Larry Gellman, a former member of my friend’s congregation, reflected thoughtfully in his blog, Thoughts from the Desert, on the Madoff affair. Gellman writes:
Time Magazine‘s article entitled, “How I Got Screwed By Bernie Madoff,” was written by investor Robert Chew. He explains that all of his money and that of his wife’s entire family (more than $30 million) was invested with Madoff.
But look at what he says:
“The call came at 6 p.m. on December 11. I had been waiting for it for five years…
I think everyone knew the call would come one day. We all hoped, but we knew deep down that it was too good to be true, right?”
Which brings us back to the original question: Why did so many smart people give Madoff all their money and sit back and do nothing when it became clear–or at least seemed likely–that he was reporting unrealistic results?
Part of it was human nature but I believe a bigger part was related to the rules of the game governing Members of the Tribe–the Chosen People at the Jewish clubs and charities where a select group of their friends and associates were also invested with Madoff. There are certain unwritten rules that go along with membership in that group. The first is that you never criticize Israel in public and the second was apparently that you don’t question Bernie Madoff. To question Madoff would have been an affront to the other members and particularly those respected tribal leaders who got them in the door in the first place. Never mind the facts and never mind the gnawing feeling described by Robert Chew that this wasn’t going to end well.
The Madoff catastrophe has left the Jewish community reeling financially and emotionally. It has also been jarring for many of us to realize that a fellow MOT could do this to his own.
But the major positive lesson that might be learned is that it’s time to move beyond tribal thinking for our own good. We can’t and shouldn’t abandon the idea of community and a shared responsibility for each other’s welfare. But we live in an open, pluralistic world where the true value of Judaism is now reflected by our wisdom, ethics, and values–not by our need to stick together and blindly trust only our own. Most American Jews realized this a long time ago. Hopefully more of our Jewish organizations and their leaders will finally get the message.