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The non-profit world is a business Improve now. Scale down. Become innovative. Excel. Become more efficient.

Other People’s Money (“OPM”)



The non-profit world is a business. Billions of dollars change hands, the tax write-offs to individuals and corporations are enormous. In an editorial this week, Rob Eshman of the Jewish Journal of Los Angeles writes about an Israeli non-profit that, in the post-Madoff world, finds itself needing to pare down, reduce overhead and cut back in order to survive. “To rebuild, [the organization] is zeroing in on those things it does best, that aren’t replicated elsewhere in the Jewish world.”

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Eshman may not have meant to highlight the most important conclusion, so allow me to do so:  When life is easy, we tend to take things for granted.  When we are faced with adversity or challenges of some sort, we are forced to re-evaluate, change old habits, bring down the old guard and start anew.  This is the time of change, and people, thus organizations, learn it the hard way.  The long-term result is beneficial.   Due to its perceived scarcity, money is more valuable now than before.  Mobilization of people should be by making them participate rather than asking them again and again for money.  Fatigue and a feeling of saturation (“we have been asked enough”) act as detriments, participation is an energy booster.  If they only look, organizations would find armies of willing volunteers, whose combined strength is much larger than the trickling of dollars that soon may dry up.    A new era has begun when “other people’s money” is treated a bit more cautiously than before.  Jewish organizations have always been competing for the very same dollars, and many have been shifting focus according to fashion.  Green Energy, Iran, Anti-Semitism, Israel-Hatred on Campuses, the Second War in Lebanon or more recently Operation Cast Lead, one holiday or another, organizations hop from one subject area to the next, instead of focusing on a narrow strip of excellence – that which they do best.    Some would claim that we need as much presence as possible on campuses, as many different organizations teaching Holocaust at schools, a more positive side of Israel shown, and so forth.  If each organization would only focus on its core objective, possibly the little presence we have would be magnified and thus more effective.   The Simon Wiesenthal Center should focus on the Holocaust, Stand with Us on Israel advocacy on campuses, Camera, Honest Reporting, Memri,  Palestinian Media Watch and The Israel Project on the media, the Anti-Defamation League on fighting bigotry and racism, the Jewish Federation on local social services, and so on.  Very few organizations have been properly narrowly focused – Dr. Daniel Pipes, Steven Emerson, American Jewish Congress and ZOA to name a very select few.  When money does not come easily, organizations go back to basics – a wonderful unintended remedy, a byproduct of the difficulties of the present time.   The New Great Depression in its very early stages is providing a dire warning:  Improve now.  Scale down.  Become innovative.  Excel.  Become more efficient.  Business as usual will see its demise and people and organizations will be held accountable.  No one will be spared.  The days of lack of responsibility are gone, a new era is being ushered in.  

A Pile of Solicitations

  I recently returned home after a 19-week assignment in Israel.  I had mountains of mail from different organizations, all asking for money.  Apparently mailing lists of Jewish donors are being sold, bartered or traded:  I do not even know many of these are 510(c)(3) non-profit organizations.  Reading through the literature I was duly impressed:  Everyone wants money, and everyone seems to claim that without their organization, the Jewish State will disappear, whether because of the threat of Iran, Anti-Semitism on Campuses or hunger in Israel itself (let alone the threat of the enemies from around).    Soldiers of the IDF, one of the strongest armies in the world, are in dire need of long, thermal underwear, the soup kitchen industry in Israel is apparently flourishing, and our baskets for the needy are a must.  In fact, baskets are such a good money making mechanism that those offering them forget that the idea behind them is often in simplicity, humbleness and the effectiveness of helping the receiver.  All these qualities get washed away in a business that generates money drawing on the good will of people.   Israel is not on the verge of going hungry.  The country is doing quite well, in fact is likely to withstand the financial calamity much better than the USA.  Israeli business people and other philanthropists are able to support both the local politicians’ efforts and numerous local causes at least as well as their counterparts in the USA.  The IDF does not depend for its survival and well being on the plethora of items highlighted overseas, and I doubt many of the outfits that bring them directly into various units should have access to these units in the first place.    I sat in a flight back from Israel next to a very well intentioned clergyperson who invited me to see videos taken in military installations and army bases during his most recent trip, “fresh off the press.”  He and his church were kind enough to support various units of the IDF, some of which are classified to highly classified.  Not only is one not supposed to see the faces and identities of soldiers in direct connection with specific units, the types of weapons and the actual locations, unauthorized access to these locations – which these clearly were – and showing the material to complete strangers (foreigners) are breaches of security.   Just a week ago I was told in an e-mail:  “Indeed, there are still too many Jews who, instead of rejoicing, are mired in depression, starvation, and hopelessness of their grim financial situation.”  The solution?  “Your donation.”  Imagine how wonderful, a simple donation and all the economic worries are gone!   Having reviewed all these letters, augmented by similar mountains of e-mails, petitions and other pleas, I became even more skeptic.  Add to the mix the invitations to events, from $10 for a talk, $25 for a movie, $75 for breakfast and $350 for dinner, all Jewish or Israel related, and it became even more obvious that the industry is doing very well, even now.    At a major event in Los Angeles last year, $500K was raised, the expenses tallied $300K, the balance was earmarked to Sderot.  I invite you to do the math. [The former mayor of Sderot was recently investigated for financial irregularities.  The city, I found, was deserted of its residents, occupied instead by members of the media and politicians looking for coverage.]  Other highlights:  A local professional fundraiser will only go to business class to Israel, she is otherwise made too inconvenient, her time too valuable.  Israeli politicians arrive in a non-stop stream on fundraising missions to LA, Miami, NY.  All this is done on your dollar.   Israelis tend to trust non-profits less than most others, thus the local Israeli population contributes far less than it could.  During the Second War in Lebanon, the Israeli Community in Greater Los Angeles raised some $175K. The Jewish Federation under John Fishel’s leadership then matched the amount.  With more than 300K Israelis in this region, the yield was miserable – not even sixty cents per person.  The money was earmarked for the Ziv Hospital in Tsefat, a Fire Department in Kiryat Shmona and Magen David Adom.  American Friends of MDA refused to transfer the funds without deducting an overhead percentage, so the organizing committee (composed of all volunteers) has decided that any money spent is paid directly to the final vendors.   An important lesson was taught:  Treat the very first to the very last dollar with the same respect – it is “other people’s money” entrusted in your hands to do the most good.  President Obama said last week:  “We’re going to need to work really hard and we’re going to have to make sure that every single dollar is well spent.  We’ve got to go above and beyond what I think is the typical ways of doing business.”  The non-profit world is no different.  Many non-profits will find themselves out of business.  Many others will trim down and become better at what they do, with less income.  All will have to realize what should have been obvious – money, like time, good will and other resources must be respected and treated as a scarce rather than abundant commodity.     Following a 19 week assignment as a foreign correspondent in Israel, Ari Bussel is now reporting from home about life in the Great Depression of the 21st Century.  In a series of articles, Bussel brings the sights and experiences of life in the America as the global recession starts to be felt.  The collection of these “Postcards from Home” captures the essence of life in Los Angeles as the first decade of the Century comes to an end.   © Postcards from Home, March, 2009 Contact:  aribussel@gmail.com


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Ari Bussel -- Bio and Archives

Ari Bussel is a reporter and an activist on behalf of Israel, the Jewish Homeland.  Ari left Beverly Hills and came to Israel 13 weeks to work in Israel Diplomacy’s Front from Israel.


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