Dei'ah veDibur - Information & Insight

A Window into the Chareidi World

1 Adar 5762 - February 13, 2002 | Mordecai Plaut, director Published Weekly








The Reparations Controversy

by S. Fried

"My dear Nachum," wrote Prime Minister David Ben Gurion to Histadrut Chairman Dr. Nachum Goldman in the 1950s. "This sets a precedent as it is the first time in the history of relations between nations that a large nation has agreed, due to moral pressure alone, to pay compensation to the victims of the previous government.

"This is the first time in the history of the Jewish people, which for hundreds of years has been the victim of persecution, oppression, pillage and plunder in the nations of Europe, that the persecutor and the plunderer has been forced to return a portion of the spoils and has even agreed to pay collective reparations for part of the material damage done. This, beyond any doubt, is a result of the resurrection of the State of Israel. The rights of Jews are no longer hefker. Now an advocate and a patron has risen up to defend them . . . "

Fifty years ago, less than seven years after the Holocaust, the Prime Minister of Israel, in the name of the state he established in Eretz Yisroel, granted himself the right to speak as nearly the sole representative of the Jewish people, as its advocate and patron. Time has shattered the illusion that the State of Israel is the defender of the Jewish people in the Diaspora, but the State continues to pose as the "advocate of the Jewish people" in monetary matters and the heir to the millions of Jews who perished during the Holocaust.

Ben Gurion's remarks contain another distortion as well. Today it has become known--and in all likelihood it was also known in the 1950s--that the German government's decision to pay reparations was not the result of "moral pressure alone," but primarily of political and economic pressure. The "new" Germany, which had just released itself from the domination of the leading allied nations, wanted to gain international recognition for divorcing itself from its Nazi past. It also requested economic aid for rehabilitation, primarily from the United States, and this aid was given through the arrangement of reparations for the Jewish people. Germany wanted to turn over a new leaf, despite the fact that a short time before many of its citizens had been Nazi killers.

The Beginnings

This is how it all began. On the 22 of Teves 5712 (January 20, 1952), just over fifty years ago, in a vote of 61 to 50, the Knesset decided to begin negotiations over a reparations agreement with Germany.

Less than seven years after the attempted annihilation, "with the air still carrying the stench of corpses burned in the gas chambers," as Dov Shilansky describes it today, the State of Israel decided to sit down at the negotiating table with representatives of the murderers. Yet not everyone was in accord with the decision.

Dov Shilansky, later Knesset chairman from the Likud, was a 26-year-old Holocaust survivor at the time. Menachem Begin was an MK and chairman of the Cheirut Movement. Both of them are remembered for leading the mass protest against the agreement. It was a very emotional and divisive issue.

Begin organized mass assemblies in city squares, while his listeners and supporters were still wearing yellow patches. He roused violent opposition. In a speech at Jerusalem's Zion Square on Asoro BeTeves 5712 he said: "When you shot at us [on the Altalena], I gave the order, `No!' Today I am giving the order, `Yes!' This will be a war for life or death. They say that we are pretending fury, but thousands of people standing here in the driving rain are living testimony that the fury of the people broke out spontaneously.

"Today a Hebrew Prime Minister is standing up to announce that he will go to Germany to receive money, that he will go sell the honor of Am Yisroel for ill-gotten gains and to cast eternal disgrace upon them. Every German is a killer. Every German is a Nazi . . . "

But his speeches had no effect on Ben Gurion, who saw this money as a lifesaver for the hunger of the Austerity Period, for the hundreds of thousands of new immigrants whose tents flapped in the storm winds of the difficult winter of 5712 and --certainly not least - - a decent basis for the establishment of Mapai in Israel.

At times the great pain they felt was expressed through desperate measures. To make a resounding show of objection Dov Shilansky detonated a small bomb at the Foreign Ministry. He spent six months in jail for his crime, but this time in jail merely bolstered his opposition to the agreement that was to exchange hatred for money.

"When they went to their deaths with blood spilling from their hearts, the Jews wrote, `Yidden, nekomoh!' not `Yidden, nemt gelt [take money]!'" says Dov Shilansky.

Shilansky Recalls

When asked whether in hindsight he thinks the reparations agreement should have been rejected, Shilansky says, "Future generations will be ashamed that the State of Israel signed the agreement."

The years have had their effect however, and today Shilansky distinguishes between the reparations agreement through which the State of Israel received compensation (much of it in the form of German goods whose production also helped rehabilitate German industry) and the compensation payments given to individuals for their suffering or the loss of their property.

"Both as a Jew and as a Holocaust survivor I objected to the fact that the State of Israel, in the name of the Jewish people and in the name of the Holocaust victims and survivors, stretched out its hand and made a pact with Germany seven years after the end of the Holocaust. It declared pardon and forgiveness on a bridge of Deutsche marks and gave Germany a sign of acceptance before the nations of the world. We took money in exchange for blood. As a Holocaust survivor I did not authorize anyone to forgive the German people."

At the same time, claims Shilansky, the negotiators neglected the issue of the return of Jewish property, both private and communal. Only now, fifty years later, when this property has already been passed from one hand to another, are they beginning to demand the return of property and even this is not being done very energetically.

There was also severe neglect in the area of individual compensation for Jewish slave-laborers in the work, concentration and death camps. Shilansky says that in 1948, shortly before the founding of the State of Israel, the United States' General Clay, appointed by the Allies to rule over Germany after the war, issued instructions to compensate Holocaust refugees for their work in the ghettos and the camps. Then the State was founded, negotiations with the Germans began and the money was never paid.

"The reparations," adds Shilansky, "led us to moral decline. Easy money always corrupts. Various public figures sat around the pot and dipped their fingers in. Mapai institutions used it to build themselves. Our moral corruption began with this money, and has continued ever since."

It is hard to say that the New Yishuv was free of corruption before the reparations. It suffices to mention Mapai favoritism and the Histadrut's red-book terror. [In the 1930s and 40s members of the Histadrut party had little red membership booklets, and party members who flashed a Histadrut booklet were given preferential treatment by many prospective employers.] Back then there were also plenty of public figures who lived well at the public's expense, eating two eggs a day when the public was rationed only one egg per week, but at least the official norm was modest.

The individual reparations were particularly harmful to the social fabric of the kibbutzim. Kibbutz members who received compensation payments were required to deposit them in the collective kibbutz treasury. Some did so against their will, some got involved in disputes and left the kibbutz and some were allowed to receive them. In all of these cases, however, the principle of equality that characterized kibbutzim at the time was infringed upon, and this may have been the beginning of the end of the kibbutz concept.

Another Perspective

Michael (accent over the "e") Kleiner is currently one of the main activists working on the issue of compensation payments, property return, and similar issues for Holocaust survivors. We also asked him whether in hindsight he would have signed the reparation payments.

"There are many sides to this issue," says Kleiner in his measured speech. "Of course there was apprehension from national, educational and moral perspectives. It was understandable, for we were a young nation. Perhaps from a detached perspective, the agreement was justifiable. But I still do not have a clear answer and I still think that if it had been up to me, I would not have been able to decide.

"On a practical level it could be that this planted the seeds of the two calamities we live with today. 1) That the State of Israel, where only a small percentage of the Jewish people lived at the time, allowed all kinds of organizations to handle the compensation funds [a reference to the Claims Committee], so that today the State has little say in the matter. 2) The right various Jews gave themselves-- ostensibly for the common good--to seize stolen-property rights that really belonged to individual Holocaust survivors. This injustice lasts to this day. More than 55 years after the War ended, Jewish organizations are still allowed to maintain staffs at the expense of those rights holders. They establish themselves as heirs even when there are real heirs."

The Chareidi Perspective

What was the chareidi community's position on the issue of German reparations? In his book Mikatovitz Ad Hei Be'Iyar, Rav Tzvi Weinman summarizes the matter based on various documents. He writes that in Tishrei 5712 (1951), the International Executive Committee of Agudas Yisroel met to discuss this question and decided "to make every effort to secure the chareidi community's share" -- but the Moetzes Gedolei Hatorah in the U.S. decided otherwise. At a gathering in New York HaRav Kamenetsky announced, "The majority decision sides with the opinion of HaRav Aharon Kotler, who opposed all negotiations with Germany even if large sums of reparations can be obtained."

In response to questions posed by one representative who stated that there are various laws in Germany on the issue, HaRav Kamenetsky replied: "One can file suit against a killer and a thief and receive damages from him, but one cannot conduct negotiations with killers and receive something that rewards horrific acts. HaRav Kotler is concerned that the Government of Israel wants to put an end to Germany's culpability and to establish friendly relations between the two peoples. Chareidi Jewry should not participate in this endeavor."

After demonstrating the farsightedness of gedolei Yisroel, Rav Weinman adds that the Moetzes Gedolei Hatorah in Israel did not issue a decision, and therefore Agudas Yisroel decided to abstain from the vote in the Knesset. Following pressure by Ben Gurion, one MK eventually voted in favor.

To complete the picture, Rav Weinman quotes an excerpt from Orechos Rabbenu Baal Kehillos Yaakov by Rav Avraham Horovitz (p. 272), according to which the Steipler permitted individuals to accept money from the Memorial Foundation for Jewish Culture (set up using reparations money) to fund the publication of a sefer kodesh. The Steipler cited the Brisker Rov who said they should take the German reparations money since it was derived from property stolen from the Jews, "and it would not be considered a zechus for the reshoim that a sefer kodesh is published using their money because what they give back is just a tiny portion of what they stole."

To this day chareidi Jewry has not received its due share of the reparations money. Though a significant percentage of the Jews who perished during the Holocaust were shomrei mitzvos and most of the Jewish communal property in Eastern Europe was religious property--botei knesses, botei medrash, cemeteries, mikva'os, hekdesh, and the like--chareidi Jewry has only received the crumbs left by various activists. During the period of the Jewish Agency's active involvement in the distribution of these funds, Agudas Yisroel representatives complained about the manner in which the money was handled.

At an Executive Committee meeting, the following resolution was issued: "Agudas Yisroel's position on the issue of reparations is well known, but it is also a well-known fact that chareidi Jewry, organized and represented by Agudas Yisroel in thousands of institutions, suffered the greatest losses and now that reparations for compensation and rehabilitation of the destruction are being distributed, the Jewish Agency has neglected to support Agudas Yisroel institutions and members. . . If our demands are not met, we will take whatever steps necessary to save as much as possible for chareidi Jewry."

Apparently the steps taken were not particularly formidable, for the discrimination exists to this day.

Anticipating the Money

As horrific as it may sound, at the height of the War, while Jews were being led to the gas chambers, Zionist organizations considered the financial benefits to be gained. As early as 1941 Dr. Nachum Goldman, chairman of the World Jewish Congress, said European Jews would eventually be entitled to war reparations.

In 1944 the Congress drew up clear demands: a) Compensation for Jewish communities and individual Jewish survivors. b) Recognition in principle of the right of the Jewish people to receive collective reparations for the material and moral losses to the Jewish people, its institutions or individual Jews.

These general demands are recorded in the memoirs Dr. Goldman published much later, but it appears that in fact the guiding principles for negotiations with the Germans had already been drafted at that point. At the time Goldman did not know that the State of Israel would be founded and therefore probably hoped to represent the Jewish people, either alone or else through a joint representation with the Jewish Agency, the Histadrut, etc.

But when the State of Israel was set up, Ben Gurion crowned himself representative of the Jewish people, leaving Goldman nothing to do but to conduct the secret negotiations that preceded West German Chancellor Konrad Adenauer's public announcement of his willingness to pay reparations, and then to hand the conductor's baton over to Ben Gurion. Goldman was not left idle, for the agreement stated that the negotiations would be conducted through two channels: the Material Claims Conference of the Jewish People was set up to conduct negotiations for individual Holocaust survivors and an Israeli delegation was dispatched to negotiate the reparations that would be paid to the State treasury as the homeland of the Jewish people. Dr. Nachum Goldman was named head of the Claims Conference.

Dr. Goldman set up the Claims Conference himself just as the negotiations proposal was passed in the Knesset. He selected representatives arbitrarily, based on connections, although he did try to include representatives from various organizations including the Joint Distribution Committee, The Jewish Agency, World Jewish Congress, American Jewish Congress, American Jewish Committee, Jewish Workers' Committee (U.S.), American Veterans' Association, etc. Most of the representatives were from the U.S., England, Australia and South Africa. A representative for the Reform Movement was also selected. Israeli representatives were not chosen-- since ostensibly Israel was represented by the government- sponsored delegation--nor were any Holocaust survivors chosen. It seems the latter were perceived as sick and feeble invalids incapable of representing themselves.

The irony is that this attitude persisted until about ten years ago, when the Center for Holocaust Survivors' Organizations was set up. The Center applied massive pressure that managed to get four of their representatives onto the Claims Conference. The other representatives came from various other organizations, some of which are no longer in existence.

The Claims Conference

"The state of affairs at the time has to be taken into account," says Claims Conference President Dr. Azriel Miller to Uri Yaakov, spokesman for the Center for Holocaust Survivors' Organizations, in an interview published in the Center's monthly magazine Mizkar ["Memorandum"]. "Jewish negotiators stood opposite German counterparts, who claimed that under no circumstances would they be able to pay any more. They also made clear that stubbornness over various details would endanger the entire agreement. Anyone who says that under the same circumstances he could have secured a better agreement is fooling himself . . . "

Dr. Miller's remarks follow claims lodged for years against various paragraphs of the agreement that deprived whole groups of Holocaust survivors. This was the first time Jews conducted negotiations on such a large scale, with no precedent to serve as a learning experience. At the time the profile of the Holocaust survivors as a group was unclear. Many of them, for example, refused to accept reparations for years as a matter of principle, but now, in their old age, they have had to knock on the doors of the various organizations to obtain their rights.

Some of the grievances are less easily dismissed. Raul Teitelbaum, a reporter and Holocaust survivor who is closely involved in the matter and serves on various committees, says, "In terms of compensation payments for forced labor, the Jewish establishment is responsible for a failure that will go down in history. This is one of the major failures of the Claims Conference and, as a result, [the heirs of] hundreds of thousands of deceased Jews who performed forced labor will not be eligible for any compensation."

The rights of former concentration camp prisoners who performed forced labor were essentially signed away in the agreement of September 10th, 1952. According to this agreement, "The victims of persecution who performed forced labor and lived in prison conditions are to be handled as just a denial of their freedom." In other words, this paragraph stipulates that such prisoners would only be entitled to compensation for being deprived of their liberty: five Deutsche marks per day of imprisonment, while typical wages for a day's work at the time came to 150 Deutsche marks.

The outrageous agreement, adds Teitelbaum, was to be taken from the money given to the Claims Conference, and therefore over the years, they were given hush money to keep the issue from surfacing. Only in very recent years has it forced its way onto the negotiating table following class action suits filed in U.S. courts by seasoned lawyers who made a sizable profit out of these cases.

Even later Claims Conference members continued to use a better-one-in-the-hand-than-two-in-the-bush approach. The uniting of Germany in 1990 provided an opening for claims from the former East Germany, which had previously ignored the issue. In order to avoid a new agreement, it was decided to insert Germany's pledge to pay compensation for the former East Germany as a separate paragraph. This paragraph, known as Chapter Two, allowed a new source of very meager funds to leak through. Thus a low-income criterion was added, although the payment was supposed to be universal compensation rather than an assistance payment.

The return of Jewish property was also a major failure, particularly in the area of real estate. Over the course of the years, laws designed to hinder the return of real estate holdings were legislated in various countries. Former Communist countries in Eastern Europe place an array of insurmountable obstacles and stipulations. Germany has also bogged down the procedure. Personal property has not been returned in almost any case, and communal property has also been difficult to reacquire.

According to the various agreements, existing kehillos are authorized to sell the property, a serious problem that goes beyond the scope of this article. Even when Jewish organizations do sell, a major question remains: What should be done with the money?

In the former East Germany, the Claims Conference distributes approximately $100 million annually from the sale of Jewish property with no rightful heir. According to Conference regulations, 80 percent of these funds are designated for financial assistance and medical care for Holocaust survivors around the world, and 20 percent are dedicated to memorials and Holocaust studies. Who decides which institutions benefit from this 20 percent? Who sets the eligibility criteria for medical assistance?

Kleiner cites an example of the type of injustices that take place today. There is an organization called WeCheck that handles claims against insurance companies. This organization received some 70,000 claims to review. Of these, 27,000 claims were immediately tossed into the trash. Why? Because they were submitted by residents of the former Soviet Union. Organization heads claim that since the insurance companies did not operate in the Soviet Union after the Communist Revolution in 1917, there could not possibly be policy- holders from the Holocaust period.

"Maybe they took out insurance in other countries," Kleiner points out. "Maybe they took out policies in Poland and fled to Russia during the War. If a computerized system is already in operation, what difference does it make to check these policies as well? Maybe you're depriving some needy Jews?"

In addition to the grievances regarding the distribution of funds by the Claims Conference, over the years serious claims have been lodged against the Israeli government. The greatest injustice has been the discrimination against Holocaust survivors in Israel who receive compensation from the Finance Ministry, compared to those who receive income directly from Germany.

Says Shilansky, "Along comes the Israeli government [in the 50s] and says to Germany, `Give us a one-time payment for Holocaust survivors and we will hand it out,' and then takes the money. Later they gave Holocaust survivors one-fourth of what they would have received if this agreement had never taken place. I ask you: Did anyone authorize them? Why did you make a deal in my name?" (See box for details.)

Shilansky recalls how he stood on the Knesset rostrum and cried out, "All of us are thieves. We eat the bread of Holocaust survivors, people who are sick and tired and poor."

The government and the organizations of course play a larger role in handling the reparations. All of the agreements set aside a certain percentage of money for clauses such as "support of organizations" or "Holocaust studies," while others allow the government to inherit money earmarked for survivors who passed away over the course of the years.

This is what is now happening with the Swiss banks fund. Totaling $250 million (which is gathering interest in the meantime), the fund was supposed to pay for accounts left dormant in Swiss banks and also to Holocaust survivors based on various criteria. In every other country in the world these funds were distributed long ago, but in Israel the payments were delayed, presumably due to a dispute over distribution. "The state has a good thing going," says Shilansky. "In the meantime other survivors are passing away and the money remains in state coffers." According to recent reports, there were even proposals to return a portion of the unused funds to Switzerland to avoid accusations of greed.

Another scheme was the Jewish People Foundation, to which heirless funds were channeled, and again the Holocaust survivors raised the same objection: Who put you in charge? Who named you heir? Why not divide these sums among those who are still alive?

Organizational Money

The biggest question mark hovers over the issue of the distribution of funds earmarked for organizations and institutions. When the reparations began the following division was formulated: 57 percent to the Jewish Agency, 28 percent to the Joint Distribution Committee (JDC), 11 percent to organizations that care for former German nationals and just 4 percent of the total allocations were dedicated to religious projects like construction of botei knesses, halachic research, sifrei kodesh, and the like. No monies were channeled to chareidi organizations that take in Holocaust survivors.

Rav Sokolovsky is the director of Ginzach Kiddush Hashem, an institution in Bnei Brak which should meet any reasonable eligibility criteria to receive major support from all of the various foundations. Certainly it deserves at least a modest building, if not on the scale of the Yad Vashem complex, at least a decent building. Yet the Ginzach is still housed in several rooms of a building that writer Rav Moshe Prager donated to the Gerrer Institutions, and he pays the rent. "Once I received a modest sum from the Claims Conference, and nothing for current expenses," says Rav Sokolovsky.

So far the Ginzach, one of the only chareidi Holocaust education centers in existence, has had to subsist on a small budget provided by the Ministry of Science and large deficit spending. Rav Sokolovsky is unaware of any chareidi organization that has received support from the Claims Conference, with the exception of Ezer Letzion, which is not specifically for the chareidi community.

"Corruption," says Rabbi Avrohom Ravitz, who is actively involved in Israel in returning property, the Generali Fund and other related issues. "The allocations are carried out in a very undemocratic fashion. Why are lists of recipients not publicized? Why is the money held in inner pockets? Everything should be disclosed. These are not someone's private funds. And in any case, if there is no ordered system of allocation, this is corruption, and if monies are allocated without notifying the public, this is also corruption."


Is the constant involvement in monetary demands creating an image of the money-grabbing Jew and increasing antisemitism? The answer is a resounding "yes," but many of those involved in the issue, such as Dr. Avi Becker, general secretary of the World Jewish Congress, remain untroubled by this question. They claim this just provides an opportunity for antisemites to vent what they normally keep to themselves, but does not add to the antisemitism.

Dov Shilansky also has few reservations. All we are asking for is what was stolen from us, he says; the effort is worthwhile not only because we need the money, but also to prevent non-Jews from benefiting from stolen property.

Antisemitism, he says, is present in every generation, with or without reasons. "What I learned from the Holocaust is that when a goy says he wants to annihilate you, believe him."

The Reparations Agreements

In the agreement reached between Israel and Germany in the early 1950s, the Germans undertook to transfer $833 million over a 12-year period and in the form of goods only.

With this, the State of Israel took huge steps in the development of its infrastructure -- railway tracks and coaches, a merchant fleet, equipment for industry and the electricity economy, and more.

Germany, for its part, made significant progress on its way to rehabilitation and acceptance as a legitimate nation.

Together with the collective agreement with the state, a personal compensation agreement for the individual Holocaust survivors around the world was signed at the same time. In it, the Germans insisted that Israel be responsible for paying compensation to Holocaust survivors who came to the country "up until January 1953."

Raul Teitelbaum, a journalist and a member of the umbrella organization of Holocaust survivors in Israel, notes that Israel consented to such a condition both because it feared losing the agreement in its entirety and due to the fact that officials at the Treasury estimated that it pertained to only a small group of people, around 3,000 in all.

In practice, however, just in the calendar year 2000 alone, the state paid monthly allowances based on this clause to some 50,000 individuals, at a total cost of $400 million! Over the past two years alone, the State of Israel has paid out compensation to Holocaust survivors in an amount almost equal to the full sum it received in the reparation agreement (in nominal terms).

The most astounding detail, according to Teitelbaum, is the fact that German legislation related to the agreements, makes no mention at all of the Jews as a group which is entitled to such reparation; it only speaks of individuals "who were persecuted by the Nazi regime on the grounds of race, religion or political viewpoint," he says.

The Germans haggled over every detail, usually ending in total capitulation on the Israeli side. For example, Israel initially demanded $1.5 billion, based on a calculation of 500,000 Holocaust survivors at a rate of $3,000 per immigrant.

Both estimations were low, yet the Germans still rejected them. They immediately cut the numbers by a third, arguing that they were the responsibility of East Germany, which constituted one-third of the German people. Thereafter they requested more reductions, bringing the compensation down to its eventual $833 million.

Even more humiliating was the agreement by Israel that monthly allowances (pensions) from Germany (as opposed to the lump sum) would be afforded only to "people of German culture."

Teitelbaum: "This clause distorted the entire significance of the reparation and gave rise to an absurd situation in which the ones who had suffered the most received the least. The dead got nothing; survivors from Eastern Europe, who had suffered the harshest conditions for the longest period of time, only received a small one-off payment; while the German Jews, many of whom had fled Germany before the Holocaust and were spared the threat of extermination, were the only ones who were afforded monthly allowances."

The one-off payment given to the remaining survivors was also determined in humiliating fashion, based on a "compensation rate" of DM 5 (slightly more than a dollar in 1951 terms) for each day spent in a concentration camp or ghetto.

Noah Flug, secretary-general of the umbrella organization of Holocaust survivors in Israel, says one of the Jewish participants in the negotiations told him how the rate was determined. "He told me that his initial demand was for compensation of DM 150 a day, equal to the wage of a German laborer at the time. He says that Adenauer went pale and started to tremble, explaining that the German economy could not afford such a sum and that he could only agree to symbolic compensation. Then he mentioned the amount of DM 5 a day. Nachum Goldman didn't consult with anyone and hurriedly agreed, and so the sum was born," Flug relates.

Officially, the grounds for the reparations were also given as "denial of freedom" to the Jews. The agreements also explicitly released Germany of any responsibility for compensation for forced labor during the Holocaust.

Taking everything into account, Teitelbaum argues that both those who opposed the agreement and those who supported it were right.

"The opponents were right in saying that the agreement afforded Germany rehabilitation at a low price, albeit much higher than the Germans themselves estimated. They thought that all the agreements would cost them around DM 7 billion."

In the end, so far they have paid -- prior to the establishment of the latest fund for compensating the forced laborers of DM 10 billion -- more than DM 100 billion.

"On the other hand, Ben Gurion was right in saying that the agreements allowed Israel to develop vital infrastructure during the initial years of the state."


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