Zohran Mamdani Wants NYC to Divest From Israel — But New Comptroller Pledges to Buy War Bonds

In a letter to state and local officials, the human rights organization DAWN warned on Friday that any investment in Israeli sovereign debt by New York City would violate local and international law.

The 26-page letter — directed to New York Mayor Zohran Mamdani, Gov. Kathy Hochul, and the state and city comptrollers — took aim at Israeli bonds, a financial instrument that invests in the Israeli government for a set period and then is paid back with interest.

Israeli bonds have emerged as a crucial source of funding for the Israeli government, with money from bond sales flowing into the country’s coffers and allowing it to continue its genocidal campaign in Gaza and displacement of Palestinians in the West Bank.

“There’s no complicated analysis needed here: New York is using taxpayer money to finance a military the entire world has watched commit war crimes and crimes against humanity for years,” said Raed Jarrar, DAWN’s advocacy director. (Mamdani, City Comptroller Mark Levine, and the other elected officials named in the letter did not immediately respond to a request for comment Friday.)

On top of the financial risk of holding Israeli debt and the moral imperative of ceasing to fund the Israeli government, divesting from Israel bonds would simply put New York more in line with the opinions of its own citizens, said Michael Schaeffer Omer-Man, DAWN’s director for Israel and Palestine.

“Where you put your money — that means something,” Schaeffer Omer-Man told The Intercept. “We’ve seen a massive shift in public opinion over the past few years as a result of the Gaza war. The political class hasn’t necessarily caught up yet, but support for Palestinians and disapproval for Israel’s behavior, actions, and policies is at an all-time high.”

New York State’s Common Retirement Fund held $352 million worth of Israel bonds as of March 2024, making it one of the largest holdings in the U.S., according to DAWN. And while former City Comptroller Brad Lander allowed the bonds held in city-controlled portfolios to lapse in 2024 — earning DAWN’s praise — the city’s new comptroller, Levine, has pledged to reinvest.

“Brad Lander understood this and divested,” said Jarrar. “Mark Levine’s promise to reinvest is a promise to keep funding Israel’s war machine with New Yorkers’ money.”

DAWN pledged to explore legal action against the state for its investment should it decline to divest in the bonds, as well as against the city should Levine’s plan move forward.

Levine’s announcement of his intent to purchase Israeli government bonds put him at odds with Mamdani, a longtime critic of Israel whose campaign did not shy away from a continued support for Palestinians despite continuous attacks smearing him as an antisemite.

“There’s a potential conflict coming up,” said Schaeffer Olmer-Man. “I hope that Mamdani holds his ground and exerts whatever influence he has to ensure these imprudent and arguably illegal investments do not renew.”

So far, Mamdani has held fast and signaled his opposition to Levine’s plan.

“I’ve made clear my position, which is that I don’t think that we should purchase Israel bonds,” Mamdani told reporters in an unrelated press conference on January 21. “We don’t purchase bonds for any other sovereign nation’s debt, and the comptroller has also made his position clear, and I continue to stand by mine.”

The standoff between the mayor and comptroller is an exact reversal of the dynamic that existed between former Mayor Eric Adams, a staunch supporter of Israel and bonds backer, and Lander, the former comptroller who allowed the city’s investment to lapse. At the time, Lander — a self-professed liberal Zionist who has been outspoken in his criticism of the genocide in Gaza — said he as simply doing his job as the steward of the city’s investments.

“We consulted our guidelines and made the prudent decision to follow them, and therefore not to continue investing in the sovereign debt of just one country,” said Lander in a July 13 letter penned in response to an ally of Adams critical of the move to wind down the city’s bonds position. “You appear to be asking that the City’s pension funds treat Israel better than all other countries. That would also be politically motivated, and inconsistent with fiduciary duty.”

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