This is really frightening.
The recent collapse of the US dollar due to the collapse of the US housing market, which itself collapsed do to mortgage fraud and bad loan policies may leave Israel's poorest…
…citizens with even less social support than they now have.
Israel's government has long left many social welfare needs to the private sector. Those charities depend largely on donations from outside Israel, primarily from the US.
It's not just that individual donors may need to cut back on or entirely eliminate their donations. The problem is, each donation is now worth 20% less.
Here's the Ha'aretz report:
Hundreds of local social charities and nonprofit groups that depend on funding from abroad fear that the continuing decline of the dollar exchange rate, combined with the growing U.S. economic crisis, will force them to dismiss employees and curtail the services they provide in the fields of education, welfare and health. The dollar's fall has cost some of these organization's a 20 percent decline in income.A friend of mine has extensive contacts in the haredi community. I've heard for years now about the high prevalence of mortgage fraud carried out by certain haredim. Flipping, criminally inflating the value of a property and then selling it to an unsuspecting buyer – usually a first time buyer who is a minority or an immigrant – is a way of life for some of these men.
"There hasn't been a crisis like this since the expansion of civil society in recent years," says Prof. Benjamin Gidron, the director of the Israeli Center for Third Sector Research at the Ben-Gurion University of the Negev in Be'er Sheva.
He estimated that $1.5 billion is donated each year to Israeli hospitals, universities and nonprofit associations. A 20 percent decline amounts to a loss of over NIS 1 billion.
"It could affect thousand of positions. The services will decline," says Eliezer Ya'ari, the executive director in Israel of the New Israel Fund. The NIF depends on donations from the U.S. for the civil society organizations it underwrites. Shatil, the executive arm of the NIF, has already begun reducing its spending, Ya'ari says.
Officials at Yad Sarah, an organization which provides medical equipment at no cost, say they will have to reduce spending on equipment and vehicles for transporting people with disabilities due to losses amounting to a few million shekels.
The predicted decline in these services will come just as more Israelis will be in need of them, in the event that the local economy slides into recession. Moreover, it comes as the government is growing ever more dependent on "third sector" organizations to provide the social services it is cutting back on.
"You can't tell a donor, 'the dollar has declined, give another 20 percent,'" Ya'ari noted.
They walk away with thousands of dollars in illegal profit. The victims most often lose their highly over-valued home to foreclosure.
It's true these frauds do not make up the majority of foreclosures. I haven't seen an exact figure, but I suspect the amount of flipping-related foreclosures is small.
But it still counts, it still hurts the victims. And it hurts all of us, as well, through a damaged economy and through more costly loans.
These crimes hurt real people.
The criminals – some of whom may daven in a shul near you – have deluded themselves into thinking the crimes only hurt non-Jews. Somehow, this is fine with them. They can daven in peace knowing they destroyed a poor man's financial future.
But their crimes also effect Jews. Nothing will demonstrate that more clearly than the suffering poor Israelis will now go through.
True, these haredi criminals did not cause all or even most of this pain. But they caused some of it. And that should make their heads hang in shame.