The politics of Swiss-baiting

Alfonse D'Amato and the Clinton administration have exposed Switzerland's role in laundering stolen Nazi loot and its intransigence in returning money after World War II. Trouble is, we've known this stuff for 50 years. Why is it suddenly news?

BY JONATHAN BRODER

Just when it seemed the Cold War's end had deprived us of world-class villains, along comes the Clinton administration to inform us that evil is alive and well in the land of Heidi, hot chocolate and the Rolex.

An official 200-page report released last week details how Switzerland knowingly laundered much of the gold reserves that the Nazis looted from the countries they overran and converted them into the hard currency that Germany required to fuel its war machine. Most damning, the report charges that the reserves included "victims' gold" -- the wedding rings, jewelry and dental fillings that the Nazis tore from concentration camp victims and then melted down into gold ingots and bars bearing the swastika emblem of the Nazi Reichsbank.

The report concludes that the Swiss government not only laundered this loot for the Nazis, but also reneged on a 1946 agreement to return hundreds of millions of dollars in other stolen assets that the Nazis deposited in Swiss banks. Finally, the report criticizes the United States -- particularly President Harry Truman -- for its failure to enforce the postwar agreement and to take seriously the plight of the ripped-off Holocaust survivors.

Strong stuff, guaranteed to boil the blood of all righteous people. Except for one problem: None of it is new. Officials and scholars have known the details of Switzerland's wartime role as Hitler's banker for more than 50 years. Truman's priorities at the time are also well-documented: Faced with the need to rebuild postwar Europe and to confront the communist threat, he caved in to Swiss intransigence, opting for the possible -- the Swiss agreed to give a small amount back -- over the preferred. Even the report's most sensational finding -- that the Swiss also laundered the fillings ripped out of Jews' mouths -- has been conventional wisdom among historians for decades.

Why, then, all the hoopla over what is, in effect, the Clinton administration's rediscovery of established truth?

There are many reasons, not the least of which reflects the world's undiminished fascination with anything concerning the Nazis and those who dealt with them. World War II documentaries have become a television staple, a black-and-white image of pure evil that both repulses and mesmerizes the voyeur in all of us. Neutral Switzerland's association with that evil only titillates us further.

But there is another, more political, reason high-level Americans are skewering Switzerland for its actions 50 years ago, one that addresses the needs of both the Clinton administration and Republican Sen. Alfonse D'Amato of New York, chairman of the powerful Senate Banking Committee. Such strange bedfellows were brought together in 1995 by Edgar Bronfman, president of the World Jewish Congress and chairman of the $22 billion Seagram company. Bronfman, a major political donor, had appealed for their help after he had unsuccessfully tried to convince the Swiss to turn over the dormant bank accounts of Holocaust victims to their surviving heirs.

For D'Amato, Bronfman's approach represented nothing less than a political lifeline. Way down in the polls and gravely damaged by his attempts to politicize the Whitewater affair, D'Amato's re-election prospects (for 1998) looked grim. Armed with an issue that had visceral appeal to New York's large Jewish population, D'Amato seized upon it as an opportunity to bounce back.

Using a trove of declassified intelligence documents, D'Amato chaired a series of Banking Committee hearings that dredged up Switzerland's unsavory wartime role. The committee heard Holocaust survivors describe how their families deposited all their possessions in Switzerland for safekeeping before the war and how Swiss bankers rudely rebuffed their efforts to recover those assets after the war. D'Amato's hearings also illustrated how the Swiss had stolen the assets in accounts belonging to Holocaust victims and used some of the money to pay Poland's postwar claims.

After a series of blunders that included the Swiss president accusing American Jews of "extortion and blackmail" and the Swiss ambassador to the United States speaking of the need to "wage war" against the Jews on the public relations front, the Swiss surrendered. They agreed to the formation of two independent commissions to probe Switzerland's wartime role and the disposition of dormant accounts. Meanwhile, Swiss banks and businesses have established a $200 million humanitarian fund to assist Holocaust survivors. The Swiss government also has proposed the establishment of an additional $5 billion fund for the same purpose.

D'Amato nowadays never misses a chance to remind his constituents of how miserable he made life for the Swiss. He particularly loves pulling out a political cartoon that appeared recently in a Swiss newspaper, depicting an angry Swiss mother, a child and an unfinished plate of food. The mother's threat: "If you don't eat your dinner, I'll have to call Sen. D'Amato." Barring some unforeseen development, political pollsters say, his re-election is assured.

Now comes the administration's report, which Clinton, not unmindful of the Jewish vote, ordered last year. It too draws on declassified wartime intelligence documents, and except for its finding about the inclusion of victims' gold in the Nazi reserves laundered by the Swiss, it doesn't go much beyond what D'Amato managed to dredge up in his hearings. It doesn't take the really bold step of including policy recommendations, which still leaves open the question of whether Switzerland should be forced to return the hundreds of millions of dollars it agreed to in 1946. Still, with the administration's imprimatur, it could be used to wring additional compensation for Holocaust victims from the Swiss government and banks. And like D'Amato, Clinton will look good in the process. So will Al Gore in 2000.

For the World Jewish Congress and other Jewish organizations, the battle against the Swiss represents a moral crusade to seek justice for the remaining survivors of the Holocaust. But there is a political subtext here, too. Ever since Israel's victory in the 1967 Middle East War, American Jewish groups have grown accustomed to playing a major role in U.S. foreign policy. Now that a Middle East peace process is in place (albeit a shaky one), their role has been diminished. Their alienation from the current right-wing government in Israel lessens their influence in Middle East affairs even further. A better chance to remain in the corridors of power these days lies not in defending Israel but in attacking Switzerland.

The Swiss still must hold a referendum to approve the establishment of the government's proposed $5 billion fund, and if their odious handling of the controversy so far is any guide, it is not at all certain that they will do the right thing. Still, before we tar the land of cuckoo clocks as the world's new Black Knight, we might do well to look more closely at the motivations of those who are doing the tarring. And we'd better get used to the fact, in this post-Cold War world, that righteous moral clarity may be something of an illusion.
May 12, 1997

Jonathan Broder, Salon's regular Washington correspondent, co-authored a forthcoming documentary on Switzerland's wartime role, to be aired June 28 on A&E.