-Caveat Lector- : Holocaust Reparations--A Growing Scandal : Gabriel Schoenfeld : GIVEN THE depth of the scars inflicted by the Nazis in World War : II, it is no : surprise that issues of restitution and reparations have refused : to go away.* The only : surprise is that they should now, at this late date, be : occupying center stage, where : they have also become a subject of increasing contention. : The sheer scope of devastation in World War II is impossible to : compass. By the : time the last shot was fired some five-and-a-half decades ago, a : mind-numbing 53 : million lives had been extinguished in the concentration camps, : in the cities, and on : the battlefields of half the world. And no less huge than the : toll in human life was the : destruction and theft of property; everywhere the Nazis turned, : they not only killed : but plundered. : The Jews of Europe, singled out for a special fate, were victims : on both counts. In : most places, they were first forced by the SS to provide a : precise inventory of all : their property, from silverware to real estate, from stamp : collections to : stock-exchange holdings, from furniture to insurance policies : and bank accounts. All : this they were compelled to surrender, after which they were : gathered together in : ghettos and deprived of sustenance, and then, after a time, : taken away to be shot, : gassed, or worked to death as slaves. : The bill for this death, destruction, and robbery came due in : 1945 with Germany's : surrender. But the prostrate country was hardly in a position to : pay. Only by 1951 : did the Federal Republic, which constituted one half of the : by-now divided country, : voluntarily undertake to compensate the few pitiful survivors or : the families of the : slaughtered and to provide restitution to the holders of the : property it had seized. In : the 50 years that have elapsed since this historic step, some 4 : million claims have : been paid and a total of $55 billion has been disbursed both to : the state of Israel and : to individual victims around the world. : Today, over 100,000 Holocaust survivors, primarily residents of : Israel and the : United States, continue to receive monthly pensions from the : German government. : Yet these numbers, significant as they are, by no means indicate : that a final reckoning : has been made. Indeed, a huge tangle of claims still appears to : remain unsettled, and : dealing with them has lately become a major enterprise. : Here in the United States, the organs of the federal government, : coordinated by the : Deputy Secretary of the Treasury Stuart Eizenstat, are engaged : in an intense : diplomatic thrust to negotiate a resolution to the outstanding : issues. They have been : propelled forward by the World Jewish Congress (WJC), an : umbrella body led by : the billionaire tycoon, Edgar M. Bronfman, as well as by two : organizations with : which the WJC is closely affiliated and that share some of the : same key personnel: : the World Jewish Restitution Organization and the Conference on : Jewish Material : Claims Against Germany (known as the Claims Conference). At the : same time, a : small army of lawyers has filed class-action suits against : European corporations said : to have profited from the war at the expense of Holocaust : victims. Revelations of : misdeeds and complicity, and demands for huge sums in : recompense, have become : daily fare. : Politicians have not been shy about climbing on board. Former : Senator Alfonse : D'Amato of New York made Holocaust restitution into one of his : signature issues, : holding widely publicized hearings on the conduct of Swiss banks : during and after : World War II. Insurance commissioners in California, Florida, : and Washington, all : with aspirations to higher office, have been generating : favorable coverage as they : pursue European firms attempting to conduct business in their : states. On September : 11, at the height of this year's election season, many of these : politicians will come : together at a banquet at the Waldorf-Astoria hotel in New York; : there, under the : sponsorship of Bronfman, they will be draped in the mantle of : their good deeds. : Among others being honored are D'Amato, Hillary Clinton (now : running for the : Senate in New York), and Alan Hevesi, the New York City : comptroller. : Leaving aside the issues raised by the very idea of a : reparations banquet, let alone a : number of names of dubious relevance (like Mrs. Clinton's) on : the roster of : honorees, the continually expanding list of Holocaust : restitution projects begs to be : examined on its merits--not least because it has begun to come : under fire from a : number of different directions. : PERHAPS THE first question to be addressed is the one with which : I began: why : is all this happening only now, after so many decades have : passed? The obvious : answer has to do with the dissolution of the USSR and its East : European empire. : By 1990, almost all the victims of Nazi persecution living in : Western Europe and the : United States had received a measure of compensation from the : German : government; but this was hardly true of denizens of the East who : fell under : Communist rule after the war. The East German authorities, for : one, insisted all along : that they had no special obligations to the Jews who suffered : under Hitler--victims, : they asserted, not of Germany per se but of a Nazism that had : been eradicated in : their own country even as it remained (so they claimed) very : much alive in the : Western zone. Elsewhere in Eastern Europe and the USSR, postwar : regimes : vigorously pursued anti-Semitic policies of their own, up to and : including judicial : murder. And in countries that were busy nationalizing all : private property, assets : seized by the Nazis were, with rare exception, never returned to : private hands. : With the fall of the Iron Curtain in 1989, and largely as a : result of pressure by both : the U.S. government and Jewish organizations, a variety of new : initiatives were set in : motion. Reunified Germany moved to establish a fund for : impoverished Holocaust : survivors from Eastern Europe who had hitherto received minimal : or no : compensation. Another German fund, officially opened this past : July, will provide : money to the forced and slave laborers conscripted into German : firms. Elsewhere, : arrangements have been made to restore confiscated property to : its rightful owners : or their heirs or, where heirs cannot be found, to designate any : proceeds from the : sale of such property to Holocaust education or to social : services for Holocaust : survivors around the world. And so forth, in virtually every : country of Eastern : Europe. : Not entirely by coincidence, shortly after the question of : restitution became unfrozen : in the East, two issues involving Switzerland came dramatically : to the fore. The first : was that country's role as a neutral power in the war. In this : role it not only enforced : an exclusionary policy against Jews seeking refuge behind its : borders but also : provided assistance to Nazi Germany in laundering gold, : consisting of some $4 : billion (in today's dollars) looted from the treasuries of : conquered Europe and an : additional $1.2 billion taken from victims of the Holocaust; : this last included not only : wedding rings but dental crowns extracted from corpses in the : various death camps : and melted down into ingots. Secondly, attention focused on the : Swiss bank : accounts established by many European Jews in the 1920's and : 30's, thought by : those who opened them to be exceedingly secure. Indeed, so : secure were they--and : so wrapped in the secrecy that is the selling point of the Swiss : banking system--that : in the years following the war they became for all practical : purposes another windfall : for Swiss bankers on top of the one offered by Nazi gold. : This state of affairs was hardly unknown or even forgotten in : the West in the postwar : era, but it took until the 1990's before the World Jewish : Congress and the U.S. : government embarked on a concerted effort to resolve it. Coming : under great : pressure, the Swiss government and major Swiss banks rushed to : create a "Fund for : Needy Victims of the Holocaust" along with a "Solidarity Fund" : for other victims of : oppression. In the face of a slew of American-based lawsuits, : Swiss banks also : agreed last year to a $1.25-billion settlement aimed at : resolving all outstanding claims : and averting sanctions on their U.S. operations. : While the Swiss banking controversy has not been fully defused, : a different set of : claims has also been making headlines around the world. These : involve the various : kinds of insurance policies issued to Jews and others in the : 1920's and 30's, which, : for one reason or another--including the death of the purchaser : in the Holocaust and : the destruction of documents in the war--were never paid. To : deal with this : exceedingly complex matter, still another commission was : established in the late : 1990's, this one headed by the veteran diplomat Lawrence : Eagleburger and : comprising German and Italian insurance companies, : representatives of the state of : Israel and of world Jewry, and European and American insurance : regulators. : In the wake of a series of tempestuous meetings, some progress : has been made : toward a settlement in this area as well. At the same time, : however, a number of : multibillion-dollar suits have been filed against the companies. : Several states in the : U.S. have also passed laws forcing European insurance companies : doing business : within their borders to disclose Holocaust-era records, and have : commenced actions : to recover unpaid insurance proceeds. The issue remains highly : charged, with : allegations of bad faith and betrayal on all sides. : THE VARIOUS disputes now unfolding are not entirely : unprecedented, with : respect either to the basic issues they raise or to the : intensity with which they are : being fought. Indeed, in the early 1950's, the debate in Israel : over whether to accept : money from Germany was, if anything, far more acrimonious than : the debate in : Germany about whether to pay it. Menachem Begin, then the young : leader of the : right-wing Herut party, held street demonstrations to denounce : the government for : accepting German "blood money." It was only as the 50's wore on : and the funds : began to flow that the debate in Israel over this subject : essentially died out. : In the United States, by contrast, a rather different pattern : has prevailed. Though in : the past decades the Holocaust has emerged as the central : preoccupation of : American Jewry, until virtually yesterday there has been : remarkably little discussion, : let alone disputation, over the proliferating initiatives, : commissions, negotiations, : funds, and lawsuits designed, ostensibly, to aid the surviving : victims of the Holocaust : and to return to the Jewish community that which was stolen from : it. : In large part, this silence undoubtedly indicates concurrence : with the idea that, in the : face of a crime so immense, every last ounce of justice must be : done; history's : greatest villains must be punished and punished again while : those who suffered : deserve every last measure of recompense. But other factors are : at work as well. : One of these is easily enough comprehended. The anti-Semitic : pseudohistorians who : deny that the Holocaust happened have battened on the issue of : reparations and : pressed it into the service of their "counternarrative," as an : example of how : predacious Jews are profiting from their invented tale of : suffering. One finds this kind : of thing, for instance, in the Journal of Historical Review, the : principal publication : of Holocaust deniers in the United States, in articles with : titles like "Jewish Blackmail : Against Switzerland" and "No End in Sight: Germany Has Paid Out : More Than : $61.8 Billion in Third Reich Reparations." Meanwhile, on the far : Left, a version of : this same thesis has been put into play by some of the : anti-Zionist followers of Noam : Chomsky, as in a recent tract purporting to demonstrate that : Jewish organizations : have engaged in a ruthless campaign to maximize their own wealth : and influence by : manufacturing non-existent Holocaust survivors.** : In the face of this portrait of avaricious Jews exploiting the : Holocaust for pecuniary : gain--a portrait that draws upon time-honored anti-Semitic : images--it is hardly : unnatural that a general (if silent) consensus should reign : within the Jewish community : on the rightness of pressing restitution claims. But there have : also been one or two : notable dissenters. The syndicated columnist Charles : Krauthammer, for example, : has worried aloud about what he terms a "grotesque scramble for : money," a : scramble whose only certain result is the "revival of Shylockian : stereotypes." : Abraham Foxman, chairman of the Anti-Defamation League, has : voiced a related : concern: thanks to the continuing demands for reparations, he : has said, people : around the world may be led to believe "that the Jews died [not] : because they were : Jews, but because they had bank accounts, gold, art, and : property." : In Europe, what Krauthammer and Foxman fear has in fact : happened, at least to : some extent. Among the Swiss, the controversy surrounding Nazi : gold and dormant : bank accounts unleashed, at its height, a tide of anti-Semitic : feeling unseen since the : pre-World War II era, complete with hate mail and death threats : directed at officials : of Jewish organizations and physical harassment of Orthodox Jews : on city streets. In : Austria, the ascension of Jörg Haider's Freedom party rested in : part on widespread : indignation at the bills being presented for that country's : complicity in crimes against : the Jews. In Germany, the New York Times reports, there has been : "a nationalist and : right-wing intellectual awakening" that reflects "weariness, : even anger, at what is seen : as Germany's eternal victimization" for the Holocaust. A vivid : sign of this was on : display in June when Germany's most prestigious literary award : was bestowed on : the revisionist historian Ernest Nolte: tellingly, Nolte used : his acceptance speech to : denounce the "collective accusation" continuously leveled at : Germany since the war. : UNSETTLING THOUGH this European mood may be, it is by no means : clear : that it should have a decisive bearing on the pursuit of : Holocaust claims. If such : claims are legitimate, it would be a double injustice to forgo : them out of fear of : arousing anti-Semitism. Besides, as the Washington Post : columnist Richard Cohen : has pointed out, if the demands of Jewish organizations have : exacerbated : anti-Semitism in places like Switzerland, then perhaps it is the : Swiss who "ought to : look to their own values and not the Jews to theirs." But are : the claims legitimate? : And are they being pursued in a legitimate manner? In attempting : to answer these : questions, we unavoidably enter upon treacherous terrain. : Within the broad categories of restitution--slave labor, stolen : artwork, confiscated : personal property and real estate, dormant accounts, : stock-exchange holdings, : insurance polices--there are, of course, countless individual : cases, each of which : must inevitably stand or fall on its own merits. But after the : passage of so many : years, assessing the merits of any one case can itself be highly : problematic. : The 1920's and 30's, the period in which many of the insurance : policies and bank : accounts now under dispute came into being, were decades of : unremitting : turbulence, with hyperinflation and depression roiling economies : worldwide and the : governments of Western and Eastern Europe responding with : currency controls, : devaluations, and other forms of intervention that left few : instruments of worth : untouched. This highly unstable era was followed by a war that : created displacement : on a global scale, with monetary, border, and regime changes, : and widespread : destruction of documents. After the war, Communism came to a : great swath of : Europe and the state assumed custody of all private assets and : records. Even if : private corporations were today consistently proceeding with the : best will in the : world, many claims would remain exceedingly difficult to sort : out. : Consider a single case. Jack Brauns, formerly Jakob Braunsas, is : currently suing the : Italian insurance company, Assicurazioni Generali, in California : courts for failing to : make payment on a life-insurance policy on which he is a named : beneficiary. : According to the set of facts presented by Generali, in 1930 : Moisejus Braunsas, a : resident of Lithuania, purchased a U.S.-dollar-denominated : policy in the amount of : $2,000 from Rigaer Union, a Latvian company in which Generali : had an ownership : interest and for which it was providing reinsurance, i.e., : acting as a backer of last : resort if Rigaer Union for some reason could not pay. In 1936, : well before the Nazis : appeared on the scene in Latvia, the policy's value was reduced : to $800 for : nonpayment of premiums, which also, under Latvian law, voided : Generali's : reinsurance guarantee. At approximately the same time that the : premiums ceased : being paid, the Latvian government enacted a monetary reform : that forcibly : converted all dollar-denominated insurance policies into : lats-denominated ones, : greatly reducing whatever residual value Braunsas's policy may : have had. In January : 1939, not long before the war came to Latvia, Rigaer Union was : forcibly liquidated : for failing to comply with a new law governing capital : requirements for joint-stock : companies; its policies were taken over by Drosiba, a far larger : Latvian insurer with : which Generali had no reinsurance tie. : Then came the war. First, Drosiba fell under Soviet rule when : Latvia was annexed : by the USSR in 1940. Then it was administered by the Nazis after : they conquered : Latvia in 1941. Finally, it fell once again under Soviet rule : after Latvia was : reconquered in late 1944. At that point, all private firms were : absorbed by the state. : Some 50 years later, after the USSR dissolved and Latvia again : achieved : independence, Drosiba resurfaced as a private firm. : Under the circumstances, Generali contends that it has no : contractual obligations to : Jack Brauns, and that if indeed he has a valid claim at all, he : should apply in the first : place to Drosiba. For his own part, needless to say, Jack Brauns : adheres to a very : different and highly compelling version of this same murky : history. : Nor is this an atypical example of the ambiguities and : difficulties inherent to the : process of sorting things out--ambiguities and difficulties that : perforce raise a : question about the tactics that have been employed to compel : settlements. If the : issues were all cut and dried, not only would most claims have : been settled long ago, : but it would be entirely justifiable to employ the heaviest : legal and political artillery to : resolve the outstanding ones. But the issues, in many if not : most instances, are not : cut and dried. And yet, some inside and outside the organized : Jewish community : have unrestrainedly availed themselves of any method, however : unseemly or even : disreputable, to go after every last franc, lira, guilder, and : mark, owed or not owed. : A GROWING number of attorneys practice the new specialty of : Holocaust law. : Although they like to wrap themselves in the rhetoric of a : sacred cause, a New York : Times story suggests an admixture that is at least 99 parts : profane. In the free-for-all : to obtain Holocaust victims as clients, the paper reports, : "competing lawyers from : the United States have barnstormed across Europe soliciting : clients, publicly : castigating each other and privately maneuvering to oust their : adversaries." In the first : 50 years after World War II, the number of Holocaust-related : class-action law suits : could be counted on two hands; in the last four years alone, the : number has more : than tripled. : Active players range from Cohen, Milstein, Hausfeld & Toll, an : eminently : respectable Washington, D.C. law firm that has humbled such : corporate giants as : Texaco, to small-time lawyers like Diane Leigh Davison, a solo : practitioner who : conducts her primary specialty in "entertainment" law out of an : office in Baltimore. : Cohen, Milstein boasts that it has assumed "the struggle for : justice" for Holocaust : victims on a pro-bono basis. Davison, for her part, expects : remuneration: "You don't : say to a surgeon, 'don't take your fee.'" And then there is : Edward Fagan, an obscure : personal-injury lawyer from San Antonio, Texas who claims to : have signed up : 31,000 clients in record time. For his role in the Swiss : settlement, he submitted to : the court a bill for $4 million, or $640 an hour. The average : pension that Holocaust : survivors today receive from the German government is $640 a : year. : Elan Steinberg, the executive director of the World Jewish : Congress, has warned : that "Holocaust survivors are being exploited by a feeding : frenzy of fee-grabbing : lawyers." But his organization, too, has not shied away from : eyebrow-raising tactics : of its own--for example, against a Dutch insurance company named : Aegon that : during the war was forced by the SS to surrender all policies : owned by Jews to a : Nazi-controlled firm. Already at the time, the Dutch : government-in-exile declared : such compulsory transactions null and void, and, beginning in : the 1950's, Aegon, : acting under Dutch law, moved to provide restitution to those : who had been robbed. : The firm, moreover, participated in successful negotiations with : the Dutch Jewish : community to establish a fund to cover any additional claims : that might come to light. : Despite this eminently defensible record, last year the WJC : launched an aggressive : campaign against Aegon, insisting that it join the Eagleburger : commission or face a : boycott of its American-based subsidiaries. Aegon balked at this : demand, : maintaining that, as a company that had itself been a victim of : the Nazis, it would not : participate in an enterprise in which it would share equal : culpability with Italian and : German firms. "Our country suffered," Kees Storm, Aegon's : chairman, told the : Financial Times. "We are in a totally different position from : other insurers." : Nevertheless, the World Jewish Congress imposed its sanctions, : with Steinberg : promising to bring the company to its knees: "the insurance : companies," he warned, : "will be even easier" to target than the Swiss banks. : No less troubling than this ungrounded effort to bludgeon a : company into : submission--the WJC has never publicly referred to a single : Holocaust-era insurance : claim against Aegon that has gone unpaid--is the organization's : attempt to wield : Dutch wartime history as a club in its public-relations war : against the insurer. : Holland, according to the congressional testimony of Israel : Singer, the secretary : general of the WJC, : had the worst record in Western Europe during the : Holocaust--some : 80 percent of its Jewish population was murdered. They were : handed : over by Dutch police. . . . The perception of Holland has : been colored : by the tragic Anne Frank story. But Anne Frank, who was : betrayed : and died in a Nazi concentration camp, had her furniture in : the hidden : annex removed by a Dutch moving company. So the failure of : Aegon : and the Dutch insurance companies is clearly bound up in : the : unwillingness to face the past--a failure of moral : restitution. : It is, of course, indisputable that, in percentage terms, more : Jews perished in Holland : than anywhere else in Western Europe. In his outstanding Victims : and Survivors: : The Nazi Persecution of the Jews in the Netherlands, 1940-1945, : the British : historian Bob Moore emphasizes the interplay of elements that : helped to account for : this disparity, among them the deeply ingrained deference to : authority that : characterized both the Dutch people and the Dutch Jews : themselves; the fact that it : was civilian Nazi officials who ruled Holland in the war years : and not, as elsewhere : in Western Europe, the Wehrmacht, thus giving a freer hand to : the SS, the key : instrument of Nazi genocide; and the continuation, during a : temporary pause in : deportations to Auschwitz from locations across Western Europe, : of transports from : Holland alone to the death factory of Sobibor. Indeed, Moore : records in one highly : relevant passage, "the Dutch victims of Sobibor more or less : account for the : percentage difference in mortality between the Netherlands and : its nearest : neighbors." : It is also true, as the WJC's Israel Singer observes, that there : was extensive : collaboration in the roundups and deportations of the Jews to : the death camps, : particularly by the Dutch police and the civil service, and in : this respect the fate of : Anne Frank was typical. But one cannot speak of Dutch : collaborators without also : taking note of the other side of the coin: the Dutch men and : women who gave shelter : to those forced to wear the yellow star, many of whom paid a : terrible price for their : pains. Yad Vashem, Israel's Holocaust museum and research : institute, has kept a : meticulously researched record, broken down by country, of the : men and women : who came to the aid of persecuted Jews in occupied Europe. In : absolute numbers of : such "righteous gentiles," tiny Holland outstrips all the : countries of Western and : Central Europe combined. Holland, moreover, was the only country : in Nazi : occupied Europe to witness a general strike in response to Nazi : depredations against : the Jews, a heroic and costly move that tragically failed to : affect the Nazi resolve to : hunt down and murder every last Jew in the land. : One can hardly say that the Dutch had an unblemished record : during World War II; : far from it. And in the aftermath they were often as callous as : they could be to the : relative handful of Jews who returned alive. Still, the image we : have of the "good : Dutchman" is not simply a myth to be torn away. To assert : without qualification that : the Netherlands had "the worst record in Western Europe during : the Holocaust" is : wickedly to blacken the name of a country that, from the bombing : of Rotterdam in : 1940 to the hunger winter of 1944-45, itself suffered grievously : in the war. One : would expect an organization attempting to right a historical : wrong to acknowledge, : and honor, its special obligation to historical truth. : AS CLOUDED as are the issues presented by the claims against : insurance : companies, an even more complex case is presented by : Switzerland. In pursuing the : Swiss banks, major Jewish organizations have loosed the most : forceful weapons in : their arsenal, including class-action lawsuits, boycott threats, : and barrages of adverse : publicity. The World Jewish Congress has again taken the lead, : lambasting the Swiss : in forum after forum for sins ranging from gold laundering to : the failure to admit : refugees. It has also published a series of hard-hitting : pamphlets, with titles like The : Sinister Face of "Neutrality": The Role of Swiss Financial : Institutions in the : Plunder of European Jewry, that detail instances of misconduct : during and after the : war. : Summing up the overall charge, Edgar Bronfman testified before : Congress that, : contrary to received wisdom, the Swiss were "far from neutral" : in the war: : Their assistance to the Nazi war machine, through the : clandestine : conversion of looted gold into Swiss francs, enabled the : Germans to : buy fuel and other raw materials they needed to prolong the : war. Some : estimates in testimony before the U.S. Senate hearings : following the : war suggest the cost may have been staggering in the lives : of American : soldiers, Allied soldiers, Jews, and other civilians across : that continent. : What are we to make of this indictment? : Clearly, the picture of wartime Switzerland as a kind of happy : haven, encapsulated : in the Broadway show The Sound of Music, has long been in need : of adjustment. : But in its place has come a mirror-image caricature that does no : greater justice to : historical reality. As with the Dutch, the actual record of the : Swiss is very checkered. : Thus, a case can be made--and has been made by, among others, : Angelo Codevilla : in a new book*--that, surrounded on all sides by the Nazis and : their allies and : vulnerable to invasion, Switzerland acted from necessity when it : served as a banker : for the Third Reich. It is also reasonably clear that : Switzerland did not violate : international law merely by trading with Nazi Germany, which was : in any event again : not a matter of choice. On this point international law is : fairly straightforward: neutral : countries are permitted to engage in commercial relations with : belligerents so long as : the government itself does not participate in such trade and so : long as none of the : belligerents is given special favor. For the most part, : Switzerland complied with these : two conditions. : The Swiss did violate international law in another way--by : trading in Nazi gold, : which they had reason to know had been looted from the : treasuries of Germany's : victims (although there is no evidence suggesting they knew that : some of the gold : had been taken from death-camp inmates). This violation, : however, was in effect : cured, legally if not morally, by the Washington Accord of 1946, : in which the Swiss : agreed to settle Allied claims in exchange for a contribution of : $58 million ($500 : million in today's dollars) to the reconstruction of Europe. : This sum was paid only after much kicking and screaming; but it : was not a : particularly large amount, and from our present vantage point : the Swiss would seem : to have gotten off far too easily. Even so, however, some : additional considerations : are relevant. Washington was hardly in the dark about the true : nature of : Switzerland's gold transactions, having obtained through : decryption of diplomatic : communications and other means a generally comprehensive picture : of Bern's : activities. In signing a binding accord, then, the U.S. : government was not snookered. : And the Truman administration had solid reasons of its own for : avoiding a major : breach with Switzerland, the one wholly intact country in the : heart of Europe in the : chaotic year 1946. : But international law aside, was Swiss neutrality itself not an : ethical disgrace? This, : as it happens, is the gravamen of a 1997 U.S. government report : prepared by the : office of Stuart Eizenstat, which also points out that Nazi : Germany "was a mortal : threat to Western civilization itself, and had it been : victorious, to the survival of even : the neutral countries themselves." : That the Swiss were free riders on the Allied war effort is : indisputably the case, but it : is difficult to imagine what kind of useful contribution a : belligerent Switzerland--a : nation of 5 million--could have made to the defeat of Nazi : Germany; in all likelihood, : a major portion of the country would have been conquered within : days and, among : other consequences, the Jews of Switzerland would have been : rounded up and : shipped away, never to return. As things stood, moreover--and as : no lesser an : authority than Winston Churchill would later attest--neutral : Switzerland was not : without considerable value to the Allies, too: as a trading : partner (in gold, as with the : Germans), an espionage porthole, and a "protecting power" for : German-held Allied : prisoners of war. To reprove Swiss neutrality from an office in : Washington five : decades after the fact, without considering the alternative and : what it would have : entailed, is to indulge in the worst kind of armchair : moralizing. : As for Switzerland's exclusionary immigration policy, it was : arguably no worse than : that of many other countries during the war. (The United States : itself hardly has a : glorious record in this department.) But there can also be no : blinking some of the : terrible things done by the Swiss, like the encouragement given : to the German : authorities in 1938 to stamp the passports of Jews with a "J" in : order to help the : Swiss border control keep out terrified refugees fleeing for : their lives. Although some : have denied anti-Semitism was prevalent in Switzerland in this : period, and Codevilla : goes so far as to say that no Swiss officials wanted to put : their names on "a policy of : exclusion of Jews per se," a profusion of easily obtainable : documents belies such : apologetics. Nor was it just low-level bureaucrats who : instructed, as in one crucial : circular, that the passports of those "who are Jewish or : probably Jewish" should be : stamped "turned back." Such policies flowed from the very top, : and were approved : unanimously by the Federal Council, the highest decisionmaking : body in the land. : GOLD LAUNDERING and a pinched or anti-Semitic refugee policy : undoubtedly : constitute the blackest mark on Switzerland's wartime history. : But the irresistible lure : both to class-action lawyers and to Jewish organizations has : been not these but the : dormant bank accounts belonging to Holocaust victims. Thanks in : large measure to : an Independent Committee of Eminent Persons, set up in response : to the growing : clamor about these unrestituted funds and headed by Paul : Volcker, the former : chairman of the Federal Reserve, our understanding of this : matter is much more : complete than it was before the shouting began--and strikingly : at variance with the : picture we have been given. : The Volcker committee examined the records of some 254 Swiss : banks that : operated during the period 1933 to 1945, covering every : institution likely to have : had foreign depositors. It scrutinized some 4.1 million : accounts, or 60 percent of the : total from those years (the records for the other 40 percent no : longer exist). From : these, the commission attempted to cull accounts matching the : names on lists of Nazi : victims provided by Yad Vashem. In all, the auditors found some : 53,886 accounts : bearing what they cautiously describe as "a probable or possible : relationship to : victims of Nazi persecution." : This number is dramatically higher than all previous estimates : given by the Swiss : banks themselves--a 1962 survey turned up only 739 accounts, : while in 1956 Swiss : bankers had been able to find a paltry total of 86. The : disparity is overwhelmingly : the result of sheer bad faith on the part of the Swiss--but it : is also a testament to the : technical and legal problems wrapped up in this issue. For, even : after the : expenditure of almost a quarter of a billion dollars in what : became the most : expensive audit of all time (not even counting the sizable : internal costs imposed on : the banks themselves) and with the aid of a "fuzzy logic" : algorithm and other : advanced computational techniques, the Volcker audit itself : encountered enormous : difficulties in tying particular accounts to particular : Holocaust victims with any : certainty. : The report is properly severe in its judgments. Some banks, it : concludes, did engage : in "questionable and deceitful actions." These included : "withholding of information : from Holocaust victims or their heirs about their accounts, : inappropriate closing of : accounts, failure to keep adequate records." Then there were : "many cases of : insensitivity to the efforts of victims to claim dormant or : closed accounts, and a : general lack of diligence--even active resistance--in response : to earlier private and : official inquiries." Some of the more egregious instances of : dissimulation and : stonewalling involved the charging of extraordinary fees to : those seeking information, : or closing accounts in such a way as to complicate or rule out : any future tracing of : ownership. : On the other hand, the offending behavior was evidently limited : to a relatively small : number of banks and is not of recent vintage. Rather, it "took : place years ago in a : particularly difficult period with different banking standards." : Significantly, the : Volcker commission uncovered no evidence of "organized : discrimination against the : accounts of victims of Nazi persecution" or "concerted efforts : to divert the funds of : victims of Nazi persecution to improper purposes." Although many : records could not : be located, this could not be attributed "to systematic or : widespread and deliberate : alteration or destruction of bank-account records for the : purpose of obliterating the : history of the accounts of these victims." Indeed, in a stunning : conclusion completely : contrary to the picture drawn by the World Jewish Congress and : the Western : media, the commission reports "many cases" in which banks : "actively sought out : missing account holders or their heirs, including Holocaust : victims, and paid the : account balances of dormant accounts to the proper parties." : No less remarkable than this conclusion is the committee's : analysis of the root cause : of the problem, which, it avers, lay less in cupidity (though : there was that, too) than : in the underlying legal framework of the Swiss banking system. : One pillar of that : framework was, and remains, the secrecy rules that were adopted : in the 1930's, : ironically enough in large measure to protect the assets of : persecuted German Jews. : These secrecy laws then helped underpin the decision (later to : become the subject of : much criticism) "not to publish the names of the dormant account : holders after World : War II." : A second and no less important pillar was the absence of an : escheat provision that : would, as in most other countries, mandate the transfer of : unclaimed banking assets : to the state after a specified period of inactivity. This : continuing anomaly in Swiss law : has given rise to what the Volcker report calls "large numbers : of dormant accounts : even in settled times" and also, for the period in question, : "very large amounts of : dormant accounts completely unrelated to victims"--a : circumstance from which the : report concludes that "the banks, for the most part, treated : foreign and domestic : customers alike." : This lapidary finding puts paid to the notion that Swiss bankers : deliberately sought to : profit from the Holocaust. Although they clearly harbored their : share of miscreants, : for the most part their dereliction, characteristic of bankers, : lay in applying the : ordinary rules of procedure to an extraordinary situation. Thus, : what can be said of : them as a whole is that they failed to rise to the occasion, and : that they made no : systematic effort, until challenged, to resolve a glaring : scandal. : Although one hesitates to compare, something similar can be said : of other banks, : including, as the Jerusalem Post and other news outlets have : reported in great detail, : local banks in Israel that have been found to be sitting on : dormant accounts : belonging to Holocaust victims. (Once again, avarice is not the : cause; it is merely the : intrinsic difficulties of determining who owns what.) And as the : Jerusalem Report : has recounted in a series of scathing articles, even the Claims : Conference, whose : vice president is Israel Singer and on whose board of directors : sits Edgar Bronfman, : has faced its share of unsightly entanglements in carrying out : its fiduciary : responsibilities--principally by failing adequately to inform : actual property owners or : their heirs of their rights to unclaimed property that then fell : to the Conference to : dispose of as it wished. In short, in managing large sums of : money belonging to the : dead, even the best-intentioned bodies can fall prey to : procedures and incentives : that can make them appear as self-serving and heartless as the : Swiss banks. : IN BRINGING this inquiry to a close, let us leave aside the : "fee-grabbing" lawyers, : who are doing what such lawyers, for better or worse, are : nowadays wont to do. : But has the organized Jewish community itself been pursuing : Holocaust claims in a : legitimate manner? : It is indisputable that without the aggressive campaign waged by : the World Jewish : Congress and its affiliates, many of the restitution efforts in : train today would never : have been set in motion. Although much of the money promised in : the 1990's : remains tied up in litigation and bureaucratic wrangling, if and : when it begins to flow : freely it might yet benefit the dwindling group of Holocaust : survivors dispersed : around the world, many of whom, particularly in Eastern Europe : and the USSR, are : said to be destitute and forsaken. : But consider what else has been set in motion. There is, to : begin with, the : questionable nature of at least some of the claims themselves, : especially those that : have been settled en bloc and under duress by banks or : corporations anxious to : avoid an unceasing notoriety and/or to continue doing business : in the United States. : As we have seen in the case of the insurance companies, the : issues are so tangled as : inescapably to inject uncertainty into the validity of any given : claim, with questions : arising about the timely payment of premiums, the existence of : reinsurance : guarantees, the effect of currency devaluations, and so forth. : And as we have seen : with the dormant bank accounts, the Volcker committee's : authoritative report clearly : refutes the accusation that the Swiss bankers engaged in : widespread and systematic : larceny. : If anything, indeed, the Volcker report highlights the suspect : nature of a good : number of the claims for compensation that have been streaming : in ever since this : issue was highlighted in the 1990's. Through a campaign of : public statements and : paid advertisements, Jews around the world have been actively : solicited to locate : their names on lists of dormant bank-account holders and unpaid : insurance policies. : More, they have been given the impression that filing a claim is : a moral imperative, a : way of seeing justice done. : The Volcker report itself expresses serious reservations about : publishing lists of : accounts, which carries a "greater implication of widespread : insensitive and even : unethical behavior than is warranted by the facts," and invites : "frivolous claims" that : can "clog the claims-resolution process [and] delay justice : rather than serving the : legitimate claimants." An independent tribunal of distinguished : jurists has been at : work evaluating claims against the Swiss banks, and has already : denied some 80 : percent of them. But the organizations are pursuing an agenda of : their own, and have : been deterred not at all by the undifferentiated scramble for : compensation they have : unleashed. : QUITE APART from the merits or demerits of individual claims, : that agenda may : be inflicting injuries ever more costly to Jewish interests. : When, in the early 1950's, : Prime Minister David Ben-Gurion asked the Israeli people to come : along with him in : accepting reparations from Germany, he did so reluctantly and : for the weightiest of : reasons: namely, to obey the "final injunction of the : inarticulate six million, whose : very murder was a ringing cry for Israel to rise, to be strong : and prosperous, to : safeguard her peace and security, and so prevent such a disaster : from ever again : overwhelming the Jewish people." Does even a shadow of such a : vital imperative : exist today? : Assuredly, the restitution effort now being pushed forward by : U.S.-based Jewish : organizations contributes nothing to Israel's security. : Conceivably, it may even harm : it. For many years now, Germany, Holland, and Switzerland have : been staunch : supporters of Israel in a Europe that has been less than : friendly to the Jewish state. : The arm-twisting, the threats of boycott, the bad press--some of : it undeserved, and : some of it undertaken for the naked aim of extracting : money--cannot but leave a : distinct impression on European minds. : Stoking the fires of anti-Semitism on the far Right is only one : and by no means the : most significant danger. The real peril comes not from the : fringe but from the damage : done in the European political center. Countries that fail to : fall into line, Israel Singer : has warned, will be "publicly attacked and humiliated," and on : more than a few : occasions his organization has made good on this threat. When : moments of strain : come along, as when Israel's Arab adversaries come shopping for : advanced : weapons systems, will the nations that have been "publicly : attacked and humiliated" : be ready to do the right thing? It is impossible to say for : sure, but one senses that : moral and political capital has been heedlessly squandered. : An injury of another sort may be done to relations between Jews : and non-Jews. : With the exception of the forced laborers and some other : currently favored groups : like Gypsies, homosexuals, and the mentally ill, both European : corporations and : Jewish organizations have said embarrassingly little about the : great numbers of : non-Jews who were deprived of life, limb, and property at the : hands of the Nazis. : But if banks and insurance companies, in particular, have unpaid : obligations, they : have them to all of their murdered customers with whom they had : valid contracts. : Obviously, the firms do not wish to widen their exposure to : thousands upon : thousands of more claims, and Jewish organizations are fighting : first and foremost for : Jewish interests. : So they should; that is their job, and besides, the fate of the : Jews, it hardly needs : emphasizing, was singularly terrible. Nevertheless, to lead or : participate in a process : through which some are given restitution while others in similar : circumstances, but on : the wrong set of lists, are not, is to sow the seeds of needless : acrimony and to court : censure on grounds to which Jews of all people should be : especially sensitive. : PRUDENTIAL CONSIDERATIONS of this sort are by no means the end : of it; : at stake also is Jewish honor, violated in several ways. For one : thing, we have been : witnessing the spectacle of American Jewish organizations : teaming up with politicians : whose tears for the six million are exquisitely synchronized : with their need for : campaign contributions and applauding headlines. A bipartisan : complement of this : breed will attend the black-tie reparations banquet at the : Waldorf-Astoria, an : exercise in self-congratulation that promises to drag the mass : murder of European : Jewry into ethnic politics at its crassest. : For another and much graver thing, there are those indigent : survivors languishing in : isolation while their claims are laboriously processed. The : Jewish community has a : proud history, extending across millennia, of taking care of its : own, buttressed by a : voluminous legal and moral literature on the sacred obligation : to feed the hungry, : clothe the naked, and ransom the captive. Can it really be that, : at the very moment : when American Jewry has been investing millions of dollars in : the construction of : Holocaust museums and memorials in every city and suburb of the : United States, : and when hundreds of millions of dollars have been spent digging : through European : banking archives, these suffering souls have been kept waiting : for Swiss and German : money to materialize? Yet so we have been solemnly assured by : those spearheading : the press for Holocaust restitution. If what they say is false, : merely a public-relations : ploy, then the pursuit of "blood money," in Menachem Begin's : withering phrase, will : have ended by casting into disrepute Jewish integrity; if what : they say is true, it will : have ended by casting into disrepute Jewish self-respect as : well. : And finally there is the damage done to our understanding of : history, to which I have : already alluded. In testimony before Congress earlier this year, : Israel Singer : declared that "the importance of financial restitution must not : overshadow the priority : of moral restitution--the honest confrontation and accounting of : the past." : Unfortunately, he and his associates have rendered any such : "honest confrontation" : all the more difficult. History is not clay to be molded this : way or that in the service : of a cause, no matter how worthy, and treating it as such only : eases the way for : extremists of Left and Right to reshape the past toward their : own, entirely different : ends, including the end of proclaiming that the Holocaust, like : everything else : touching upon the Jews, was just about money after all. : Some of these extremists have accused the organized Jewish world : of engaging in : gangster tactics. One can only hope that the venom of such : attacks will not deter : other, more responsible voices from issuing criticism when and : in whatever measure : it is due. Thus far, alas, only a few such voices have been : heard. "The pursuit of : billions in Holocaust guilt money," warns Charles Krauthammer : with characteristic : directness, "has gone from the unseemly to the disgraceful." To : Abraham Foxman, : the reduction of the Holocaust to a matter of dollars and cents : amounts to a : "desecration" and "too high a price to pay for a justice we will : never achieve." : They are right. It is past time to reconsider. : * In what follows I use the words "restitution" and : "reparations" interchangeably, : though the former, strictly speaking, refers to the return of : property to its rightful : owner and the latter to compensatory payments for wartime or : occupation losses : agreed to, usually in a treaty, by a vanquished belligerent : state. : ** The Holocaust Industry: Reflections on the Exploitation of : Jewish Suffering, : by Norman Finkelstein. Verso, 150 pp., $23.00. : *** Between the Alps and a Hard Place. Regnery, 288 pp., $27.95. : GABRIEL SCHOENFELD is senior editor of COMMENTARY. <A HREF="http://www.ctrl.org/">www.ctrl.org</A> DECLARATION & DISCLAIMER ========== CTRL is a discussion & informational exchange list. Proselytizing propagandic screeds are unwelcomed. Substance—not soap-boxing—please! 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