Jack M. Lew, President Obama’s frum former chief of staff and budget director, and now his nominee to head the U.S. Treasury, will face the Senate Finance Committee Wednesday at the formal vetting stage prior to confirmation.  Until several days ago, the nomination seemed to be a slam dunk.

Not anymore.

One of President Obama’s pet peeves has long been tax advantages for the wealthy.  In 2007, when Obama ran for president the first time, one of his favorite targets for vitriol was “overseas tax havens,” in places like the Cayman Islands.  And guess who had close to $100,000 in assets socked away right there in the Cayman Islands? Lew.

While he was president, Obama railed against a specific five-story building on Grand Cayman Island called Ugland House, which nearly 12,000 businesses claim as the address of their corporate headquarters.  The Cayman Islands is a tax-free jurisdiction in which corporations can be “housed,” at least on paper, thereby enabling those companies and wealthy individuals to avoid paying U.S. taxes.

In 2008 the Senate Finance Committee held hearings on Ugland House. The Committee chair, Sen. Max Baucus, explained the committee was “concerned that U.S. taxpayers are creating offshore business entitles solely to evade their U.S. tax obligations, [and] seeking to confound I.R.S. collection efforts by obscuring the true ownership of American assets or income.”

In 2009 Obama said, “for years, we’ve talked about shutting down overseas tax havens that let companies set up operations to avoid paying taxes in America.  About Ugland House, he said, “either this is the largest building in the world, or the largest tax scam in the world.  And I think the American people know which it is.  That’s the kind of tax scam that we need to end.”

But according to The New York Times, as recently as 2010, Jack Lew had invested money in a CitiGroup venture capital fund whose address was Ugland House, Grand Cayman Island.  And based on Lew’s tax filings in 2009 and 2011, he had as much as $100,000 in such investments.

Senator Charles Grassley (R-IA) is fuming.  He called it ironic that Obama’s nominee to head the Treasury Dept., someone who has been, according to reports by conservatives, “inflexible” about spending cuts, benefited from the very offshore tax shelters Obama has repeatedly attacked.  That, and the fact that the IRS is located within the Treasury Dept. and the long arm of the IRS is what gets blocked by tax shelters such as the one provided by  Ugland House.

Others pointed out that many Obama supporters criticized Mitt Romney for holding investments in the Cayman Islands.  According to NBC News, an ad during the  2012 campaign asked, “Why would Mitt Romney invest millions in the Cayman Islands?”

A White House statement issued in response to this latest controversy, pointed out that Lew sold off his investments in the Cayman Islands based fund, and “he paid all of his taxes and reported all of the income, gains and losses from the investment on his tax returns.”

The Times revealed that although Lew had previously worked for the administration, it was not until 2010, after he was confirmed as director of the Office of Management and Budget, that Lew fully divested from the Ugland House CitiGroup fund.  Investments in those funds are not for the short-term, and the sale cost Lew more than $50,000.

Obama and Lew supporters are pooh-poohing the offshore tax shelters issue, especially given that the information was available when Lew went through prior confirmation hearings, albeit for non-Cabinet positions.

And at least one other Treasury Secretary, former CEO of Goldman, Sachs Henry Paulson, who served under President Bush, had extensive financial holdings in the Cayman Islands.

On the other hand, Republicans were not the ones vilifying “the rich” for trying to evade paying U.S. taxes through legitimate ventures, while the Democrats have practically raised that criticism to an art form.

Which brings up a likely ally – if they want to avoid being called hypocrites – for the Republicans who want the Ugland House tax shelter issue to be raised at the hearing: the radical leftist street theater group, Code Pink, and one of their close uber-leftist allies, The Nation.

For those who have been in a coma for the last couple of days, Jack Lew who is an Orthodox Jew and currently the President’s Chief of Staff will be nominated by the President for the cabinet position of Secretary of the Treasury. Although as of this writing it has not been made official – It seems that this will indeed happen. I also believe that he will sail through the confirmation process.

First let me echo the OU’s congratulatory response. I could not be prouder of my co-religionist, Jack Lew, my country, the United States of America, and my President, Barack Obama.

That’s right. I said I am proud of the President for looking beyond the criticism he got from the Jewish community about Hagel and choosing the best man for the job at Treasury even though he is Jewish. I believe the President is a man of integrity. Though I strongly disagreed with him about Hagel, I think he truly believes Hagel to be the best man for the Secretary of Defense.

I think Hagel will be a negative influence vis-à-vis Israel. But I believe (or at least hope) that the President will stick to his polices with respect to Israel. His polices are for the most part very supportive of the Jewish state. Although I still don’t like the fact that someone who has shown great antagonism towards “The Jewish Lobby” will be a member of his cabinet – I do not believe that the President sees us that way. He has certainly never referred to any of us that way.

That Jack Lew, an Orthodox Jew whose Sabbath observance might seem to be a hindrance to his duties has the confidence of the President says a lot about both men. Apparently the President cares that his employees do not sacrifice their principles for their job. In fact the President himself has seen to it that Mr. Lew does not violate the Sabbath. He has been Jack Lew’s Shomer in that regard – reminding him on Friday’s that sunset was approaching and he better hurry up and get home before Shabbos begins.

It is interesting to note an article that appeared a few days ago in the Forward. It was about just how far an observant Jew can go in the workplace these days despite some apparent obstacles. Avital Chizhik, an Orthodox woman, writes about her experiences in seeking a job.

When asked about there indeed her religious observances would hinder her – she replied that she was not that religious. Her interviewer laughed and offered her the job saying he was glad to hear that.

She felt guilty afterward realizing that indeed she was ‘that’ religious. But after thinking about it, she realized that she was really responding to an image and not reality. Unfortunately our image as observant Jews does not always project confidence in an employer about our dedication to our jobs. Her reaction was made to counter that notion. She goes on to say that the sense of purpose that drives her religious beliefs and actions is also channeled into her work – making for a much better employee.

Although I am very happy for Ms. Chizik’s success, there is no better role model for an Orthodox Jew achieving career success than Jack Lew. Of course he is not the first Orthodox Jew to achieve it. Former Vice Presidential candidate and senator from Connecticut, Joe Lieberman did it first.

The job Mr. Lew is about to take on is not an easy one. Which adds to his prestige. His job will perhaps be the most difficult one in the President’s entire cabinet. He will be presiding over an economy that has yet to completely recover from the recession of 2008. Whatever improvement or deterioration happens in the economy will be under his watch. He will either get credit or blame.

Which leads me back to a common fear many Jews have about a Jewish public servants in positions of power in the government. Some people will say that they regret the choice of any Jew, let alone an Orthodox one, being in such a position. They fear that if the economy goes really south, “the Jews” will be blamed for it. As they always have in the past by European governments. The last government to blame the Jews for their problems ended up with the Holocaust!

I understand their fear. It is based on a very long and sad history of persecution of the Jewish people by governments that were at first friendly and welcoming to us. They will say it happened “there” when no one expected it, it can happen here just as easily. “The Goyim don’t need much to turn on us.” Germany was great to the Jewish people for generations of Jews. And look what happened. We should not be naïve about our standing here… that it’s all smoke and mirrors and when the chips are down we are going to be the first ones to be blamed.

Like I said, I understand it. But it’s just plain wrong. Aside from the fact that this country was founded precisely on the principle of religious tolerance, the American people are a fine and decent people who know not to blame their troubles on any one ethnicity. There has unfortunately been many examples where high profile religious Jews have done wrong.

The American people have had ample opportunity to blame “the Jews” for a variety of behaviors of its miscreants. Bernie Madoff could have easily sparked an anti-Semitic backlash… as could any one of a number of high profile Jewish miscreants. High profile because of their obvious Jewishness. How many Orthodox Jews wearing Kipot and other religious artifacts have been arrested or convicted of financial fraud? How many Orthodox Jewish molesters have been in the news lately? There is certainly enough of that kind of thing to bring out any latent Antisemitism. And yet it hasn’t.

Instead we have a President nominating an Orthodox Jew to perhaps the most important cabinet position in America right now… a nomination that should – as I said – sail through congress. So even if God forbid the worst happens and the economy really tanks, perhaps Jack Lew will be blamed. But in no way will “the Jews” will be blamed. Those among my coreligionists who don’t understand this and think I am naïve, are themselves naive. They truly do not understand what this great country is all about nor what the American people are made of.

What a Country!

Visit Emes Ve-Emunah.

There are those who think a politician cannot be charged with anti-Semitism or anti-Zionism if the politician appoints Jews or Israelis to high positions. President Obama has just handed such people another shield to hold up against those charges.  Bloomberg and other news sites are reporting that tomorrow, January 10, Obama will nominate his Orthodox current chief of staff, Jack Lew, to head the Treasury Department.  Lew would replace the out-going Timothy Geithner.

Staunchly pro-Israel and pro-American leaders and organizations have harshly criticized the president’s most recent nominations for three of the most significant positions in the U.S. government. Claims against all three have centered on their documented inclinations towards conciliation and negotiation with the most intractable Islamist and repressive governments, including Iran and Syria, and terrorist groups such as Hamas and Hezbollah, while at the same time exhibiting a decided frigidity towards the Jewish State.  Those claims have been leveled against Senator John Kerry (R-MA) for Secretary of State, Senator Chuck Hagel (R-NB) for Secretary of Defense, and John Brennan for Director of the CIA, all of whom have encountered fierce resistance in certain sections of the staunchly pro-Israel community.

It is unlikely that Lew’s nomination will be met with hostility by the pro-Israel crowd, but that is not because he is an Orthodox Jew who strives to maintain his Shomer Shabbat life despite his demanding position.  Rather, a cursory review of Lew’s professional and academic background reveals a candidate who appears eminently qualified for what is a non-foreign policy position.

Lew was born and raised in Queens, New York, received degrees from Harvard College and Georgetown Law School, and spent most of his career in the public sector, including two stints heading the Office of Management and Budget, and serving as an aide to the late Speaker of the House, Tip O’Neill (D-MA). His private sector positions have included managing director for Citigroup and as an executive vice president of New York University.

In his role as right hand man to the president, the Orthodox Lew was useful in using that hand to reach out to, and smooth down the feathers of, those mainstream American Jewish organizations and leaders for whom such outreach is meaningful. It was widely reported that Lew assisted Obama in making calls to the heads of such organizations, in trying to derail “Jewish” criticism of the Hagel nomination.

While Lew is unlikely to face hectoring from pro-Israel forces, what he will face as Treasury Secretary is more than sufficiently harrowing.  It will be his job to try and tame the $16.4 trillion debt ceiling.  That limit was reached on December 31, at which point the Treasury Department began using “extraordinary measures” to keep the government operating.  But those measures will be exhausted within the next few weeks, according to the Congressional Budget Office.

As the president’s chief of staff, Lew was already used as the president’s kosher imprimatur, but the Treasury Secretary is a higher profile position and one that sets policy, whereas chief of staff ostensibly controls access to the president, but is not an independent policy-making position.

An in-depth article about Lew which ran in November’s National Journal, reveals a man who very much shares this president’s views of government and spending priorities.

If Lew became Treasury secretary, members of the business sector and political observers say, it would send two messages from the administration to Wall Street and the financial community. First, that they don’t have an ally or one of their own in Washington. Second, that the White House intends to keep close watch over tax policy and international financial decisions.

The choice would make the Treasury job  an extension of the White House’s economic team.  “And [appointing] Jack Lew suggests that [Obama] is going to continue to be the principal economic spokesperson because Jack Lew is not Mr. Outside. He’s Mr. Inside,” says Rothkopf, the former Clinton official.

And in the most recent fiscal cliff negotiations, Lew was seen by some as being particularly obstructionist.  Senate Minority Leader Mitch McConnell (R-KY) was reportedly irked by Lew’s intransigence.

Still, Treasury is hardly a position like Secretary of State or Secretary of Defense from which decisions that have an existential impact on Israel will be made.  Domestic spending issues are more frequently the focus of centrist Jewish organizations which tend to be dominated by Democrats, for whom a fiscal conservative might be a lightening rod.  Lew is unlikely to raise the ire of non-partisan pro-Israel organizations.

Of course, if Lew is moving to Treasury, who will be the president’s next chief of staff?  So far the names being floated include Denis McDonough, currently a deputy national security adviser, and Ron Klain, who had served as Vice President Joe Biden’s chief of staff.

If Lew’s replacement is Denis McDonough, sparks may yet fly.  McDonough has been fingered as one of the people most likely to have altered the famous CIA talking points on the attacks on Benghazi. The alteration of those points, it has been claimed, led the Obama administration to publicly blame the murderous violence on a crude little video which Muslims deemed insulting to their prophet, rather than immediately acknowledging that it was a planned attack by an al Qaeda affiliate against the United States on the anniversary of 9/11.  It is hard to believe the White House would want to bring the focus back on Benghazi, although most news sites which have mentioned McDonough as one of Lew’s likely successors did not even make the connection.

WASHINGTON – President Obama on Monday announced that Jack Lew, his director of the Office of Budget and Management – a Cabinet-level position – would replace William Daley as White House chief of staff.

Lew, 56, was chosen for his long years in government and his reputation as a skilled multi-tasker – he was top-budget cruncher for Bill Clinton before reprising the job for Obama – but Jewish officials were offering a sigh of relief for a subsidiary reason: Their who-we-gonna-call pleas were answered.

Since Dennis Ross, Obama’s top Iran adviser, announced his departure late last year, community officials wondered who was left to call in a White House that has hemorrhaged top Jews over the last year or so. Lew, an Orthodox Jew, is close to the community and is a go-to person for Jewish events in the capital.

“The reports that there’s no one to talk to have always been exaggerated,” said Malcolm Hoenlein, the executive vice president of the Conference of Presidents of Major American Jewish Organizations.

Hoenlein pointed to Peter Rouse, a counselor to Obama who has served as acting chief of staff, as someone who has always been accessible.

Still, Hoenlein added, “Jack being there will be beneficial, it will foster communication.”

Orthodox organizations immediately welcomed the Lew appointment.

Orthodox Union Managing Director Rabbi Steven Burg and executive director for public policy Nathan Diament issued the following statement: “We commend President Obama for appointing Mr. Jack Lew as White House Chief of Staff. Our community takes great pride in the appointment of the first member of our community to this position of great responsibility. We wish Mr. Lew a hearty ‘Mazal Tov’ on his historic appointment and best wishes in his new role in serving the president and people of the United States.”

Rabbi Abba Cohen, Washington director for Agudath Israel of America, said “The president is to be commended for appointing Jack Lew as his new chief of staff. Jack Lew is a person of great skill and intellect. He is an extraordinarily hard worker with a firm grasp of both policy and politics. He is a true public servant.”

Obama launched his administration with a strong contingent of Jewish advisers: In addition to Ross, David Axelrod was his top political adviser, Rahm Emanuel was his chief of staff and Daniel Shapiro handled the Levant desk at the National Security Council.

Emanuel quit in late 2010 to run for Chicago mayor, Axelrod left soon after to help run Obama’s reelection campaign and Shapiro is now in Tel Aviv as ambassador. That left a perceived gap in the White House – one that Lew would fill, though Jewish officials stressed that they did not expect the attention from a chief of staff that they received from mid-level staffers.

“That’s not the role he’s going to play,” said Abraham Foxman, the national director of the Anti-Defamation League, referring to the regular conference calls that Ross and Shapiro had with Jewish community leaders.

“He will be an adviser to the president on all things and a gatekeeper, but to the extent the president will turn to him for his view, he has an understanding of the community and of its views.”

President Obama with Jack Lew at his side, announces Lew's appointment as White House chief of staff.

The Obama administration clearly wanted to push across the Jewish message; Shapiro Tweeted the news in Hebrew to his followers. Israeli ambassadors don’t usually make a big deal of the appointment of a White House chief of staff.

Obama stressed Lew’s management savvy in announcing the appointment on Monday. “Jack’s economic advice has been invaluable and he has my complete trust, both because of his mastery of the numbers, but because of the values behind those numbers,” he said.

Lew has become something of a go-to Obama administration speaker and guest for the organized Jewish community, particularly among Orthodox Jews. Most recently, he lit the “national menorah,” the giant chanukiyah that graces the National Mall and is organized by American Friends of Lubavitch.

“As an American Jew, I can’t think of anyone who has a deeper commitment to the United States as well as his own Jewish identity at the same time,” said Rabbi Levi Shemtov, who heads the Chabad group and noted that Lew occasionally stops by for Shabbat services.

“His appointment obviously gives the White House an envoy to the Jewish community who is eloquent, respected, even beloved across the Jewish spectrum. That’s probably an added bonus rather than the core qualification.”

Lew maintains a reliable shtick in his interaction with Jewish audiences: How he balances the 24/7 demands of being a top government official with the 24/6 Sabbath-observant lifestyle.

One incident involves a Shabbat call he received from President Clinton. He came home from synagogue and the phone rang. As was his practice, he waited until the answering machine clicked on to see if it was urgent enough to pick up. As it happened, it was a White House staffer telling him to ignore the earlier message from Clinton, who had been phoning from overseas and had forgotten that in Washington it was still Shabbat. The matter was not urgent enough to interrupt Lew’s observance, Clinton told the staffer to tell Lew.

Natan Sharansky heaped praise on the new White House chief of staff, Jack Lew, saying that his “faith and bond with Israel and the Jewish people is an important part of his life.”

Sharansky said Lew would not remain indifferent to Israel, adding that “Lew is a great Israel supporter and has always taken upon himself to help us.”