Jewish American donors to Israel criticized the country's wealthy for not helping their fellow citizens enough, the locals blamed the situation on tax policies, and all agreed that more charitable involvement is necessary in general.
"Do you think that wealthy Israelis contribute enough to philanthropic causes?" This was the opening question in a provocative and unusual discussion that took place in Jerusalem about 10 days ago between Jewish millionaires from abroad and their Israeli counterparts. The man who posed the question, panel moderator Shale Stiller, president of the Harry and Jeanette Weinberg Foundation - the largest philanthropic foundation in the Jewish world - intended to get some answers. To his right on the podium sat Israeli industrialist Dov Lautman and American philanthropist Edith Everett; to his left, high-tech entrepreneur Nir Barkat and British businessman Jacob Schimmel, chairman of IDB Holding Corporation and one of the heads of Matan, a nonprofit organization that promotes investment by the business sector in Israeli communal efforts.
About 250 people sat at round tables in the room where the event took place. They included members of the board of trustees of the World Joint Distribution Committee, which convened in Israel for the first time in the organization's long history, and some very well-to-do locals. The evening was organized by the JDC, which works to encourage businesses and Israeli citizens alike to donate to social causes.
The explanatory material distributed to the participants stated that Israeli philanthropy is a relatively new phenomenon, and that even though the concept of charity is deeply rooted in Jewish tradition, large donations from private Israeli sources are not particularly common. The reason? The socialist-Zionist culture that characterized the young state.
This trend changed in the 1990s, according to this document, in the wake of the growth in private wealth. Currently there are more than 6,000 millionaires living in Israel, with a combined estimated fortune of $22 billion. The text goes on to explain that the total charitable contributions by Israeli individuals and companies is estimated to be $250-400 million per year. By comparison, the Weinberg Foundation alone donated $100 million last year; some of the money went to Israel, but the bulk went to charitable projects in the United States.
The discussions on stage and around the tables, each of which comprised participants from Israel and abroad, were conducted very politely. But the very fact that they occurred at all reflects a growing sense in the United States that Israelis have become accustomed to requesting significant donations from American Jews, while they themselves either do not contribute at all, or do not do so sufficiently, considering that their standard of living has risen sharply and exceeds that of many Jews in the United States and elsewhere.
'Taking the plunge'
"I'm seeing more and more Israelis taking the plunge," said Barkat, the first to respond to Stiller's question. However, he added that people can't be pushed into the water, but have to be drawn into it. Asking whether Israelis contribute their share isn't a fair question, according to Barkat. "You must ask if the direction is correct, if we're educating a young generation of philanthropists. The answer to that is 'yes.'"
Barkat is one of the founders of the Israel Venture Network (IVN), an organization of about 200 Israeli and American high-tech businesspeople, dedicated to investing in education and welfare programs in Israel. "Israeli philanthropy isn't organized like it is in the United States, but we're not in competition with the Americans," he noted.
"Israelis contribute a lot - like three years to the army," Schimmel said, adding that donations have increased threefold in the past decade. Israelis donate a lot of time, Lautman said in response to the million-dollar question, "and besides, it's important to remember that the Americans started a generation before us." Lautman added that Israelis would have more incentive to make charitable donations if these donations were tax-exempt, as they are in the United States, and he urged Stiller to press for a change in this policy during his meetings with Israeli politicians; currently, an exemption is granted only for donations up to NIS 2 million.
Stiller had another suggestion for getting Israeli millionaires to loosen the purse strings: If Israel had an estate tax like the United States does, he said, wealthy citizens would make donations now, just as Americans do, to avoid the taxes that will have to be paid later on their estates. Lautman wasn't convinced, and countered that if there were no estate tax, one wouldn't need to avoid it.
Barkat also thinks that the tax-exemption ceiling on donations should be abolished in order to encourage Israelis to give. "You have to start talking about investment, and not about charity," he said. "When you're talking about investment, the state is ready to finance a tax exemption. When you're talking about a donation, it imposes a tax."
The next question posed by Stiller, as to whether wealthy Israelis should donate money to needy Jews abroad, seemed to cause some discomfort among the Israelis present. Those who make money abroad should donate to Jews abroad, Lautman replied. As an example, he cited the owner of the Africa-Israel corporation, Lev Leviev, who does business abroad and contributes to Jewish causes in the former Soviet republics.
But Lautman and other Israeli speakers were united in the view that the poor of their country come first. Lautman suggested waiting a decade, and letting American Jewry help Russian Jews, many of whom "came to Israel with nothing. We need to worry about those who came here."
Poverty vs. Hamas
Stiller didn't relent, and said that if Jews had adopted that approach in America, Israel "wouldn't have received anything from us. We also have a lot of needy Jews and a lot of needs." Lautman responded that the United States is the richest country in the world, adding that approximately 85 percent of Jewish philanthropic donations there aren't even earmarked for the community's causes. He also argued that poverty, economic gaps and inequality in Israel worry him more than Hamas and Hezbollah, and therefore Israeli philanthropists ought to focus their contributory efforts on their own country.
Judith Recanati, who founded Natal - The Israel Trauma Center for Victims of Terror and War, and contributes to a variety of causes such as programs for at-risk youth, agreed. "There are so many needs in Israel," she told the others at her table, who included Ron Grossman of Baltimore, who gave money to establish the Kesher center for parents and children in Hadera, and is considering upping his donations to Israel. Americans share Israelis' love for their country, Grossman explained, but new strategies have to be developed to involve Israelis in philanthropic activity. Recanati reported that since 1998, Natal has helped 25,000 Israeli trauma victims, and that 40 percent of the donations for this have come from local donors. Former Knesset Speaker Avraham Burg, now a businessman, termed this almost-equal level of funding "a unique occurrence."
Seated at the same table as Recanati, and apparently acting on the theory that the best defense is a good offense, Burg asked the American philanthropists with a smile whether, without Israel or needy Jews in America, they would be able to raise anything at all on behalf of "local needs in the United States." He was referring to the fact that a large portion of donations by American Jews are designated for non-Jewish communal purposes.
Overall, the guests were complimentary to the Israelis and the "brotherhood of the wealthy" survived the few barbs that came from the American side. But the strongest gut reactions actually came in response to Stiller's question of whether American philanthropists ought to donate to Israeli hospitals which have their own research foundations that bring in millions of dollars. Barkat contended that the hospitals are not well-off; Schimmel pointed out that the government does not have money to build a trauma unit at Rambam Medical Center in Haifa, and so the IDB's foundation is underwriting its construction.
Edith Everett, who donates millions of shekels annually to education and welfare institutions - including in Hatzor Haglilit and the Druze sector - angrily disagreed with both men. The government should be more involved, especially when it comes to basic services, she said, adding that it is infuriating that only half of children in educational institutions with a long school day receive lunch there. Everett told of how for three years running, the principal of a school in Hatzor Haglilit has asked her to help pay teachers' salaries. "I'm not willing to pay salaries anymore. It's the state's job to pay the teachers," she declared, adding that money should be donated by other sources - in addition to the government's allocations, not instead of them.
Barkat tried to defend the state's actions, claiming that the government cannot possibly fulfill all its commitments. Lautman tried to attack the issue from another angle: Philanthropists need to exert pressure on the government to improve its style of management - in education, for example - to use the money more effectively, he said. "This is our right, because we contribute a lot of money to education."
All were agreed on the need for more charitable involvement on all levels. Stiller said that many different organizations approach his foundation, asking for money. When they are told that they must submit financial reports with information such as the ratio of contributions to salaries, and that transparency is vital, he said, "They say, 'Trust us. We're helping Jews.'"
"Don't give them a cent," Lautman advised him.
Stiller assured him: "They don't get a cent from me."