The Controversial David Magerman
“I’m a systems guy,” Magerman tells me by way of introduction, half a minute after we first meet. Juggling a Koosh ball, the sandy-haired, baby-faced philanthropist is slouching on a chair in his second-floor office at Kohelet Yeshiva High School in Merion. The school, which he uprooted from Northeast Philly three years ago, sits at the geographic heart of Magerman’s project, just off Montgomery Avenue’s ultra-Jewish commercial corridor. “I see it as a great system for life,” he continues, meaning Judaism. He’s relied on the same phrase in previous published interviews, but it’s more than a rehearsed talking point: Magerman’s been methodically test-driving systems his whole life.
The son of a cabdriver and a secretary, he was raised Conservative Jewish in Miami. By the time he enrolled at Penn in 1986, he had stopped practicing. After his father died his freshman year, the self-proclaimed “lab rat” sat shiva for a day with his mother before rushing back to campus without finishing the week-long mourning. The closest he came to faith was a grad-school dalliance with Ayn Rand, which began at Stanford, where he earned his Ph.D. in computer science. And like any good, nerdy John Galt ascending the ranks of the meritocracy, he realized after graduation that the spoils of academia just weren’t sufficient for an intellectual hero.
In 1995, he joined what many consider the best-performing hedge fund ever: Long Island-based Renaissance Technologies. “It was very Ayn Randian,” Magerman says. “In some sense, people inside the company looked down on people who were not making a lot of money and not super-intelligent.”
It wasn’t simply the gobs of cash that appealed to him; it was how the money was made. Renaissance’s flagship investment vehicle is called the Medallion Fund, and it’s legendary for two reasons. First, it never fails. Since the mid-’90s, it’s had one negative quarter, and has averaged an unheard-of 40 percent return. Second, it possesses a secret mathematical formula that computers use to troll at high speed for hidden patterns.
If Rand’s objectivism—along with an incongruous dabble into the Gaia Hypothesis—was Magerman’s first “system,” Renaissance provided another. But a decade later, he’d grown disillusioned with both. Put off by the greed and conspicuous consumption of his colleagues (helicopters to Manhattan for dinner, for example), Magerman decided the “American mind-set of achievement orientation” wasn’t a “sustainable model.” Equally, he came to realize, objectivism was a “system that probably works, but it leaves people dead or starving.” (For what it’s worth, it was reported in July that the IRS has accused the Medallion Fund of cheating the government out of millions in taxes.)
Around the time Magerman began plotting his departure from Renaissance, in the mid-2000s, he took a trip to Israel and was so inspired that upon returning, he enrolled in a Torah-by-phone program. Presto, he had his new system. In 2006, seeking a faith-oriented community away from New York, which he’d been trying to escape since 9/11, he settled in Gladwyne with his wife and three kids. Two years later, he finally quit Renaissance and began focusing in earnest on Philadelphia’s Jewish community.
While Magerman reinvented himself, his new home was undergoing a transformation of its own. First, Philadelphia’s Jewish day schools were hit especially hard by the recession. Declining enrollment and rising tuition created a vicious cycle that atrophied a number of schools, especially the non-Orthodox ones. The woefully funded Jewish Federation of Greater Philadelphia wasn’t doing much to stem the “affordability crisis,” as it’s known. Magerman enthusiastically stepped in.
In 2008, he teamed up with Federation to plan “Megafund,” a major initiative that would boost funding for day schools. But when he got fed up with all the “legalese” and the glacial pace of negotiations, he abruptly left the partnership and set up shop on his own. The Kohelet Foundation was born, and Magerman’s been at odds with Federation ever since.
Since its inception, Kohelet has disbursed between $15 million and $20 million to area Jewish day schools—a larger amount than any other donor, including Federation. (Magerman says he’s given $50 million total to Jewish causes globally.) And because he sees public and non-Jewish private schools as a scourge that threatens all Jewish day schools, Magerman gives throughout the area, regardless of geography or denomination. (“Mike Bloomberg is doing great stuff in the world. He just doesn’t get that he should be supporting Torah education, not Harlem inner-city education,” Magerman says.) Tuition abatements at Perelman Jewish Day School’s Saligman Middle School, in Melrose Park, resulted in dozens of new admissions; a couple of grants essentially rebuilt Politz Hebrew Academy in Northeast Philly.
The community has taken notice. None of the two dozen businessmen, educators and Jewish community pooh-bahs I spoke with disputed Magerman’s newfound importance. When it comes to Jewish giving, says fellow Main Line mega-donor Gary Erlbaum (whose son, Marc, wrote and directed Café), “You just have one figure who stands head and shoulders above the rest.”
Meanwhile, thanks to newcomers like the Magermans, the Main Line’s Orthodox population has been booming. In the past 20 years, it’s grown from 250 to 750 families and from one Orthodox synagogue to five. Magerman’s own Orthodox empire is nestled in one square-mile pocket of Lower Merion, all of it centered on Montgomery Avenue, where young parents dressed in black push their strollers on Saturday mornings. The Kohelet Foundation is just up the street from Citron and Rose, which is right across the way from Magerman’s forthcoming restaurant, the Dairy, which is a third of a mile from Kohelet Yeshiva High School, which is a hundred yards away from Magerman’s synagogue, which is a quarter-mile from the manse he’s building himself down the block from the original Barnes Foundation.
The purpose of Magerman’s enclave—his eruv within an eruv, if you will—is not just to make life convenient for him on Shabbos. Rather, he explains, he’s working “aggressively” to make the Main Line even more of a hotbed for observant Jews.
But … why? Out of theoffice now, eating lunch in an inconspicuous corner of Citron and Rose, I ask Magerman how he reconciles his scientific mind with belief in God. What he says surprises me: “I’m close to faith, but I’m not quite there, because I’m too kind of wrapped up in ‘Wait a minute, how does that work, that doesn’t make sense.’” He adds: “I’ve kind of decided to live my life as though I have faith.”
Magerman attends services daily, bemoans the rise of the two-income family, and does his best to abide by the rules of Orthodox Judaism. But not necessarily because God’s telling him to. As he explained in an op-ed piece last year on the necessity of funding Jewish day schools, he does it because the system works.
“Why do the Jewish people survive, and frequently thrive, in almost every era and almost every country we have gone to in exile? The answer is the one constant that Jews have always had throughout time and everywhere we have gone: Torah,” he wrote. “Sadly, we are now working hard to break this chain by convincing ourselves that the reason for our success in America is freedom and assimilation.” Later, like the fat man in Café whose own faith heals all the movie’s troubled characters, he tells me, “If Jews followed Torah, we wouldn’t have any problems.”