Monday, July 12, 2010

Money and Klal

I was going to pussyfoot around the topic of this posting and build up to breaking the bad news, but there really is no way to cushion this news. It's not that Klal is going to run out of money to support itself soon--it's that Klal has already run out of money to support itself. And it's all our own fault. We've taken to heart the injunction to give tzedaka and give generously. However, it's not hearts that are needed at this point but clearly thinking heads.

As Klal has grown the number of institutions and organizations of Klal has also grown, but that number has grown at a far faster rate then Klal, as presently constructed and organized, can adequately support. The problem is simple if you look at it objectively and use a calculator instead of wishes and hopes. There are X number of Jews. Those Jews do not all have the same amount of money. It's a fact of life that some people will have more money and some will have less or no money--always been that way and always will be. Even if those in the top money levels were to contribute far in excess of 10-20% in charitable giving, there is not enough money available to sustain what we have created.

Now granted, there is an awful lot of tzedaka money being given, huge sums of it. But a lot of that money is being flushed down the toilet rather than doing any good. Why?

First, a duplication of services. Blink twice and a new tzedaka organization will come into existence. I'll acquit the people who start them of nefarious motives, but some of those organizations have no business being in existence. They aren't fulfilling an unfulfilled need of Klal but are duplicating a service that another organization, sometimes many organizations, is already fulfilling. For example, how many hachnosas kallah gemachs and funds are truly necessary for one town, even one the size of NYC, to have? Each of those gemachs has X amount of overhead, even if 100% staffed by volunteers. The more of these gemachs, the more overhead, the less money going to help the people the gemach is supposed to help. Some of these gemachs work on sound economic principles, and a whole lot don't. And the kallah gemachs are relative small fry in the tzedaka world. In virtually every area we have multiple groups all collecting for the same things. There is a great deal of waste of Klal's resources because of this duplication.

Second comes handling money in an appropriate fashion. Far too many of the organizations of Klal are headed by people who may have good hearts but who also have no idea about economics. The organizations are poorly organized and run. Their budgets are seriously out of whack. Check the state records for those organizations that do report their finances and you will see operating expenses in too many cases that exceed 40 to 50 to even 90 percent of funds collected. And if that is only 30%? That still means that for every dollar donated, only 70 cents goes to the stated purpose. And speaking of those state records, just why is it that every tzedaka organization does not register itself with the state as a 501(c)3, so that people could legitimately take off any deduction to that organization as a tax deduction and/or see the organization's financial reports? Call me a cynic, but they don't do so because then their finances would come under scrutiny and some wouldn't pass the test as financially stable, well-run organizations.

So why are we in this position? It has to do with arithmetic. We've got addition down pat and multiplication too--the number of organizations attest to that fact. What we don't seem to have mastered is subtraction--once something comes into existence we are not only loath to get rid of it, but we don't have in place any mechanism that could do so even if we wanted to close down an organization. Nor do the organizations seem capable of subtracting some services, once given, despite there being no money to provide those services to the number of people requiring them.

Yes, I know, I missed an arithmetic function--division. Here we are the star pupils. As Klal has grown, we have divided ourselves into ever growing divisions of yiddishkeit. To speak of one klal is a misnomer. And each division of Klal believes itself entitled to all the charitable services, uniquely constituted to serve just that division of klal. Now granted, in some instances geography does play a part in these divisions. For example, Hatzolah of Williamsburg cannot be expected to also service Forest Hills or Flatbush or SI--it's not physically possible. And yes, the various Tomche Shabbos organizations also function along geographic lines, except where they don't.

Sometimes those lines are ideological rather than geographic. Group A and Group B and Group C, all basically in the same geographic area, all have the need for a particular type of tzedaka organization, or believe they do. Logic would dictate that ONE organization would come into existence that would service the needs of all three groups. And logic has nothing to do with it--politics and quasi-hashkafic differences do. Groups A, B, and C don't all share the same hashkafah or philosophy and each looks at the other with more than a dollop of suspicion and dislike. So each group opens up an organization to provide the service needed. And then what do they do? They go outside of their group to ask for funds to support that organization. So now you have three groups with three organizations all competing for the same limited tzedaka money in Klal. And yes, expenses will be multiplied because Klal is divided into so many little pieces.

And then there is another major reason for the proliferation of tzedaka organizations specific to Klal. There exists in many sectors of Klal a distrust of the secular world. These sectors attempt to cut themselves off from the secular world. Granted, some of them are perfectly willing to take SOME government money, particularly in the areas of housing assistance and food stamps. But when it comes to services that may generally fall under the rubric of counseling, they refuse to use the services. Unless a service is under "frum" auspices it won't be used, won't be recommended.

Let me leave you with this: whatever I said about tzedaka organizations above applies equally well to the schools we have. We're long overdue to have some of the less efficient, more costly schools close down. We're overdue for mergers between some schools that are offering identical services, competing for the same students and the money that comes with those students. We're overdue for better fiscal organization and responsibility. We certainly are long overdue for a common, unified purchasing entity that would allow the schools to get better pricing on the things they buy. And the divisiveness that exists for the tzedaka organizations exists for the schools as well.

But soon, verrrrrry soon, it all won't matter because the well is dry and pumping harder isn't going to help--only cutting down and cutting back will.


Anonymous said...

Sure there are always going to be people who have less and people who have more but you left out one important fact. Even though the frum population keeps growing, so there should be enough money growing also, the part of the population that is planning on being supported by tzedaka is growing faster then the other parts. Yes, I mean planning on taking tzedaka not an accident of circumstances. We're running out of money because takers are more in number and those earning money who can give are getting to be less.

Anonymous said...

With no central authority like the RC Church, I don't see a good way to curtail this problem. I think we can all take a lesson from Warren Buffet who is going to use the foundation set up by Bill and Melinda Gates to give away his billions, rather than set up his own separate foundation and infrastructure.

Anonymous said...

What about cutting back on services that duplicate what the government and secular non-profits provide. For example, there are already perfectly fine ambulance/EMT services in many areas served by a Hatzolah. What about taking advantage of public schools for the younger grades?

JS said...

I see that the Anonymouses already said some of the points I was going to make. The main reason there are so many organizations is because it's a darn good way of making money, getting kavod, and looking like an altruistic person. The proliferation of tzedaka organizations is really no different than the proliferation of yeshivas in Israel that the American families send their post-high school graduates to. It used to be that hardly anyone sent to Israel yeshivas before college and thus there were a handful of yeshivas. Somewhere, someone thought this was a travesty and got all the high schools in America to push this on the student bodies. Overnight, seemingly, every rabbi had his own yeshiva or seminary in Israel. The best part is you can collect tzedaka for the yeshiva while collecting tuition. No different than the myriad of yeshivas in Brooklyn - every rabbi with a hope and a dream has his own yeshiva or kollel and they all go collecting.

Also, many organizations, even reputable charities and communal organizations play games with compensation. They pay only pay an employee $30k in salary, but they give the person a HUGE expense account for flying to Israel, taking people out to dinners, etc. The yeshivas all do this, for example. A friend who works for a Jewish organization told me her boss has a sizable expense account that is just used for flying to Israel to visit former students and take them out to fancy dinners. It's probably labeled as "fund raising."

There are so many organizations because there's no communal pressure to not have so many. There's always money out there to be tapped - either from the community or from the government in grants or tax breaks.

Finally, so many services are already provided by the government or other secular organizations - for some reason fewer and fewer are deemed acceptable for klal. You mention counseling services, but there are many others. Hatzalah is redundant in many communities, for example. We duplicate secular educational services in our yeshivas. We charge $40k+ for special ed yeshiva when the public schools make so many services available for free. The list goes on.

JS said...

Another thing that bothers me about our communal philosophy about giving charity - it is deemed better and more important for someone to give money so someone can put together a lavish wedding they couldn't normally afford (as opposed to the simple rabbi and two witnesses they could afford) than it is to give to cancer research or provide life-saving money to aid organizations when there is a tragic earthquake or tsunami.

It makes me so sick.

Miami Al said...

The local paper has a section on Sunday called Community, and lists what is going on where. It lists many projects led by students (feel good interest stories) as part of their community service.

All the local non-Jewish private schools brag about the tons of work done by students. One article in there was a girl that volunteered at a soup kitchen, and asked what they needed, what they really needed was a second stove to serve the increased demand.

She said she was going to get them another stove, and the administrator said encouraging words but didn't think much of it. She went around, raising small amounts of money, until she got another stove to feed poor people, very impressive little project.

We read in the paper, occaisionally, about the local non-Orthodox Jewish schools, and they children there are raising money for Jewish related charities, but ones for the entire Jewish world. They are always supporting some cause in Israel, a Holocaust museum, etc.

When I hear about a fund raiser from the Orthodox schools, it is ALWAYS adult led, and the benefit is almost ALWAYS for the school itself. Occasionally something else is done in the community, generally to raise money for the Shul.

But yes, plenty of fund raising to make the Shul catering to doctors and lawyers more luxurious, or the school for their children more luxurious, but helping the ACTUAL poor is nowhere on the radar screen.

Note, helping someone in the top 10% of income have more luxuries for their child, or helping someone in the top 25% have a wedding like they are in the top 5%, is hardly charitable giving, but is what is being taught to our children.

I won't pretend that I did a lot of real community service, it wasn't my thing, but I certainly had friends VERY into it. The limited amounts I did to fulfill my community service requirements was definitely an eye opener into realize just HOW privileged I was.

I sometimes wonder if the fear of children going OTD is self fulfilling. If you only see the "fun" from the secular world, you wonder why anyone would stay Frum. If you saw the families devastated by poverty, drug use, etc., you'd have a MUCH higher opinion of our insular world. But if your first exposure to "secular culture" is keg parties at Rutgers, I can see why that would seem like more of a draw.

JS said...

Very few yeshivas to the best of my knowledge have actual chesed requirements.

The ones that have it as a requirement usually call it a "mitzvah points" or "chesed hours" program. You get "points" or "hours" by helping your parents (i.e., doing chores) or helping at the shul (i.e., doing chores).

Some schools have it as an extracurricular activity which is completely optional such as a "chesed club." The club usually goes to the local hospital or Jewish nursing home.

This is such a narrow-minded approach to chesed. It's no wonder we think putting together a lavish wedding is true chesed or making sure a new infant has nice toys or young children don't have to, God forbid, wear clothing from Walmart is true chesed.

I remember when the disasters in Haiti and Indonesia occurred. You couldn't watch any channel on TV for more than 5 minutes without seeing a call for aid and money. The entire country mobilized to help in any way they can. And yet, how many shuls even mentioned the disasters from the pulpit and asked people to help? In one shul I'm familiar with they didn't announce it because Jews weren't affected - the line was if you wanted to help out, give to Jewish organizations in the areas affected.

I guess this is the legacy of Avraham.

Anonymous said...

Excellent points JS. I also think that the names given to some tzedakah organizations elevates them to something its hard to say no to. For example, "Kallah Gamach" sounds a lot better than "fancy wedding dress group."

Miami Al said...

A friend working as a consultant some years back was advising a Jewish Charity umbrella group in Boston. They were trying to raise money for Boston area charitable works, some Jewish, some cultural and arts related.

They brought in the consulting group because they had a problem:

1. Many of their wealthy potential donors gave primarily to their downstream organization, but not through the united Jewish effort

2. They wanted to figure out how to direct those sums through their appeal, to strengthen the efforts of the Jewish community to be participants in the community

Obviously, this was a non Frum organization, they were supporting helping the poor, supporting the arts, etc., not wedding dresses, and they were dealing in real money.

Their MO was to follow what the Catholics and Christians in the area were doing, whose people were accustomed to giving through their religious groups and helping out, which wasn't the case amongst the Jews.

Beyond the silliness, if someone is giving $1000 to the Boston Symphony, who really cares if it gets laundered through a Jewish appeal, they were trying to figure out how to make themselves more relevant.

However, they were a pass-through entity, that other than administrative costs, didn't seem to add much.

However, just like we are all proud that Israel is one of the first countries on the scene when a disaster hits, it would be nice if everyone saw that when disasters hit in places like Haiti, Jews are at the forefront of helping.

If the Orthodox leadership EVER gets its wish, and the other Jewish groups disappear, then just wait to see how Jews get treated in this country. At least right now, anti-Semitism aside, most educated people have a positive impression of Jewish people, if they were exposed with the VIN crowd, I think that would change in a heart beat.

That crowd looks like a caricature from the medieval anti-Semetic diatribe, it's as though they decided on how to be Jews from the anti-Semites.

Ari said...

I was just at a shiva house, unfortunately, and it occured to me that at the end of the day, unless you're a communal leader in the classic sense(there are very few of these), platitudes about knowing the entire Torah and Shas, or even giving advice to the little people, mean very little compared to living a life of chesed, of true kindness.

Learning Torah (or pretending to) in seclusion, is essentially a selfish act unless it's applied to everyday life. I'd rather have a few less yeshivas manufacturing roshei yeshiva wannabes, and a few more institutions helping people in actual need. More awareness of our history through emphasis on Navi, more sensitivity toward self-perfection and public service, and less training to be a professional dayan to aribitrate ox gorings, split proverbial hairs, and resolve sundry disputes.