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Israeli Fund for ‘diaspora Education’ Supports Selected Orthodox Schools

A $7 million Israeli government budget item for Diaspora Jewish education made a big splash last spring when it was “discovered” through an advertisement placed in a daily newspaper here.

Foreign Ministry officials touted it as prime evidence of the new kind of Israel-Diaspora partnership Deputy Foreign Minister Yossi Beilin has been championing.

But the fund, administered by the Finance Ministry, is in fact a long-standing example of a different sort of Israel-Diaspora partnership.

According to sources familiar with the fund, it helps Diaspora Jewish schools virtually hand-picked by a wealthy pro-Israel activist. The activist, they say, has leveraged his Washington influence to win the favor from Jerusalem’s state budget.

For more than 15 years, the money has almost exclusively supported fervently Orthodox and non-Zionist schools with more than an estimated $50 million.

The World Zionist Organization was part of the association that disbursed the government fund for the past 10 years. But it recently pulled out of the partnership, citing its dissatisfaction with how the allocations are made.

Similar discontent may soon spread to the Knesset Education Committee. Knesset Member Avraham Burg, who chairs the committee, said the fund is “corrupt” and serves special interests. At the conclusion of a recent interview with the Jewish Telegraphic Agency in his Knesset office he asked an aide to arrange a special Education Committee meeting to investigate the fund.

‘CONCERNED ABOUT JEWISH CONTINUITY OVERSEAS’

Back in April, Deputy Foreign Minister Beilin was quoted by The New York Jewish Week as calling the allocation “very meaningful.”

“It proves that Israelis are concerned about Jewish continuity overseas and are willing to take steps to demonstrate that,” he was quoted saying.

The Foreign Ministry subsequently was deluged with applications from communities all over the world, said Haim Divon, head of the ministry’s World Jewry division.

But the Foreign Ministry was forced to retrench after a few inquiries at the Finance Ministry, where it was advised that the fund is about 15 years old. Divon said he was also “told by sources that the monies for this year were already exhausted,” despite the fact that the April 30 application deadline had not yet arrived.

For his part, Beilin had no comment about the fund for this story, his assistant said.

After weeks of persistent telephone calls and inquiries to Finance Ministry spokesman Eli Yosef, it became clear the ministry is reluctant to speak about the fund.

Nonetheless, an intriguing story can be told based on a lengthy investigative article in 1986 in the Davar newspaper by Yakir Tsur, a state comptroller’s report in 1988, an up-to-date private written report by Tsur, other research and interviews with informed sources.

All of these sources but the comptroller’s report link one man by name to the heart of the story: Zev Wolfson, a man Israeli officials believe is very powerful on Capitol Hill on their behalf.

In recent years, the Finance Ministry apparently has advertised the Fund to Aid Diaspora Jewry each year in a newspaper, as required by Israeli law.

The ad spells out eligibility requirements for recipients, which are supposed to be “schools abroad providing Hebrew education in communities in which there is a danger of assimilation and where, without this support, (they) could not continue to function in the long run.”

But sources say the fund has not been publicized abroad and that each year the money has been awarded to the same non-profit “amutah,” or association.

For years this amutah was called the Association for Jewish Secondary Education in Boarding Schools in the Diaspora. The name was later changed to the Fund to Aid Diaspora Jewish Education.

But the man who allegedly controls the amutah has remained the same: Wolfson.

Wolfson is described by Israelis as a wealthy and politically influential American Holocaust survivor who is a Zionist and who also believes that Orthodox education is the only tool to fight assimilation in the Diaspora.

Despite repeated requests, Wolfson declined to comment on the fund for this article.

The association disburses millions of dollars of government money to about two dozen schools annually. Most are Orthodox and non-Zionist and most are in France and the former Soviet Union, but schools in North America also receive its money. It submits detailed reports every three or four months to the Finance Ministry, according to its chairman, Moshe Haskell.

According to an expenditure sheet obtained by JTA, in 1992, for example, the association gave $435,000 to She’erit Israel Yeshiva in Brooklyn. The association also allocated $780,000 to what was listed as the Queens Academy for Russian Immigrants in New York.

“We get money sporadically, periodically,” said Rabbi Moshe Jacobs, executive director of She’erit Israel. “It goes into our bank account. I have no idea how it works, how it was set up.”

Jacobs said his 4-year-old school has an enrollment of around 300 Russian immigrants, none with a Jewish background, many with parents on welfare.

“The only reason parents send their kids is because of our secular studies,” he said.

The Queens school had no listing in the telephone book.

ALLOCATIONS ANGER WZO OFFICIAL

This pattern of allocations angers David Harman, director-general of the Jewish Agency-World Zionist Organization Joint Authority for Jewish Zionist Education.

“The State of Israel is giving taxpayer money to an institution in Queens hellbent on providing an Orthodox education to Russian immigrants to the United States?” he asked.

“And this is at a time when the top priority of the Israeli government is the aliyah and absorption of Russians in Israel?”

For about a decade the WZO led the “Wolfson” association in partnership with officials from the Ministry of Education.

But last fall, WZO and Jewish Agency leaders met with Finance Minister Avraham Shohat and pulled out of the partnership at the insistence of Chairman Simcha Dinitz.

Dinitz has since taken a leave of absence from his post after being indicted on charges stemming from alleged misuse of Jewish Agency credit cards.

“The WZO decided to withdraw from this amutah because it could not control the transfer of allocations and felt the allocations were not being made according to Zionist priorities,” said Yehiel Leket, acting chairman of the WZO and Jewish Agency.

After the meeting with Shohat, a new association was set up without the official participation of the WZO. But it retained Haskell as chairman.

The fund is commonly referred to by insiders as the “Wolfson Fund,” a fact acknowledged by Haskell. He insists, however, that the association is “officially” independent of Wolfson and when applications come in addressed to “The Wolfson Fund,” they are returned.

Haskell said Wolfson has sat in on portion of amutah meetings and “from time to time he talks to me. He can try to persuade me which (school) is more important, but there are many others who also try.” Haskell also conceded that his fund’s money goes mostly to Orthodox schools to which Wolfson also has contributed.

‘WOULD CONSIDER’ APPLICATION FROM REFORM

But he said it is not a matter of policy. It is that “the Orthodox are more devoted to education” and to “creating new schools.” Also, he said, the Orthodox “applied, (while) the Reform and Conservative don’t apply.

“If the Reform applied, we would consider” the application, he said.

Wolfson was never a member of the amutah, said one insider, but the fund is “a puppet” of his as a result of an apparent deal made with the Israeli government in return for “services rendered to the State of Israel,” said this insider.

The “services” refer to monies supposedly allocated to Israel by the U.S. Congress through the efforts of key congressional members close to Wolfson.

Wolfson has a reputation here as being very powerful on Capitol Hill. But Washington insiders tell a different story.

“He’s irrelevant to the foreign aid,” said one Washington source familiar with the efforts to obtain Israel’s annual $3 billion aid package. “The thing he has been relevant on is raising money for his particular projects and causes.”

One area where Wolfson’s influence was reportedly felt was the American Schools and Hospitals Abroad Program of the Agency for International Development. Controlled by a congressional subcommittee, the program is funded largely from the properties of Americans living abroad, personal bequests and dissolved businesses.

According to the 1986 Davar article, of a $25 million budget, Orthodox yeshivot and other Israeli institutions got approximately $18 million.

Wolfson is probably most closely associated with Sen. Daniel Inouye (D-Hawaii).

In 1988, when Inouye was chairman of the Senate Allocations Committee, apparently at Wolfson’s urging he included an $8 million budget item for fervently Orthodox schools in France.

When this was discovered, Inouye was forced to confess having made a mistake. This episode is said by some to have derailed Inouye’s efforts to be Senate majority leader and also exposed the funding by the American Schools and Hospitals Abroad Program, which then changed its policies.

(Contributing to this report was JTA staff writer Larry Yudelson in New York.)

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