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Community Must Prepare Wisely for the Post-Madoff World

January 1, 2009 By:
Andrew Silow-Carroll
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 Earlier this year, when Eliot Spitzer still held the title of America's most shameful governor, I urged the Jewish world to develop a universal standard for measuring the damage done to Jews by disgraced fellow Jews -- what your bubby and mine used to call a shande fer de goyim. At the time, I thought we might calculate the shande factor in Abramoff Units. But that's the old math. Today, we'd have to measure calumny on the Madoff Scale.

It's hard to fathom the mounting toll of this scandal, surrounding a trusted hedge-fund manager who lost his clients billions in a financial Ponzi scheme. Those clients included so many Jewish philanthropies and big givers that organizations that haven't been affected are compelled to put out press releases saying so.

Bernard Madoff was deeply ingrained in the East Coast's Jewish country-club culture; he was also an officer at Yeshiva University, and a money manager for foundations maintained by Steven Spielberg, Elie Wiesel and Hadassah.

The only silver lining seems to be that Ponzi himself wasn't Jewish.

Jewish organizations -- and let's face it, each one of us -- are bracing for an anti-Semitic backlash. As Bradley Burston put it in in the Israeli daily Ha'aretz, the scheming financier both affirms the Jew-hater's stereotypes, while managing "to harm contemporary Jewry in ways anti-Semites could only dream about."

Even before Hurricane Bernard hit, Jewish defense groups were watching for signs that Jews would become scapegoats for the global financial crisis. Internet conspiracies link Fed chairman Ben Bernanke, Rep. Barney Frank, investor George Soros and Lehman Brothers in a sort of Protocols of the Elders of Subprime. In October, "Saturday Night Live" ran a creepy skit depicting a gloating Soros, and bankers Herbert and Marion Sandler kvelling about the sale of their loan company to Wachovia for $25.5 billion in 2006.

Such activity led Kenneth Stern, the American Jewish Committee's point man on anti-Semitism, to write a speculative piece titled "Will financial crisis encourage anti-Semitism?" Stern noted the ugliness found on the white-supremacist and neo-Nazi sites, and decried the scapegoat rhetoric of Iran's President Mahmoud Ahmadinejad.

And yet, Stern acknowledged that hate sites number just a few thousand among the 185,000,000 existing Web sites. Meanwhile, Islamist extremists and pro-Palestinian apologists, like white supremacists, have had no trouble in the past concocting their own reasons to hate the Jews -- no matter the headlines.

Which isn't to say we have nothing to fear but fear itself, but it does suggest that Jews will waste a lot of communal energy if we spend much time worrying what they think. We went through this exercise a number of times in the past, when the bad guys were named Ivan Boesky and Michael Milken. Few, if any, Jews suffered at the hands of anti-Semites as a result of those scandals. The exception, perhaps, was the Jonathan Pollard affair, in whose aftermath Jews in the military and Defense Department felt the cold eye of scrutiny.

This month, Jews were indeed victimized -- but by a fellow Jew, and perhaps by their own philanthropic culture. Unlike Internet neo-Nazis, this issue is something Jewish communities can address. As Jeffrey Solomon, president of the Andrea and Charles Bronfman Philanthropies, told the Jewish Telegraphic Agency: "What really emerges out of this [is that] people sometimes forget to conduct due diligence when dealing with others with social prominence -- and especially in the hedge-fund area, where people think you have to be really smart to be in hedge funds."

In other words, folks who should have known better were dazzled by Madoff's milieu and too-good-to-be-true returns. As a result, they placed their assets -- and their community's assets -- in a single basket.

Rather than arming for a war against the hate groups, Jewish organizations should be devising ways to learn the lessons of the Madoff disaster, and share those lessons with their colleagues at Jewish institutions large and small.

They should be grateful for the generosity of the very wealthy, but without allowing the machers' riches to place them above scrutiny.

The organizations' leaders should take a long, hard look at the overlapping, and even redundant, agencies and projects in Jewish life, and figure out ways to get past the turf wars and meet challenges more efficiently and effectively. 

Andrew Silow-Carroll is the editor in chief of the New Jersey Jewish News.

 

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