gone directly from the Israeli drawing board to American TV screens. Neumann hopes DogTV is barking up the right tree.

There’s more than one way to support the Jewish state

In the landscape of American Jewish organizations, The New Israel Fund (NIF) has long occupied a prominent place on the left side of the aisle. Back in 1979, almost three decades before the “pro-Israel, pro-peace” lobby J Street was established, when Peter Beinart was still in elementary school, NIF began supporting Israeli-based non-profits that advanced the Jewish and democratic identity of Israel.

In the years since, NIF has donated more than $200 million to civil- and human-rights organizations in Israel. Its current list of grantees includes groups advocating for women, Palestinian Israelis, Ethiopian-Jewish Israelis, and Reform and Conservative Jewish practice, to name a few. 

The Journal caught up with NIF CEO Daniel Sokatch, formerly the founding executive director of the Los Angeles-based Progressive Jewish Alliance, to discuss changes he’s seen in Israel, how NIF is advancing its mission in the Jewish state and how he manages to stay optimistic about the future.

Jewish Journal: You lived in Israel in the 1990s; how has the country changed since then?
Daniel Sokatch: I went to Israel in 1994 to go to rabbinical school. I realized pretty quickly that what was exciting to me was less the rabbinate than it was Israel. I dropped out of rabbinical school and stayed in Israel for a year and a half, working and soaking up what was a completely golden age, and went back to the United States in September 1995, just about five weeks before the assassination of Prime Minister Yitzhak Rabin.

Today, [Israel is] a very different place in terms of the hopes and aspirations that people there feel are realistic. It’s a very different place in terms of the demography. The situation of the Arab-Israeli sector was quite different than what it is today. Many of the fractures and schisms that are so apparent in today’s Israeli society were less exacerbated then.

JJ: Benjamin Netanyahu, both in his time as finance minister and now as prime minister, seems to have really transformed the country.
DS: Netanyahu led a series of economic shifts that have transformed the country in ways that have resulted in great prosperity for some and — as we saw this summer, when almost half a million people took the streets — massive amounts of discord for many others. But it was a mélange of factors that caused this transformation, and it’s an ongoing transformation.

JJ: Your organization recently launched a new campaign with an ad in The New York Times focusing on extremism and the treatment of women in Israel. It was inspired by one NIF supporter’s trip to Iran, and his concern that there might be parallels between the situation of women in Iran and Israel. Did you worry about that comparison?
DS: The ad doesn’t mention Iran at all. Murray Koppelman — this is a pillar of the New York Jewish community [who traveled to Iran and pledged to match all contributions to NIF for the new campaign, up to $500,000] — wasn’t afraid Israel was turning into Iran. He worried, though, because he saw things that reminded him of developments in Israel that have been unsettling to him in recent years, like the segregation of buses, like the removal of images of women in the public sphere, like the attempted crackdown on human rights or civil rights organizations to do their jobs. These things disturbed him, and he came home and said, ‘I don’t want to see my beloved Israel go down that path.’ That’s what the campaign is about.

JJ: NIF will have a booth at this year’s Celebrate Israel festival in Los Angeles and representatives of the group will be marching in New York’s Celebrate Israel Parade, even as there have been some calls for NIF to be banned, calling the group anti-Israel. What’s it like to be at the center of that contention?
DS: These are charges made either by extremist right-wing organizations who have vowed to — to use their terminology — “delegitimize” any organization or any individual that doesn’t subscribe to their definition of what it means to be pro-Israel. But we don’t have anybody who gets to dictate what it means to be pro-Israel, and I’m deeply gratified by the response of the Jewish establishment of this country — for the most part — in refusing to blacklist organizations like NIF.

JJ: You brought up the Jewish establishment, so I have to ask you about Peter Beinart.
DS: I knew you were going to ask me about Peter Beinart.

JJ: Is there something that you usually say when people ask you about him?
DS: (Laughing) No, but I’ll say this. I think that our community prides itself on being a big tent. And lots of people say things and put forth ideas. If they do it with good intentions and civility and respect for the opinions of others, I think that we’re crazy not to encourage them.

JJ: How do you hold onto your idealism?
DS: One thing I picked up when I was in rabbinical school was the belief that there are two Jerusalems: Yerushalayim shel ma’alah and Yerushalayim shel mata — in the rabbinical tradition, a heavenly aspirational Jerusalem and a real, actual city where people live. One day, I was walking home and I looked up at the sky when I heard the roar of a jet. There was a big airplane, which flew from the east over Jerusalem, circled the city twice, and flew back to the east. This is 1994, when you can’t do that without violating some enemy country’s airspace.

When I got home, I learned it was King Hussein of Jordan in the plane, the flight was to signal the surprise signing of the peace accords between Israel and Jordan, and Rabin had been in the control tower at the airport talking to him. At that moment, I saw the coming together of the heavenly and the actual Jerusalems. I saw what’s possible, I tasted it — we all did. I just don’t think that’s dead or over; I just think it’s a long hard road to get back there.

Chicago urges city workers’ pension fund to divest from Iran

The Chicago City Council urged the city’s largest employee pension fund to divest from Iran.

The council unanimously approved a non-binding resolution this week that encouraged the Municipal Employees Annuity and Benefit Fund of Chicago to divest from companies doing business with Iran’s energy sector. Divestment would be gradual.

If the fund follows through, Chicago would join New York City, Washington and 11 other U.S. cities in divesting from businesses involved in Iran. A number of states also have divested from Iran or are considering legislation that would do so.

The Chicago-area Jewish Community Relations Council lobbied to pass the resolution. B’nai B’rith International praised the work of the Chicago City Council.

“Chicago’s city government has set an important example for other municipalities to get on board to isolate Tehran,” B’nai B’rith President Allan Jacobs, a resident of the Chicago suburb of Lake Forest, Ill., said in a statement. “Sanctions are working. Resolutions such as this are helping unite local governments as well as the global community in a cohesive effort to isolate Iran.”

Crisis-hit Greek Jews fear for their future

Patricia Alcalay, 24, has been unemployed since she finished her nursing degree in December 2010. Her father lost his job four months ago, a year shy of retirement.

Her older sister, who was studying abroad, meanwhile, found work in the Netherlands and is not coming back to Greece anytime soon.

Stories like these have become common among the Jewish community in Greece, which like the rest of the Greek population is struggling to stay afloat in a country engulfed in the fifth year of an economic crisis that shows no sign of abating.

Approximately 5,000 Jews live in Greece—about 3,500 in Athens, 1,000 in Thessaloniki and the rest scattered elsewhere—and community leaders say they are laboring to maintain Jewish institutions and deal with the additional heavy demands on welfare programs.

Some of the leaders fear a greater threat to the community’s future: an exodus of young, unemployed Jews leaving a country where they see little hope.

“It is a very difficult situation for us because of the financial crisis in Greece. It affects the Jewish community very heavily,” said Benjamin Albalas, the president of the Jewish Community of Athens, an association that provides funding for the city’s Jewish institutions. “We are supporting two synagogues, the school, the cemetery, a community center and a number of needy people that is growing all the time.”

As the need for community aid has increased, the funding to the communal institution has decreased sharply.

Much of its revenue comes from Jewish community-owned commercial and residential properties dating back before World War II, when some 78,000 Jews lived in Greece—many in the northern port city of Thessaloniki, a community that was almost wiped out entirely in the Holocaust.

But in the past year the Greek government, faced with chronic income tax evasion, imposed steep property taxes in a bid to raise state income. “And because of the general situation, the people who rent our properties have either left or they have asked us to lower rents,” Albalas said.

In addition, he said, donations from hard-hit community members have dropped 50 percent.

Albalas declined to give specific figures, either for income or for the needs.

As part of the harsh austerity measures imposed on Athens, the Greek government has slashed pensions, lowered public and private sector wages, and reduced tens of thousands of state jobs, all of which have hurt the weaker sectors of the Jewish community.

“Our two main problems now since the crisis are that pensions have gone down and there is very big unemployment,” said Isaak Mordechai, the deputy head of the Athens welfare committee. “Pensions have diminished so much, people cannot live.”

The Jewish Community of Athens is providing direct assistance—financial help, supermarket food vouchers, and medical and psychological support—to some 60 people. “But it is clear that a lot more people are going to need help,” he said.

In February, the Jewish Agency for Israel’s Board of Governors voted to grant about $1 million over two years to help Greece’s Jewish communal institutions continue operating. Other Jewish groups have offered aid, too.

However, community leaders in Athens and Thessaloniki say they have not been officially informed of the decision and the money has yet to arrive.

The money, though, will focus on Israel education, and is earmarked to help the Jewish communities of Athens and Thessaloniki cover specific initiatives, according to JAFI spokesman Josh Berkman. Among those initiatives are shlichim (Israel emissaries to the community), counselors for the Jewish summer camp and financial assistance to the Jewish school in Athens.

“I can assure you we are in touch with the Jewish leadership in these communities,” Berkman said.

As of late February, the American Jewish Joint Distribution Committee had donated $330,000 for welfare and school scholarship to the Athens Jewish Community, according to a news release.

Such funding, however, will not keep the the institutions alive and support the needy.

National unemployment is more than 21 percent and tops 50 percent among those under 25. Albalas says the levels are about the same in the Jewish community.

For the young, the future looks like a wasteland.

“I have occasionally had some part-time jobs, but nothing permanent. It’s very disappointing,” said Alcalay, who has been searching for work as a nurse for 16 months and is considering abandoning her profession.

“I’m looking for a job in any field now because I need the money. I don’t have anything else apart from my parents, and both of them are also unemployed,” she said.

Alcalay is not alone.

“There are many of my friends who have just finished university this year or last and can’t find jobs,” said Evie Leon, 24, a former head of the Jewish Youth of Athens.

The community tries to help. Jewish businessmen network to find jobs for the young unemployed. Two young men receive stipends for taking part in daily minyan.

“We are talking about simple jobs, we are not head hunting,” Mordechai said.

But ultimately it is not enough.

“The unemployment is so bad that unfortunately they are leaving for abroad, either to study or find work,” said David Saltiel, who heads Thessaloniki’s Jewish community, where the situation is equally grim, and is president of the Central Board of Jewish Communities in Greece.

Leon says her friends in Greece are “depressed and stressed.” The rest have left and “are not planning on coming back until the situation gets much, much better.” Even though she has a job, she also is “looking into opportunities to leave the country.”

Alcalay’s 25-year-old sister is among those who left to study and did not return after she found a job with an IT company in the Netherlands.

“She wants to come back in a few years, but I don’t recommend it,” Alcalay said. “Even though I love her, I say don’t come back because you will be unemployed.”

Those who leave are doing what they can for themselves and their families. But leaders know and fear the toll this will have on the community.

“When our young generation leaves and becomes well established abroad, I think it will be difficult for them to return,” Saltiel said. “We will become a community of old people.”

Editorial Cartoon: The Sacramento Chainsaw Massacre


Sheldon Adelson on Newt: ‘He’s at the end of his line’

Sheldon Adelson, who with wife Miri, has given more than $15 million to the Newt Gingrich Super PAC Winning Our Future, said Monday he believes Gingrich is “at the end of his line” regarding the race for the Republican presidential nomination. 

Adelson was speaking informally to a small group at his Las Vegas hotel and casino, The Venetian, which hosted The Jewish Federations of North America’s second annual TribeFest, a three-day leadership and networking retreat that attracted more than 1,400 Jewish professionals.

The casino magnate, sporting a button that read “Obama…Oy Vey,” visited a TribeFest session focused on the potential 2012 Jewish vote. As he exited the session, about a dozen participants followed Adelson into the hallway.

Story continues after the jump.