Do Jewish schools have too much endowment 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 billion-dollar Madoff losses are only cumulative. After all, individual investors lost mere millions.

For example, Long Island Jewish Health Systems lost almost $6 million. 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.

Then there’s the world of Jewish education. Yeshiva University lost $110 million. This is not that serious, it says, “because it is only 8 percent of our endowment total, and our work will not be affected.”

The Jewish Community Foundation of Los Angeles lost $18 million and the Technion, Bar-Ilan University and Hebrew University 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 fundraising 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 $1 billion in endowment funds, would it not be a fine idea for it to allocate a mere 1 percent of its funds to help other similar institutions? (A billion dollars, remember, is $1 million multiplied by 1,000 — a thousand million. That is real money.)

Do the math: 10 percent of $1 billion is $100 million, 1 percent of $1 billion is $10 million. Can you imagine the impact on Jewish life if these behemoths of endowment funds were somehow to shave off 1 percent of their funds annually to help sister institutions in need? If by their own admission, a loss of $100 million does not affect them, then certainly giving away $10 million would be a mere pittance. Compared to what they already have, that does not count as real money nowadays.

If the Technion would distribute $10 million a year to the science programs of Jewish schools everywhere; if Bar-Ilan and Hebrew University would allocate $10 million a year to fund Jewish studies departments in Jewish high schools around the world; if Yeshiva University would allocate only 1 percent — something over $10 million a year — to struggling small yeshivas 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 percent of their endowments, certainly a gift of 1 percent should be easy to manage. After all, none of them would be giving away any real money.

Emanuel Feldman, a resident of Jerusalem, served as a rabbi in Atlanta for 40 years. He is the former editor in chief of Tradition magazine and the author of nine books. This column first appeared in the Jerusalem Post.