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Lessons of Holocaust Compensation From: Naseer Aruri ed., Palestinian Refugees and their Right of Return (London: Pluto Press, 2001). By Norman G. Finkelstein Soon after the Nazi Holocaust, Jewish organizations and the government of Israel negotiated substantial compensation agreements with Germany. In the past decade, new compensation agreements have been negotiated with Germany as well as with other European governments. These agreements constitute an important precedent for Palestinian material claims against Israel. In the early 1950s Germany entered into negotiations with Jewish institutions and signed a series of indemnification agreements.[1] With little if any external pressure, it has paid out to date some $60-80 billion. The German government sought to compensate Jewish victims of Nazi persecution with three different agreements signed in 1952. Individual claimants received payments according to the terms of the Law on Indemnification (Bundesentschädigungsgesetz). A separate agreement with Israel subsidized the absorption and rehabilitation of several hundred thousand Jewish refugees. The German government also negotiated at the same time a financial settlement with the Conference on Jewish Material Claims against Germany, an umbrella of all major Jewish organizations including the American Jewish Committee, American Jewish Congress, Bnai Brith, and the Joint Distribution Committee. The sums paid out by the postwar German government significantly affected Jewish life. During the first ten years of the agreement (1953-63), the Israeli historian Tom Segev reports: the reparations money funded about a third of the total investment in Israel's electrical system, which tripled in capacity, and nearly half the total investment in the railways, buying German diesel engines, cars, tracks, and signaling equipment. Equipment for developing the water supply, for oil drilling, and for operating the copper mines ... was bought in Germany, as well as heavy equipment for agriculture and construction - tractors, combines, and trucks.[2] Germany earmarked the Claims Conference monies (approximately one $1 billion in current values) for victims of Nazi persecution who were not adequately compensated by the German courts. As it happened, the Claims Conference used the monies mostly for other purposes, for example, subsidizing Jewish communities in the Arab world and Jewish cultural institutions such as the Yad Vashem Holocaust museum in Israel.Beginning in the early 1990s mainly American Jewish organizations cooperating with Israel opened a new round of 'Holocaust compensation' negotiations with various European countries. The first target was Switzerland.[3] The Swiss stood accused of directly and indirectly profiting from the Nazi persecution of Jews. Acting at Israel's behest, the World Jewish Restitution Organization mobilized officials at the federal, state and local levels in the United States to press Switzerland for Holocaust compensation. A senior official in the Clinton administration, Stuart Eizenstat, conscripted twelve federal agencies for this initiative. A major international conference was convened in London. The House and Senate banking committees held multiple hearings. Class action lawsuits against Switzerland were filed in American courts. State and local legislatures across the United States implemented economic boycotts. In the end, Switzerland agreed to pay some $1.5 billion in compensation. For our purposes, the merits of the case against Switzerland (dubious at best) are less important than the legal and moral precedents it set. The chairman of the House Banking Committee, James Leach, maintained that states must be held accountable for injustices even if committed a half-century ago: 'History does not have a statute of limitations.' Eizenstat deemed Swiss compensation to Jewry 'an important litmus test of this generation's willingness to face the past and rectify the wrongs of the past.' Although they couldn't be 'held responsible for what took place years ago,' Senator Alfonse D'Amato of the Senate Banking Committee acknowledged that the Swiss still had a 'duty of accountability and of attempting to do what is right at this point in time.' Publicly endorsing the Jewish demand for compensation, President Clinton likewise reflected that 'we must confront and, as best we can, right the terrible injustice of the past.' 'It should be made clear,' bipartisan Congressional leaders wrote in a letter to the Secretary of State, that the 'response on this restitution matter will be seen as a test of respect for basic human rights and the rule of law.' And in address to the Swiss Parliament, Secretary of State Albright explained that economic benefits Switzerland accrued from the plundering of Jews 'were passed along to subsequent generations and that is why the world now looks to the people of Switzerland, not to assume responsibility for actions taken by their forbears, but to be generous in doing what can be done at this point to right past wrongs.' Noble sentiments all, but nowhere to be heard - unless they are being actively ridiculed - when it comes to Palestinian compensation for the dispossession of their homeland. In negotiations with Eastern Europe, Jewish organizations and Israel have demanded the full restitution of or monetary compensation for the pre-war communal and private assets of the Jewish community.[4] Consider Poland. The pre-war Jewish population of Poland stood at 3.5 million; the current population is several thousand. Yet, the World Jewish Restitution Organization demands title over the 6,000 pre-war communal Jewish properties, including those currently being used as hospitals and schools. It is also laying claim to hundreds of thousands of parcels of Polish land valued in the many tens of billions of dollars. Once again the entire US political and legal establishment has been mobilized to achieve these ends. Indeed, New York City Council members unanimously supported a resolution calling on Poland 'to pass comprehensive legislation providing for the complete restitution of Holocaust assets', while 57 members of Congress (led by Congressman Anthony Weiner of New York) dispatched a letter to the Polish parliament demanding 'comprehensive legislation that would return 100% of all property and assets seized during the Holocaust'. Testifying before the Senate Banking Committee, Stuart Eizenstat deplored the lax pace of evictions in Eastern Europe: 'A variety of problems have arisen in the return of properties. For example, in some countries, when persons or communities have attempted to reclaim properties, they have been asked, sometimes required ... to allow current tenants to remain for a lengthy period of time at rent-controlled rates.' The delinquency of Belarus particularly exercised Eizenstat. Belarus is 'very, very far' behind in handing over pre-war Jewish properties, he told the House International Relations Committee. The average monthly income of a Belarussian is $100. To force submission from recalcitrant governments, those seeking Jewish restitution wield the bludgeon of US sanctions. Eizenstat urged Congress to 'elevate' Holocaust compensation, put it 'high on the list' of requirements for those East European countries that are seeking entry into the OECD, the World Trade Organization, the European Union, NATO and the Council of Europe: 'They will listen if you speak ... They will get the hint.' Israel Singer, of the World Jewish Restitution Organization, called on Congress to 'continue looking at the shopping list' in order to 'check' that every country pays up. 'It is extremely important that the countries involved in the issue understand,' Congressman Benjamin Gilman of the House International Relations Committee said, 'that their response ... is one of several standards by which the United States assesses its bilateral relationship.' Avraham Hirschson, chairman of Israel's Knesset Committee on restitution and Israel's representative on the World Jewish Restitution Organization, paid tribute to Congressional cooperation. Recalling his 'fights' with the Romanian prime minister, Hirschson testified: 'But I ask one remark, in the middle of the fighting, and it changed that atmosphere. I told him, you know, in two days I am going to be in a hearing here in Congress. What do you want me to tell them in the hearing? The whole atmosphere was changed.' 'Were it not for the United States of America,' Eizenstat aptly observed in his paean to Congress, 'very few, if any, of these activities would be ongoing today.' To justify the pressures exerted on Eastern Europe, he explained that a hallmark of 'Western' morality is to 'return or pay compensation for communal and private property wrongfully appropriated.' For the 'new democracies' in Eastern Europe, meeting this standard 'would be commensurate with their passage from totalitarianism to democratic states.' Yet, judging by the claims of Palestinians, it would seem that a main US ally has yet to make the transition. Apart from the moral link joining Jewish claims against Europe, on the one hand, and Palestinian claims against Israel, on the other, a direct material link potentially joins the respective demands. When Israel first entered into negotiations with Germany for reparations after the war, the Israeli historian Ilan Pappe reports, Foreign Minister Moshe Sharett proposed transferring a part to Palestinian refugees, 'in order to rectify what has been called the small injustice (the Palestinian tragedy), caused by the more terrible one (the Holocaust)'.[5] Nothing ever came of the proposal. A respected Israeli academic, Clinton Bailey, recently suggested using part of the funds from the Holocaust settlements with Switzerland and Germany for the 'compensation of Palestinian Arab refugees'.[6] Given that almost all survivors of the Nazi holocaust have already passed away, this would seem to be a sensible proposal. One cautionary note should be entered. Elsewhere I have documented that Jewish organizations misappropriated much of the monies earmarked for the Jewish victims of Nazi persecution.[7] It would be regrettable should monies earmarked for the Palestinian victims of Israel's establishment also end up in undeserving hands. Indeed, if only to avert yet another injustice befalling the refugees, it is vital that Palestinians set up accountable democratic institutions. NOTES
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Video: On the place of civility in academic life (10.18.2007) Finkelstein's talk at the academic freedom conference Tenure Denial Letters (June - November, 2007) On How Actual Survivors Were Cheated by Jewish Organizations:
Communication for Middle East Journal. (02.19.2006) Alleged Errors in Beyond Chutzpah. (2005) MEMRI NAZIS (again) (10.23.2006)  New evidence of old lies (2005) Under the heading DIABOLICAL PLOTS, I stated in Beyond Chutzpah...    Articles and Reviews Related to The Holocaust Industry  Preface to German edition of The Rise and Fall of Palestine Postscript to German edition of The Rise and Fall of Palestine The Dershowitz File:
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