Israel-Diaspora Partnership Threatened

By Anthony Weiss

Published January 28, 2009, issue of February 06, 2009.
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The link between North America’s federated Jewish charities and the organization that built the State of Israel with their donations, the Jewish Agency for Israel, may be coming unglued.

The Jewish Agency, founded in the 1920s as the operations arm of Theodor Herzl’s World Zionist Organization, today serves as Israel’s main immigration agency and as a major nongovernmental social services provider. Funded by hundreds of millions of dollars per year in donations from Jewish community chests in America and elsewhere, the agency is designated in Israeli law as the official liaison between the Israeli government and Diaspora Jewry.

That relationship was called into question in a scathing January 22 letter by the chairman of the Jewish Agency’s board of governors, Richard Pearlstone, denouncing a restructuring plan being considered by United Jewish Communities, the clearinghouse for North America’s local Jewish charity federations.

“We fear that United Jewish Communities is on the way to abandoning its obligations and responsibilities to the hundreds of thousands of Jews we serve every day, with the clear result of deconstructing the historic partnership between JAFI and the federations of North America,” Pearlstone wrote.

The rupture threatens links between local North American Jewish charity federations — which raised $900 million last year — and two huge agencies aiding Jews around the world: the Jewish Agency, which operates in Israel, and the American Jewish Joint Distribution Committee, which operates worldwide. Often seen as embodying the traditional ideal of international Jewish solidarity, their connection to their American funders has been strained in recent years — partly due to growing domestic needs and donor demands for more accountability.

At the center of the current crisis is UJC, founded in a 1999 merger among several national agencies, including the historic United Jewish Appeal. The merger was intended to streamline operations and to shore up overseas aid allocations. The merger has been troubled by stagnant fundraising, claims of a lack of focus and declining federation support for overseas work.

The Jewish Agency has faced particularly hard times. Allocations from North America this year are $125 million, down from $138 million the previous year. The drop, combined with the falling value of the dollar, has created a shortfall of more than $40 million at the agency this year, forcing steep budget cuts.

“It’s such a significant change, we won’t be able to recognize what was once the proud participation of the American Jewish community in building the Jewish state.” said a longtime Jewish organizational professional.

Pearlstone’s letter came in response to a draft strategic plan proposing that UJC allocate funds to other organizations beyond the Jewish Agency and the JDC. No less controversial, it proposes that UJC seek donations from Israeli philanthropists cultivated by the Jewish Agency and JDC. In the letter, and in an ensuing conversation with the Forward, Pearlstone said that if UJC proceeded with its plans, the Jewish Agency would bypass UJC to speak directly to federations and even seek to solicit funds from individual donors.

The chairman of UJC’S board of trustees, Joe Kanfer, told the Forward that the strategic plan attacked in Pearlstone’s letter was only a draft and that the criticism was premature. He noted that “the situation in Israel has changed in the last 40 years.”

In a January 27 letter co-signed by two other UJC officials, Kanfer suggested a meeting to discuss differences.

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