U.S. Jewish Donors Are Worried About Israel's Judicial Overhaul but Are Still Contributing

There is growing concern among nonprofit organizations in Israel that they might see a decline in donations, particularly from the North American Jewish community, in the wake of the efforts by the Israeli government to pass legislation undermining the independence of the country’s judiciary. Also of possible concern to American donors are policy disagreements between Israel and the United States.

In 2020, Israeli nonprofit organizations received about 20 billion shekels ($5.5 billion based on the current exchange rate) and 60 percent of that was donated from abroad. In addition to concern about a drop in overseas contributions to the Israeli nonprofit sector, there is also worry that Israeli donors might cut back on their contributions if they recently shifted assets abroad or due to rising interest rates and increases in the cost of living in Israel.

At the beginning of the week, a group of major North American donors to Israel, including businesspeople and philanthropic foundations, sent a letter to Prime Minister Benjamin Netanyahu expressing their concern over the rapid pace at which the government has been seeking to pass the legislation that would alter the balance among Israel’s branches of government. They also noted the lack of public consensus in Israel over the proposed plans.

Among the signatories to the letter were Charles Bronfman, who was a founder the Birthright project and founder of the Karev Foundation, which works in Israel’s schools. Among the other signers were the Russell Berrie Foundation, the Harry and Jeanette Weinberg Foundation, the Leichtag Foundation and the Meyerhoff Family Charitable Funds. The signatories have collectively donated hundreds of millions of shekels to projects and institutions in Israel.

The donors didn’t threaten cuts in their Israeli philanthropy, but in reference to the government’s plans, they stated that they are “deeply troubled by this attempt to curtail the independence of the judiciary, one of the key features that makes Israel one of the most vibrant democracies in the world.”

“Swift legislation without adequate dialogue can undermine the checks and balances that are at the core of Israel’s democracy, threatening critical relationships both within Israel and between Israel and the Diaspora,” the letter stated, according to a report by the Jewish Telegraphic Agency.

The Weinberg Foundation, which has assets estimated at $2.9 billion, contributes to nonprofits in Israel that are engaged in assisting the elderly, people with special needs, youth at risk, education in outlying areas of the country and job creation. In 2005, the Russell Berrie Foundation, which has $200 million in assets, established a nanotechnology institute at the Technion – Israel Institute of Technology at an investment of $100 million. It also provides funding for educational and employment projects for the country’s ultra-Orthodox population, including a project aimed at integrating ultra-Orthodox Israelis into the high-tech sector, as well as contributing to MIGAL Galilee Research Institute, the Shalom Hartman Institute and the Maoz leadership program.

The Meyerhoff foundation provides funding for Sikkuy, which is engaged in Arab-Jewish relations, the ANU social activism platform and the Association for Civil Rights in Israel.

Among the other signatories to the letter are businesspeople Daniel Lubetzky, Lester Crown and Georgette Bennett. In 2010, Bennett and her partner contributed 50 million shekels to establish a humanities department and scholarship fund at Jerusalem’s Van Leer Institute.

‘Spitting in the face of American Jewish donors’

The letter does not contain an explicit threat that the donors might stop giving to Israeli causes, but sources in the Israeli nonprofit sector have expressed concern about a possible decline in American Jewish donors’ motivation to give. In addition to the government’s plans to overhaul the judiciary, the sources cite the attitude of some senior figures in the new government toward Reform Judaism and the LGBTQ, controversy over religious pluralism at the Western Wall and the proposed elimination of the right to immigrate to Israel by non-Jewish applicants who are the grandchildren of Jews. They also cite statements by cabinet minister Avi Maoz objecting to the involvement in Israel of overseas donors.

The director of one philanthropic foundation said: “Philanthropy comes with a desire to advance a social agenda. There are donors who are worried about the fundamental values of the country to which they have donated over all the years, and there are donors who, after helping the country flourish for yearsת find their names on blacklists of senior government officials – with their money classified as illegitimate. There are people in the government who are advancing an agenda of limiting civic involvement. This casts a cloud over philanthropic activity with the government.”

“There’s discussion regarding philanthropic foundations’ continued ability to cooperate from abroad with the government in Israel. It’s become difficult to work with the current government from the standpoint of values – due to the disparity between its positions and those of the donors, but also from a practical standpoint,” she said. “There are projects that the government isn’t interested in. These are magnificent projects for the advancement of women, advancing minorities, LGBTQ communities and civil rights.”

Referring to the undermining of democracy in Hungary, another foundation director said, “There’s concern that if we head to where Hungary is, there will be donors who say that they’re not prepared to contribute to an undemocratic country or who aren’t prepared to cooperate with the government. It’s also possible that we’ll see a diversion of donations to projects with a democratic agenda and the defense of human rights, at the expense of other projects.”

Another senior figure in the nonprofit sector said, “I’m concerned about a drop in the scope of donations – both from abroad and from Israel. The new generation of donors from the United States is moving away from Israel due to the disparity that has developed between their liberal worldview and developments in Israel, and I’m concerned that the regime change is exacerbating the situation,” he said referring to the proposed plans for changes in the balance of power, which would give the government control of the appointment of judges and enable the Knesset to overturn Supreme Court decisions, along with other matters.

“My concern is also that money will be taken out of Israel, because when people withdraw their investments and money from the country, they also contribute less to causes in Israel. In addition, the cost of living could hurt small donations from members of the public,” he remarked.

Someone with a close association to American philanthropies said, “Provisions in the coalition agreements that were agreed upon among all the parties in the coalition [government], such as the ‘grandchild bill,’ are really like spitting in American Jewish donors’ faces, and there are also donors who are concerned about harm to the LGBT community. All of this hurts their motivation to donate to Israel.”

‘They want their contributions to be effective’

According to Israel’s Central Bureau of Statistics, between 2015 and 2020 overseas donors gave 11 to 12 billion shekels a year to Israel. That annual figure is thought to have jumped to 13 billion shekels in 2021 in part due to donors’ interest in helping to deal with the COVID-19 pandemic. There are no available figures for 2022.

According to the statistics agency, 31 percent of the contributions from abroad are directed to institutions engaged in research, higher education or education more generally. Nineteen percent goes to nonprofits and other groups working in the fields of social welfare, health, culture and policy. Seventeen of the funding goes to helping needy families, people with special needs, the elderly, Holocaust survivors and victims of sexual abuse or other violence.

A substantial portion of contributions to Israel from the United States is raised through Jewish federations in communities across the country. These funds come from individuals and philanthropic foundations. Jewish Federations of North America, which represents the federations in Jewish communities throughout the United States and Canada, declined to comment for this article.

Shira Ruderman, the executive director of the Ruderman Family Foundation, which contributes in large measure to projects that strengthens the ties between Israel and American Jewry, said, “In recent years, there has been growing concern over a drop in the scope of donations due to the lack of political stability [in Israel] in addition to global disasters and local needs [abroad], which have continually grown. Nevertheless, support for Israel has remained substantial. I haven’t heard about donors who have announced that they were stopping donation to Israel. There are donors who believe that it’s actually now that Israel needs them more than ever and say that they will continue to give.”

But Ruderman also noted that donors view themselves as social investors and they want their donations to be effective. “They view their support as a partnership in which the state share similar values and an absence of stability and differences of opinion between the Jewish communities and the government is liable to harm the motivation to donate,” she said.

Ron Barkai, the CEO of Civil Leadership, an umbrella organization of nonprofit groups, said there has been no indication of a drop in contributions to Israeli nonprofits.

“Jews in the United States don’t sense the power of the public protest in Israel,” the director of one Israeli charity remarked, “and their loyalty to the Israeli public is greater than the loyalty to any particular government.” But he added, “We don’t know what the long-term effect will be on thousands of small donors, and it’s possible that we’ll see a snowballing of donors who stop contributing.”

For her part, Dr. Osnat Hazan of Tel Aviv University’s Institute for Law and Philanthropy said, “Donors have a commitment to nonprofit organizations and to the causes that they contribute to, so we don’t always see a drastic drop in the scope of contributions even during periods of economic crisis. It’s difficult to anticipate in advance what a concern will produce. There’s a consensus regarding assistance to the needy, to Holocaust survivors, to research and higher education. These are matters that are beyond political disputes and I don’t think we’ll see a drop in contributions to these causes.

“I don’t see a reason for philanthropists to want to stop supporting causes that are dear to them in Israel. There are donations to entities that work on both sides of the social-political controversy, and we don’t know who will receive more.”