Jewish Money Corrupted the Jewish State

Diaspora Jewish philanthropists, showering money on Israeli politicians, helped ripen the field for corruption; Olmert's conviction is just a case in point.

Anshel Pfeffer
Anshel Pfeffer
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Ehud Olmert speaking in February 2014.
Ehud Olmert speaking in February 2014.Credit: Gil Cohen-Magen
Anshel Pfeffer
Anshel Pfeffer

Seventeen years ago this week I had the first front-page main headline of my career. Like many other headlines in those days on Kol Ha’ir, Jerusalem’s bravest weekly paper, it dealt with Mayor Ehud Olmert. This specific one revealed how together with a colorful and dubious British-Jewish businessman, Olmert had planned to raise billions in an issue of municipal bonds, only to have their grand design shot down by the Treasury Ministry. Unsurprisingly, Olmert’s partner in the scheme did not have the necessary experience for such a venture but he had donated funds to his campaign, and had since gone missing in mysterious circumstances. Of course, any speculation on our part on what else the absconding millionaire had done for the mayor or promised to do in the future would have landed us in court facing a libel suit. Alternatively, it could (should) have been the basis for yet another police investigation into the now convicted ex-prime minister’s financial affairs.

Thousands of words have been written this week since the devastating verdict on Monday, speculating on how the talented young politician who first made his mark in Israeli public life as a fearless fighter against corruption in high places had been transformed over the years into a serial bribe-taker. What happened on the way from a Spartan childhood on the Jabotinsky Estate, surrounded by the upstanding stalwarts of the Revisionist Movement, that had made Olmert into a man with a $300-a-day cigar habit, the most valuable fountain pen collection in the country and a predilection for first-class air-travel?

My own theory is that early on in his career he came into close contact with too much Jewish money. I apologize to our more faint-hearted readers who may find that combination troublingly reminiscent, but the sad fact that Jewish money has corrupted a generation of leaders of the Jewish state is inescapable. How else to explain the lavish habits of men such as Olmert, Ehud Barak, Benjamin Netanyahu and others who grew up in the early days of the state when austerity was not only a necessity, but an overwhelming virtue?

Cast your minds back to almost any period in Israeli history before the prosperity boom of the 1990s, when most Israelis didn’t own a car and had never traveled abroad. There were no fine wines on sale, everyone smoked cheap, locally-manufactured cigarettes, and generals and ministers spent their retirement in small apartments on the kibbutz. A few families in Tel Aviv and Jerusalem had money but they were not held up as shining examples of Zionist fulfillment in the way the overnight high-tech millionaires are today. Corruption of course existed, but it was mainly the sort you usually find in any country with a largely centralized economy where the lines between public, political and personal finances too easily get blurred. The scope for bribe-taking was limited in a society where a public servant driving a flashy car, wearing tailored suits, smoking cuban cigars and spending too much time in Manhattan would immediately be noticed and frowned upon.

But if you were a young and upcoming minister or general, the kind who got to meet the princes of the Jewish world at the King David Hotel or Tel Aviv Hilton, and as guests of honor at conventions overseas, if your job made you one of the select few who frequently flew abroad, you could taste this other life of plenty. And once you left the hotel lobby or landed back at Lod, how drab and mundane life back home seemed with a single black-and-white television channel, leaky milk bags, and a three-year waiting list for a telephone line.

The founders' generation were pioneers who had left the Diaspora behind and when, by necessity, they had dealings with the rich brothers who remained in the fleshpots, were capable of returning home, their feeling of superiority intact. But the next generation had a much more difficult task, brought up to disdain capital and material comfort while constantly being brought up against the growing disparity between them and their cousins. In the 1950s and 60s, Israelis spoke dismissively, but also wistfully, of the rich uncle in America. The one who had chosen a life of luxury instead of ideology and came bearing gifts to visit once a year. A generation would pass before getting rich would become glorious, but meanwhile the frustration lingered.

You could be a combat pilot or a nuclear scientist, command divisions and direct a state budget, but you would never have anything coming close to the material quality of life enjoyed by even a moderately successful lawyer or professor or doctor in the west.

It’s hard to locate the point where they gave in. One place to start would be the personal loans furnished by the likes of Meshulam Riklis to generals building homes upon retirement in the early 1970s. Ariel Sharon could have never afforded the massive (by Israeli standards) Sycamore Ranch on his IDF pension, even when it was supplemented by a Knesset salary. Thirty years later, another member of the 1967 General Staff, President Ezer Weizman, was forced out of office for having not disclosed a loan he received from Jewish tycoon, Edward Sarousi. Sharon himself was almost indicted over another loan from a foreign benefactor, Cyril Kern.

And Olmert of course was forced to leave office and indicted (though eventually acquitted, pending appeal) following allegations of receiving envelopes stuffed with money from another Jewish businessman, Morris Talansky. There seems to be a pattern here to which you can add the multiple investigations of Foreign Minister Avigdor Lieberman for his dealings with Austrian-Jewish tycoon Martin Schlaff (which never lead to an indictment despite over a decade of probes and the best efforts of the State Attorney) and countless other similar cases. Olmert was just one of those popular guests in the parlors of Jewish philanthropists, one of the most successful practitioners of the burgeoning and lucrative Israel-Diaspora industry. He was far from being the only politician who realized it was the easiest way to finance impressive election campaigns and a comfortable private life.

Even the Holyland scandal which finally lead to Olmert’s conviction this week, while not directly involving any foreign suspects, is a result of the shopping spree by Diaspora Jews in Jerusalem, snapping up prime real-estate for their second and third homes. Millions were given in bribes to Olmert & Co to build the monstrosity defacing the city’s skyline simply to satisfy the demand. Only a minority of the project’s apartments are owned by local Israelis.

There is no new moral to this story. Corruption occurs wherever politicians and easy money mix and the generosity of the Diaspora brought huge benefits to the holy land. Most of the money, but not all of it, was given out of the goodness of their hearts. But when Jews around the world read the latest news, shake their heads and wonder what has become of Israel, they should just bear in mind that it was their money that corrupted us.

Shula Zaken.Credit: Tal Shahar

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