(Brief exerpts only) from a paper by Sidney Zabludoff***, published March 2007 in the Jerusalem Center for Public Affairs "Jewish Political Studies Review" 19:1-2 (Spring 2007). [Follow this link to see the full paper) ...
Less than 20 percent of the value of Jewish assets stolen by the Nazis and their collaborators has been restored. At least $115-$175 billion (2005 prices) remains unreturned despite numerous clear and explicit international agreements and country promises made during World War II and immediately thereafter. Even the highly publicized resurgence of restitution efforts since the mid-1990s resulted in the return of only 3 percent of Holocaust property. A key reason for these meager results during both periods was the failure to make a unique, comprehensive, and timely effort to deal adequately with an event unequaled in the annals of modern history-the extermination of more than two-thirds of continental European Jewry and the confiscation of nearly all of its assets.
There was a marked divergence between the promises and the reality of returning Jewish assets stolen by the Nazi regime and its collaborators during the Holocaust era. Two key time periods in this regard are the postwar era and the mid-1990s to the present, when there was a resurgence of interest in asset restitution. Certain lessons have emerged from the cumulative experience.
Excluded from the present discussion are other legitimate claims of Holocaust victims such as Nazi-inflicted damage to life, health, and income. These relate to pensions and onetime payments, such as for slave labor.
Estimated Value of Pre-Holocaust Looted Jewish Assets
...it is possible to provide a reasonable estimate that can be used as a framework for understanding the issue in terms of what was lost and what has been restored.
In late-1930s prices, the value of Jewish assets amounted to $10-$15 billion.....In today's prices (2005) the value of these Jewish assets would be some $143-$215 billion.....
How Restitution Fared until the Mid-1990s
The Promises and Pledges
Efforts to restore property taken by the Nazis and their collaborators began well before the end of hostilities......Throughout the war, the Allies constantly stated that a major aim was to ensure the return of property stolen, confiscated, or taken under duress.....
.....Soon after regaining their independence, all occupied countries put in place restitution regulations. ....
The Reality
At most, 15 percent of Jewish assets confiscated from 1934 to 1945 were returned after the war to their owners, their heirs, and Jewish organizations representing heirless claimants. Within Western Europe, the percentage restored for each country roughly ranged from 10 to 60 percent. In Eastern Europe, restitution was negligible. This meant the value of unrestored assets by the mid-1990s amounted to $120-$180 billion at 2005 prices....
....In November 1992, the World Jewish Restitution Organization was formed to handle the return of Jewish property in postcommunist Eastern Europe. It grew out of an alliance between major Jewish international bodies (representing the Diaspora) and the state of Israel, and was aimed at recovering communal property and private assets.
....Restitution faced many complications because assets were hard to find and difficult to value while confiscation had taken many paths. A major problem was that most property owners had died in the Holocaust along with their close heirs. Many of the remaining heirs lacked knowledge of the assets or possessed none of the paperwork needed to prove ownership. Among the many other impediments were:
● Many Jews were forced to sell their businesses, homes, and possessions at far less than prevailing market values because of Aryanization and loss of income.
● Property was extracted indirectly via heavy taxes solely on Jews.
● Movables were very difficult to trace. Furniture and other household items were disbursed widely. The bulk was sold or auctioned throughout Europe or ended up in the homes of numerous Nazi officials. A considerable share was simply stolen by Nazi collaborators or greedy neighbors in the occupied territories.
● Stocks, bonds, and other financial instruments often were traded many times and thus were dispersed throughout global markets. To make matters more difficult, much of this financial paper was in the form of bearer instruments, which do not indicate the name of the owner.
● The Soviets confiscated from the Reichsbank in Berlin large amounts of bonds and securities that the Nazis had not sold via Switzerland and other neutral countries during the war. These assets were an important part of the prewar financial portfolio of European Jews.
● Placing a value on the lost property was extremely intricate. The prices of bonds and stocks followed an erratic course as a result of the 1930s depression and the war. Much of the real estate was heavily damaged. Many once-prosperous companies were now defunct or a slim shell of their prewar proportions. Moreover, determining a fair amount to compensate for lost earnings on assets, especially financial holdings, was a highly contentious task.
● In some countries, the looted property was sold or auctioned off cheaply by the Nazis and their collaborators and the receipts placed in a fund. Those running the fund often charged excessive fees for the task. After the war, the amounts remaining in these funds thus were relatively small, leaving little for cash-strapped governments to return.
....During the mid-1990s, the concern for completing the restitution task resurfaced with considerable intensity. It was triggered by questions related to the duplicity of Swiss banks in failing to return Holocaust survivors' or their heirs' bank deposits made before World War II. It then erupted from a confluence of events. The coming of age of the "third" generation after the Holocaust led to a renewed discussion about how countries and their citizens had reacted to the plight of Jews....
....The enhanced interest was aggressively impelled by politicians, lawyers, and Jewish groups, mainly in the United States. U.S. congressional hearings were held. State banking and insurance regulators (mainly in New York and California) threatened to halt bank mergers involving European banks and not allow insurance companies to do business in their state unless restitution was adequately addressed. Jewish organizations operating in the United States, especially the World Jewish Congress, were highly effective in making politicians and regulators aware of the restitution issue and in publicizing historical information obtained from the U.S. National Archives.....
....European governments and companies were forced to take action.....When it came to returning or paying for stolen assets, however, the negotiations with European countries and businesses were long and arduous. From the mid-1990s to 2006, only some $3.4 billion was pledged to restore unpaid assets directly to survivors or their heirs or as humanitarian funds ....In addition to these pledges, about half a billion dollars was paid via a few high-profile individual art and real estate legal cases, bringing the total to nearly $4 billion.
Despite the considerable public awareness and U.S. pressure, only about 3 percent of the unpaid Holocaust assets was restored during the ten years since 1995. As a result, more than 80 percent remains unpaid, an amount equal to $115-$175 billion in 2005 prices. Moreover, progress in meeting the pledges was painfully slow. By the end of 2005, only about half of the $3.4 billion pledged was disbursed....
....After 2002, efforts to resolve the remaining restitution issues quickly faded. Most significant was the reduced U.S. political clout, which had been the mainstay of the endeavor. No additional noteworthy congressional hearings were held, efforts by U.S. state regulators diminished sharply, and there were unfavorable court cases. Public interest meanwhile receded along with an appreciable drop in press articles. .....
....West European governments and their public had little or no incentive to muster the political will needed to restore or compensate for the vast amounts of Jewish property never returned. This largely reflected the view that the issue had been resolved decades ago. There was also no significant number of Jewish voters.....
* * * SIDNEY ZABLUDOFF is an economist who worked for the White House, CIA, and Treasury Department for more than thirty years. Upon retirement in 1995, he focused on issues related to the restitution of Jewish assets stolen during the Holocaust era. He has published numerous detailed studies on the issue and was the principal analyst for Jewish participants involved in insurance claims.
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