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Letter from Jerusalem: Battle for the ‘pushke’

NOVEMBER 16, 2017 – Remember the pushke? That little blue-and-white collection box – the older versions of which are now collectors’ items – was long the symbol of the Jewish National Fund, which, since its founding in 1901, has been seen by many as the flagship Zionist charity.

The original goal of the JNF, founded in 1901, was to purchase tracts of land in Ottoman-ruled Palestine for settlement by early Zionists. This goal continued through British Mandate rule and even after the establishment of the State of Israel, with the organization gradually branching out to the planting of forests, water management, parks, and other nature projects, as well as helping to develop the chronically underfunded Galilee and Negev.

Today, it owns some 13 percent of the land in Israel, while about 80 percent is state-owned and 7 percent privately owned.

That’s right. The JNF still owns land it purchased for the Zionist endeavor, and at 13 percent, that’s a lot of real estate. A great deal of it is leased out for extended periods, much of it to kibbutzim and moshavim (which in recent years have upended general understandings about some of the agricultural land they rent from the JNF and the state by “rezoning” it for the development of mini-suburbs, thus cashing in on skyrocketing housing prices).

This means that aside from the millions the JNF still takes in from contributions each year, it makes many millions more as a landlord. A nonprofit organization, it puts much of this income back into its development and management activities, although it has come under fire in recent years for the fat salaries and perks it confers upon some of its top leaders, a number of them political appointees. (The American branch of the JNF recently weathered controversy over private loans it had provided to two of its senior executives.)

Earlier this year, the Israeli State Comptroller’s Office determined that the JNF lacked the transparency necessary for proper outside oversight, saying that between 2008 and 2014, when it had approximately $2.8 billion in income, it “used only around a third … to carry out its public duties in the realm of land development and forestation. In contrast, some 43 percent … was used by the JNF to boost its financial assets … without doing any staff work to determine the necessity of this accrual or to determine whether at least some of the money could be used to advance its main public purpose, redeeming barren land.”

The upshot is that the JNF – which overall gets good grades for the work it has done and continues to do as part of the Zionist endeavor – is seen by many in Israel as a cash cow just waiting to be milked. This is more than evident thanks to a recent flap that’s developed between the organization and the government of Prime Minister Benjamin Netanyahu.

Last week, cabinet ministers voted to support legislation aimed at requiring the JNF to hand over up to four-fifths of its annual income to the state. If the bill becomes law and the organization refuses to do so, it will lose its tax-exempt status as a nonprofit.

“The JNF sells lands every year and receives billions of shekels in return. It is very important that this money be channeled to the needs of the State of Israel,” Netanyahu, a supporter of the bill, told his fellow cabinet members. “These needs cannot wait.”

The “needs” are, ostensibly, infrastructure projects. But observers say the projects could receive funding from the existing budget – except that the money is instead earmarked for endeavors supported by the narrow interests of parties that Netanyahu wants to keep in his coalition. They explain that the JNF, with all that money coming in, makes for a nice, soft target.

Interestingly, the legislation is not supported by lawmakers belonging to a coalition partner, the Bayit Yehudi party, the political force seen as representing settlers.

Some observers say this is because settlers see themselves as the last vanguard of true Zionists, and as such, they identify closely with the symbolism of the JNF, which started life buying up land for Jewish settlement. (This is not to mention the fact that some JNF funds end up in settlements or in other projects beyond the Green Line, the 1949 armistice lines established between Israel and its Arab neighbors, despite laws in some of the countries where the money is raised.)

But Bezalel Smotrich, a Bayit Yehudi lawmaker who lives in a West Bank settlement, indicated that his opposition to the bill was due more to coalition infighting.

“I don’t understand the coalition’s eagerness for the forced lighting-strike move that gives billions to the Kulanu party while dealing a fatal blow to the JNF,” he said immediately after the cabinet vote.

Kulanu, with 10 Knesset seats, is considered the Likud’s senior coalition partner. It is a secular, center-right party whose main platform is lowering consumer prices on everything from apartments to cottage cheese. Its leader is Moshe Kahlon, the finance minister, one of the most powerful positions in the cabinet.

Kahlon supports the legislation, which if passed, could see billions pour into state coffers to be distributed to a great extent in a way that would boost his popularity and that of his party. That’s a political threat to Bayit Yehudi, whose support is more closed-ended than a party seen as working toward things that benefit the entire electorate.

The dustup has the potential of fracturing the coalition that Netanyahu has been working so hard to preserve, for if Bayit Yehudi leaves, it would take eight seats away from Netanyahu’s fragile six-seat majority in the Knesset.

The leadership of the JNF has also been digging in. Its chairman, Danny Atar, recently sent a letter to the Israeli groups and public bodies receiving funding, saying they “can no longer depend on JNF support.”

Earlier in the week, he took a far more populist approach by warning Netanyahu on Twitter that if the legislation went through, the prime minister would be “fulfilling Zahalka’s dream of dismantling the JNF,” referring to an Arab lawmaker who has been particularly critical of some of its policies and wishes to close it down.

It might be hype, and on Tuesday, JNF leaders reached a compromise in which they would turn over to the state about $500 million over the next three years – although a key lawmaker says that’s not enough and intends to keep the legislation alive that would strip the JNF of its tax-exempt status.

If that happens, those little blue-and-white “pushke” collectibles might soon skyrocket in value, as does memorabilia from any entity that goes out of business.

Lawrence Rifkin is a Jerusalem-based journalist.

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