Only one country in the world can claim that its very founding was rooted in the belief that before the state could be established, a world-class institution of higher learning and research needed to exist. That country is Israel: a nation whose development as an educational and technological powerhouse stems from its only natural resource - the intellect of its people. Its medical achievements, solid judicial system, hi-tech miracles and agricultural breakthroughs have emanated from its major institutions of research and learning, beginning with the Hebrew University of Jerusalem, which opened in 1925. Unfortunately, 2009 finds higher education at a crossroads in Israel, the one true bastion of freedom and progressive thinking in the Middle East. In fact, the university system that has produced leaders and Nobel laureates is in serious peril. All of the country's universities face substantial deficit budgets because of reduced government funding over the past decade. This year, the government is supplying approximately 50 percent of the university system's operating budget, down from 70% prior to 2002. The government has a responsibility to its people, which is why we call upon the newly elected government to renew its financial commitment to higher education. Without doubt, this investment in brainpower is essential to the country and the world. The higher education system, which has a total annual operating budget of only $1.3 billion (roughly equal to the research budget of one American top-tier university), has produced stellar returns for humanity and the Israeli people. Dating back to the country's founding, its universities, and the Hebrew University in particular, have been the driving force behind the transformation of barren, arid land into a green, self-sufficient country and a model of economic development. The issues surrounding the current funding situation for universities are complex. Clearly, solving these problems requires single-minded dedication and cooperation among the country's 250,000 students, university faculty and administrators, and government officials. The government must be determined to prevent a further erosion of teaching talent - the brain-drain problem - and to make a university education affordable to the thousands of hard-working students eager to establish professional careers in every field. The number of tenured faculty who teach has dropped 17% in recent years to 4,500. This is due, in part, to salary caps and the lack of a salary increase for educators since 2002. Another 3,000 academics have chosen to work abroad, where their salaries have tripled. THE DIFFICULTIES faced by the higher education system have been expressed in at least three protests on campuses during the past three years - a six-week student strike in 2006, a 13-week strike by lecturers in 2007 and a request by the presidents of all seven universities asking students to stay home in November 2008. These disruptions have been especially painful for students, whose academic years have been extended into the summer months, increasing their expenses and decreasing their summer earning capacity, tragically causing some to drop out. At the center of the threat to the university system is the government's refusal to implement some or all of the recommendations of the widely respected 2007 Shochat Committee report, even though it had accepted those recommendations. The report calls for the injection of $640 million into the university system. The government was to increase the system's funding by $100 million increments over a five-year period. The remaining $140 million was to come from an increase in annual tuition fees to $4,600 from $2,400. But the capital injection hasn't occurred because it was tied to an increase in tuition which the past government decided not to implement. The unpopular political football of tuition increases is being tossed back and forth between the universities and the Treasury. While groups such as the Union of Students have opposed any increase, the past government pointed its finger at university administrators, urging them to act. Nevertheless, a tuition increase has not been effected in a decade, suggesting that an increase is inevitable at some point in the near future. All this finger pointing and politicizing of educational issues has obscured the most important fact: The country simply cannot risk the deterioration of its internationally renowned university system. The smooth functioning of this system is the basis for the state's future success. A farsighted reform of the entire system is required. We therefore urge the new government to implement the recommendations of the Shochat Committee report, assuming the needed cooperation of the entire university system. Moreover, additional efforts must be made so that the nation's young people gain access to higher education and the means to pay down educational debt. Much as we have in the US, the government could facilitate programs similar to the Federal Stafford Loan programs and the "G.I. Bill." These programs would ensure Israel's continued ability to contribute to the world in medicine, agriculture and technology, and in the more general realm of intellectual thought and discovery. Nor is it enough to call for action by the government and its universities. American Jews must ask themselves about their aspirations for Israel and the Jewish people. Since the inception of the state, we have supported its institutions of higher learning. Now is not the time to turn away from the challenge of assuring their ongoing greatness. We owe it to ourselves and to future generations to ensure that Israel remains a beacon unto the nations. The writer is the national executive director of American Friends of the Hebrew University.