Real Money

The late senator Everett Dirksen of Illinois once famously said to Lyndon Johnson about the national debt: “A few billion here, a few billion there and before you know it, you’re talking real money…” The world economic meltdown is painful, but there is one silver lining: At least we are now talking real money. We no longer deal with mere millions. Billions are the currency of the hour.

Ah, Madoff, ah, Ponzi! They have shown us what real money is. But let us not exaggerate: The Madoff billion dollar losses are only cumulative. After all, individual investors lost mere millions.

For example, Long Island Jewish Health Systems lost almost $6m. But not to worry, they tell us, because this was “less than 1 percent of our portfolio.” Not a bad portfolio, one that exceeds the real money threshold. Yeshiva University lost $110m. This is not that serious, it says, “because it is only 8% of our endowment total, and our work will not be affected.” The Jewish Community Foundation of Los Angeles lost $18m. and the Technion, Bar-Ilan University, Hebrew University and Hadassah all lost heavy millions, but they all assure us that – even though they will never recoup those millions – they are not broke and will continue to operate and function normally.

AN IMPERTINENT question keeps popping up: If these and other Jewish institutions can afford to lose hundreds of millions of dollars without any affect on their programs, this means that each of their endowment funds runs into the billions. Why, then, are these and the others who lost so much constantly asking for funds? Why are they in a perpetual fund-raising feeding frenzy? Instead of raising money constantly, perhaps they should be giving some of it away.

Here is a modest proposal to save Jewish life: When a Jewish institution reaches $1b. in endowment funds, would it not be a fine idea for it to allocate a mere 1% of its funds to help other similar institutions? (A billion dollars, remember, is $1m. multiplied by 1,000 – a thousand million. That is real money.) Do the math: 10% of $1b. is $100m., 1% of $1b. is $10m. Can you imagine the impact on Jewish life if these behemoths of endowment funds were somehow to shave off 1% of their funds annually to help sister institutions in need? If by their own admission, a loss of $100m. does not affect them, then certainly giving away $10m. would be a mere pittance. Compared to what they already have, that does not count as real money nowadays.

If Technion would distribute $10m. a year to the science programs of Jewish schools everywhere; if Bar-Ilan and Hebrew University would allocate $10m. a year to fund Jewish studies departments in Jewish high schools around the world; if Yeshiva University would allocate only 1% – something over $10m. a year – to struggling small yeshivot and day schools that cannot pay their teachers on time, that are housed in meager facilities and have inadequate equipment, that are living a hand-to-mouth existence, that are valiantly trying to keep their heads above water – if all this were done, it could make a major difference to the future of Jewish life. If institutions like these can survive losses of more than 8% of their endowments, certainly a gift of 1% should be easy to manage. After all, none of them would be giving away any real money.

ANOTHER QUESTION keeps recurring, this time about Bernard Madoff himself. With palatial homes and chateaus around the world, and private planes and yachts and chauffeurs, with all the trappings of super-wealth, with more real money to his name than he or his future generations could ever need, why did he keep running after more?

One answer is that like a drug, the pursuit of money is an addiction, and one cannot simply withdraw from it. Like the smoker and his tobacco, the drinker and his alcohol, such a person in hot pursuit of more money surely realizes intellectually that enough is enough, but somehow finds that he cannot pull back from it. A creeping madness sets in, irrational behavior takes over, he finds himself caught up in a whirlpool from which he cannot escape, and he has to keep moving faster and faster just in order to stay in place. Instead of possessing money, the money possesses him.

In other words, as King Solomon, the wisest of all men, put it in Kohelet 5:9: “He who loves money is never satisfied with money.” Madoff is the living embodiment of that old adage: “Money is a wonderful thing, but it is possible to pay too high a price for it.”

Our real worth as a person was never measured in dollars, not even in millions or billions of them – but in who we are and what we become. To paraphrase Senator Dirksen, a mitzva here, some lovingkindness there; a sympathetic word here, a Torah thought there; a prayer here, an act of charity there – and before you know it, you’re talking about a real Jew.

The writer, a resident of Jerusalem, served as rabbi in Atlanta for 40 years. He is the former editor-in-chief of Tradition magazine and the author of nine books. He is on the editorial staff of the newly published Encyclopedia of Mitzvos. This article also appeared in the Jerusalem Post.

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12 Responses

  1. Joel Katz says:

    “…and Hadassah all lost heavy millions, but they all assure us that – even though they will never recoup those millions – they are not broke and will continue to operate and function normally.”

    It looks like Hadassah will not continue “to operate and function normally”.

    According to JTA, Hadassah just laid off one-quarter of its staff.

  2. Yechezkel Hirshman says:

    This entire post, complete with the quote from Senator Dirkson (unnamed) was expressed in my blog post entitled The Richest Man in the Cemetery on Dec. 25, 2008.

    Boruch she’kivanta.


  3. Leah says:

    Ahhhh yes, that is an excellent idea- One Jewish organization giving to another. No man dies with half of what he desires. How true- and pathetic.

  4. BobF says:

    If you give money to an organization, the organization has the responsibility to use it for the programs described when they were fund raising. THey have no right to give it to some other organization-if people wanted to give to some other organization they would.

  5. Ron Solomon says:

    Bar-Ilan University in Israel did not lose a dime to Madoff. Please correct your stories. It was incorrectly reported and keeps getting picked up.

  6. Chaim Fisher says:

    The author asks, “why did he keep running after more?” about Madoff.

    Madoff had to get more and more money new pouring in, to pay off all the non-existent gains he kept promising earlier investors. That’s how Ponzi schemes work.

  7. Bob Miller says:

    What we have here are essentially independent private organizations, each focusing narrowly on its own priorities and survival.

  8. Yehoshua Mandelcorn says:

    “if Yeshiva University would allocate only 1% – something over $10m. a year – to struggling small yeshivot and day schools that cannot pay their teachers on time”
    Flagship schools with large endowments should support feeder schools.
    But they will never support schools that do not believe in the flagship school itself.
    YU is viewed in many circles as the “dark side of the force”.

  9. Michoel says:

    I really wish you would feature R. Feldman more often. He is a wonderful, wise writer and someone that all participants of this blog can learn from.

  10. Michael Mirsky says:

    I wouldn’t say that they will be unaffected. Hadassah has already announced layoffs of some of their staff.

    I think you are inappropriately comparing the size of their funds with the size of their annual disbursements. Most of these funds have very large amounts in capital which they invest in stocks or bonds. The idea is that what they disburse each year is the interest or profits on the principal, so that the payments can continue to be made for many years to come. They don’t want to touch the capital, because that affects future payouts. Also I believe some of these funds are constrained by the donors in how much they can disburse.

    What you’re suggesting is that they whittle down their capital on an ongoing basis giving 1% to other causes. 1% may sound like a small amount, but when you consider the possibility of huge drops in the total value of the capital (especially in equities as happened last fall), you really don’t want to touch your capital at all, but only draw on it in extreme circumstances. I’m sure some of them have had to do that to keep operations going after the recent losses in the stock market.

  11. Leah says:

    Bob F. I was just reading your comment and I agree with it…also , is it something that could be worded and announced that ABC organization is working with organization XYZ and funds are distributed amongst the two. Meaning it would be something that would be announced so it is fair.

  12. Eliezer says:

    I agree with the sentiments of Michael. But to take it one step further, what you are asking is for these organizations to break into their endowment funds on a yearly basis, however, these funds don’t get increased all that often. Since as mentioned they are living off the interest, by taking away any of that fund, they would end up lowering their income, which would severly limit what they can acomplish.

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