Eden's Herbs

What is a Ponzi scheme?

A Ponzi scheme is an investment fraud that involves the payment of purported returns to existing investors from funds contributed by new investors. Ponzi scheme organizers often solicit new investors by promising to invest funds in opportunities claimed to generate high returns with little or no risk. In many Ponzi schemes, the fraudsters focus on attracting new money to make promised payments to earlier-stage investors and to use for personal expenses, instead of engaging in any legitimate investment activity.
-- US Security and Exchange Commission (www.sec.gov .)

In December of 2008 (when I was away in Asia) the biggest, longest, most widespread ponzi scheme in history was discovered. Bernie Madoff, a 70-year-old investment banker in New York whose hedge fund, Ascot Partners, was widely known for it's high stability and double-digit returns (although in retrospect such unrealistically high returns should have raised warning signs.) Amazingly, his scheme lasted about 20 years, creating a huge spiderweb of interests and investments involved and apparently 50 billion all told. (http://www.forbes.com/2008/12/12/madoff-ponzi-hedge-pf-ii-in_rl_1212croesus_inl.html )

Well, Bernie Madoff had an interesting relationship with Hofstra. He graduated from Hofstra in 1960 and in 2004 was named to the Board of Trustees.

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I arrived to the small town of Neti Vot to meet Bat Zion, who then drove me to the even smaller Moshav Shokeda to her permaculture farm, Eden's Herbs. On the way we had many discussions. She was quite negative about the farm, warning me that she would not be offended if I did not stay for long. This left me a little uneasy, but I tried to laugh it off and assure her it couldn't be so bad. She began describing what she does on the farm: right now she is doing a lot of Japanese translating online to pay bills (much more than she had to in the past) because of financial troubles. She grows medicinal plants, and she grows a very specific plant that is being researched for its cancer fighting potential for her "guru," or a specialist she works closely with in the South. The research on this was being funded by some sort of grant...and that money was lost in Mr. Madoff's ponzi scheme. As Bat Zion described this to me, she definitely felt like she needed to simplify it for someone who would not know what she was talking about. Perhaps someone unfamiliar with a ponzi scheme, and much less with the name Bernie Madoff. On the contrary, I sat there listening, feeling my stomach turn. 'No, mam-in fact, I am quite familiar with the man who is causing you such struggles. Actually, the university that I attend entrusts our important decisions to be made by him on the most influential body in the university.

I felt personally guilty on so many levels:
a) This egotistical man from big city New York (where I live) is ruthlessly taking advantage of this small farm woman trying to be self-sustaining, to feed her family, and to discover safer, more economical alternatives to unnatural pharmaceuticals and to potentially fight cancer (her).
b) Somehow, every bad decision that Hofstra makes I feel personally responsible for all of the bad decisions that Hofstra makes. He was probably on the board of trustees because of his well-know insane amounts of money; not because of his dedication to higher education or his real knowledge of what is best for a university or its people who spend every day there in the long run.