Monday, December 05, 2011

Free Loan Societies

There is one Lubavitcher Chasid who at age 39 has without much fanfare created a major Kiddush HaShem. And yet what he does is one of the more common things found in Orthodox Judaism. From the New York Times:

Rabbi Hirshy Minkowicz runs a gemach, a program of interest-free loans, in a prosperous stretch of suburbia near Atlanta.

What is novel about this program is that it is not geared for the religious Jewish community but for the secular Jewish one that he serves in Atlanta. As the article points out the word Gemach is a Hebrew acronym (transliterated into English) for Gemilas Chasadim –acts of kindness which is one of Judaism chief mandates. It is also the result of a biblical law that forbids charging interest on loans. Although there are legitimate loopholes in the law that are commonly used for business purposes, the pristine unfettered application of the law in issuing an interest free loan is indeed an act of kindness.

The fact that there are so many Gemachs in the Torah world is at the same time both laudable and troubling.

The greatest number of Gemachs are probably located in Charedi Israel where the need is the greatest. And many of them are fully capitalized. I was made aware of one in particular near Mir Yeshiva that is capitalized to the tune of 80 million dollars. Your read that correctly. It is not a mistake. And it is one of the busiest places in the neighborhood at the times during the week when it is open to the public.

It is truly a tribute those philanthropists whose magnanimity has funded these Gemachim with such large donations. They gain no financial benefit from them. They only gain the Mitzvah of Gemilas Chasodim. The very idea of a Free Loan Society is a Kiddush HaShem. That it has been publicized in a New York Times article make it an even greater Kiddush HaShem. This Lubavitcher Chasid has taken this idea and applied to people who might not normally be aware of it – let alone access it. That he has made it available to them – people in great need due to the economy makes his Kiddush HaShem enormous.

What kind of people are they?

As pointed out in the article there are many people who are living middle class lifestyles and had incomes of between $75,000 to $200,000 who lost their jobs. Some are probably still out of work. Others have found jobs paying a small fraction of their previous incomes. They have no assets and have nowhere to turn except for a free loan society like the one Rabbi Minkowitz runs. I don’t know if there are any others like it in the country (or even in the world) but the fact that there is one is a tribute to this relatively young man and his father who set the example.

There is however a troubling aspect to Gemachs. It is the fact that there are so many Jews who are in need of them and use them. They are not people who had jobs and lost them. They are mostly Avreichim - people who do not work by choice preferring to learn in a Kollel full time instead. This is especially true in Israel. They often have to resort to more than one Gemach just to put food on the table. The fact is that there are an enormous amount of Avreichim in Israel are so poverty stricken that even with the help of these Gemachs they cannot support their typically large families. So they resort to many other financial devices, like maxing out every credit card; borrowing from parents and relative; to building up huge debt at the neighborhood grocery store that allows them to buy food on credit by signing simple IOUs.

And this does not even speak to those Avreichim who - by trying to live middle class lifestyles they were used to growing up - spend money way beyond their means to buy things that they cannot afford. And yet who can blame them for wanting to retain some of the basic middle class standards of their parents.

This has led to an unacceptable situation. One that is best illustrated by the three examples in a November 17th post by Rafi on his blog Life in Israel:

1. The other day someone advertised in the Yated that they are selling the rights to name their baby, in order to cover their debts.

2. Mevaser ran an ad yesterday of a family in Yerushalayim, an avreich, his wife and 10 children that can no longer afford the rent, cannot afford to buy an apartment, and are not willing to move out of Jerusalem. They advertised that they are looking for someone to donate an apartment to them.

3. The worst, and perhaps the saddest, of these stories is a report yesterday in
Ladaat of an avreich in Brachfeld - Modiin Ilit who was caught stealing Materna - baby formula - from the local store. This has been going on for a while, and it took the store some time to catch the perpetrator of the theft. The avreich confessed after having been caught, and explained that he has 5 children at home to feed and cannot afford it.

Obviously this fellow has probably already done all of the things he could legally in order to feed his family, including borrowing to the max from every Gemach he could find and it was not enough. The one thing he did he probably did not try is leaving the Kollel to find a job.

Stealing? Violating such a basic Halacha as Geneiva is unacceptable behavior even if it is to feed your family. While I am sympathetic to his need, Geneiva is not the way any Jew should act let alone those who are supposed to be the most honest and ethical among us.

Is the poverty so strong and yet the refusal to go work so entrenched that stealing to feed your children becomes preferable to work? I’m sure that no one taught this Avreich to do this. I’m equally sure that he knew it was wrong. Nonetheless he was so desperate - he did it.

Is this what the world of Avreichim in Israel has come to? I doubt that this kind of thing is widespread. But even though it is an anomaly it certainly speaks to the desperate financial situation that so many Avreichim face.

If $80 million Gemachim are not enough to help people like this out - they are in a lot more serious trouble than anyone thinks.