When people like us default on a loan, the banks nail us to the wall. Eliezer Fishman? He’ll be tied to a wall very gently, and with velvet rope.
By LAWRENCE RIFKINEliezer Fishman(photo credit: SA’AR YA’ACOV/GPO)
A few weeks ago, while scrolling through an online financial gossip section (yes, there is such a genre), I happened across a photo showing a long convoy of shiny Cadillac SUVs traversing a lush vineyard that looked awfully familiar. The drivers, I read, were members of a Cadillac owners’ club and were on an organized outing to a luxury luncheon, complete with top-class entertainment, at a winery. The winery, it turns out, was at my old kibbutz.When I left 37 years ago this month, the kibbutz was home to people who wanted nothing more than to give to the common good in return for a fair slice of a reasonably decent life. Everyone had a roof, everyone was fed and everyone received heath care. There was a communal swimming pool, a cultural center and a lounge. There was a bit of pocket money, too, as well as a small fleet of simple, dusty sedans to share for vacations or a movie in town.So the photo of what amounted to several millions of shekels’ worth of wheeled indulgence passing through the very area where I, on a beat-up tractor with a wobbly back-drill, had once labored to dig holes for new vine plantings, was somewhat jarring. It made me think how the kibbutz, like many others, eventually went broke paying off hyper-inflated loans when capitalist and vengeance-bent finance ministers convinced banks to play hardball with the socialist enclaves, and how in order to survive, it and others were forced to open their gates to private concerns, some catering in great part to those of considerable means.Believe me, I can’t begrudge any of those drivers for having a car that would cost me four or five years of salary – for all I know, some may have worked two or three jobs to buy them. What I think about is why others work two or three jobs and can’t feed their family, and this when the banks – the same financial institutions that once wrung struggling kibbutzim by the neck – today coddle those who can easily afford expensive cars. People like Eliezer Fishman.MAYBE A decade ago, I sat a few tables from Fishman in a Tel Aviv bistro. He seemed to be enjoying himself. Who knows – maybe he had just found another pal high up in a bank willing to loan him a few hundred million. Fishman, after all, was a tycoon, and tycoons, especially those with serious media holdings that can be turned into public relations vehicles, have long been the kind of people banks like to get into bed with. When it works, it’s a bed of bliss. When it doesn’t, it’s a sickbed. But it’s hardly ever a deathbed. For that, there’s you and me.When Fishman’s holdings – much of them paper holdings, it turns out – went farther south than Antarctica, the banks were willing to allow him to comfortably rearrange a pile of debt running into the billions. Some of it would even be forgiven. And those lavish estates and other assets he had cleverly placed in the names of family members to the tune of hundreds of millions of shekels? They’d remain safely out of the repo man’s reach.The people occupying the corner offices on the top floors of our banks – people making oodles of money themselves – saw Fishman as one of their own. These people rub elbows with gazillionaires like him everywhere, from social clubs, tony restaurants and pricey watering holes to beachfront villas here and abroad. They’re good buddies who cut their friends slack in times of need. It took a major public outcry to get them to change their mind and nail Fishman to the wall like they do the rest of us when we can’t pony up.While we get actual nails pounded through our palms, though, Fishman will probably be tied in place with velvet rope. Yet you can be sure that the banks will not be happy doing even this; after all, other tycoons might turn skittish about asking for a few hundred million, and these are loans that make the banks far more than the outrageous fees they pile on schnooks like you and me. Besides, if the loans go bad, the losses can always be steered toward pension funds – where our hardearned shekels will take the hit.So don’t be fooled by the banks and their decision to come down “hard” on Fishman. What looks like altruism is only the result of a public outcry. When the outcry dies down, the banks will go back to lavishing cash on people from socioeconomic cohorts where the major, and perhaps only, goal in life is to make it to the very highest cohort, that Valhalla where the mustachioed, smug-looking Fishman once frolicked with the other owners of Israel, Inc.I’LL ADMIT it. I’ve long been angry at my bank. I grew up in a place and time when banks paid you decent interest on a simple, liquid savings account. We were taught to bring our nickels and dimes each week to school – where there was a bank account that taught us the wonders of compound interest.Here? They nickel and dime you to death with line items that would make an old-time robber baron blush. Only when you take the time to read the reams of fine print do you discover that many of these charges are default settings you can actually opt out of – if you’re willing and able to run the gauntlet of the bank’s usual hard-sell bureaucratic rigmarole.And interest? Even in the days when rates were normal, all you got was prime less two points. As for prime, that was actually too low for high rollers who needed a place to park considerable fortunes between considerable deals.And just one more bellyache about my bank: I do my transactions online, and after I move around funds to cover a larger- than-usual credit-card bill, the website informs me: “Your transaction has been completed successfully!”For some reason, I look at the exclamation point and wonder whether the bank is surprised that its website actually works, or whether it merely thinks that poor schnooks like us need a little positive reinforcement once in a while.I wonder, too, whether Eliezer Fishman’s electronic transactions elicit the same exclamation point. Nah. He’ll probably get champagne and caviar delivered straight to his wall. And trust me: The velvet rope holding him there will even be perfumed.