Exposing the Israeli Dollar Bond Scheme, Deliver Palestine from Occupation

Some 23 activists and I have uncovered, to our own surprise, Israel’s diabolically clever plan to use private American dollars to finance its future militarism, including its occupation and possible liquidation of its Arab population. It’s up to us to expose it.

First, we must understand what we have uncovered.

Those of us who have visited Israel recognize it as financially stressed by the cost of a giant military occupation. It is not unlike the Soviet Union in its gulag days. Simply stated, Israel, with less people than New Jersey and less natural resources than Colorado, is insolvent and close to bankruptcy; with its built-in military machine more expensive than most countries ten times its size, it is worse off than Ireland, Greece, or Cyprus.

But Israel has cooked up a brazen scheme to solve its financial dilemma — not by demilitarizing, as it should, but by getting others to pay for its costly wars against its neighbors — by borrowing huge amounts of money from the American public on the not too good name of the Dollar — more than it can or will ever repay. The scheme is based on two premises: Israel is already raising money by selling bonds defined in our Dollar. This practice will permit it to default without destroying its own currency (NIS), and it will gain endorsements of US state and local governments, including the Colorado legislature, by lobbying them to legitimize its Dollar bond issue.

Israel is, in effect, creating a new legal tender, which we are giving the name “I-Dollar Bonds” (IDB), in various terms and series.  One is called the Jubilee Series.

In order to sell these bonds, Israel has set up sales offices in at least 25 major financial centers in the US. Because the state of Israel has a dismal credit history and weak credit rating, having twice devalued its currency to nothing, it must rely on deception to sell bonds.

Israel Development Corp. published on its home page this claim that one of its sales agents named Brian Friedman, quoted it verbatim to the Colorado legislators on April 16s: “Israel has never defaulted on an interest of principal payment.” This may be a technical truth, but it hides a giant lie.

Countries do not have to default to cheat creditors. Israel was able to print Shekels to pay off old bonds denominated in Shekels. The check in the envelope was probably worth less than the stamp in 1985 when Israel devalued the Old Shekel to near zero. Israel did not default; it paid off creditors with worthless money. New Shekel bonds (NIS) bought in 1986 have lost about 59% of their value in US dollars by now. Israel’s “we have never defaulted,” claim may be a nominal truth, but it is a de facto lie to sell junk rated bonds to individuals and trusts.

At the present moment, Colorado SB13-176 has. unfortunately, accomplished its propaganda purpose. While the amended original bill is non-functional, if it becomes law, its title will legitimize Israeli-Dollar Bonds and influence private investors to think Colorado law has been changed to recognize their credit worthiness. After all, if these bonds are good enough for the State Treasurer, why not for your IRA or pension plan?

It is vital to realize that this author does not expect Israel to compete for the short term dollar holdings of the treasuries of the several states. The state’s cash reserves are short term dollars that must be rolled over every few months or even weeks, mere eyewash. Israel must hook long term buyers as they have done in the past.

Israel’s interests are served by selling term bonds that run 5, 10, 20, and now 30 years.  These are not bought by State Treasurer’s who usually have to spend the tax dollars they take in during the year received. As the Assistant Treasurer of Colorado told the Senate Finance Committee, “liquidity, not return on investment” is its primary concern. Israel’s bond salesmen will earn scanty commissions selling three or six month paper. But it will be very profitable to sell 10 year IDB’s.

The state legislature is being used to legitimize the I-Dollar bonds, not to own them. Here is an example of how bond musical chairs works:

Ohio proudly announced on the Israeli Development Corp. website that it now owns some $80 million of bonds issued by the state of Israel, probably short term because the state of Ohio will need its money this year to pay expenses. As big as this number sounds, it is peanuts compared to the $50 billion in IDB’s that Israel claims is outstanding, with probable average maturity dates of 10 years. Because the State legitimizes holding Israel’s paper, administrators of pension and profit sharing plans will be easier to talk into long term investments…some of which, I venture to say, will never be paid off.

As much as I would like to claim a legislative victory in last week’s CO Senate Finance hearing, it is not a victory yet. All Israel cares about is getting its name legitimized in the statutes.  If the title of a bill reads, “A bill to allow the state to purchase bonds issued by the state of Israel,” Israel wins.

How should the IDB Ponzi be contested? Through 15 church denominations whose national leaders have already recognized Israel as a brutal occupier of its neighbors, and who have asked that the US Government cut off $3 billion a year of foreign aid to Israel. These denominations have hundreds of congregations in Colorado, more in larger states. They will listen. Each congregation has local “activists for peace” who do not know about this bond scheme. This is our opportunity to involve local congregations whose national leaders have already gone on record calling for sanctions.

How do we involve local churches? The answer is found in a look back at this history of church activism. The Pro-Life movement of the 1980s was limited to unborn life and not connected to the anti-war movement or the movement to free the Palestinians from its 50 years of occupation. The first Intifada, which might be called the first youth revolt, began about this time, largely unnoticed by Americans. Prior to the first invasion of Iraq in 1991, the movement for peace in Palestine consisted primarily of Isolated individuals who had personal knowledge of abuse and occupation and wrote or talked about the need for reform. Andrew J. Hurley, a Catholic, was one of these, authoring an almost unread book called Holocaust II, Saving Israel from Suicide. US destroyed the Iranian Army in Kuwait in 1991, while Israel cheered.

Inside Christian Zionist churches, those of us who raised criticism of Israel were treated as if we needed education about “God’s plan” for Israel. A few fiscal conservatives noticed, with curious concern, that Israel got a disproportionate amount of US Foreign Aid, recalling only vaguely events of the Oslo peace accord a decade before.

It was not until 2002, after my stay in Gaza during intifada II, that several friends and I started Project Strait Gate to hold peace vigils at large churches for the purpose of spotlighting to their congregations the war agenda supported by their Christian Zionist church leaders. (http://charlesecarlson.com/view-vigil/)

More years passed while the Palestinians continued to suffer. Finally in 2008, the National Council of Churches (NCC) published a groundbreaking flyer entitled, “Why We Should Be Concerned About Christian Zionism.” This was the beginning of a movement for peace that for the first time crossed denominational borders in recognizing Christian Zionism as a warring influence. The flyer stated in part:
* It is a movement with negative consequences for Middle East peace.
* It fosters fear and hatred of Muslims and non-western Christians
* It leads to the dehumanization of Israelis and Palestinians
(http://www.ncccusa.org/pdfs/christianzionismbrochure.pdf)

In November 2012, leaders within fifteen mainline Christian denominations and organizations, with some 30 million members in the USA, took a bigger step: a joint political resolution against funding Israel’s occupation of Palestine. They called for Congress to sanction Israel by terminating its $3 billion a year foreign aid, publicly acknowledging Israel’s abuse of the Palestinians.

The churches were also recognizing their own responsibility to not allow taxpayer money to be spent for what they saw as an evil cause. They stated in part:

“We write to you as Christian leaders representing U.S. churches and religious organizations committed to seeking a just peace for Israelis and Palestinians. Our organizations have been deeply involved in this pursuit for decades, inspired by the call and promise of Jesus Christ who said, “Blessed are the peacemakers, for they will be called children of God.”  It goes on…“We have also witnessed widespread Israeli human rights violations committed against Palestinians, including killing of civilians, home demolitions and forced displacement, and restrictions on Palestinian movement, among others.”
* (http://globalministries.org/news/mee/pdfs/Military-aid-to-Israel-Oct-1-Final.pdf)

The Problem, the Opportunity:
The leaders who have spoken out, calling for sanctions on Israel, are without doubt a brave minority in their own churches. Most members of these churches, including many local clergy, either do not understand the issue, or partly understand but fear losing members if they raise the issue. Christian Zionist churches are very powerful in their support of Israel, and by various means, Christian Zionism has penetrated all these denominations and congregations to varying degrees.

Project’s Suggested Objective
Encourage local church leaders to endorse and participate in a sanction program that leaders in their own congregations have already acknowledged and endorsed. We must convince them they can quench the flow of public money to Israeli militarists. We note there are over 100 congregations of just one of these denominations in Colorado: the Evangelical Lutheran Church (ECLA), each of which should be contacted.

Suggested Method
Create an Internet communications program and database. Information should include a mass E-mailing campaign, selective phone contacts and social media directed toward church leaders, layman directors and youth leaders. Schedule film showings and meetings to encourage church-centered “action” committees.

Make a film about stopping war by controlling Israel’s access to U.S. dollars. IDB’s are a form of counterfeiting and should be exposed as such.

We Need:
NETWORK DESIGNERS
GOOGLERS: to collect church contacts
EDITOR/PROOFERS
CALLERS to make appointments with pastors or leaders
INTER-FAITH SPEAKERS

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Yes, I Can do… _____________________________________________________________________________________________________