U.S. issues take center stage with American ex-pats
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U.S. issues take center stage with American ex-pats

How the U.S. financial crisis is affecting former N.J. residents in Israel

JERUSALEM ““ Former Teaneck resident Rabbi Aaron Tirschwell, director of Israel Operations for the National Council of Young Israel, recently returned from a fund-raising trip for one of his projects, Eye Squad, which offers services to North American teens in Israel during the year after high school.

The timing of the trip, just on the heels of the Wall Street financial debacle, could not have been worse.

“The crisis has affected fund-raising efforts greatly,” said Tirschwell. “People are holding back – either because they’re being conservative or because they just don’t have the funds.”

Some former donors told him they cannot give as much as before. “People are saying that now is just not the right time,” said Tirschwell, even though the High Holidays are traditionally a period of generous giving.

And for those Israeli-Americans whose jobs are tied to American firms, the worries are more personal.

One former Bergen County resident running an investment banking division for a Big 4 accounting firm said the situation has affected him already and may get even worse. “In my work, we do deals and I advise on transactions between companies. When nobody knows what things are worth, nobody buys or sells.”

Furthermore, he explained, “Israel is very export-oriented, so we have two problems: First, many companies have sales in dollars but expenses in shekels. So before the crisis even came to head, Israeli companies were already hurting as the dollar fell against the shekel. Second, now that the U.S. market is in a tailspin, demand isn’t what it once was, and that affects Israeli exports – from cell phones to irrigation systems to MRI machines – in a very serious way.”

The banker, who did not want to be identified, added that “whereas the Israeli economy has been strong in terms of GDP growth, the U.S. economy’s growth will be zero or negative, and next year you’ll see a significant impact on the Israeli economy.”

In the short term, he said, many immigrants with jobs in America are in effect experiencing a 30 percent pay cut just because of the exchange rate, and those who sold a house in American dollars have fewer shekels with which to buy a house here.

An attorney who made aliyah two years ago from Bergen County has maintained his 12-year-old Manhattan firm but had to lay off about half a dozen of his 22 staffers.

“I went to New York three days before the crash, on an emergency basis,” said the lawyer, who also did not wish to be identified. “I pared down the staff considerably – which I’ve never done before in my life. This was a direct result of not being able to make payroll. I had been financing payroll out of my own pocket for a long time because I couldn’t bear to let anyone go. But it got to the point where I had no choice.”

Bank of Israel Governor Stanley Fischer told an interviewer on Voice of Israel government radio that “we can’t know where, in the long range, the changes in the world will harm our financial network,” but that he was generally optimistic about how the American financial situation would affect Israelis.

The former Bergen lawyer has a different take on this. “Where I live, there is a large Anglo [English-speaking] community where Americans were the ‘haves’ and Israelis were the ‘have nots.’ Now the Americans have to work harder to make ends meet. Israelis lived lean all along and barely made ends meet – they certainly had no money in the stock market – so they are probably not feeling this as much as we are.”

His family’s cleaning woman now comes once a week instead of three times; they now buy milk in bags instead of cartons to save a few shekels. “I’m not used to watching every penny that leaves the house,” he said, “but anything not vital is potentially on the chopping block.”

Former Teaneck resident Ronnie Levin, whose area of expertise is mathematical modeling of bank risk, is consulting for an American commercial bank. “I happen to be fortunate in terms of my job situation right now,” he said. “I have been consulting for 16 years, and for most of that time I worked for banks or institutions on the ‘sell’ side, and that area has been hit very hard.”

“I know someone else here in Israel who has been doing this kind of work for Lehman Brothers, and I assume he’s looking for a job,” Levin continued. “I’m not sure of the effect the crisis will have for me. It might make my consulting contract less secure, or on the other hand they may deem it more important to keep me on.”

The investment banker said that despite the gloom, he can see some bright spots.

“Certain areas in Israel are doing very well because they are less impacted by the crisis,” he said. “Technology and clean energy, with oil prices so high, have been positively impacted. Israeli companies in a better cash position than their American counterparts – institutions are being more conservative and therefore are sitting on more cash.”

He, like many other Anglo-Israelis on the street, believe the situation may lead to another, less direct, effect: More American Jews deciding to live in Israel. One reason behind this thinking is the traditional rise in anti-Semitic sentiment surrounding major financial crises; the other is that concerns about income are a primary reason many comfortable Jews hesitate to make the move.

“I think there may be more aliyah because of this,” the banker said. “There’s always a silver lining.”

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