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June 19, 2008

Falling dollar hurts seniors in former Soviet Union

http://www.jewishjournal.com/50_Plus/article/falling_dollar_hurts_seniors_in_former_soviet_union_20080618

Alexey Zheleznyak is one of 32,000 Russians whose social services were cut last year as a result of a decline in the dollar's value. Photo by Grant Slater.

Alexey Zheleznyak is one of 32,000 Russians whose social services were cut last year as a result of a decline in the dollar's value. Photo by Grant Slater.

MOSCOW (JTA) -- From its perch above a shelf packed with crystal dishes, a photograph of Alexey Zheleznyak's late wife keeps watch over a spotless apartment.

The ripple effect of a sluggish American economy has forced Zheleznyak, 81, into what he calls the "woman's business" of dusting and cooking.

"I spend almost all my time and all my energy on these things now," he said.

Three years ago, Zheleznyak's wife was bedridden and dying, but a home-care worker funded by the American Jewish Joint Distribution Committee (JDC) dropped by twice a week to wash her, care for her bedsores, clean and cook.

After his wife died, the worker still came but less often, until global economic pressure forced the JDC to scale back operations for the "least needy" in the former Soviet Union. Six months ago, Zheleznyak began having to fend for himself.

Of all the JDC's operations abroad, the former Soviet Union has been hit hardest, according to JDC officials, due to the sliding value of the dollar coupled with inflation in a resurgent Russian economy. Only Israel receives more American funds than the former Soviet Union from the JDC.

As a result, some 32,000 elderly Russians like Zheleznyak have been shaved from the JDC rolls of those who received aid since 2006, when the number peaked at 220,000, JDC officials said.

Organizations such as the JDC and the Jewish Agency for Israel, which are the overseas partners of the North American federation system, rely on donations or money from reparations that is distributed, budgeted and doled out in dollars. Most of that money is sent abroad, where it is spent in local currency under local market conditions.

As the U.S. presidential contenders, Sens. Barack Obama and John McCain, trade barbs on how best to fix the economy, the dollar continues a three-year slide against other currencies. In the former Soviet Union, the JDC's purchasing power has decreased by 13 percent to 20 percent, depending on the country.

At the same time, Russia's economy is soaring on the back of oil prices at $130 per barrel that provide a base for increased wealth, higher commodity prices and inflation.

Russia experienced nearly 12 percent inflation in 2007. Despite price controls on food that lasted through March's presidential election, the International Monetary Fund is predicting that inflation may top 14 percent in 2008.

In sum, that means JDC's $100 million budget for the former Soviet Union set in 2007 now buys only $80 million worth of home-care workers, hot meals and the staff to administer it all.

That has "forced us to rethink how we do business," JDC Executive Vice President Steve Schwager said during a recent trip to Moscow. "Some things that we would normally do, we've had to cut out and find alternatives."

On Monday, the JDC announced it will lay off more than 60 staff members worldwide in an effort to grapple with the budget shortfalls. In addition to cutbacks on social services to the elderly, JDC also has cut back dramatically on Jewish arts and education activities.

Despite efforts to insulate the elderly from budget cuts, those who receive help from the welfare centers in Russia and other countries have paid the price in solitude or painful walks to open markets where they can purchase cheaper groceries.

The most able are the first to be taken off the collective list maintained by the five welfare centers in the Moscow area.

"The first priority we have is to help people who can't help themselves," said Alexander Kirnos, director of the Yad Ezracenter.

The uniform public pension across Russia is about $143 a month, but each area calculates bonuses on those pensions based on the cost of living, said Zhenya Mazarova, JDC's director of welfare programs for Moscow and central Russia.

While pensions increase each year, their purchasing power decreases when measured against inflation -- some 26 percent over the past three years, based on government figures.

One pensioner, Olga Troytsa, 85, lives alone in a one-room apartment outside Moscow.

With no children, Troytsa occasionally receives visits from longtime family friends who bring her food packages and a half-hour of friendly company -- services that used to come from a JDC employee.

Despite having had six operations and a metal support that she wears all but three hours a night, her Moscow pension disqualified her from a JDC food delivery program.

Troytsa says her pension is mostly gone by the end of the month and she misses the company, but there is only one way to make it through the day.

"I laugh at it," she said. "To cry wouldn't help."

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