NEW YORK -- While American Jews are contributing record sums to Jewish causes at home and abroad, thousands of them are withholding or diverting up to $20 million in donations this year, partly to protest the religious and peace policies of Israel's conservative government, leaders of Jewish organizations say.
Bernard Moscovitz, the chief operating officer of the United Jewish Appeal, the primary fund-raising vehicle for Jewish social welfare in Israel and the United States, said that Jewish giving was still 2 percent higher this year than last year but that giving had been running 8.5 percent ahead of last year's pace until some leaders urged that donations be withheld or diverted.
Others warned that the withholding or redirecting of contributions could turn into a major philanthropic rebellion if Orthodox Jews succeeded in cementing their control over religious life in Israel. They also said a shortfall of $15 million to $20 million in projected donations in a year of huge Wall Street profits was significant.
"Twenty million dollars is not chopped liver," said Jonathan Levine, the American Jewish Committee's regional director for the Midwest.
The dispute over Orthodox control, or "who is a Jew," as the religious pluralism controversy is known, points to deeper changes under way in Jewish philanthropy.
Experts on American Jewish giving say several factors are responsible for a growing percentage each year of Jewish giving to non-mainstream Jewish and non-Jewish institutions and causes.
These factors include an aging Jewish population and a generational shift in giving patterns, a high rate of religious intermarriage and social integration among Jews, a changing relationship to Israel and a fraying of what has been the most successful fund-raising system in history -- the United Jewish Appeal and the 189 local Federations in Jewish communities throughout North America that raise and allocate money for social welfare at home and abroad.
"We're experiencing a sea change in Jewish life which has extraordinary implications for Jewish giving," said Gary Tobin, the director of Brandeis University's Cohen Center for Modern Jewish Studies.
The change is partly obscured by the fact that it comes during a time of record giving. American Jews, who constitute close to 2.5 percent of the U.S. population, raised as much as $4.4 billion in 1995, said Jack Wertheimer, the provost of the Jewish Theological Seminary in New York and author of an article on philanthropy in the 1997 American Jewish Year Book.
The annual Federation-United Jewish Appeal campaign, the fund-raising centerpiece of local Jewish communities, will raise about $737 million this year, as opposed to $721 million last year. Including donations to its $4 billion endowment and other gifts, the Federation will raise a total of $1.6 billion.
Contributions to religious institutions, though they are not added up nationally, probably total as much as $1.4 billion a year, not including gifts to synagogue capital campaigns, Wertheimer said.
In addition, other Jewish charities will probably raise a minimum of $700 million, not including charity for Jewish education, an ever-growing $1 billion economic sector.
Altogether, Wertheimer estimates Jewish giving to Jewish causes at more than $4.5 billion this year.
But while overall Jewish giving is growing, until this year annual donations to Federation-United Jewish Appeal campaigns, when adjusted for inflation, were on the decline since 1989, along with the number of contributors to these campaigns and the percentage of their charity that is directed to Jewish causes.
Moreover, two-thirds of Jewish "megagifts" -- that is, gifts from Jews of more than $10 million -- that a generation ago went to Jewish causes now go to museums, colleges, libraries and other nonsectarian institutions, said Jeffrey Solomon, president of the Andrea and Charles Bronfman Philanthropies.
"It's a difficult time in Jewish philanthropy," concedes Richard Wexler, a Chicago real estate lawyer who is national chairman of the United Jewish Appeal.
Moscovitz argues that the annual campaign's relatively lackluster performance was due partly to the fact that the same donors gave the Federation system an additional $1 billion from 1990 to 1995 for "Operation Exodus," the emergency campaign to help Jews leave the former Soviet Union and resettle in Israel. Still, even he agrees that there is some cause for concern.
Most Jewish giving now goes through independent family foundations or takes the form of gifts to endowments, often with strings attached. That limits the Federation system's ability to direct the donations as it once did and the collective power wielded by such communal giving.
"This weakens the ability of the Jewish community to plan, coordinate and allocate its resources," Wertheimer said.
As a result, organized Jewish giving to education and the poor in America and what Tobin calls "philanthropic Zionism," that is, expressions of support for Israel through giving to the traditional vehicles of the secular Jewish community, are also under pressure.
Analysts say some of the changes reflect a deep confusion and frustration within the American Jewish community over Jewish identity at home and discontent with Israel's policies abroad. But no issue has polarized giving to Israel as much as the religious pluralism legislation now pending there, action on which has been deferred until January.
The legislation would bar non-Orthodox Jews from the country's 150 religious councils, which distribute some $70 million a year in government funds, and would bar anyone but Orthodox rabbis from converting people to Judaism in Israel.
In the eyes of many American Jews, 85 percent of whom are unaffiliated or belong to the Reform and Conservative streams, this would effectively disenfranchise them.
Prime Minister Benjamin Netanyahu, who on Sunday night addressed the Council of Jewish Federations, says he understands the threat the issue poses to American Jewish-Israeli solidarity. But he also knows that political parties representing Orthodox Jews control 23 of the 66 seats in his coalition in the Israeli Parliament and thus, if not appeased, could topple his government.
Moscovitz said Federation-United Jewish Appeal donations had been up 8.5 percent this year until an effort to forge a compromise on the religious legislation collapsed this summer.
In response, prominent American rabbis, lay leaders and Jewish commentators urged American Jews to redirect contributions to Israel from the Federation system, which works closely with the Israeli government, to alternative charities like the New Israel Fund, the Abraham Fund, the Israel Policy Forum and others whose programs were primarily aimed at promoting tolerance, democracy and pluralism in Israel.
Such appeals have infuriated Federation officials, who accuse their proponents of fostering disunity among Jews and putting sectarian and political concerns ahead of the needs of disadvantaged Jews. Sixty percent of United Jewish Appeal money, they emphasized, goes to American Jewish causes.
But the Federation system has responded by agreeing to increase the $15 million it now spends on programs in Israel that promote religious diversity, tolerance and democracy to $20 million next year.
And following an agreement last month with representatives of the Reform and Conservative communities, it has also pledged to encourage Jews who favor those goals to make a supplemental contribution to the Federation campaign specifically for such programs.
Still, few think that would prevent a plunge in giving to the Federation system should the legislation in Israel be approved. Tobin said his research showed that no other single issue "cuts as much to the philanthropic core," for two reasons.
First, he said, American Jews, given their high rate of intermarriage -- 52 percent in 1991 -- "don't want anyone telling them that their children are not really Jews."
Second, "Americans Jews, like all Americans, don't like extremists, and they don't like theocracy," he said. "So the notion that one branch of Judaism controls the political scene and disenfranchises them is totally at odds with their democratic, pluralistic American identity and values."
Rabbi Jerome Davidson, the spiritual leader of Temple Beth-el, a reform congregation in Great Neck, N.Y., said he would continue calling for a retargeting of Jewish contributions until the Orthodox Jewish hold on Israeli politics was broken.
"The Non-Orthodox American Jewish community is fed up with supporting -- through Federation and religious yeshivas -- the very groups that attack us with rocks and excrement while we pray at the Wall," he said, referring to an incident that occurred in August at the Western Wall in Jerusalem.
Moscovitz asserted that appeals for retargeting had led not to rechanneled aid, but to a modest reduction in contributions. "Some people have just used this as an excuse not to give," he said.
But interviews with spokesmen for several alternative Jewish charities report
that their fund-raising is up sharply.
For example, Gil Kulick, the communications director of the New Israel Fund, which was started in 1979 with a grant of $100,000 from 10 San Francisco families, raised a record $13.5 million last year and has seen a 25 percent increase in contributions this year.
"We're up by about 50 percent in the last two years," he said, attributing the increase to Jewish fury over pluralism.
But the changing relationship between American and Israeli Jews may eventually have an even more drastic effect on giving.
"Apart from the religious pluralism problem, the perception that Israel's economy is booming and that external threats appear to be disappearing in the wake of the cold war make these the most challenging years we've ever faced," Wexler said.
Moreover, younger Jews, comfortably integrated into American life and most of them born after the Holocaust and the creation of Israel, simply have a different relationship to the Jewish state.
"For my kids the Holocaust is ancient history, and they have no emotional relationship to Israel," said Michael Steinhardt, a leading New York philanthropist. "No wonder the proportion of dollars going Jewishly is diminishing."
Younger Jews, in fact, are far less likely to give to and through the Federation. Studies show that only a quarter of Jews age 32 to 50 give, and that only 12 percent of intermarried households, as opposed to 59 percent of all-Jewish households, give to the United Jewish Appeal.
Still another factor is growing donor demand that Jewish charity begin at home. In response, the proportion of Federation dollars going to Israel has been declining for a decade -- from an average of 60 percent to 40 percent. But donors are also demanding greater control over how their donations are spent.
That has triggered an explosion of giving through some 11,000 family foundations or funds, 3,500 of which are not under the Federation umbrella. And there are a growing number of endowments, three-quarters of which make gifts that are directed or restricted. All told, Wertheimer said, gifts to campaigns, endowments and foundations totaled more than $8 billion from 1990 to 1995, only half of which were under Federation control.
Direct gifts to Israeli and American Jewish institutions through, for example, "friends of" groups, have also soared in the last decade and now equal twice the amount of money that goes to Israel through Federation channels. Such groups and family foundations increasingly form what Wertheimer calls a "parallel philanthropic universe" to that of the Federation, drawing away resources and talent.
Moscovitz denies that this independent giving reflects, to some extent, dissatisfaction with the Federation system, which some donors call arrogant and overly bureaucratic.
The United Jewish Appeal, he said, is trying to expand its donor base of 800,000, whose average gift is $900, through new mailings four times a year, as well as through more personal contact with and greater flexibility for givers. He also points to the United Jewish Appeal's program that allows donors to specify where they want some of their money spent.
But increasingly, he said, the Federation system will evolve
as an agent that marshals funds and provides choices for independent and
Federation donors. He and others in the field also see philanthropic "partnerships"
between federated and independent givers, as well as Jewish and non-Jewish
groups, as the wave of the future.