THE TRANSFER AGREEMENT: THE DRAMATIC STORY OF THE PACT BETWE

"Science," the Greek word for knowledge, when appended to the word "political," creates what seems like an oxymoron. For who could claim to know politics? More complicated than any game, most people who play it become addicts and die without understanding what they were addicted to. The rest of us suffer under their malpractice as our "leaders." A truer case of the blind leading the blind could not be found. Plumb the depths of confusion here.

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15. Judgment on the Sand

EVEN BEFORE Sam Cohen's deal was verbally accepted by the Reich Economics Ministry on May 13, 1933, it became impossible to confine knowledge of the secret negotiations to a select few German Zionist circles in Germany and Jerusalem were aware of developments, as were key Zionist leaders in London, including Weizmann, Rutenberg, and Professor Brodetsky. And in late April, the Jewish Agency Executive Committee finally learned of the project. Who knew how much, and at what point during the first hush-hush weeks of negotiations, created a chaotic scenario.

For instance, Sam Cohen was still in Poland when Siegfried Moses received word on May 13 of the Reich Economics Ministry's acceptance. [2] So the German Zionists were unaware of the height or breadth of the deal, although they probably suspected it might include Hanotaiah.

After Sam Cohen first secured the currency exemption in late March 1933, he quickly convinced the Reich to link an emigrant's currency grant to the purchase or attempt to purchase orchard acreage from Hanotaiah. Cohen did this without the ZVtD's permission. [2] The Emigrant Advisory Office had agreed to the linkage because they were guarding against citizens removing currency from Germany for merely a temporary stay abroad. A good-faith attempt to purchase acreage from Hanotaiah was a reasonable indicator of an emigrant's sincere intent to relocate permanently. [3]

Reich recognition made Hanotaiah the "preferred" Palestine land broker and transfer authority for German Jews. But Hanotaiah was unacceptable to the ZVtD because its transaction terms left little choice of relocation or cash for German Jews. ZVtD director Georg Landauer was originally able to thwart the Reich's Hanotaiah requirement by encouraging individual emigrants to protest the condition or substitute another Palestinian land broker in place of Hanotaiah. Landauer had thought this effectively cut Hanotaiah out. [4]

But Landauer soon learned that Hanotaiah was back in the arrangement. Cohen briefed Landauer on the new arrangement sometime between May 14 and May 17. From Cohen's description, Landauer suspected that Hanotaiah was no longer just the "preferred" land broker but the chartered company entrusted with the future of German Jewish emigrants. Cohen was bluntly told his monopoly was out of the question. He tried to reassure the German Zionists that Hanotaiah actually held no monopoly, but the ZVtD leadership was not convinced. They insisted Cohen issue a formal disavowal of any monopoly to the Reich. Cohen answered that he had already made that point perfectly clear during negotiations. [5]

The Economics Ministry's official May 19 confirmation of Sam Cohen's deal was delivered to Siegfried Moses, who was still listed as Cohen's solicitor. Landauer studied the document but found no indication of a Hanotaiah monopoly. He concluded that Cohen's deal was in fact a limited arrangement between the German government and a private Palestinian company that would not obstruct the official Zionist bodies from negotiating the larger transfer Arlosoroff was still formulating. [6]

The same day, May 19, Arlosoroff finalized his transfer ideas. The grandiose project was outlined in a personal memo marked TOP SECRET. The centerpiece of the plan was a "Liquidation Bank." Rutenberg had originally talked of a liquidation company, but ownership of the company had become a political issue, and Arlosoroff was now convinced the solution was a publicly supervised transfer, not a privately controlled migration. Arlosoroff's Liquidation Bank would be internationally recognized, probably under the aegis of the League of Nations. Relying on Weizmann's good relations with both the British government and Mussolini, Arlosoroff proposed that the bank's funding be secured by joint British-Italian sponsorship with international Jewish contributions. Merchandise would of course be the nexus between Germany and the Zionists. [7]

In fact, Arlosoroff's May 19 transfer plan was essentially the same as Sam Cohen's deal, with two basic improvements. First, German exports would not be limited to agricultural wares. Any German product or commodity would be included. Arlosoroff's memo listed items as varied as automobiles, building materials, dyes, and pharmaceuticals.8 His thought was not just the expansion of orchards, but the creation of a thriving urban and rural society.

Second, Arlosoroff's transfer would not be cashless. Emigrants would receive their £1,000 entrance money in hand, and then transfer an additional sum that would be used in trust by Zionist institutions to develop the country. This additional money was essential. Thousands of Jews could not be suddenly transferred to primitive Palestine without the roads, schools, hospitals, ports, and other fundamentals of a twentieth-century nation. Many of these had to be constructed virtually from scratch. Arlosoroff's Liquidation Bank would take over the blocked assets of German Jews, use them to pay for German exports, sell them in Palestine, and give proceeds of the first £1,000 to the immigrant, minus a small percent for administration. [9] Transferred cash beyond the first £1,000 would be invested in infrastructure. In this way, Palestine would receive the maximum merchandise and investment capital. The Jewish immigrant would receive the maximum cash.

In addition, Arlosoroff's May 19 memo listed Germany's inducements: a gateway to the Middle East market, increased employment, and the foreign-currency opportunities of unhindered exports. Moreover, the Zionist transfer would be seen as the minimum of "fair play" toward German Jewry that Western leaders had publicly called for in recent days. Thus, Hitler could both remove the Jews and be recognized as assisting in their national aspirations. [10] Arlosoroff's memo demanded all Jewish "sentimentality" about negotiating with the Nazis be rejected. Emotionalism, he argued, would not gain Jews their homeland. [11]

But Arlosoroff appended one important stipulation to his memo. German Jewish transfer must be wholly voluntary. This was a mandamus from Herzl. The Jewish State awaited only those who would ascend to it: Emigration was aliya, the Hebrew word for ascent. No Jew would be forced to liquidate his German existence. [12] Arlosoroff's plan combined the best elements of international law, bribery, and freedom of choice. All his hypothesizing had created a workable transfer, guaranteed by law and motivated by self-interest.

When Arlosoroff completed his top-secret memo on May 19, he was unaware that the Reich had already agreed to Sam Cohen's deal. When apprised of the unexpected development, probably that same day, Arlosoroff did not agree with Landauer's assumption that Cohen's pact was a limited deal. Arlosoroff believed it was the deal. But they were all still guessing. Cohen himself could not be located in Berlin to explain, because on May 19 Cohen had suddenly surfaced in London. [13]

Arlosoroff had to move quickly lest a man and his orchard company supplant the entire international Zionist movement and seize control of the fate of the Jewish nation.

His first task was to circulate word that the official proposal of Zionism was in the hands of Chaim Arlosoroff, head of the Political Department of the Jewish Agency -- not Sam Cohen, orchard broker. More important, transfer must provide emigrants with as much of their cash as possible and Palestine with as many building materials as possible. On May 20, in a wide-ranging interview with Robert Weltsch, editor of the ZVtD's Juedisehe Rundsehau, Arlosoroff detailed all the proposals of his plan, which only twenty-four hours earlier had been marked TOP SECRET. [14]

The interview was printed in the Rundsehau's May 24 edition. In it, Arlosoroff pinpointed the problem for Jews. They no longer needed refuges, asylums, or other temporary solutions to their persecution. Jews needed an endpoint in their quest for self-determination. Palestine was this endpoint. There Jews would find the glory of self-imposed struggle. After the struggle they would find agrarian opportunities if they chose, industrial opportunities if they chose -- whatever they chose, for the choosing would now be free from anti-Jewish decrees or concessions from on high. Through liquidation, Jews would achieve independence -- for the first time in 2,000 years. [15]

"This leads me to a central question ... the liquidation of capital and holdings belonging to German Jewish emigrants," Arlosoroff explained in the article. "There appears to be no way out for people whose fortune exceeds the amount of foreign currency normally permitted ... under present laws. . . . It makes no sense to ignore it or to think that it can be solved without an agreement with the German government. ... The only way out is to ... provide a benefit to both parties." [16]

Nazi censors ordered the newspaper seized. The Reich Press Office routinely suppressed troublesome editions and sometimes closed publications down altogether. In this case, the first for Juedisehe Rundsehau, the edition was merely confiscated. [17] No reason was given, but that same day, to clarify matters, the Reich Foreign Ministry transmitted a written guideline to the British embassy, ostensibly in response to their earlier inquiries regarding the original currency exemption. [18] The Reich specified: "The emigrant must first of all give convincing evidence of his serious intention to transfer his domicile abroad permanently [Reich emphasis], and must produce a certificate from the Emigrant Advisory Office that his proposals are economically realizable and that the capital which he wishes to take with him is of suitable amount for beginning a new existence abroad." [19] The reference -- without naming it -- was to Sam Cohen's cashless or near cashless orchard settlement scheme. An accompanying message warned that publicity be strictly avoided. Whatever cash German Jews were allowed would severely burden monetary reserves, and if too many emigrants applied, the intensified fiscal strain would force a curtailment of the entire arrangement. [20]

The Nazis had effectively muffled Arlosoroff. So Arlosoroff left the country to promote the position that a Jewish exodus from Germany should guarantee as many emigrant assets as possible. Arlosoroff went to Prague, where on May 25 he urged an audience to act unemotionally for the benefit of Germany's Jews and indeed the entire Jewish people. The most pressing issue, he told them, was the immediate transfer of German Jewish youth. "We do not want them to become psychic cripples." Second in line, Arlosoroff said, should be laborers from ages seventeen to twenty-two, who would build and cultivate for a dramatic national expansion. Then would come the settlers, rural and urban. These new settlers, the commercial and agrarian lifeblood of the nation-to-be, should not be exploited by competitive and un viable programs -- a reference to Sam Cohen's deal. Instead, Jews should pool their resources in a single officially sanctioned program. That program would have to include German merchandise. Undoubtedly, many in the crowd were boycott advocates, but he urged them to be realistic and understand that Jewish assets must be made liquid and transferable. And this would require an understanding with the German government that would hinge on exports. This theme was repeated in a public address in Warsaw on May 27 and in newspaper interviews published in Europe and Palestine that week. [21]

Arlosoroff tried to circulate his notions as the true position of the Zionist movement. But with a secret deal already ratified by the German government, Sam Cohen was far ahead of him. And Cohen was now in England, making arrangements with the rest of the Zionist hierarchy. Enough speeches had been made. Arlosoroff hurried to London.

***

In London, Mr. Sam Cohen had been very busy. On May 19, shortly after his arrival, Cohen telephoned Martin Rosenbluth, the German Zionist dispatched to London by Goering to stop the anti-Hitler movement. Rosenbluth was now stationed in London as the Zionist Organization's liaison with the ZVfD. Cohen briefed Rosenbluth on the deal and asked for an immediate meeting to discuss its implementation, but warned that Landauer and company were extremely dissatisfied with the arrangement. However, after hearing Cohen's preliminary explanations, Rosenbluth was convinced that Landauer must be sorely mistaken. Cohen's deal seemed fine, especially in light of the Jewish Agency quarrels and sniping, which prevented any decisive action in April. So just after he hung up, Rosenbluth dashed off a short note to Landauer reminding him that German Zionists had received reports of the squabbling in Jerusalem and London, and perhaps Cohen's deal was not so bad. [22]

During the next several days, Cohen explained the lucrative potential of his deal to the Zionist Executive Committee in London. Seeking to broaden the benefits, the Zionist Executive urged him to submit his private agreement to "national control." That would mean sharing the agreement with the official land-settlement firms such as Yakhin, owned by the Mapai-controlled Histadrut workers organization. Cohen agreed. The Executive then asked him to return at once to Palestine to personally handle negotiations between Hanotaiah, Yakhin, and other companies. They promised the Jewish Agency's full support and gave him a letter of authority dated May 30, 1933: "The Executive Committee has taken note of your agreement with the German Ministry of Economics and would be gratified if you were successful in bringing about an agreement for joint implementation of the plan between Hanotaiah, Yakhin, and other appropriate societies. We are pleased that you agree with the idea of national supervision for this project." [23] By relying on Cohen, the Zionist Organization preserved its own deniability. If tumult arose over any deal with Hitler, they could just blame a private citizen acting alone.

***

Frustrated and travel-weary, Arlosoroff arrived in London on June I, almost two weeks after Sam Cohen. The challenge facing Arlosoroff was to unravel the complicated arrangements Cohen had woven. At stake was a nearsighted business deal that would squander Zionism's one great chance, probably its last great chance, to bring the Jewish people en masse to Palestine.

Upon arrival, Arlosoroff went to Zionist headquarters at Great Russell Street for a conference with Nahum Sokolow, president of the Zionist Organization, Berl Locker of the Zionist Executive, David Werner Senator of the Jewish Agency Executive, and Martin Rosenbluth and Leo Herrmann of the ZVfD. Arlosoroff made his appeal. He began with an analysis of Zionism's precarious status in Germany and claimed the future was in the hands of young German Jewish leaders. The older leaders, such as Landauer, would be emigrating to Palestine in the near future. Arlosoroff called their abandonment of the work in Germany "deplorable," adding that they would be hard to replace. [24]

As to transfer, there was only one solution, argued Arlosoroff: an internationally guaranteed Liquidation Bank. Without it, Jewish assets in Germany would soon dwindle to nothing. Only personal savings and reserves were buffering the present misery. With those depleted, the narrow Jewish employment possibilities remaining in Germany would utterly pauperize the community. Moreover, German currency was so weak that the absence of international guarantees could collapse any system limited to reichmarks. [25]

Arlosoroff was sure that when German Jews discovered they could not remove large amounts of their money through Sam Cohen's deal, they would postpone emigrating to Palestine until they were destitute. In that case, their indispensable capital contribution would be squandered. Or they would resort to widespread smuggling. The Nazis would invariably catch many of the smugglers, and the Jews would suffer even worse. Without larger cash permits, the overwhelmingly non-Zionist German Jewish population would simply reject Palestine as a realistic option. [26]

The Executive Committee and the German Zionists heard Arlosoroff's compelling explanations. It was now a choice between Sam Cohen's deal or Chaim Arlosoroff's transfer. A long discussion ensued. Arlosoroff answered the questions persuasively. By meeting's end the decision was made: in favor of Arlosoroff. [27]

Arlosoroff was instructed to proceed to Jerusalem and establish an official institution to supervise the Liquidation Bank. Rosenbluth and Senator would coordinate the program in Berlin. Arlosoroff would control the entire operation. [28] There was no time to enjoy the triumph. With his instructions and authority clearly laid out in writing, Arlosoroff left the conference for a meeting across town with Colonial Secretary Cunliffe-Lister.

At 5:00 P.M. in an office at the stately House of Commons, Professor Brodetsky and Arlosoroff met Cunliffe-Lister and A.C.C. Parkinson. Speaking in a clear, forceful manner, Arlosoroff impressed upon Cunliffe-Lister that Jews were finished in Germany. Their only way out was his transfer plan: children first -- this captured Cunliffe-Lister's sympathy the most; laborers second -- Cunliffe-Lister understood the need for this advance group and was receptive to bending the immigration-certificate system to the emergency. [29]

Arlosoroff then began to explain how the transfer would work. The Liquidation Bank would gather in Jewish assets and use them to export German goods to Palestine. Cunliffe-Lister's facial expression changed. His reaction to a flood of German wares displacing British wares on the Palestinian market was as Professor Brodetsky feared. Cunliffe-Lister interrupted, "Where do we come in? You will be increasing German exports at our [British] expense." [30] Throughout all the secret meetings with Weizmann, Arlosoroff, and Arab leaders in Palestine during April, Cunliffe-Lister had been willing to cooperate on a glorious new plan for the area, a plan of binational self-determination that would solve a host of Arab and Jewish problems and produce a modern Jewish State in the process. There would be commerce, technology, and prosperity for all. Great Britain would reap the financial benefits, selling basic materials and consumer goods to a developing Palestine. The notion of Germany replacing Britain as Palestine's greatest commercial partner had not even occurred to Cunliffe-Lister.

Arlosoroff tried to minimize Cunliffe-Lister's bad reaction. Perhaps the League of Nations, in overseeing the Liquidation Bank, could structure things so as not to harm British commercial interests. Cunliffe-Lister stopped the discussion cold and snapped, "Do what you like, but don't tell us!" [31]

Arlosoroff realized that opposition to trading with Germany would be everywhere. But he was convinced that economic inducements were the only way to prompt Germany to cooperate in the transfer. Next, it was necessary to contact Sam Cohen.

Exactly how the Zionist Executive explained the withdrawal of support for Cohen is unrecorded. Cohen had already set things in motion under the Zionist Organization's preliminary May 30 authority. Meetings had been scheduled in Palestine between Hanotaiah, Yakhin, and other companies. But ultimately, Cohen was forced to step back and allow Arlosoroff to assume control of the transfer. The difficult negotiations must have stretched over several days, because not until June 4 was a cable dispatched to Hanotaiah Ltd. in Palestine: "JOINT IMPLEMENTATION OF SAM COHEN PROJECT REQUIRED UNDER NATIONAL CONTROL. DISCUSSION BY ALL PARTICIPANTS NECESSARY. DELAY MEETING FOR ARRIVAL COHEN ON 12TH [JUNE], ARLOSOROFF 15TH." The cable was signed "ARLOSOROFF/COHEN." [32]

Arlosoroff intended to use the Hanotaiah agreement as a springboard for formal negotiations with the Reich that would produce a transfer controlled by the Jewish Agency. However, Arlosoroff quickly learned that the German government, believing Cohen and Hanotaiah represented the Zionist movement, had indeed granted Hanotaiah complete responsibility for Jewish emigration to Palestine.

On May 19, the day the Reich confirmed Cohen's deal in writing, the British Passport Control Officer in Berlin received new instructions governing the issuance of capitalist certificates for Palestine. Previously requiring evidence of £1,000 in hand, he was now told "not to insist on the production by the applicants of a currency export permit." Instead, the passport officer was "to accept as evidence" proof of capital in "reputable banks in Holland, Switzerland, etc." And he was to "take into consideration as capital the value of machinery, stock, immovable property, etc." [33] What's more, whenever Jews applied for their currency permits at Reich offices, they were handed a notice referring them to "the firm Hanotaiah Ltd. (the solicitor Siegfried Moses), on the basis of an agreement which has been concluded, sells settlement sites, etc., against payment of the purchase price into a blocked account." [34] The cashless or near-cashless transfer was formally in place. And Hanotaiah was totally in charge.

Quickly the word reached the ZVfD in Berlin from prospective emigrants all over the country. Hanotaiah did indeed hold a monopoly, despite the assurances of Sam Cohen. Emigrants found they could leave Germany -- but only if they left behind most of their holdings to be divided between Hanotaiah and the Reich. By June 9, Landauer was forced to concede in a letter to a colleague in Breslau that he had been deceived by Cohen. Landauer promised to intervene at once to strike down the Hanotaiah exclusive. [35] He knew that non-Zionist, middle-class German Jews would simply not leave everything behind for a new life in Palestine. If they were to be convinced to start a new life in the Jewish national home, they must be allowed to take some of their old life with them.

***

Palestine was ready to explode. Internal Zionist politics had produced a dangerous undercurrent to the German emergency. Revisionist forces led by Jabotinsky were challenging the entire leadership of the Zionist Organization -- which was becoming increasingly Mapai-dominated. Jabotinsky planned a dramatic appeal for floor votes at the upcoming Eighteenth Zionist Congress to oust the existing leadership and install himself and his circle. [36] At stake was the very philosophy of Zionism.

In simplified terms, Mapai, or Labor Zionism, saw Palestine as a home for a Jewish elite that would toil in the noble vocations of manual work and farming. Their orientation was communal, socialist. They wanted collective farms and villages. Moreover, Labor Zionism desired the many, but not the multitudes. Mapai's Israel would not be for every Jew -- at least not in the beginning. At first Israel would be for the approved cadre of pioneers. And Mapai wanted gradual "constructive programs" to build the Jewish Homeland -- dunam by dunam. [37]

Revisionist Zionism rejected Jewish exclusivity. They wanted a nation of ordinary Jews in a mixed urban-rural society. The system would be free enterprise not socialism. And Revisionism believed that Palestine could not be acquired a nibble and a shipload at a time. Only by rapidly transferring the largest number of Jews in the shortest amount of time would the Jews constitute a sudden majority in Palestine that could declare the State. With specific unpleasantries about starvation and exposure deleted, Revisionism was very much an updated version of Max Nordau's catastrophic Zionism. [38]

All the conflicts of Mapai-dominated Zionism and Revisionism became life-or-death issues with the rise of Hitler. How many Jews to bring to Palestine, how quickly, from which socioeconomic-national category, and by what means were all fighting questions. Whether to work with the Hitler regime, or combat it through an economic boycott, only heightened the confrontation.

The battle techniques of Revisionism and Mapai also differed. Mapai was expert at political warfare -- not so much by the rules as for the rules. Preoccupied with legalisms, they favored sudden organizational and government meetings that would yield repressive regulation. For example, in December 1931, a Mapai-engineered Zionist Organization decree urged all registered Zionists to avoid membership in Jabotinsky's Revisionist Union. [39]

Revisionists, on the other hand, were heavily Fascist and profoundly influenced by Mussolini. Neither Vladimir Jabotinsky nor Benito Mussolini approved of Hitler's twisted version of Fascism. Nonetheless, Jabotinsky's legions were wrapped in many of the same fabrics. The paramilitary Betar youth corps trained in military camps and wore the same characteristic brown-colored shirts found in Germany. Revisionists claimed their brown was the color of the earth. But a German brown shirt and a Jewish brown shirt were practically indistinguishable when laid side by side. On one occasion, in mid-April 1933, a Betar parade through Tel Aviv was attacked by Labor Zionists who claimed the brown outfits were so reminiscent of Nazi uniforms (even though nothing resembling a swastika was displayed) that the march itself was a provocation to violence. [40] True to Fascist ideology, the fist and the shout were the preferred methods of achieving Revisionist goals. Labor Zionists, especially David Ben-Gurion, were fond of calling Jabotinsky the Jewish Hitler. [41]

During the spring of 1933, every Zionist decision was calculated for its impact on the coming elections for control of the Eighteenth Zionist Congress. As the sniping intensified, Revisionist sympathizers were increasingly shut out of the Mapai-controlled Histadrut labor exchanges. Palestinian Revisionists found they could not earn a living. Revisionists in turn became professional strikebreakers, available for Palestinian employers suffering from Histadrut labor actions. This was especially true in the vast orchard business, where a strategic strike could forfeit a harvest and cripple an entire settlement. [42]

While Revisionists were trying to topple the Mapai labor monopoly in Palestine, Labor Zionist leaders were touring hundreds of East European towns and villages, hoping to convert traditional Revisionist voters. Typical was the May 5, 1933, visit of Ben-Gurion to Riga, Latvia. No sooner had Ben-Gurion stepped from the railway station than a band of Betarim pelted him with rotten eggs. Mapai supporters rushed to Ben-Gurion's aid. Police were called to disperse the fight. [43]

Politics was in fact a vital factor when the Zionist Executive in London persuaded Cohen to merge his Hanotaiah deal with Yakhin, the Mapai-controlled land firm. Whoever controlled the German Jewish money and immigrants, directed votes and financial resources that could be wielded in the war for control of Zionism.

Advocating the anti-Hitler boycott became part of Revisionism's campaign for popular support. On April 28, despite official Zionist calls to abstain from anti-Hitler agitation, Jabotinsky delivered a forceful condemnation of Nazi relations with Palestine. It was the first speech by a foreign Jew ever broadcast by Poland's state-controlled radio. Speaking alternately in threat than a promise. Assassination was the known punishment for moderation.

Jewish radicals were equally irate. Mizrachi -- the major religious Zionist party -- publicly demanded Arlosoroff's resignation on the grounds he had no authority to convene the extraordinary luncheon. [52] The ranks of Revisionism went further and demanded Arlosoroff be relieved of his life. One Revisionist leader in Lodz, Poland, declared at a news conference that if a Jewish courtmartial existed, Arlosoroff would be condemned to death; he reportedly added that his own hand would not tremble if asked to carry out the sentence. Another Revisionist leader, this one in Warsaw, allegedly stated that any Jewish youth who fired a shot at Arlosoroff would become a saint. [53]

Undaunted, Arlosoroff continued his binational efforts, enlisting the active support of the British. The first fruits of these secret initiatives came quickly. By the end of April, Palestine's high commissioner had announced the resettlement of one hundred Arab families evicted when their absentee Arab landowners sold land to Zionists. The high commissioner stressed that Jewish agricultural methods were to be employed. The unnamed architect of the resettlement plans was Chaim Arlosoroff, who had been secretly working on the program for some time. [54]

Simultaneously, a model Arab community was being sponsored by the Jewish residents of Netanya, the Jewish colony just north of Tel Aviv established in part by Hanotaiah and Revisionist leaders. Netanya residents included a number of American Zionists, many of whom were devout binationalists. Several of these residents, Hebrew University Chancellor Judah Magnes among them, convinced Hanotaiah to rehabilitate the nearby rundown Arab village of Umm Khaled. Under the plan, Hanotaiah would provide each household with ten dunams (2-1/2 acres) of land, a house, an area for animals, and additional dunams for vegetable growing and citriculture. In a confidential May 1 report, United States Consul in Jerusalem Alexander Sloan explained that Hanotaiah had agreed to assist "provided it is given complete title to a certain section of sand dunes facing the sea on which it now holds a 99-year lease." Sloan explained that "Hanotaiah Ltd. is interested politically in the betterment of Arab-Jewish relations." [55] Naturally, the better Arab-Jewish relations were, the less difficult it would be to conclude land sales.

The binational initiatives of spring 1933 found not only Jewish takers but Arab takers as well. Suddenly, for the first time in Palestine's turbulent history, moderate Arabs were standing up. With the security of German Jewish money forecast by Arlosoroff, many Arabs were finally willing to say yes to coexistence. For example, shortly after the King David Hotel luncheon, the Transjordan Opposition scheduled a major anti-Zionist conference for May 18. But the conference was postponed when pro-Zionist Arabs violently disrupted the meeting. [56]

On May 24, dozens of Arab sheikhs and property owners, representing twenty-three villages and a large town in Transjordan, visited the white, mazelike structure housing the Jewish Agency in Jerusalem. The assembled leaders collectively invited Zionists to purchase Arab land in Transjordan for the mass settlement of Jews. [57]

That same day, Jewish Agency chairman Emanuel Neumann met with W. J. Johnson, treasurer of the Palestine government. Neumann was always lobbying for the British to allocate as much of Palestine's tax money and other fiscal resources to Jewish projects as to Arab projects. That day, as Johnson explained some of the government's big development plans -- housing for British troops and the accretion of a huge monetary reserve -- Neumann asked how then would the resettlement of displaced Arabs be financed? Johnson replied that the money wouldn't be provided from the government's normal revenues. [58]

Where will the money come from? asked Neumann. Johnson at first tried to evade the question. But Neumann pressed until Johnson, stipulating the strictest confidence, admitted that the specifics of a £2-million Palestine development loan had been secretly approved by Sir Cunliffe-Lister when he visited Palestine in April. The fine points, just completed, were being rushed to London in the next airmail pouch for Cunliffe-Lister's signature. Such a development loan had been debated for two years without agreement. Therefore, Neumann was amazed as Johnson itemized the details: first, a water supply system for Jerusalem and Haifa, possibly with a drainage grid. Neumann interrupted and said such a massive endeavor would cost at least £350,000 for Jerusalem alone. Johnson corrected him: £480,000. Second, an oil port at Haifa costing anywhere from £150,000 to £200,000. Third, port improvements at Jaffa, no figure mentioned. [59]

Johnson then described some of the Arab settlement programs. To start, a program of general assistance, say, £50,000, to help Arab villagers in the hill country; Neumann guessed this money was designed to buy political support for the new situation. Additional money would resettle Arabs displaced by absentee landlord property sales to Zionists. Neumann guessed resettlement would cost a few hundred thousand pounds. Johnson said no, it would be "much more than that." [60]

Central to the plan was an "Agricultural Bank" capitalized with £100,000 from the new fund and an additional £500,000 from the Prudential Insurance Company or its executives, perhaps Barclays Bank, and Anglo-Zionist investors. To avoid any sectarian character, Englishmen would manage the Agricultural Bank; a three-man bank advisory committee would include a Jew, an Arab, and the Palestine director of agriculture. Once in place, the Agricultural Bank would permit both Jew and Arab to purchase and settle land throughout the Palestine plains. [61]

Johnson mentioned other projects: irrigation plants, hydrographic surveys, Arab municipal improvements, water for remote Arab villages. All this money would be borrowed by the Mandate government from the great new fund. The interest rate would be no more than 3-1/2 to 5 percent because the British Treasury would guarantee repayment. Neumann remarked, "Very cheap money indeed." Johnson answered that the Treasury was willing to guarantee repayment, thus assuring the low interest rate, because Palestine would generate huge purchases of British exports. [62]

Johnson and Cunliffe-Lister were unaware of it at the time, but Britain's special inducement -- massively increased exports to Palestine -- was to be eliminated in favor of a bitter concession to Nazi Germany. A week later, on June 1, during the meeting with Arlosoroff, Cunliffe-Lister finally discovered this and realized that all the binational plans, many of which were already under way, were now of primary benefit only to Jews and Germans. Britain would lose -- and not just trade. For Germany's winnings would include breaking the boycott and gaining the economic recovery she needed to rearm.

***

Chaim Arlosoroff was one of the most provocative thinkers of his day in that he tried not to overwhelm, but to transform. In an era of extremes, his efforts to combine the hostile forces around him were almost too theoretical to succeed. Rumors of a deal with Hitler only accelerated the controversies swirling around him. By early June 1933, Arlosoroff was in fact a threat to so many groups that people measured themselves by how vehemently they opposed him.

His Jewish friends began to fear and hate him. Arlosoroff was a top Mapai leader, but Labor-aligned moderates could hardly contain their fury that the prodigy of the Zionist movement was abandoning all Zionist discipline. Unilaterally he was formulating and executing policy -- binational breakthroughs with the Arabs and controversial trade-offs with the Nazis. Arlosoroff was by himself engineering the fate of societies and nations, not in theoretical, discreet ways leaving plenty of doors open for retreat, but by one stunning fait accompli after another. Arlosoroff was dangerous to Mapai and to the others of moderate mainstream Zionism. He was giving away the Promised Land to the Arabs, and in so doing giving away the Eighteenth Zionist Congress elections to the Revisionists. Arlosoroff would have to be stopped.

His enemies among the Jews were convinced there was no greater nemesis. Arlosoroff was a special foe of Revisionism. It was Arlosoroff who in late 1931 conceived the decree against membership in Jabotinsky's Revisionist Union. The calls for his assassination were so commonplace during early 1933 that it was rumored Revisionist circles were merely debating whether to kill him before or after the Eighteenth Zionist Congress. According to one such rumor, Vladimir Jabotinsky himself was said to have quashed a far-gone Palestinian conspiracy by cabling the ringleaders a one-word instruction: "NO." [63] More than rumor was an odious Revisionist pamphlet published by Abba Achimier, the editor of the Revisionist newspaper Hazit Haam. Achimier's pamphlet, entitled "Manifesto of the Sicarii," explained a new secret society based on an ancient sect of Jewish assassins from the Masada era. The Sicarii carried short Roman daggers and assassinated Jewish leaders found guilty of consorting with the Roman enemy. [64] Arlosoroff was consorting with 'all of Revisionism's greatest enemies: the British, who occupied the land; the Arabs, who refused to make room for Jewish destiny; and the Germans, who were dedicated to annihilating the Jews. Arlosoroff would have to be stopped.

His enemies among the Arabs saw him as the one Zionist willing to push past the historic barriers. Arlosoroff was too willing to use the new powers and wealth arising out of the German crisis to create a new binational community that would make the battle cries of Arab rejection obsolete. To Arab extremists, Arlosoroff was the most dangerous Zionist in Palestine. Not because he sought to conquer. But because he sought to combine. Arlosoroff would have to be stopped.

His enemies in Britain were created unexpectedly. Suddenly the British government realized that Chaim Arlosoroff carried the key to economic turmoil or triumph in Palestine for either Britain or Germany. The transfer as London had originally envisioned it would be a boon for the British economy that would blossom into an extended economic sphere of influence over the entire Mideast. That prize was now going to Germany. Arlosorofrs dreams would play right into Hitler's plans. Arlosoroff would have to be stopped.

And his newest enemy was the one enemy people knew the least about. His name was Mr. Sam Cohen. Cohen had masterminded an international economic and political coup. If successful, he alone would control millions of dollars, thousands of people, and large tracts of land. One man working alone could, if allowed, deliver the Jewish nation to the Jewish homeland. Cohen could be this private messiah. But now Arlosoroff was obliterating it all. Cohen was being robbed of both his promise and his profit. Arlosoroff would have to be stopped.

The question was: Who would stop him, and how?

***

The passions of Palestine, its dreams and disappointments, all focused on a single man. When Arlosoroff departed London in the first week of June, he was returning to a land whose potentials he loved. Too few in Palestine would accept the clarity of his ideas. But Arlosoroff had visions from the beginning.

When he was only twenty-two years old, in 1922, Arlosoroff first visited Palestine and encountered the reality of a land inhabited by one people of the present while cherished by another people of the past. The young Zionist wrote, "Let us not overlook the following fact: there is in the country a massive [Arab] nation ... and it makes no difference if we call it a national movement or not. . .. We have only one way: the road of peace; only one national policy: a policy of mutual understanding .... Peace and agreement cannot grow overnight. The road to it is long and requires much work." [65]

For years Arlosoroff had sought peace by the forces of reason. All efforts failed. In June 1932, one year after becoming the political secretary of the Jewish Agency, Arlosoroff wrote a disconsolate letter to Weizmann, predicting that soon only two options would remain: "narrowing down the geographical area [in Palestine] in which Zionism will materialize." That failing, a man of peace such as Arlosoroff in desperation advocated a brief coup, hoping that this position of power could result in coexistence. [66]

But such transient suggestions as armed revolt were outmoded because the German crisis would at last allow him to create realities with money where reason had failed.

As Arlosoroff traveled across Europe, rumors were everywhere. He was sealing a pact with Hitler, and forging a new binational political party with pro-Zionist Arabs, and was even ready to publish an Arab-Zionist newspaper. Shortly after Arlosoroff left Poland in early June, the Polish Revisionist newspaper Die Welt accused Arlosoroff of trying to make peace with Hitler and warned; "Get off the Jewish stage, Dr. Arlosoroffi" On June 9, the Palestinian Revisionist newspaper Hazit Haam declared, "At a time when the people of Israel in Palestine and abroad are in a defensive war of honor against Germany ... an official of the Jewish Agency suggests not only a cancellation of the boycott but also a promise of a market for German imports .... This should be viewed as putting a knife in the back of the Jewish people while attempting to stretch out the hand of friendship to the Hitler government." [67]

The animosity of the Jewish masses, the desperation of German Jewry, and the momentus failure or success that might emerge within the coming days could not help but cast the thirty-four-year-old Arlosoroff into a deep depression. As he journeyed home to Palestine, Arlosoroff's gloom was only worsened by a sequence of missed trains, lost wallets, and strange delays. Everything had gone wrong, and Arlosoroff felt the omens were not good. [68]

Arlosoroff had hoped to meet his wife Sima in Egypt and enjoy the train ride back to Tel Aviv together. But the mishaps forced him to board a ship in Naples that didn't arrive in Egypt until June 13. The superstitious Arlosoroff asked Sima to instead meet him at 6:00 A.M. on the fourteenth at a Palestine train station along the way. [69]

Arlosoroff and Sima arrived in Tel Aviv at 9:00 A.M. on June 14 and went straight to their Tel Aviv apartment at 82 Yarkon. There Arlosoroff hugged his children for the first time in over a month. Later that day, he visited his mother. And he conferred with various Zionist officials. Throughout the day, his dejection remained clearly visible to those he met. [70]

That night, Arlosoroff tried to find solace playing with his infant son Shaul. One of Shaul's favorite games was to remove his father's ring from his finger and replace it. But this day, when Shaul removed the ring, he replaced it on his mother's finger. Arlosoroff cried out, "Not yet." [71]

***

On June 15, Arlosoroff, still tired from his travels, continued meeting on the transfer question. It is rumored that among those he spoke with was Sam Cohen.

The next day, June 16, Arlosoroff lunched with High Commissioner Arthur Wauchope. After lunch, they visited a village that Arlosoroff said would become a major center for transferred German Jewish youngsters. At the end of the afternoon, Arlosoroff went back to Tel Aviv, arriving at 5:15 P.M., in time for shabbat, the Jewish Sabbath. [72]

At about sunset, Sima and Arlosoroff tried to soothe their nerves with a quiet dinner at the Kaetedan boardinghouse on the beach north of Tel Aviv. It was a favored establishment of Mapai leaders. [73] After dinner, Arlosoroff wanted to walk along the deserted seashore around the Kaetedan, but Sima was afraid. Just that day, the Revisionist newspaper Hazit Haam had issued what many considered a public death threat. The article attacked what it called an alliance between Hitler and the Mapai party engineered by Arlosoroff. "There will be no forgiveness for those who have for greed sold out the honor of their people to madmen and anti-Semites .... The Jewish people have always known how to size up the betrayers of the nation and their followers, and it will know today how to react to this crime." [74]

Arlosoroff had lived with threats for some time. When informed in early 1933 that he was at the top of a fanatic Revisionist group's hit list, Arlosoroff at first refused protection, saying, "No Jew would kill me." Not long after, however, Sima heard footsteps outside their door late at night. Situated as they were in a Jewish neighborhood, they concluded the prowlers were Jewish. So Arlosoroff finally agreed to post a guard outside his home. The threat from the Arab side became equally real, forcing Arlosoroff to carry a pistol while traveling through Arab areas. But before leaving for Germany, Arlosoroff had deposited his pistol with a friend, and had not yet reclaimed it. So on the night of June 16, Arlosoroff was unarmed. [75]

The moon was not out that night. As Sima and Arlosoroff began walking, little could be seen except the red running lights of freighters in the Mediterranean to the west and the sparkling crescent of lights formed by Tel Aviv and Jaffa to the south. Before long they had strolled so far north there was nothing but solitude, sand dunes, and the foamy fizzles of the sea. But then Sima noticed two men following, a short one and a tall one who seemed to waddle as he walked. [76]

Soon the two men quickened their pace and passed Sima and Arlosoroff. Sima was frightened, but Ariosoroff reassured her. "Don't worry, they're Jews." The two men were now ahead, but they then stopped. The taller one began to urinate into the sand as the Arlosoroffs came closer. [77] Finally, the Arlosoroffs saw the lights of a distant Jewish housing development. They left the seashore and meandered through the new neighborhood, discussing the construction that everywhere rose from the sand. An hour later, they returned to the beach, arms entwined, and began walking south, staying close to the waterline. After a while the two men again appeared, walking slowly so the Arlosoroffs could not help but pass. When they did, the two men sped up and in turn passed the couple. This passing and falling back occurred several times as the Arlosoroffs continued walking south. [78]

When the Arlosoroffs neared a Moslem cemetery on the outskirts of Tel Aviv, Sima noticed a donkey carcass lying on the shore. And then, just ahead at the cemetery, the two men stopped entirely, turned, and positioned themselves on either side of the Arlosoroffs' path. As the Arlosoroffs passed between the men, the taller one shined a flashlight in Chaim's face and said, "kamah hashaa" -- an erroneous construction of the Hebrew phrase for "What time is it?" [79]

Just then the other man pulled out a Browning automatic and a bullet flashed into Arlosoroff's chest. He dropped to all fours, his life spilling onto the sand. The two assailants fled into the dunes as Sima screamed in horror, "Help, help! Jews shot him!" The bleeding Arlosoroff immediately corrected her, saying, "No, Sima, no." [80]

At first Sima struggled to help Arlosoroff crawl. Finally she helped him stand. Sima supporting him on her shoulders, they walked toward some people summoned by the shot. As bystanders took Arlosoroff's bleeding body, Sima ran back to the Kaetedan to call police and an ambulance. As she raced into the lobby, she cried, "They've shot Chaim" and begged for help. Meanwhile, people on the beach carried Arlosoroff to the roadway and began looking for someone to take him to a hospital. But this was shabbat, 10:30 P.M. No automobile traffic. In desperation, a bystander sounded the horn of a parked car. The car's owner came out and at once agreed to drive Arlosoroff to the hospital. [81]

Arlosoroff was lying on the gravel of the roadway, still bleeding, his jacket under his head as passersby kept asking who had done the shooting. Arlosoroff answered, "I will tell everything, but let me rest." Finally the automobile was brought around and Arlosoroff was helped in and rushed to Hadassah Hospital. Along the way, Arlosoroff remained coherent, but still refused to answer any questions. [82]

At the hospital, the doctors were ill prepared and indecisive. This being shabbat, there was no surgeon on duty. Arlosoroff reached the emergency room at eleven-thirty -- about an hour after being shot. The first surgeon arrived before midnight but would not operate until joined by three other specialists still en route. While waiting, the staff tried to make a weakened Arlosoroff comfortable. By this time, word had spread throughout Tel Aviv. The loved-hated son of Zionism had been shot. Political friends and associates began gathering around his bed. They and the police asked him question after question. But Arlosoroff was too faded to respond cogently. [83]

They were all helpless. Nothing could be done. Arlosoroff had just a few powerless moments remaining. No one expected him to speak. But with the last air in his lungs he turned toward the mayor of Tel Aviv, Meir Dizengoff, looked up, and whispered in soft tones, "Look what they have done to me." [84]

And then he died.
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Re: THE TRANSFER AGREEMENT: THE DRAMATIC STORY OF THE PACT B

Postby admin » Fri Jun 26, 2015 6:16 am

Part 3: The Boycott Struggle

16. Sam Cohen Resumes Control


LESS IMPORTANT than the death of Arlosoroff became the question: Who killed him? In London, members of the House of Commons immediately demanded an inquiry. In Warsaw, all Jewish newspapers featured black borders of mourning on their front pages. Memorial services were held in Vienna, Paris, and many other cities. Rewards for the capture of Arlosoroff's assailants were posted throughout Palestine. His funeral was attended by the largest assemblage in Palestine's history, between 70,000 and 100,000 persons. Arab and Jewish leaders alike and the entire consular corps paid their homage to the man generally assumed to be the brightest ascendant of the Zionist movement. [1]

Quickly the Revisionists emerged as the logical, and to a larger extent, the most suitable culprits. Police squads raided the apartments of leading Revisionist figures, including Abba Achimeir, the editor of Hazit Haam, who had so vocally editorialized for Arlosoroff's murder as recently as the day of the crime. [2] There they found a Betar activist named Abraham Stavsky, who had arrived from Poland just a few months earlier but was now eager to return. Sima Arlosoroff identified Stavsky as the man who held the flashlight, and Polish Revisionist Avi Rosenblatt as the one who fired the pistol. Some weeks later, Abba Achimeir himself was accused of masterminding the plot. [3]

Whether or not Stavsky, Rosenblatt, and Achimeir were the actual murderers will never be known. Sima Arlosoroff was under tremendous pressure from Mapai leaders to maintain her damaging testimony despite doubts. [4] In the months that followed, the murder investigation was besieged by bought-and- paid-for Arab confessions, false witnesses, manufactured evidence, bizarre theories, dramatic revelations, and unanswerable questions. Within a year, Rosenblatt, the alleged triggerman, and Achimeir, the accused ringleader, were both acquitted due to conflicting evidence. Stavsky, however, was found guilty and condemned to death. A long appeal finally released him on an evidence technicality. [5]

Eyewitnesses, real and induced, former police officials, and even private detectives continued announcing dramatic denials and reversals for years after the trial. Mapai leaders, satisfied that Revisionism was implicated -- whether or not juridically guilty -- would refuse to discuss the case even decades later. Revisionists and their sympathizers, determined to cast off a "blood libel," produced numerous theories to clear their names. Usually the theories blamed Arabs, sometimes they blamed British agents, and one farfetched story even blamed Goebbels, who supposedly wanted to obliterate the last shreds of his wife Magda's Jewish associations, including her former friend Chaim Arlosoroff. Five decades after the conflict, recriminations still fly among Zionist leaders when the question of Arlosoroff's murder is raised. [6]

But if the aftermath was bitter, the moment of conflict itself was torment. Jabotinsky's biographer remembered it this way: "For those who did not live during that agonizing summer of 1933, it is difficult, almost impossible, to imagine the dreadful atmosphere of violent animosity that permeated Jewish life all over the world, particularly in Palestine and Poland." [7] Mapai exploited the tragedy to its maximum. A broad anti-Revisionist movement sprang up uniting a range of Zionist ideologies behind Mapai. These groups collectively advocated the banishment of all Revisionists from Zionism. One policy statement declared, "No intercourse whatever with Revisionism! Let our motto be: Expel the Revisionist gangs from Jewish life!" Jabotinsky was often held personally responsible. Pamphlets called him a "bloodthirsty beast." [8] David Ben-Gurion, who would become Israel's first prime minister, admitted he was "less interested in whether Stavsky is the murderer than in Jabotinsky." Ben-Gurion declared that Jabotinsky bore total responsibility because he was Revisionism's "commander, leader, and mentor." [9]

Emulating the very violence they were decrying, Mapai forces called for "avenging our Arlosoroff" with a bloody reprisal against Jabotinsky. Polish newspapers in early July 1933 printed rumors that Jabotinsky, fearing an attack, had canceled his forthcoming lecture tour. Jabotinsky refused to cancel the tour, but was persuaded to accept a bodyguard. [10]

At each tour stop, he was heckled and harassed. At Brest-Litovsk, home town of accused assassin Stavsky, the throng became vicious. Young Polish Revisionist leader Menachem Begin remembers the event as traumatic: "An inflamed crowd tried to stone him [Jabotinsky] and we surrounded him, creating a human wall to absorb the stones." [11] In the town of Pinsk, Begin remembers the emotional chill as he heard his idol Jabotinsky plead, "The inciters tell you that I educated young Jews to murder one of their own people, while I have devoted my whole life to saving Jews, ... to defending them from pogrom and assault." Begin controlled his emotions that day as he sat behind Jabotinsky, prepared to jump out in case a rock was thrown. But he recalls that another Jabotinsky aide trembled and wept. [12] The Revisionist movement was crumbling. The staunchest advocates of Jewish defense had become outcasts among their own people.

Hostilities continued as Mapai forces hammered away at Revisionism, labeling it a Fascist misfit of Zionism, and harassing Jews who supported Jabotinsky. Jabotinsky himself was portrayed as the Jewish Hitler, commanding forces analogous -- somehow even linked -- to Nazi Storm Troopers. And yet in truth, it was not the stalwarts of Jewish militancy, the Revisionists, who had constructed avenues of commercial and political detente with the Third Reich. It was the forces of Mapai.

And as Revisionism fell to one knee in the summer of '33, the anti-Nazi boycott fell with it. For to adhere to the boycott was to carry out Revisionist dogma. To reject the boycott was to reject Vladimir Jabotinsky.

***

The campaign to reject the Revisionist-tainted boycott in Palestine reached a formal level even before Arlosoroff was assassinated. In fact, while Sam Cohen and Arlosoroff were still in London, at the beginning of June, the Mapai-dominated institutions of Palestine were already scurrying to implement Cohen's merchandise deal -- whether funneled through Hanotaiah Ltd. or supervised by national Jewish authorities. For example, on June 6, an ad hoc coalition assembled at the Tel Aviv Chamber of Commerce. There were representatives from the Jewish Agency, the Vaad Leumi, the Jaffa-Tel Aviv Chamber of Commerce, the Histadrut, the Citrus Center, the Association of Farmers, the Manufacturers Association, and the Organization of German Immigrants, which was the Palestinian counterpart of the ZVfD. These groups formed something called "The Conference of Representatives of Institutions in Connection with the Question of Clarifying Trade Relations with Germany" -- The Conference of Institutions for short. [13] Their purpose was to explore the many ways Sam Cohen's deal could benefit Palestine commercially.

The Conference of Institutions was afraid to assume an openly antiboycott stance. So on June 6, they carefully adopted a nonstance. They didn't endorse the anti-Nazi boycott. Nor would they oppose it. Effectively this was of course a vote to accept German goods. [14]

A week later, Sam Cohen returned to Palestine from London. The previous few weeks had been filled with sudden triumphs and reversals for Sam Cohen. In mid-May, he was able to feign legitimacy to the German government and walk away with a cashless transfer that would bring badly needed agricultural materials to his sand dunes soon to be orange groves. Despite the resistance of the ZVfD, Cohen was able to sail to London and on May 30 gain the written endorsement of the Zionist Organization to include Mapai-owned grove companies. However, after Arlosoroff had been given superseding authority, Sam Cohen refused to relinquish control.

On June 15, Cohen went to see German Consul Heinrich Wolff in Jerusalem and presented the obsolete May 30 letter from the Zionist Organization endorsing Hanotaiah's cashless transfer. Cohen then asked Wolff to help him expand his limited agreement from I million to 3 million reichmarks. [15] To convince Berlin that he was the one man capable of breaking the boycott against Germany, Cohen offered an ace.

Among the most vehement anti-Nazi newspapers in Palestine was Doar HaYom, the official Revisionist publication. Doar HaYom had been a pioneer in the economic war against Germany. When the boycott itself became an issue within Zionism, Doar HaYom steadfastly supported boycott agitation, often publishing encouraging columns by Vladimir Jabotinsky. [16] Somehow Mr. Sam Cohen acquired a financial interest in Door HaYom. He was then able to replace the pro-boycott editor with a freelance writer named Moshe Smilansky. [17] Smilansky was already the editor of Bustani, official journal of the citrus growers. Bustani under Smilansky was a well-established proponent of better German-Palestinian trade relations; Germany was after all Palestine's second-largest customer for Palestine's number-one export: citrus. [18] During his June 15 meeting with Consul Wolff, Cohen explained that Doar HaYom, which had been so vocal a boycott advocate, would suddenly become silent on the issue. [19]

Consul Wolff agreed to give Cohen full backing both to expand his agreement and to overcome any ZVfD opposition in Berlin. That same day, Wolff sent the Reich Foreign Ministry a long memorandum, "Increase of German Exports Against Payment into Sperrkonto [Blocked Accounts] to Palestine for the Purpose of Breaking the Boycott." Wolff's report asked his superiors "to urgently prevail upon the Reich Economics Ministry" to implement their deal with Hanotaiah quickly. Wrote Consul Wolff, "Only through the admittance of exports, as is proposed by Hanotaiah, will it be possible to effectively counteract the anti-German boycott here." [20]

Wolff then explained why it was imperative for Germany to break the boycott in Palestine first. "The anti-German boycott is making progress not only in Palestine but in the entire world." But now, argued Wolff, the world Jewish community was looking to Palestine for leadership, instead of the other way around. This political inversion had taken place since April. He added, "[Since] Palestine is now ... calling the tune ... then everything that ... counteracts the boycott in this country [Palestine] would have beneficial effects for us elsewhere, e.g., the United States." [21]

Wolff's intelligence about the shift in world Jewish affairs was accurate. This view was especially acceptable to Berlin because it fit the Hitler conception of an international Jewish conspiracy headquartered in Jerusalem. Building on this foundation, Wolff's June 15 letter encouraged Berlin to increase the incentive to Zionism by expanding Hanotaiah's license in quality and quantity. Wolff estimated that a RM 1 million ceiling would allow only thirty or forty German Jews to emigrate to Palestine. "In the eyes of the Jews," wrote Wolff, "this is but a drop in the bucket." Wolff's suggestion: increase the ceiling. "Every day would constitute a gain .... Do it as quickly as possible." [22]

Consul Wolff's second idea was the germ of the key financial potential of the entire agreement. The idea called for German Jews "who do not yet wish to emigrate but who would later on wish to settle in Palestine or neighboring areas to pay for exports into the Hanotaiah Sperrkonto [blocked account]." [23] This was Sam Cohen's answer to Arlosoroff's Liquidation Bank. Cohen's new arrangement would permit masses of German Jews -- declared emigrants or not -- to deposit their assets for safekeeping. Call it an escape hatch, an insurance policy, or an investment. Thousands of German Jews would surely take advantage of the opportunity. This would create a massive frozen cash pool for Hanotaiah's use.

The resulting extra millions in German merchandise would be too much for Hanotaiah to distribute in Palestine alone, so the firm would establish a re-export system throughout the region. Wolff pointed out that this "could constitute a possibility of breaking the boycott in Egypt and Cyprus" as well, and cut in on French competition in those markets. [24]

To countercheck any efforts by Georg Landauer and his circle to discredit Cohen, Wolff sprinkled his memo with assurances of Cohen's authenticity as the syndic of Zionism. "Mr. Sam Cohen showed me a letter ... from the Zionist Central Organization [sic] in London, which shows that the Central Organization is effectively working on eliminating obstacles which could arise from Jewish circles against Hanotaiah's plans, insofar as those circles are pushing for an increasingly organized boycott movement." Wolff then referred to the joint telegram sent some days before by Arlosoroff and Cohen to Hanotaiah, instructing that no action be taken until they both arrived in Palestine, at which time Hanotaiah's private deal would be submitted to "national supervision." Wolff referred only to the "national supervision" fragment of the telegram, implying that this proved that Hanotaiah's position was official. Hanotaiah's official status, wrote Wolff, "would take the wind out of the sails of those radical circles which are pressing for continued boycott." [25]

Citing Cohen's dedication to eradicating the boycott, Wolff advised Berlin, "Sam Cohen feels that it is urgently necessary to use the local press ... to defeat the boycott," adding that Cohen now controlled Doar HaYom. Wolff explained, "Today a contract is to be signed which will provide Mr. Smilansky with decisive influence on the newspaper [Doar HaYom]. Smilansky ... is prepared to exert all his influence against the boycott movement. I believe this ... will significantly enhance an anti-boycott mood." [26]

Lest his unabashed support for Cohen and the upbuilding of Palestine arouse suspicions in Berlin, Consul Wolff was careful to qualify: "I need not emphasize ... that I am not making these statements in the interest of the Jews, but only because I see in this plan a significant means of employment, considering Germany's precarious economic conditions. The Jews would benefit from the implementation of these plans; but in my opinion, our own advantage would be considerable and the best deals are always those which benefit both parties." [27]

Consul Wolff's motives were in truth an amalgam of sympathy with Zionism, loyalty to Germany, and efforts to ensure his own survival. He was no Nazi, and no anti-Semite. He did not seek the expulsion of Germany's Jews. But as Weimar Germany's liaison with the Jewish national home, he embraced the basic tenets of Zionism, doing what he could to further a cause sanctioned by the League of Nations. On the other hand, situated in the capital of the mythological Jewish conspiracy, with a Jewish wife, Consul Wolff was in a precarious position. He tried to straddle the fence and stay alive doing it. For this reason, his paragraphs were constantly weighted to the point of literary clumsiness with the words "to break the boycott." Whatever words he chose, they were almost always shown to Zionist personalities in advance, including Sam Cohen. In fact, his June 15 memorandum ended with a postscript implying that Cohen was virtually looking over his shoulder. Wolff appends, "P.S. Sam Cohen just informs me that the Jewish National Fund, headed in Palestine by Ussischkin, and Baron Rothschild's representative are in full agreement with Sam Cohen's proposed activity, which gives added significance to his work, insofar as it constitutes an anti-boycott measure." [28]

Wolff's postscript name-dropping Ussischkin and Rothschild was just another undisguised reminder to the Reich that Cohen was the only man who could overcome the boycott and at the same time solve the problem of a Jewish presence in Germany. And undoubtedly Wolff himself believed that Sam Cohen was the authorized agent of the Zionist movement. After all, during this June 15 meeting, Cohen had displayed obsolete letters of authority that out of context could easily be misconstrued. Ironically, Cohen's ruse was due to be spoiled as soon as Chaim Arlosoroff could present his superseding authority to Wolff. In fact, by June 9, the Zionist Executive in London had already sent the Jewish Agency in Jerusalem a cable specifying Arlosoroff's total authority in the transfer question. [29] But for some reason Cohen felt confident enough to set in motion, on June 15, this new request for an expanded Hanotaiah license.

The next day, June 16, before Arlosoroff could schedule a meeting with Consul Wolff, Arlosoroff was assassinated. So, as far as Consul Wolff knew, Cohen was still the legitimate representative of the Zionist movement, and the Hanotaiah deal was the sanctioned medium of transfer. As such, there was little standing between Sam Cohen and his plan for near-cashless indentured servitude for German Jews as a means of building the Jewish national home.

But such a transfer was a calamity Georg Landauer in Berlin could not allow. If Sam Cohen had arranged a deal for Hanotaiah, that was one thing. But Hanotaiah was not the authorized trustee of the Jewish people. Landauer was determined to make that clear to the German government. [30]

Building on the rapport established by Cohen with the Economics Ministry, Landauer felt confident enough to make his own approach. On June 20, 1933, Landauer had a letter delivered to the Economics Ministry proposing for the first time a formal conference with the ZVfD to develop an official plan to export merchandise to Palestine against the blocked accounts of Jewish emigrants. Landauer implied that various "interested parties" -- meaning Hanotaiah -- had already applied for this "basic idea." But Landauer warned that any such transaction would depend upon the involvement of the Anglo-Palestine Bank, the only Palestine bank Zionists trusted. The point was not explicitly written, but Landauer was trying to say that blocked accounts should be entrusted to a bank, not to a private real estate company. Landauer's note added that the director of the Anglo-Palestine Bank, Mr. E. S. Hoofien, had just arrived in Berlin from Tel Aviv, and asked if they could all get together for a discussion. [31]

That same day, June 20, the Reich Foreign Ministry received via diplomatic pouch Consul Wolff' June 15 letter suggesting a broadened version of Sam Cohen's dea1. [32] Landauer's June 20 letter to the Economics Ministry was sufficiently vague that the government had no reason to suspect that the two letters were not part of the same negotiating effort. In fact, they were diametrically opposed.

While Landauer was cautiously making his first formal entreaty to the Third Reich, Sam Cohen was moving rapidly in Palestine to gamer the backing he needed to claim legitimacy. During the last week of June the Organization of German Immigrants convened a meeting in Tel Aviv chaired by Arthur Ruppin. Ruppin had been influential in the Zionist movement for years. Also attending were representatives of Hanotaiah, Yakhin (Mapai's land company), and Sam Cohen. Cohen spoke first, reporting on transfer prospects and developments to date. There is no record of what method he used to convince the group to circumvent Georg Landauer and the German Zionist Federation in Berlin. But unaware that Cohen's deal was an inequitable cashless arrangement, the conferees agreed there was now no need to interfere with Cohen's progress. They voted to create a commercial coalition between Yakhin and Hanotaiah Ltd. [33] This was the very coalition originally envisioned by the Zionist Executive in London before Arlosoroff arrived to demand that Cohen's deal be executed through official institutions.

One of the German Zionists, Felix Rosenbluth, drafted a compact binding Hanotaiah and Yakhin to immediately negotiate joint implementation of Sam Cohen's dea1. [34] As one of the German Zionists who originated the transfer concept in mid-March 1933, Rosenbluth was a fitting choice to draft this agreement. Later, he would change his name to Pinchas Rosen, and as Israel's first minister of justice, become the architect of Israel's judicial system.

Instructions went out to the representatives of both Hanotaiah and Yakhin, already in Berlin, to begin hammering out the details of sharing Hanotaiah's privilege. Representing Yakhin would be Lev Shkolnick, who as Levi Eshkol would become Israel's third prime minister. Representing Hanotaiah would be its director and part-owner, Moshe Mechnes. [35]

Sam Cohen had now won the renewed endorsement of the German Zionists in Palestine and the agreement of Mapai. He was authorized to proceed to Berlin as soon as possible to negotiate an even larger emigrant asset allowance from the German government. The men backing him, however, were still unaware that Sam Cohen's project was cashless. [36]

On June 25, Ludwig Pinner, a leading German Zionist in Palestine, wrote a somewhat accusatory letter to Landauer in Berlin, dismissing Landauer's criticism of Cohen's Hanotaiah plan as the words of a "rival." Pinner could not understand how Landauer could be so antagonistic to Sam Cohen's plan when the ZVfD itself, represented by Siegfried Moses, was Cohen's obvious sponsor. [37]

Landauer responded to Pinner at once with a bitter, albeit somewhat suspect, denial. "I once again repeat," wrote Landauer, "that the agreement between Hanotaiah and the Reich Economics Ministry was not made on the suggestion nor with the help of the ZVfD. . . . Siegfried Moses [ZVfD president, who originally worked as Cohen's attorney] dealt with the matter only as a solicitor hired by a firm.... The matter reached us ... as a fait accompli." [38] Landauer was trying to disclaim knowledge of the deal and dismiss Moses' brief involvement as unrelated to Moses' post in the ZVfD. In truth, the ZVfD, Landauer, and Moses had originally sponsored Cohen, but Cohen continued negotiating.

Trying to explain how Sam Cohen's plan endangered emigrating German Jewry, Landauer added, "What Mr. Sam Cohen says about his activities here for the good of the revocation of regulations for emigrants is pure nonsense . . . . The text of the agreement with the Ministry is not known to us. . .. [But] for some days doubt has arisen about whether the cash sum will be at the free disposal of the clients .... I would warn people before they enter into a contract with Hanotaiah, because the emigrants would then find an existence only as settlers of Hanotaiah." [39]

Landauer's protestations from Berlin were too late. Cohen was using his freedom of movement and speech in Palestine to influence key Zionist personalities and organizations to make him the de facto envoy of the Zionist movement. In addition to the Organization of German Emigrants and important elements of Mapai, Cohen recruited the Jewish National Fund to his side. As official landholder of Zionist property in Palestine, the JNF was among the most powerful Zionist institutions. Its leader, Menahem Ussischkin, had already threatened the Jewish Agency in April 1933 that he opposed many of the plans for German Jewish capital transfer, and might be forced to sponsor his own rival plan. Now at the end of June, in exchange for Ussischkin's support, Cohen promised to arrange the transfer of blocked JNF monies in Germany. [40]

Large sums were indeed accruing in JNF's German bank accounts from domestic relief donations. If Sam Cohen used his connections to transfer this money, substantial funds would be available for wholesale land purchase in . Palestine. So on June 25, 1933 -- the day Pinner wrote his letter to Landauer supportive of Sam Cohen -- Ussischkin wrote two letters of his own. The first went to Sam Cohen at his London address: "Let me once again request that you use your influence at the Ministry in Berlin [so] ... funds presently being collected for the Jewish National Fund, and monies already held in escrow, be transmitted here without delay. Per our conversation, you have understood that these funds are now urgently required here for land purchases to be used for new settlements. A steady stream of German Jews is presently immigrating into Palestine and the first thing they ask for, with good reason, is to have a piece of land on which to settle and make a living." [41] Ussischkin dispatched a similar letter to the JNF office in Berlin, with special tributes to Cohen added into the text. To obviate any doubts, Ussischkin specified, "We have given Sam Cohen carte blanche in this matter." [42]

By June 25, 1933, Cohen had accumulated enough written testaments of legitimacy to overcome any challenge from Landauer and the ZVID. More important, he had Consul Wolff. And so, on June 24, even before all the supportive conferences and letters had become facts, Sam Cohen again visited Wolff and asked for assistance in fulfilling his promise to Ussischkin and in stifling any attempts to discredit Hanotaiah's efforts. Wolff dutifully obliged by sending an urgent letter to the Foreign Ministry in Berlin "as a follow-up to my report of June 15 on Sam Cohen's activities to break the boycott." This letter, however, mixed careful qualifications with the consul's usual unmitigated support for Cohen. Wolff was walking a tightrope between Zionist voices and Nazi ears. He was by now aware that although Cohen had assembled an arsenal of prestigious endorsements, his legitimacy was still very much in question. So Wolff formulated his sentences cautiously: "Today, Mr. Sam Cohen told me the following, which I have no reason to doubt since from reports I have about him I conclude that he is most reliable." [43]

Wolff continued, "In order to secure the necessary broad approval among Jewish circles ... Mr. Sam Cohen several days ago held a meeting attended by the main local industrial representatives, workers, planters, and the Jewish National Fund, among others. On that occasion Mr. Sam Cohen obtained the concurrence of the ... organizations for his plan [to bring German exports to Palestine]. The industrialists are especially interested in importing German machinery, which could amount to ... some £300,000 [roughly RM 4 million]." [44]

Consul Wolff's June 24 letter added that this extraordinary development would be enhanced if Jewish National Fund money could be transferred, despite existing currency prohibitions. Acknowledging that circumventing the currency regulations was highly unusual, Wolff still made "a plea that if possible Mr. Sam Cohen be supported in this matter. In all these questions, my point of view is that the danger of the boycott, which in my opinion threatens not only in Palestine but in the whole world, can only be counteracted when the Jews come to the conclusion that the German government -- speaking only from an economic point of view -- is prepared to make a generous accommodation." [45]

Wolff asked Berlin "if a decision could be speeded up" on his June 15 request to expand Hanotaiah's deal from RM 1 million to several million. Wolff then mentioned an additional incentive: substantial payment in actual foreign currency. Apparently, Sam Cohen envisioned generating so much foreign currency by widespread sales of German merchandise in Palestine and neighboring countries that he could afford to pay about 60 percent of the purchase price in actual foreign currency, the remainder coming out of blocked emigrant accounts. [46]

Consul Wolff claimed in his June 24 letter that Cohen was now off in Europe to wage his antiboycott campaign. Since there was little time to spare, Consul Wolff asked that the Reich's decision be sent not only to the Jerusalem consulate but also ''to Mr. Sam Cohen in care of the [German] consulate in Geneva, where he will look for messages to him, as he and I have agreed." [47] It was almost as though Sam Cohen had become part of the German diplomatic and trade apparatus, selling German goods, arranging for the emigration of German Jews, supplying foreign currency, stimulating German employment and breaking anti-Nazi boycotts. This, of course, was the desired appearance. But no matter how much Sam Cohen's pro-Reich activities were deliberately overaccentuated to evoke Nazi cooperation, there existed one salient, inescapable common ground: The national aspirations of both Nazis and Zionists hinged on the successful removal of Jews from Germany to Palestine.

And yet there was one major problem. German Jews simply didn't want to leave.
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Re: THE TRANSFER AGREEMENT: THE DRAMATIC STORY OF THE PACT B

Postby admin » Fri Jun 26, 2015 6:17 am

17. Jews, Zionists, Germans, Nazis

THE UNWILLINGNESS of German Jews to be forced from their country loomed as formidable an obstacle to transfer as any presented by German government policies or Zionist organizational strife. In fact, even if German Jews did consider a temporary hiatus from their beloved Fatherland, they envisioned other European countries as havens. The last place on their minds was Palestine. Historically, Zionism had always been a German Jewish taboo. Yet in 1933 the leaders of this shunned splinter were suddenly elevated to the status of spokesmen and agents of German Jewry -- a people they did not represent. A broken-line triangle between German Jews, Zionism, and Nazism was the key to Zionism's sudden ascent as Jewish custodian for the Third Reich.

Nazi mythology accused Jews of being an alien factor in German society. But in truth, Jews had lived in Germany since the fourth century A.D. As elsewhere in Europe during the Middle Ages, what German Jews could do and say, even their physical dress and appearance, was oppressively regulated. Confiscation of property and expulsion were frequent. Worse, anti- Jewish mobs often organized hangings and immolations at the stake. Even when left alone, German Jews could exist only in segregated ghettos subject to a long list of prohibitions.

The pressure to escape Germany's medieval persecution created a very special kind of Jew, one who subordinated his Jewish identity to the larger Christian society around him. Assimilation became a desirable antidote, especially among intellectuals during the Age of Enlightenment. When Napoleon conquered parts of Germany in the early nineteenth century, he granted Jews emancipation. But after Napoleon was defeated, the harsh German status quo ante was restored. The taste of freedom, however, led affluent and intellectual Jewish classes to assimilate en masse. Philosophically, assimilationists no longer considered themselves Jews living in Germany. Instead, they saw themselves as Germans who, by accident of birth, were Jewish.

Many even succumbed to the German pressure to convert to Christianity. German Jewry lost to apostasy many of their commercial, political, and intellectual leaders. A far greater number were convinced that Jewish ethnic identity should be denied, but nonetheless saw quintessential value in the tenets of Moses. These German Jews developed Reform Judaism. But even many of Reform Judaism's pioneers ultimately converted to Christianity. [1]

Between 1869 and 1871, Germany granted Jews emancipation from civic, commercial, and political restrictions, although certain prohibitions against high governmental, academic, and military office remained in force. Emancipation allowed acknowledged Jews to assimilate comfortably into German society. Germany's Jewry seized the chance to become equals. They changed their surnames, adopted greater religious laxity through Reform Judaism, and frequently married non-Jews, raising the children as Christians. Outright conversion became common.

In fact, of approximately 550,000 Jews in Germany who were emancipated in 1871, roughly 60,000 were by 1930 either apostates, children raised without Jewish identity by a mixed marriage, or Jews who had drifted totally away. Even those consciously remaining within organized Jewish "communities" neglected their remnant Jewish identity. The Jews of twentieth- century Germany, like their Christian neighbors, embraced national identity far more than religious identity. In the minds of German Jews, they were "101 percent" German, first and foremost. [2]

When political Zionism emerged shortly after emancipation, its principal leaders were Germanic, spoke German, and looked to Germany as the sponsor of a hoped-for Jewish home. Imperial Germany viewed Jewish notions of self-removal as a curiosity that appealed to basic anti-Semitic precepts. But German Jewry vehemently rejected Zionism as an enemy from within. Assimilated cosmopolitan Jews feared any assertion that they did not belong to Germany, any implication that Jewish loyalties were not to the Fatherland. The religious sector reacted with equal condemnation. Clinging to their communal existence, and unwilling to return to the Promised Land until beckoned by the Messiah, religious German Jews saw Zionism as sacrilege. [3]

So in 1897, when Herzl selected Munich as the site of the First Zionist Congress, Jewish leaders throughout Germany publicly protested until the convention was relocated to Basel. Anti-Zionism was one of the few Jewish topics Reform, Orthodox, cosmopolitan, and ghetto Jews could agree on. [4]

In the years after Basel, the movement earnestly tried to find acceptance among Germany's Jews. From 1905 to 19II, Zionism's world headquarters was seated in Cologne. But the overwhelming majority continued to revile it. In The History of German Zionism, German Zionist chronicler Richard Lichtheim recalls that "nowhere was the opposition of Jews to the new movement so widespread, principled, and fierce as in Germany." In March 1913, fed up with Zionist efforts to organize the withdrawal of Jews, the Central Verein, representing over half of German Jewry, expelled any member who advocated loyalty to any land other than the German Fatherland. [5]

When World War I broke out, it was an opportunity German Jews had awaited to prove they were patriotic, fully integrated Germans. About 100,000 Jews fought, 80,000 in the trenches. Some 12,000 were killed. And yet the persistence of Zionism still brought German Jewish patriotism into question. After Britain's 1917 Balfour Declaration promised a Jewish national home in Palestine, German Jews frantically avoided any identification with Zionist activities that might be interpreted as a link with Germany's enemy Britain. [6]

Before 1933, fewer than I percent of the Yishuv, or Jewish community in Palestine, had immigrated from Germany. In 1912, only 8,400 out of roughly 550,000 German Jews elected to pay the token shekel of Zionist membership. In 1927, German Zionist affiliation had grown to about 20,000. But that figure included many so-called non-Zionists, who endorsed Jewish philanthropic settlements in Palestine but wholly rejected the concept of Jewish nationalism. Many of these non-Zionists became financially involved simply to create an economic dependence that would allow them to control the more militant wings of the movement. [7]

Because the world headquarters of the Zionist Organization remained in Berlin during World War I, German Zionists were able to rise to an influential niche in the movement. Their connections with the kaiser's government were used to influence Turkey, to cancel violent Ottoman measures against the Yishuv after negotiations for the Balfour Declaration commenced in early 1917. [8] Even though the international seat of the movement shifted to London when the Jewish National Home was established, German Zionists retained an important place in Zionism. Their influence within the movement was still intact when Hitler came to power in 1933.

***

Zionism could have been expected to appeal to Nazis because the prospect of sending Jews back to Palestine appealed to the intellectual ancestor of Nazism, Martin Luther, leader of the Protestant Reformation.

In the early 1520s, the rebel monk Luther looked to the Jews as a potential following free from what he termed "papal paganism." So protective of Jews was Martin Luther that church superiors branded him semi-Judaeus or half-Jew. But in the late 1520s, Luther began showing irritation with German Jewry's refusal to abandon Judaism. [9]

In the early 1540s, Luther underwent a startling philosophical transformation, from archdefender to archassailant. In 1543, Luther published a vitriolic anti-Semitic pamphlet entitled "On The Jews and Their Lies" that virtually specified, down to the phrasing, the height and breadth of Nazi-style political anti-Semitism.

Luther's words: "They have been bloodthirsty bloodhounds and murderers of all Christendom for more than fourteen hundred years in their intentions .... Thus they have been accused of poisoning water and wells, of kidnapping children, of piercing them through with an awl, of hacking them in pieces, and in that way secretly cooling their wrath with the blood of Christians." There was no doubt in Luther's writings. He employed endless repetition to avoid any mistake. And in this pamphlet his point was clear: "The sun has never shone on a more bloodthirsty and vengeful people." [10]

Luther insisted that the Jews had enslaved Germans. Luther's words: "In fact, they hold us Christians captive in our own country. They let us work in the sweat of our brow to earn money and property while they sit behind the stove, idle away the time, fart and roast pears. They stuff themselves, guzzle and live in luxury and ease from our hard-earned goods .... Thus they are our masters and we are their servants." [11]

Luther suggested a solution to the Jewish problem in Germany: force them to return to Jerusalem. Luther's words: "[The Jews] should as we said, be expelled from the country and be told to return to their land and their possessions in Jerusalem, where they may ... murder, steal, rob, practice usury, mock and indulge in all those infamous abominations which they practice among us, and leave us our government, our country, our life and our property ... undefiled and uncontaminated." [12]

He vehemently rejected the notion that ghettoized Jews were held captive in medieval Germany. Luther's words: "We surely did not bring them from Jerusalem ... No one is holding them here now. The country and the roads are open for them to proceed to their land whenever they wish. If they did so, we would be glad to present gifts to them on the occasion; it would be good riddance .... They must be driven from our country. Let them think of their fatherland [Jerusalem] .... This is ... the best course of action, which will safeguard the interest of both parties." [13]

Luther knew Germany's Jews would be "loath to quit the country, they will boldly deny everything and will also offer the government money enough for permission to remain here." And so he explained a seven-point program for wiping out German Jewry. Luther's words: "I shall give you my sincere advice: First, to set fire to their synagogues or schools and to bury and cover with dirt whatever will not bum, so that no man will ever again see a stone or cinder of them .... Second, I advise that their houses also be razed and destroyed .... Instead they might be lodged under a roof or in a barn. . . . This will bring home to them . . . that they are living in exile and captivity, as they incessantly wail and lament about us. [14]

"Third, I advise that all their prayer books . . . be taken from them. Fourth, I advise that their rabbis be forbidden to teach henceforth on pain of loss of life and limb .... Fifth, I advise that safe-conduct on the highways be abolished completely for the Jews .... Sixth, I advise ... that all cash and treasure of silver and gold be taken from them .... Seventh, I recommend putting a flail, an ax, a hoe, a spade, a distaff, or a spindle into the hands of young, strong Jews and Jewesses and letting them earn their bread in the sweat of their brow." [15]

Luther's program called for the abolition of Jewish rights, the seizure of their assets, the destruction of their homes and synagogues, concentration in misery, and forced labor. However, Luther suggested that his final step, forced labor, would be so impossible for the lazy, untrustworthy Jews that it would by itself lead to negotiation over their assets, and then expulsion: "Then let us ... compute with them how much their usury has extorted from us, divide this amicably, but then eject them forever from the country." [16]

Luther asserted that any Christian who showed mercy toward a Jew would himself bum in the fires of Hell. His treatise's parting instruction were as follows: "Act like a good physician who, when gangrene has set in, proceeds without mercy to cut, saw and bum flesh, veins, bone, and marrow .... Bum down their synagogues, forbid all that I enumerated earlier, force them to work, and deal harshly with them .... Therefore it would be wrong to be merciful. ... We must drive them out like mad dogs .... I have done my duty. Now let everyone see to his. I am exonerated." [17]

Luther's advice about Jewish persecutions and expulsions was espoused in 1543, after the principles of the Lutheran movement had already been formalized in the Augsburg Confession of 1530. [18] Consequently, the Luther . Solution was at first not widely taught in the church schools that Luther had so profound an influence over. But it was kept alive in the seventeenth and eighteenth centuries by renegade churchmen. The Luther Solution was revived as a national issue in the second half of the nineteenth century. The German Jews had been emancipated in 1871, thus becoming visible in all sectors of German life. Visibility had always been a fear of the Jews. The fear was vindicated this time as well.

Adolf Stoecker, the Court and Cathedral Preacher of Berlin, led the reaction in 1874. He used his church position to organize an anti-Semitic political party that included many clerics dedicated to expunging the Jewish presence from German society. Stoecker was in fact dubbed "the Second Luther." His relentless Judophobic preaching included the now familiar slogan "The Jews are Germany's misfortune." The words were taken from Luther's original treatise. [19]

Stoecker and other anti-Semitic German nationalists were the impetus behind the Union of German Students, an anti-Jewish society organized in 1881. The Union, represented at every major university, included a large number of theological students who became the carriers of church-disseminated anti-Semitic dogma at the turn of the twentieth century. [20]

Two rabid German national anti-Semites who gained prominence during the Stoecker heyday were Houston Steward Chamberlain and Theodor Fritsch. Fritsch, in the late 1880s, helped form anti-Semitic political parties that would later evolve into the NSDAP. The Nazis referred to him as their spiritual leader. Chamberlain became Hitler's personal inspiration. [21]

In 1917, a Germany gripped by war lavishly marked the four-hundredth anniversary of Luther's Reformation. It was the perfect moment for a Luther revival. As Germans struggled to defend the Fatherland, Luther's ideology of territorial and ethnic destiny gave them conviction and encouragement. [22]

A few years later, a defeated Germany was again looking to Luther, this time for strength and solace. During the 1920s, the church literally became an extension of German nationalism. The purity of German blood, the sanctity of German religion, and the destiny of the German people were all woven into a virtual theomania. Integral to this movement was the compulsion to exclude Jews for all the reasons Martin Luther had enumerated four centuries earlier. [23]

Anti-Semitic German nationalists outside the church resurrected the Luther Solution. They called themselves Nazis. In their campaigns to recruit support, Brownshirts spoke the familiar phrasing of Germany's religious patriarch. From the street corners they constantly reminded that Martin Luther was beckoning Germany to expel the Jews. [24]

In spring 1933, Hitler reflected the weight of Luther's words upon his own thought. During a newspaper interview, Hitler asked who was "prepared to harbor . . . those who have poisoned the wells of Germany, of the whole Christian world. Gladly we would give each and everyone of them a railroad pass and a thousand mark note for pocket money to be rid of them." [25]

From Luther's treatise "On the Jews and Their Lies": "They have been ... murderers of all Christendom for more than fourteen hundred years ... poisoning water and wells.... The country and the roads are open to them to proceed to their land whenever they wish. If they did so, we would be glad to present gifts to them on the occasion; it would be good riddance." [26]

Julius Streicher's newspaper Der Sturmer bannered the Luther slogan in every issue: "Die Juden sind unser Ungluck!" -- The Jews Are Our Misfortune! [27] And one of Streicher's anti-Jewish picture books was titled after the Martin Luther adage "Trust no fox in the field and no Jew under his oath." [28] In Germany, preaching Jew hatred was as good as preaching the gospel.

When Streicher was captured by the Allies in 1945, they confiscated his personal copy of "On the Jews and Their Lies." At the Nuremburg War Crimes Trials, Streicher, a philosophical descendant of a centuries-long tradition, explained his actions with these words: "Martin Luther would very probably sit in my place in the defendant's dock today if this book had been taken into consideration .... In the book "[On] The Jews and Their Lies" Dr. Martin Luther writes that ... one should burn down their synagogues and destroy them." [29]

Martin Luther gave rise to nothing less than a jagged and saltatory lineage of Jew-hating German nationalists that culminated in the men and women of the Nazi movement.

***

The Nazis had always glossed over Zionist aspirations for statehood. Hitler believed that Jewish laziness, decadence, and impurity made Jewish nationhood an impossibility. In Hitler's words, spoken in the first days of Nazi organization: "The establishment of a [Zionist] state is nothing but a comedy." [30]

Instead, the Nazis seized upon the one aspect of Zionism they approved of: the condemnation of a Jewish presence in Germany and the desire to remove Jews to Palestine. On April 6, 1920, in Munich, Hitler explained the Nazi willingness to embrace Zionism with these words: "To reach our goal, we must use every means at our disposal, even if we have to make a pact with the devil himself." Ironically, Vladimir Jabotinsky had spoken essentially the same words several months before, when he declared to the Twelfth Zionist Congress: "In working for Palestine, I would even ally myself with the devil." [31]

A few months after his April 1920 promulgation, Hitler made the point again, at a Munich beer hall. While he was preaching his doctrine of Jewish expulsion, someone from the crowd hollered something about human rights. Hitler answered sharply, "Let him [the Jew] look for his human rights where he belongs: in his own state of Palestine." [32]

Hitler's foremost theoretician on Judaism and Zionism, Alfred Rosenberg, adopted Hitler's willingness to exploit Zionism. Writing in 1920 in the Nazi newspaper Die Spur, Rosenberg demanded that Germans lay aside all feelings of antipathy: "Zionism must be actively supported so as to enable us annually to transport a specific number of Jews to Palestine, or, in any case, across our borders." [33]

With the appointment of Adolf Hitler, the moment was ripe for a hateful alliance; Nazis and Zionists working in concert for a Jewish exodus. In the first months of 1933, German Zionists knew they faced either total demise or ultimate vindication. [34] So, in a bold move, the ZVfD launched a two-sided campaign: first, to convince the Nazis to recognize Zionism as the custodian of Germany's Jews; second, to convince Germany's Jews to admit that yes, German Jewry belonged in Palestine.

On January 31, 1933, within twenty-four hours of Hitler's appointment, the ZVfD newspaper, Juedische Rundschau, asserted that the defense of Jewish rights could be waged only by Zionists, not mainstream Jewry. After the May 10 Nazi book burnings, Juedische Rundschau mourned the loss as did all Jews, but could not resist publicly labeling many of the Jewish authors "renegades" who had betrayed their roots. [35] The anti-assimilationist barrage continued weekly with Zionist aspersions sounding painfully similar to the Nazi line discrediting the German citizenship of Jews.

It became that much harder for German Jews to defend against Nazi accusations of illegitimate citizenship when a loud and visible group of their own continually published identical indictments. It was as mainstream German Jewry feared, and as Nazi philosopher Alfred Rosenberg made clear in his anti-Semitic teachings: "If an organization inside the state declares that the interests of the German Reich do not concern it, it renounces all its civil rights." [36] Zionism had become a tool for anti-Semites.

***

The Hitler hierarchy was at first unwilling to work with Zionism, lest the rank and file misunderstand the association. In fact, by March 1933 the ZVfD was clearly marked for extinction. [37] But all that changed when Stephen Wise rattled the boycott and protest saber at Germany. The critical minute for Zionism had come during the March 25 meeting with Goering. The Zionists stepped forward and offered to try to dissuade Wise from holding his Madison Square Garden rally. In that instant, the Zionist relationship to National Socialist goals underwent a rapid transformation, from theoretical to practical.

Sensing the change, Juedische Rundschau called in an April 7 column for Zionists and Nazis to be "honest partners." [38] Instrumental in developing this partnership was ZVID activist Kurt Tuchler, whose many acquaintances in the NSDAP included an Austrian-born engineer named Baron Leopold von Mildenstein, an SS officer dealing with Jewish affairs. Tuchler wanted to convince von Mildenstein's circle that the NSDAP should openly promote Jewish nationalism. If von Mildenstein could write a pro-Palestine article in Goebbels' widely read newspaper, Der Angriff, it might sway many in the party and the government. Von Mildenstein was receptive, but insisted that he could write a believable piece only if he actually toured Palestine. So Tuchler invited von Mildenstein to Palestine. In late April 1933, both men and their wives boarded an ocean liner for Palestine. The Nazi party and the ZVID each had granted permission for the joint trip. Von Mildenstein approved of what he saw in the kibbutzim and in Tel Aviv. He even learned a few Hebrew words. Many photographs were taken, numerous mementos were dragged back to Germany. An elaborate illustrated series was published about eighteen months later in Der Angriff under the title "A Nazi Goes to Palestine." Goebbels' newspaper was so proud of the series that a commemorative coin was struck in honor of the voyage. On one side was a swastika. On the other side a Star of David. [39]

Von Mildenstein rapidly became the party expert on Zionism. He was said to have read Herzl's "Der Judenstaat" and insisted his subordinates do likewise. One of these subordinates was a man named Adolf Eichmann. Von Mildenstein, and later Eichmann, developed the Jewish Section of the Reich Security Main Office, which in the late 1930s coordinated Jewish emigration policies. In the early 1940s, Eichmann's domain would change from emigration and Zionism to deportation and genocide, as he orchestrated the shuttling of millions of Jews to the gas chambers of Europe. [40]

The Nazi recognition of Zionism that began in April of 1933 was apparent because the Zionists enjoyed a visibly protected political status in Germany. Immediately after the Reichstag fire of February 27, the Nazis crushed virtually all political opposition. Through emergency decrees, most non-Nazi political organizations and suspect newspapers were dissolved. In fact, about 600 newspapers were officially banned during 1933. Others were unofficially silenced by street methods. The exceptions included Juedische Rundschau, the ZVfD's weekly, and several other Jewish publications. German Zionism's weekly was hawked on street comers and displayed at newsstands. When Chaim Arlosoroff visited Zionist headquarters in London on June I, he emphasized, "The Rundschau is of crucial importance today for the Zionists. Every day it gets fifty to sixty new subscribers." By the end of 1933, Juedische Rundschau's circulation had in fact jumped to more than 38,000 -- four to five times its 1932 circulation. [41] Although many influential Aryan publications were forced to restrict their page size to conserve newsprint, Juedische Rundschau was not affected until mandatory newsprint rationing in 1937. [42]

And while stringent censorship of all German publications was enforced from the outset, Juedische Rundschau was allowed comparative press freedoms. Although two issues of Juedische Rundschau were suppressed when they published Chaim Arlosoroff's outline for a capital transfer, such seizures were rare. Other than the ban on anti-Nazi boycott references, printing atrocity stories, and criticizing the Reich, Juedische Rundschau was essentially exempt from the so-called Gleichschaltung or "uniformity" demanded by the Nazi party of all facets of German society. Juedische Rundschau was free to preach Zionism as a wholly separate political philosophy -- indeed, the only separate political philosophy sanctioned by the Third Reich. [43]

In 1933, Hebrew became an encouraged course in all Jewish schools. By 1935, uniforms for Zionist youth corps were permitted -- the only non-Nazi uniform allowed in Germany. When the Nuremburg Laws in late 1935 stripped German Jewry of their citizenship, it became illegal for Jews to raise the German flag; the same law, however, stipulated that German Jewry could raise the Star of David-emblazoned Zionist flag. [44]

The ZVfD's quick success in lobbying the Zionist option to the Reich advanced the priority of their second imperative: convincing German Jewry to relinquish ten centuries of German national existence. But the bulk of German Jewry wanted another solution to their predicament.

They wanted to stay, even as second-class citizens -- even reviled and persecuted. The hot springs and baths, the outdoor Konzerten of Bach and Mozart, the readings of Goethe, Oriental carpets on the floor, exotic fruits from Africa, a noble tradition they had fought for, died for, profited by. These people were integrated. They were Germans. They wanted to stay, even as helots.

Zionism said no. While mainstream Jewish organizations were frantically assembling theories and position papers suggesting a tapered-down but still German national existence, the Zionists were doing the opposite. On June 21, 1933, a long ZVfD memorandum was sent directly to Hitler outlining those Zionist tenets that were consistent with National Socialist ideology. For example: "Zionism believes that a rebirth ... such as that in German tradition resulting from a combination of Christian and national values, must also come about within the Jewish community. Racial background, religion, a common fate and tribal consciousness must be of decisive importance in developing a lifestyle for Jews too .... Zionism's objective is to organize Jewish emigration to Palestine in such a way that it improves the Jewish situation in Germany .... Jewish settlement is based on agriculture. All productive work, be it of an agricultural, craftsmanship, or industrial nature, is performed by Jewish workers who are inspired by a new, idealistic work ethic." [45]

The German Zionist memo to Hitler contained the obligatory appeals to Nazi prejudices about Jewish laziness and calculated comparisons between the two movements. This was the only way to converse with the Nazi regime. Nazis were philosophically trained to dismiss as standard Jewish trickery any logical, civil, and legal arguments by Jews laden with words of justice and compassion. On the other hand, Nazis weren't fooled by the obvious Zionist use of Aryan rhetoric. Rather, they viewed the Zionists not as partners, but as agents who would act not out of interest for the Reich but for their own Jewish national aspirations. And while the Zionists indeed spoke in the Aryan context, they recognized fully that they were speaking to an enemy of the Jews, an enemy who understood that Zionist approaches were not for the sake of the German state, but for the sake of the Jewish state. This mutual understanding was even set down in writing in the Zionists' June 21 memo to Hitler: "For its objectives, Zionism feels able to enlist the cooperation of a basically anti-Jewish government, because dealing with the Jewish problem does not involve sentimentality." The memo added that it was precisely that absence of Zionist sentimentality about the anti-Semitic regimes it worked with that committed the worldwide Zionist movement against the anti-Nazi boycott. [46]

Perhaps no more dramatic example of German Zionism versus German Jewry exists than a Juedische Rundschau article entitled "Wear It with Pride, the Yellow Spot!," written by editor Robert Weltsch. This article appeared April 4, 1933, as one of the first German Jewish comments following the shock of the aborted April First anti-Jewish boycott action. Decades after the fact, Weltsch's article is held up as an act of courage comforting the Jewish community in a moment of anguish while the nation around them was reviving the medieval concept of Jews wearing an identifying yellow spot on their clothing.

In fact, Weltsch's article was a barbed chastisement of German Jewish assimilation in Germany at the very moment when Jews were struggling to preserve their legal status as citizens. Weltsch's words:

April 1, 1933 will remain an important date in the annals of the German Jew and the entire Jewish people. The events of that day have not only a political and economic, but also moral side.... Our concern is the moral aspect.... On April 1, the German Jews received a lesson which goes much deeper than even its embittered and today triumphant opponents can guess.... Our concern is how does Jewry react to all this.

April 1, 1933 can be a day of Jewish awakening and Jewish rebirth. If the Jews want it to be. If the Jews are mature enough and possess sufficient inner greatness. . . . We must recommend that during these days the publication which stood at the cradle of Zionism, Theodor Herzl's Judenstaat, be distributed among Jews and non- Jews in hundreds of thousands of copies.

We Jews who have been brought up in the spirit of Theodor Herzl are not accusing today -- we only seek to understand. And to ask ourselves where our own guilt lies, how we have sinned.... Jewry bears a heavy burden of guilt because not only did it not heed Theodor Herzl's call, it even partially ridiculed it.... It is not true that the Jews are traitors to the German nation. If they have committed treason, it was directed against themselves, against Jewry.

Because every Jew did not proudly bear his Jewishness, because he wanted nothing to do with the Jewish question, he shares the guilt for all Jewry's humiliation. Despite all the bitterness we feel reading the National Socialist calls for [an anti- Jewish] boycott ... we can still be grateful ... for one thing. The [boycott] guidelines state in paragraph 3: ... "this concerns businesses which belong to members of the Jewish race. Religion is irrelevant. Businessmen who have been baptized Catholics or Protestants or dissidents of the Jewish race are, for the purposes of this decree, Jews."

This is a reminder for all traitors to Jewry. He who sneaks away from the community [by assimilating] in order to improve his own situation should not be rewarded for his treason. This attitude toward renegades contains the beginning of a clarification. . . . To be a renegade is shameful; but so long as the world put a premium on it, it appeared to be advantageous. Now it is an advantage no longer. A Jew is being identified as such. He is given the yellow spot.

The fact that the boycott leadership decreed that boycotted businesses be identified with "a yellow spot on a black background" is a tremendous symbol. This measure is meant to be a stigma, a show of contempt. We accept it, and we want to make it a badge of honor.... Among other symbols and inscriptions, many store windows were painted with a big Star of David. Jews, pick it up ... and carry it with pride!

... If National Socialism recognizes this state of affairs, it would no doubt wish as its Jewish partner a Jewry which values its honor. [47]


Only a few of the dramatic catchphrases from Weltsch's article have been remembered, hence the myth that his words were an act of comfort. But for the 97 percent of German Jewry who rejected Zionism and accepted German assimilation, [48] Weltsch's denigrations and dramatic calls for a bold abandonment of ten centuries of German existence were painful and foreboding. His words signaled the beginning of what Diaspora Jews had always feared about Zionism-the day it would be used as the legal and moral pretext for forcing Jews out of European society.

The broken-line triangle between German Jews, Zionism, and Nazism, now filled in by tears, blood, and hate, explains how a fringe minority of German Jews -- numbering just a small percent of the community -- assumed emergency custody of 550,000 men, women, and children. Based on that custodial privilege, the Zionist movement in Palestine, Germany, Great Britain, and America continued to debate how best to claim the Jewish nation waiting within the borders of the Third Reich.
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Re: THE TRANSFER AGREEMENT: THE DRAMATIC STORY OF THE PACT B

Postby admin » Fri Jun 26, 2015 6:17 am

18. Jews Lead the World to Boycott

MOST JEWS in America and Europe committed to political and economic battle with the Reich were also avid Zionists. But many of them possessed a Diaspora Zionist orientation; that is, they valued the right to live in the nations of the world as coequal to, not mutually exclusive with, the right of return.

To most Diaspora Jews, the tug of Palestine and the right of assimilated citizenship elsewhere represented a choice rather than a conflict. With the ascent of Hitler, these Jews would not tolerate one right to be subordinated to the other. While their political agitation often included demands to open the gates of Palestine to German Jews, care was taken not to abandon the struggle to defeat Nazi persecution of those Jews who wanted to stay. In fact, as Hitler became a progressively deadlier menace, most Jews felt the work for Palestine should be prioritized second. First and foremost was the battle to save German Jews in the context of their right to live freely in Europe.

That meant boycott and protest. It was emotionally impossible for Jewish circles to do otherwise. The daily reports of outrageous atrocities and persecution cried out for a punitive reaction.

Examples: In mid-May 1933, The Manchester Guardian and The London Jewish Chronicle reported that a Berlin Jew picked up by Storm Troopers was not seen again until his body was discovered two weeks later amid sewage outside the city. The victim had been "horribly mutilated, his face had been smashed in and his lips had been cut open." [1]

On June 9, The Jewish Chronicle reported how a squad of four Brownshirts broke into a Berlin dressmaker's apartment at 2:30 A.M. The Nazis decided to "squeeze the Jewish blood" out of the eighteen-year-old son. "In front of the parents they ... started beating him with whips. One sat on his head, another on his feet, and the other two beat him for ten minutes. All the time, the parents were ordered to keep their eyes wide open and watch the scene.... [Then] they decided ... to cut out a swastika on his forehead so that he should remember 'the good times of Nazi rule.' But, not with a knife was the ... work done, but with their revolvers. Each of the four Nazis kept hitting the boy on the head, so as to form the wound into a swastika. The boy's face was a mass of raw flesh, and so was most of his body." The Brownshirts left the house with a warning not to "'tell stories about Nazis.'" [2]

In late June, The Jewish Chronicle reported the invasion of a Jewish clothes merchant's home in the fashionable section of Berlin. SA hooligans "broke down the doors of Herr Friedenberg's flat and attacked him savagely, beating him for an hour on end with their rubber truncheons, chairs, or anything that came to hand. His groans and cries could be heard out in the street." [3]

German Jews knew that it was better to endure silently. To complain was to be marked as a purveyor of Greuelpropaganda, which would only bring more hooligan punishment upon a victim's family and business -- not to mention actual prosecution, which generally meant shipment to the Dachau concentration camp. Family and friends frequently did not even know the grisly details. The local NSDAP unit would often order the body to be either cremated or buried before the family was notified. And the Jewish Burial Society was under explicit instructions to not reveal information about the physical condition of any corpses. [4]

Nonetheless, a fraction of the sadistic tales did leak out, mainly via the scores of refugees who streamed out daily. Relief sources estimated that 90 percent of the Jews reaching Poland by June 1933 had suffered physical violence. About 25 percent of the refugees, including women and young girls, still bore the wounds of torture. [5] And travelers -- businessmen, diplomats, and academics -- regularly brought back stories of uncontrolled street violence. [6]

Of course, the Third Reich tried to deny that any anti-Jewish violence was occurring in Germany. In an interview in mid-June 1933, Hitler tried to assure a Colliers Weekly correspondent: "Perfect calm reigns in Germany. Not a street has been destroyed. Not a house .... If only all Americans could come over here! They would look about and ask themselves where is this revolution, where is this terror, where is all this destruction and chaos I've heard about?" [7]

Such calming statements were not convincing in the face of repeated public promises by prominent Nazis to kill every Jew in Germany. Just a few weeks before Hitler's statement to Colliers Weekly, Nazi boycott leader Julius Streicher told a meeting in Nuremberg that if Germany went to war, every Jew in Germany would be killed. At the same time, Nazi leaders in Danzig issued a secret memorandum, a copy of which was obtained and published by The London Daily Herald. The memo claimed, "Final punishment of the enemies of the German nation, in the first rank of whom are the Jews, will be ordered by Hitler at the right moment .... That which tomorrow may be a holy duty must today be left undone." [8] At the same time, a prominent German physician published in a German medical journal his solution to the Jewish problem: sterilization. [9]

Even the American Jewish Committee, which had tried to pretend the atrocities did not exist, was compelled by mid-June 1937 to admit that anti- Jewish violence in Germany was rampant. In a booklet entitled "The Jews in Nazi Germany," which they released to the media, the Committee detailed count after count of Nazi brutality. The New York Times endorsed the Committee booklet as a believable bill of particulars of the Reich's anti-Jewish campaign and advised the public to reject all German denials. [10]

The question before the world now was whether the Hitler regime could be smitten down quickly -- certainly before it pauperized German Jewry, but more important, before it could carry out the recurring Nazi promise of destruction to 550,000 Jewish men, women and children. Protest and boycott were the only weapons at the disposal of those who opposed the Reich.

So the protests and boycotts continued. City after city hosted Madison Square-style rallies throughout the month of May. Melbourne, Philadelphia, Buenos Aires, Warsaw, Marseilles. The protest movement in England was especially contagious. Raucous mass demonstrations started in Manchester and swept through Newcastle, Leeds, Birmingham, and Glasgow. The protests culminated in an overflow rally May 16 at London's Queen Hall. [11]

During May, the boycott movement continued to spread, especially where there were Jews to fire the issue. Cairo: The League Against German Anti-Semitism demanded that all Egyptian Jews lead a national boycott of German goods and services. Gibraltar: One thousand Jewish merchants vowed to boycott all German merchandise. Paris: Filmgoers cheered a band of Jewish youths who disrupted a German film; more disruptions were promised for any future German screenings. [12] London: The extensive boycott against German ocean liners was in large part due to Jewish passengers switching to British and Italian vessels; prior to the boycott, half of all Anglo- Jewish ocean travelers sailed on German ships. [13]

Buenos Aires: German commercial interests in Argentina were powerless to stop the accelerating boycott organized by Argentinian Jews; the Argentine boycott not only involved German ships and products, but called for depositors to transfer accounts from German to Argentine banks. Paris: The League Against Anti-Semitism began proliferating the boycott throughout the provinces by opening boycott offices in Lyons, Nice, and Marseilles. [14] Amsterdam: Two boycott groups printed thousands of "boycott stamps" to be used on envelopes and parcels. The stamps featured a swastika transmuted into a four-headed snake behind prison bars over Dutch, French, and English inscriptions urging boycott. They quickly became an international boycott tool. In late May, sample stamps were delivered to New York for the American movement by a Dutch physician. But the Jewish War Veterans were already mailing an American version at the rate of 10 million per week. [15]

A sudden growth in the boycott was also spurred when national trade unions became active in the movement. British trades were sympathetic from the beginning in March 1933. But by late May, guided by Jewish industrialist Lord Melchctt, the powerful Trades Union Congress (a union federation) declared the anti-Nazi boycott a mandatory pursuit for its members. The T.U.C. instructed member unions, Labour party supporters, and Cooperative Societies to bring the benefits of boycott to British manufacturers. [16]

At about the same time, the Dutch Federation of Trade Unions and the Social Democratic Labour party in Holland adopted a stance identical to British labor. Britain's ambassador at The Hague reported that the boycotters acknowledged the "harmful effect such a boycott would have on Dutch agricultural exports to Germany . . . but decline to be deterred by such considerations." [17]

If anyone in Berlin dreamed that the mid-May deal with Sam Cohen would act as an automatic boycott circuit breaker, they quickly realized they were mistaken. During late May, German consulates throughout the world continued to report attacks on Reich commercial interests. On May 24, Hitler was handed a report on the entire foreign-trade question. Protectionist trade policies coupled with the growing international boycott were listed as the two principal reasons for Germany's dwindling exports. The report explained that the boycott itself was a joint reaction by Jewish groups and labor unions. The prospects: bleak. [18]

By June, data from the previous months was starting to pile up in Reich offices like delayed battle casualty reports. The news was always worse than expected. Germany's vital trade surplus for the first four months of 1933 was down more than 50 percent from the 1932 figure, dropping from RM 70.2 million to RM 35.4 million. [19] Throughout North Africa, ordered and shipped German goods were being refused, resulting in staggering losses. Egyptian refusals alone amounted to about $500,000 weekly. [20]

Specific German industries were hit hard. Reeling from the failure of the Leipzig fur auction, in June the fur industry was authorized to proclaim: "Jews in the fur trade are welcome in Leipzig." [21] But Jews in foreign countries who controlled almost all wholesale fur transactions were keeping their promise to destroy Germany's fur business. Jews were also heavily represented in the international textile market. Britain's most outspoken boycott leader, Lord Melchett, headed one of England's textile conglomerates. So when Germany's already suffering textile industry suddenly lost another RM 1 million in sales, the Reich readily conceded that the boycott was responsible. [22]

Perhaps the most devastating and visible loss struck the German diamond industry. Previously Germany had employed 5,000 diamond workers, even as thousands of Dutch polishers went jobless. In the last days of May, Holland's mostly Jewish diamond traders collectively refused to send any more gems to Germany for polishing or cutting. In less than a week, 4,000 unemployed Dutch diamond workers were hired in Antwerp and Amsterdam to handle the diverted business. Germany's lucrative diamond industry was dismantled overnight. [23]

The Jews were striking back. Not in the shoulder, where the enemy was armored, but in the region of the wallet, where the enemy was tender and exposed.

By early June 1933, the specter of collapse was hovering over the Third Reich. On June 6, Hjalmar Schacht sent a grim letter to the Fuhrer reporting that as of May 31, only RM 280 million in gold and foreign-exchange reserves remained in the Reichsbank. There was now "the great danger that the foreign exchange available will no longer be adequate for the orderly payment of the millions needed daily in German foreign trade transactions. This danger is all the greater, since the constant reduction of available foreign exchange reserves causes foreign trade to shrink more and more." Schacht then confirmed what foreign newspapers had already published, that Germany's positive trade balance -- that is, her vital surplus of exports over imports -- for the first quarter of 1933 was less than half the 1932 figure: down from RM 94 million to RM 44 million. Schacht warned that a drastic decline in trade was now "dangerously imminent." [24]

"We should not wait for such a situation to occur if we do not want to jeopardize payments for imports, especially of raw materials and semi-finished goods, the processing of which forms the basis for the employment of a highly qualified German labor force." [25] The words, underlined by Schacht, carried an ominous message. Germany's exports were mainly finished goods, which relied upon the imported components. It was one thing for Germany to default on its past debts, bonds, and intergovernmental obligations. But if Germany could not continue the day-to-day purchasing needed to keep its people working, they would suddenly stop working.

Schacht demanded an immediate prohibition on paying foreign-exchange obligations incurred before the bank crisis of July 1931, except those required by the Standstill Agreement, which froze most of Germany's debts as part of a restructured repayment plan. This measure would barely allow Germany to continue day-to-day business. [26] France's ambassador in Berlin, Andre Francois-Poncet, visited Reich Foreign Minister von Neurath the next night, June 7, to protest that French creditors would be severely affected. Von Neurath defended the move as a natural consequence of the export decline. [27] It was Germany's old argument against the boycott. How could she honor her international debts when her ability to pay was dependent upon exports that were being refused throughout the world?

American complainers were more outspoken. Chief among them was John Foster Dulles, an attorney representing American banks. Ironically, Schacht had always believed that the threat to default on American holders of German bonds, due to a lack of foreign exchange resulting from the boycott, would be a major incentive for Americans to reject the anti-Hitler campaign. But Dulles' written protest promised even more retaliation: "I believe that if Germany inaugurates such a system, your outgo of devisen [foreign currency] will continue to be very substantial and your income of devisen will be very sharply reduced due to increased obstacles and prejudices against the use of German goods and services." The last clause bore the familiar ring of anti- Nazi boycott phraseology. Dulles' message added, "There is already a considerable element which is discriminating against the use of German goods and services. This may prove to be merely a passing phase, or it may crystallize into a well-defined national attitude. In my opinion it will crystallize if ... [Germany] alienates that important element of our population which is represented by the holders of German bonds." [28]

Punctuating his threat with the statement "Defaulted bonds do not evaporate," Dulles listed retaliatory measures beyond a boycott, including a court-ordered seizure of German private and public assets in the United States. An attached memo actually itemized some of the assets that could be liquidated: the vessels and revenues of three German shipping lines; the property and funds of the German-Atlantic Cable Company; the AEG and Gesfurel electric companies; and the United Steel Works; plus the deposits of at least two major German banks in the United States. Together the targeted assets represented $155 million. But Dulles promised that the seizures would extend even to unrelated German firms abroad that owed money to the targeted German debtors. [29] In other words, Dulles was threatening a systematic repossession, confiscation, and liquidation of Germany's international commerce.

Currency and debt manipulations bought time, but precious little of it. Nazi leaders were frantic and divided on how best to fight the boycott. Increased threats were offered. In a June 10 Volkischer Beobachter editorial reprinted in America, Hitler's philosopher Alfred Rosenberg warned, "The fate of the Jews ... might become worse if world Jewry does not give up its isolation plan against German business." [30] But boycotters ignored such threats, believing that Nazi persecution was proceeding as swiftly as possible -- boycott or not.

In one test case, the Reich used its precious remaining influence with a foreign power to outlaw a boycott movement. This happened in Latvia, one of the strongest boycott centers in the Baltic region. In late May, the German embassy sought court restraint for Jewish student groups urging a boycott of German films. Then in early June, shortly after the All-Latvian Jewish Conference and various Socialist groups voted to officially sponsor a boycott, the Reich hit back with a German boycott of Latvian butter. Germany promised that butter was only the beginning. In truth, the Reich could not afford to disrupt more bilateral trade than that; butter was selected only because such a ban was already needed to protect the domestic German butter market. But for Latvia, the warning was sufficient. Within a week, von Neurath had concluded an agreement in London with the Latvian foreign minister to ban all further anti-Nazi boycott activities in Latvia. However, while the agreement did reduce open anti-Nazi organizing, Latvian boycott groups in fact remained in the forefront of international boycott actions. [31]

But the Latvian case was isolated. The anti-Hitler movements in other countries were only becoming more organized and more comprehensive. One of the most threatening precedents was being set in England by an elderly gentleman named Capt. Walter Joseph Webber. Captain Webber, who earned the nickname "the Gallant Captain," established a system of "boycott certificates" for British stores. Just as the NSDAP in Germany had circulated window certificates for Aryan businesses free of Jewish commercial dealings, so Captain Webber's organization in England would begin distributing window certificates for stores in strict compliance with the anti-Nazi boycott. Those stores not displaying certificates would be blacklisted and, if necessary, boycotted themselves. If Webber's vigilant inspectors found any breach, the certificate would be removed. [32]

At first, Captain Webber set June 15, 1933, as the deadline for compliance. But when a multitude of shops asked for extra time either to return or to sell off at discount their remaining German inventory, the deadline was extended to July x. When the certificates were finally released, 5,000 were affixed to store windows in England the first day alone. Many went to non- Jewish concerns. Adherence was strictly enforced in Jewish neighborhoods. For example, late one Friday night, Mr. Isaac Angel's London toy store was found with German stock. An angry mob of about a thousand protesters surrounded the store and became so menacing that mounted police were dispatched. The incident ended only when the frail Captain was summoned and escorted through the crowd to confer with Mr. Angel. The protesters finally dispersed when assured the German toys would be sent back, whereupon a certificate of compliance would be issued. [33]

Despite the economic and psychological impact of local and national boycotts, what the Nazis feared most was a coordinated global operation. For instance, when a haberdasher in London considered refusing to sell German gloves, where was he to find alternate sources of gloves? When an optical house in Newark considered switching its long-established German source of ground lenses, where were the new lenses to come from? Locating new distributors, hammering out new commercial relationships was not an overnight process. Even when the outrages of Nazism provoked merchants to discontinue stocking German goods, this could be done only for a few months before their own businesses would begin to suffer for lack of merchandise. Sympathetic businesspeople and consumers were only too happy to cut off German goods permanently if someone would only locate alternates of identical quality and price.

Germany's competitors in France, Canada, England, Czechoslovakia, America, and Holland were glad to fill the void. But how were the cutlery manufacturers in Sheffield, England, to discover the neighborhood cutlery stores in Pittsburgh and Krakow? How were the quaint china ware shops of Oslo and Buenos Aires to locate the china factories of Rumania?

By 1933, commerce had become so international a complex that only a global organization could fundamentally shift commercial traffic over and around the well-entrenched German export system. And the boycott organizers understood this from the beginning.

These organizers knew that boycotts become successful not by asking people to stop buying and selling what they have traditionally bought and sold, but by asking people to switch their buying and selling loyalties. New loyalties, once rooted, would become equally difficult to dislodge. Without high-quality, price-competitive alternative sources of supply, the anti-Hitler boycott would be no more than an emotional, briefly punitive commercial reprisal. But with an international clearinghouse to reroute the rivers of commerce, Germany would be left deserted and destitute -- not for just a few months, as she weathered the attack, but in a systematic fashion that would remain in force until Germany collapsed from within.

The major boycotters of America, Holland, England, France, and Poland, looking forward to the moment of international consolidation, almost universally adopted the same slogan: "Germany will crack this winter!"
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Re: THE TRANSFER AGREEMENT: THE DRAMATIC STORY OF THE PACT B

Postby admin » Fri Jun 26, 2015 6:18 am

19. Germany Will Crack This Winter

TIME was what the Reich needed. When the Reich could no longer pay its obligations, Germany would be bankrupt. That moment had been technically postponed for years by rationing foreign exchange to only the most important transactions. But with Reichsbank reserves hit so hard by both the boycott and the Depression, there would soon be nothing left to ration.

In fact, in early June 1933, the German government was forced to permit the American Jewish Congress and other groups to send a multimillion-dollar Jewish relief fund to Berlin. The decision was of such importance that final approval could be granted only by Hitler himself. It was a difficult approval, because accepting relief funds was an admission that German Jews were being economically destroyed -- something the Reich continued to deny. But the dollars were too badly needed to prop up the foreign-exchange scarcity. Moreover, when recalcitrant NSDAP activists tried to seize the funds from Berlin banks, claiming that the Congress money belonged to a hostile organization, the government quickly intervened and cash distribution to Jews resumed. The threat that future relief dollars would not be sent to Germany was too perilous a possibility to allow any interference. [1]

But relief funds were mere drops of water to the cash-thirsty Reich. In plain English, they were already broke. Only Schacht's clever acts of desperation were postponing a mass shutdown of German industry.

For example, shortly after Sam Cohen's deal was concluded, the Reich Economics Ministry realized the potential of using blocked marks and merchandise to pay desperate creditors. A similar arrangement was set up with a new American syndicate managed by the Harriman Company Harriman would purchase German merchandise for about 150 American individuals and companies owning blocked accounts in Germany. It worked this way: American importers would pay only 75 percent of their merchandise invoices in actual U.S. currency. But these dollars would never reach the German manufacturer; they would go into the Reichsbank reserve. The Reichsbank would then pay the German exporter in blocked marks. The remaining 25 percent of the invoices would be paid to a U.S. escrow account in dollars. To consummate the transaction, the U.S. creditor would take over the dollar escrow account in America and the German manufacturer would take over the creditor's blocked account in Germany. The Economics Ministry expected to promote about RM 25 million in exports by this technique. [2] The U.S. creditors were so desperate they were willing to traffic in German exports to slowly regain part of their assets frozen in Germany. In the process, Germany earned foreign currency and kept industry working a little longer.

Another trick for time was the proliferation of bilateral bartering. With little or no cash to pay for raw materials and semifinished goods needed for industry, Germany could resort to the barter system, a straight exchange of goods or commodities. For instance, Germany could swap its coal for another country's cotton, or German pharmaceuticals for another country's metal ore. In this way, a bankrupt Germany could keep manufacturing components flowing to German industry, and the population would remain working.

But such tricks were dependent upon one essential factor: the inherent value of German goods. Once German merchandise did become essentially valueless, Germany could gain yet a little more time with domestic tricks, charades, and outright thefts. For instance, the Reich could offer subsidies to stave off an industry's disintegration. By early June, such subsidies were frequent. For example, on June 6, Goebbels granted a RM 10 million subvention to the German film industry. [3] But crippled by cinema boycotts, the German film industry would take many months, perhaps years to rebuild. [4] How long could such subsidies continue?

Or the Reich could broaden its artificial protection of domestic industries. Such protection already existed for numerous commodities such as eggs and wheat. But whenever the government banned competitive supplies from neighboring countries, those countries always retaliated with similar restrictions on German products. So one German economic sector would flourish for a moment, while several others paid the price. For example, trade with Rumania was almost nonexistent by June 1933 because Germany's protectionist ban on many Rumanian farm products provoked a reciprocal ban on most German wares. [5] How long could the Reich protect selected economic sectors at the expense of others?

Or the Reich could expand its rigid wage and price controls. But that creates shortages, black markets, and even bankruptcies. In fact, such bankruptcies were regularly occurring. Defunct companies were simply absorbed into ever larger cartels to keep the employees working. But how long could unprofitable businesses continue federating before they created one prodigious industrial failure? How many such failures could the Reich prop' up with subsidies? And how many shortages could the Reich endure before work was forced to a halt for lack of materials?

Or the Reich could fool the millions of unemployed Germans into believing they were actually gainfully employed. With over 5 million still jobless, employment schemes were an obsession of the Third Reich. For example, in May, Hitler announced "compulsory volunteerism" as a substitute for actual employment. Most of these schemes simply relocated the worker. Heavily reliant on Nazi jingos and fatally underfinanced, the substitute work programs were aptly summed up in a mid-May report by British commercial attache F. Thelwell: "Schemes for [re]settlement and for the provision of work ... are being dealt with together, and ... such a state of confusion exists and such obviously fantastic plans are being discussed, that it is quite impossible to form any rational or coherent picture of what will ultimately be done." [6] How long could such schemes continue to fail before the populace saw them as placebos?

Or the Reich could continue squeezing its own citizens and companies. This it was already doing to the Jews, with the overwhelming approval of the anti-Semitic population of Germany. Jewish assets in Germany probably exceeded RM 10 billion. [7] But the Nazi business usurpers were so inept that Aryanized businesses frequently failed, creating even more unemployment. Moreover, by spring 1933, the company takeovers began extending into the non-Jewish sector as any suspect business was subject to confiscation by party kommissars (locally appointed party controllers). The situation became so precarious that Nazi leaders such as Hugenberg, Goebbels, and even Hitler were incessantly chastising NSDAP kommissars to stop their takeovers. On May 20, for example, Goebbels warned kommissars, "We will not permit the country's business to be destroyed by dilettantes." [8] How long could productive businesses be neutralized before the collective loss created an insurmountable crisis?

The Nazis knew the answer to all these questions. If exports fell too low, Germany as a nation would again be faced with starvation. It had happened just fourteen years earlier; it was still fresh in many minds. In the winter of 1919, a besieged Germany was blockaded into submission, starved into defeat. To the Nazis, the anti-German boycott of 1933 was in many ways a reminiscent tactic. There were no enemy ships in the seaways, no hostile divisions at the bridgeheads. But as effective as any blockading frigate or infantryman was this boycott that blocked German goods from being sold, blocked foreign exchange from being earned, and blocked the means of survival from entering Germany.

How many months could Germany survive once the boycott became global, once commerce was rerouted around Germany? The boycotters adopted a slogan: "Germany will crack this winter." In Berlin many believed those words. On June 14, Britain's Ambassador Sir Horace Rumbold reported to British Foreign Secretary John Simon on an hourlong conversation with former German Chancellor Heinrich Bruning. The meeting was held in great anxiety because Bruning was convinced his phones and mail were monitored. Rumbold conveyed Bruning's belief ''that economic conditions might deteriorate to such an extent in the autumn or winter as to produce a very serious situation in this country." Rumbold added his own validation: "I have heard from a direct source that the Chancellor [Hitler] himself is very apprehensive of the economic conditions which are likely to obtain towards the end of the year." [9]

Two weeks later, on June 30, Rumbold sent Simon another report, this one describing the unparalleled political and economic chaos dwelling in Nazi Germany. Rumbold's report closed with a flat assertion: "The Chancellor is concentrating his attention on the problem of reducing unemployment in the realization that his stay in office depends to a great extent on the economic situation next winter." [10]

***

Germany's economic viability had indeed become a phantasm of lies, tricks, and facades. And then came the very thing the Reich was dreading: boycott consolidation. Since the spring, both the Jewish War Veterans in New York and the Polish boycott committees in Warsaw had talked of joining forces. On June 3, Lord Melchett and the British Trade Unions Congress took the initiative and issued formal invitations to the independent boycott committees of the world to assemble in London on June 25 to establish an international boycott council. [11]

Melchett titled the boycott convention the World Jewish Economic Conference. The name was a wordplay on the intergovernmental meeting then under way in London, the World Economic Conference, convened to stimulate trade, especially with Germany. As it turned out, Germany's hopes for increased trade evaporated. So threatening were the World Economic Conference delegates that Schacht's plan of default had to be suspended for fear of provoking extraordinary retaliation, such as the liquidation of German property abroad as promised by John Foster Dulles. A Reich cabinet meeting called on June 23, shortly after the World Economic Conference, reported: "Pessimistic as were the expectations with which the [German] delegation went to London, they were outdistanced by far. Germany found among all states an attitude that hardly could be worse." [12] Melchett's Conference planned to finish the job.

The Jewish War Veterans and the American League for the Defense of Jewish Rights -- America's two vanguard boycott groups -- accepted Lord Melchett's invitation at once through ALDJR president Samuel Untermyer, one of American Jewry's most respected champions. He was renowned as the man who broke the "money trusts," as the former law partner of Committee leader Louis Marshall, as a major figure in the victory over Henry Ford, and as a regular crusader against civil rights injustice. His leadership was all the more meaningful to the boycott movement since he was a popular rival of Stephen Wise, who had yet to declare a boycott. However, in accepting Melchett's invitation, Untermyer asked if the conference could be postponed two weeks, giving Untermyer and his associates time to wrap up affairs in America. Melchett quickly agreed and a new date was set: July 15. [13]

Preparations began in earnest. Boycott groups from Holland, France, Poland, England, America, Latvia, and from thirty other nations would attend. Successful boycott ideas would be exchanged. Inefficient methods would be analyzed and improved. Separate committees would focus on techniques for organizing trade unions, manufacturers, and consumers. Most important, all the groups would bring long lists of manufacturers and sellers seeking alternatives to German goods. [14] These lists would be put together, making the international boycott group a commercial clearinghouse first and foremost. In the meantime, those anxious to replace German goods continued their haphazard struggle to find one another via advertisements in a boycott publication, The Jewish Economic Forum, published by Lord Melchett.

Egyptian importers of silk stockings want supplies "similar to the Chemnitz products." British ornament distributers invite carved wood from any non-German sources. Poland's leading importer of cleaned graphite seeks non-German alternative supply. British cap manufacturers need cap fasteners produced anywhere but Germany. Hungarian, Yugoslavian, Swiss, and Czech firms want gloves, hats, glues, and foodstuffs to replace German products. The French State Railways offers special discount freight rates for shippers seeking to avoid German trucks and rail lines. [15]

Such inefficient methods would be short-lived. At the July 15 World Jewish Economic Conference all the emotionalism, anger, and resentment of the boycotters would be transduced into pure business. The mercantile expertise of centuries would be but a rehearsal for the biggest and most important commercial brokerage network in Jewish history. If the deals were right, German Jewry could be saved.

Once the global boycott became a reality, the slogan "Germany will crack this winter" could well become a prophecy.

***

Mr. Sam Cohen, on June 24, 1933, concluded a fruitful meeting with German Consul Wolff in Jerusalem. A number of boycott-breaking ideas were discussed, and Consul Wolff was eager to notify Berlin. In a memo marked "URGENT," sent that day to the Reich Foreign Ministry, Wolff reported, "Mr. Sam Cohen ... had informed me today that he will most likely ... attend a Jewish congress in London, planned for the middle of July, which is to make decisions concerning the Jewish boycott against Germany ... throughout the most important countries of the world." Wolff predicted "that the boycott resolution will be passed" since Jews everywhere believe "the boycott is the only weapon which can do appreciable damage [to Germany]." [16]

It went on: "If Mr. Sam Cohen is now going to attend what I might call the 'boycott congress,' he is doing so ... in his capacity with Zionism here and with the Jewish Agency; [and] to put the brakes on the congress by working behind the scenes.... He will try ... to sell his anti-boycott plans to influential attendees of the London congress. This includes if possible, Stephen Wise and attorney [Samuel] Untermyer, both of whom are arriving from America to attend the congress." [17]

Consul Wolff added that Cohen's tireless anti-boycott efforts were being continuously subverted by Jewish and Zionist groups who maintained that Hanotaiah's 1-million reichmark permission was too small a concession to trade for the politically volatile act of abandoning boycott. Playing right into the Nazi mentality, Wolff labeled the RM 1 million license as "insignificant in view of the magnitude of [Jewish] economic problems and the wealth in Jewish hands .... The only successful measure to counteract increasing Jewish hate and hostility for Germany would be a more generous accommodation on the part of the German government. It is of course understood that such an accommodation would be in the economic rather than in the political area." [18]

Consul Wolff's letter was another lobbying effort to expand Sam Cohen's deal to several million and broaden it to cover future as well as present Jewish emigrants. In the Nazi party's view, "future" emigrants included every Jew in Germany. In allying with Consul Wolff, Cohen found his most effective advocate. Even as Wolff was mailing his June 24 letter, the Economics Ministry in Berlin was notified of the Foreign Ministry's full endorsement of the consul's recommendations. [19] Consul Wolff was after all Germany's man in Jerusalem. Berlin relied upon him. So did Sam Cohen.

Consul Wolff would not fail him. In yet another fortifying effort, sent three days later, Wolff sent a personal note to his colleague Kurt Prufer, who supervised the Foreign Ministry's Eastern Department. "I have become more and more convinced that Mr. Sam Cohen's way is the only one which will enable us to overcome the Jewish anti-German boycott movement," Wolff wrote. "Mr. Sam Cohen has been successful in not only provoking the interest of all appropriate local authorities and individuals for his plans, but also in obtaining the most extensive authority for implementation under [Jewish] national supervision .... This is the only way ... something can be done about the wave of boycotts." To drill home the perception of Cohen's validity, Consul Wolff added assurances that there would be no subsequent opposition to Cohen or Hanotaiah, "not from the orchard growers, or the big Zionist funds, or worker groups or from any other party." [20]

For the moment, such assurances were essentially correct. Leading Zionist institutions, desperate for fast action in the face of the growing boycott, had indeed endorsed Cohen. On July 2, the ad hoc Conference of Institutions convened a meeting attended by representatives of the Histadrut labor conglomerate, the Manufacturers Association, the Organization of German Immigrants, and other official entities. These men indeed represented official Jewish Palestine, and they reiterated their belief that breaking the boycott was the only way to save the Jewish wealth of Germany. But the men also verbalized their fear of a popular backlash. By now, the Third Reich's hot-and- cold pogrom was so heinous, and the public cries for boycott so vehement, that few could envision public acceptance of any economic liaison with Germany. The Chamber of Commerce representative reminded the gathering that in a previous session on June 6, they had voted to take no stand for or against the boycott, functionally defeating any boycott plan. The June 6 resolution had been withheld from public view following the Arlosoroff murder. But the representatives now felt they could no longer delay if German immigrants were to successfully transfer their assets to Palestine. The representatives voted to encourage a merchandise arrangement with the Reich. [21]

The next day Consul Wolff resumed his campaign. On July 3, he dispatched a letter marked "VERY URGENT" to the Reich Foreign Ministry relating the various tactics boycotters would try and credited Cohen with providing inside information. "Mr. Sam Cohen, . . . who because of his intimate knowledge of local conditions, called some other matters to my attention, ... for example ... the British and French, to exploit the difficulties experienced by German export efforts in Palestine, . . . intend to establish a clearinghouse which with the help of local Jewish firms would list present German suppliers and then be in a position to offer British and French substitute merchandise at lower prices. Mr. Sam Cohen informs me that Jewish [Zionist] circles to date do not favor such an enterprise, and I believe him, because Sam Cohen and his friends are strong Zionists who want to facilitate the immigration of German Jews to Palestine by way of Hanotaiah's imports .... [But] they must demonstrate that by organizing this German Palestine trade they can make a special contribution to Palestine [outweighing the value of the boycott]." [22]

Wolff's July 3 letter warned Berlin how advanced the Palestine boycott was. "What is happening in Tel Aviv ... is that young men are inspecting every store, demanding to see company orders and invoices to determine the origin of merchandise." [23] The consul urged approval of his earlier request to expand Hanotaiah's transfer permission in both cash limit and in the type of merchandise allowed.

When Wolff first requested the expansion in late June, he enticed the Reich with assurances that Cohen's deal was broadly supported through "national supervision," and with promises that Cohen would separately import £500,000 worth of machinery, paying mostly with foreign currency. But Wolff now advised the Reich that Cohen's role as a boycott breaker was so crucial that Berlin should circumvent "national supervision" and grant Hanotaiah an outright monopoly on all German imports to Palestine. [24] Cohen had originally agreed to "share" his commercial ventures with publicly responsible companies such as Yakhin to avoid profiteering and engender public control. But now Cohen would share the profits and the decisions with no one.

In his July 3 letter, Consul Wolffalso indicated that Cohen was no longer willing to pay any foreign currency for the special orders of machinery. The consul acknowledged that Berlin would not like this retreat, but stressed that if Germany expected to break the boycott, it should cooperate with Cohen. Wolff suggested all outstanding questions be resolved at a meeting with Cohen in Berlin on July 13. [25] Then expansion of the original deal, separate arrangements for machinery imports, and exact foreign-currency requirements could be settled.

"Immediately afterwards," Wolff wrote, "he plans to go to the [July 15] 'boycott congress' in London." [26] The implication was clear. Mr. Sam Cohen's work at Melchett's July 15 boycott conference would hinge on the deals he could arrange in Berlin on July 13.

***

The protest situation in England was almost a mirror image of America. The general British population was shocked and angered by Germany's anti- Jewish regime. Christian and Jewish lay and religious leaders favored strong punitive measures. His Majesty's Government preferred to remain silent, but frequently acceded to the wishes of the people and Parliament to lodge formal objections with the Reich. Yet in England, as in America, the biggest obstacle to a united protest and boycott movement was the coterie of leaders standing at the helm of the Jewish community. [27]

As in New York, London's Jewish community was divided into an East European class congregated in the East End, and the more gentried West European, heavily Germanic families of the West End. These two groups often looked upon each other with reproach. The East Enders -- working people and struggling merchants -- were accustomed to noisy protests to secure their rights. West Enders preferred dignified methods of coping with injustice toward Jews. [28]

The British counterpart of the American Jewish Committee was a small group of self-appointed gentlemen called the Anglo-Jewish Association. The seeming counterpart of the American Jewish Congress was an elected representative body called the Board of Deputies of British Jews. However, the Deputies pursued defense missions in their own sedate manner. And unlike the Congress, the Deputies were known for being either anti-Zionist or non- Zionist. So, while they were indeed elected, they often did not represent popular Anglo-Jewish desires. [29] Therefore, in their custodial approach to Jewish affairs, the Deputies found a greater kinship with the conservatives of the Committee than with the rabblerousers of the Congress.

In the protest and boycott vacuum created by the Anglo-Jewish Association and the Deputies, there arose many grass-roots Jewish and interfaith groups determined to boycott. Such ad hoc entities as the World Alliance to Combat Anti-Semitism, Captain Webber's Organization, and Lord Melchett's Anglo-Jewish Trades Council generated a militancy directly threatening Anglo-Jewry's established leadership.

The disunity came to a climax during July 1933, when Lord Melchett's circle was determined to stage massive protest and boycott actions in London. Among the most important was the July 15 World Economic Jewish Conference. The custodial mentality of Anglo-Jewry's leaders caused them to issue statements claiming the planned World Jewish Economic Conference -- and its constituent groups from thirty-five nations -- was an "unauthorized" gathering of Jews to be ignored. [30] At first, conference organizers refused to be intimidated. They enjoyed mass support, buoyed each time they vowed publicly to hold the boycott conference with or without the sanction of traditional Anglo-Jewish leaders. But as the barrage of discrediting statements by established Anglo-Jewish leaders mounted, it became clear to Lord Melchett that British Jewry was not ready to wage economic battle with Hitler. By July 7, he was forced to announce a postponement of the conference until autumn. The official explanation cited a need for several national boycott committees to coordinate further. [31]

But Lord Melchett correctly understood that Jews alone could not execute a successful boycott. They were dependent upon winning Christian cooperation. That would be impossible as long as official Jewish organizations denounced the boycott and the boycott conference as illegitimate. It was therefore time for a showdown.

In a surprise move on July 12, Lord Melchett's representatives attended a meeting of the Joint Foreign Committee, the foreign policy arm of the Board of Deputies and the Anglo-Jewish Association. All policies on the German crisis were technically formulated through this bilateral deliberative body and reflected the decisions of the Deputies and the Anglo-Jewish Association. [32] The JFC's approbation was therefore imperative.

During the meeting, Lord Melchett's advocates presented an eight-point memorandum requesting the JFC step aside and acknowledge that reaction to the Hitler crisis was solely within the purview of a special ad hoc committee to include Lord Melchett and other boycott notables. [33] If they did not wish to join the boycott, at least they could be silent while others took up battle.

Abdicating authority on the greatest emergency facing twentieth-century Jewry would not be an easy act for the Joint Foreign Committee. Zionist stalwarts attending the session lobbied against Melchett's superseding committee because it promised boycott as an official policy, thus derailing hopes for a transfer to Palestine. Many of the regular Jewish leaders fought the abdication for all the known reasons of fear and caution and because it was an admission that their leadership was bankrupt.

But enough JFC members either buckled under Lord Melchett's pressure, chose to be relieved of the responsibility, or secretly backed the popular movement. After a bitter debate, a majority ratified Melchett's memorandum -- six in favor, three against. [34] Thus, an ad hoc committee now superceded the established Anglo-Jewish authorities on all questions regarding Nazi Germany. The boycotters could approach the Christian community and British government as the designated and legitimate voice of Jewry, thus ending months of public disunity.

Neville Laski, president of the Deputies, and Leonard Montefiore, president of the Anglo-Jewish Association, saw Lord Melchett's coup as virtual insurrection. Indeed, the London-based Jewish Chronicle described the Joint Foreign Committee upheaval as a "Palace Revolution." And the New York-based Jewish Daily Bulletin described the confrontation as "the possible overthrow of the present leaders of British Jewry." [35] The boycotters accepted these descriptions and lost no time in wielding their new power. They quickly called for the Deputies to ratify Melchett's takeover of the JFC and adopt a formal boycott resolution at the Deputies' next meeting, July 16. [36]

Neville Laski immediately swore in a press interview that if the Deputies passed Melchett's boycott resolution, he would resign at once. [37] But conference organizers disregarded Laski's threat. If on July 16 the Deputies ratified the JFC takeover and a boycott resolution, it would segue perfectly into London's mass protest and boycott march planned for July 20. These formal and popular mandates would then set the dramatic and authoritative foundation for a World Jewish Economic Conference that fall to rally the world in a coordinated boycott.

At the end of the day on July 12, the Reich realized that its future might indeed soon be decided by Jews -- unless somehow Lord Melchett's deeds could be undone. In this climate, German officials prepared for the next day's meeting in Berlin with Mr. Sam Cohen.
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Re: THE TRANSFER AGREEMENT: THE DRAMATIC STORY OF THE PACT B

Postby admin » Fri Jun 26, 2015 6:18 am

20. July 13 at Wilhelmstrasse

WILHELMSTRASSE was the name of a street, and the name of a block of German government buildings. In both senses, Wilhelmstrasse designated the seat of German government. Although built during the reign of Frederick the Great in the mid-eighteenth century, Wilhelmstrasse's exterior lacked any hint of grandeur. Its monotonous two-story length was interrupted by nothing more distinctive than a simple entrance flanked by two wrought-iron light fixtures, topped by a tiny balcony. [1]

The Wilhelmstrasse interior had been updated to suit the new Germany. Swastika emblems and flags had been hurriedly added to all the empty spaces. Anyone entering the building could not help but sense the lack of continuity between this Reich and the two before.

It was to the depths of this complex of government offices that Mr. Sam Cohen reported on July 13, 1933, ready to discuss the final details of assuming personal custody of the fiscal and physical future of German Jewry. If all went as expected, his RM 1 million license, granted in mid-May, would be expanded to a perhaps limitless concession sufficient to transfer the assets of thousands of German Jews -- those few who wished to emigrate to Palestine, and those of the majority who frankly could not afford to rule out the option. Those German Jews who did elect to move to Palestine would find their existence essentially limited to working the citrus groves of Hanotaiah's acreage. Those depositors who would not leave Germany or who chose another destination would find their assets already transferred and invested in their name in Palestine.

Sitting atop this mammoth transaction would be Mr. Sam Cohen. For his contribution to the Zionist cause he would of course collect a suitable commission in the form of Hanotaiah's profits. Undoubtedly, these profits could then be reinvested in other worthy Zionist projects. Hence, he could derive immense personal satisfaction from his venture. But beyond simple profits, it must have been clear that as transfer agent of the German Jewish community, Cohen would become the all-powerful middleman of the Jewish nation-in-waiting. For him this was a climactic moment.

It had been a tortuous, intrigue-filled journey to this hour. He had shuttled between Jerusalem and London, Berlin and Warsaw, and many points along the way. He had outmaneuvered his critics, outdistanced his sponsors, and outlived his competition. He had been quick, clever, and undaunted as he perfected the art of selective omission, distorted appearances, and a promise for everyone. By these powers he had assumed the unquestioned role of broker for the Zionist movement and the Jewish people. He walked into the conference room, prepared to quibble about percentages of foreign currency and procedures of liquidation, but emerge one way or another with everything he wanted.

And there, sitting in the conference room, waiting for the meeting to commence was Georg Landauer, director of the Zionist Federation of Germany. With him was David Werner Senator of the Jewish Agency Executive. [2] Those first moments were undoubtedly tense as Sam Cohen greeted the men whose authority he had cleverly usurped and misrepresented. Landauer could have easily denounced Cohen then and there as a fraud who had engineered a massive international conspiracy to corrupt Reich currency regulations. But would Landauer be believed? By the same token, Cohen, the man the German government had come to trust as their anti-boycott champion, could have denounced Landauer and Senator as rebellious elements within the Zionist movement who refused to go along with the sanctioned policy of cooperation with Germany. But would Cohen be believed?

On the other hand, why should either side become accusatory and forfeit a crucial meeting with Reich officials to arrange the all-important transfer? The resulting fiasco could eradicate any chance of negotiating on any formal and congenial basis as "partners" in good faith. So Cohen and Landauer remained cool with no sign of hostility or rivalry. They would both negotiate as Zionists for the best transfer arrangement Germany would grant them.

When Currency Control director Hans Hartenstein and his assistants, as well as Foreign Ministry experts and a Reichsbank director [3] joined the Zionists, they were totally unaware that Cohen and Landauer were not part of the same team. Almost a month before, on June 20, Landauer had made his first formal entreaty to Hartenstein by delivering a memo asking to broaden the transfer concession beyond that originally granted to Hanotaiah in mid-May. That same day, Hartenstein received a copy of Consul Wolff's request to expand Cohen's agreement. There was no reason to believe that these two requests were not the same. When Landauer somehow learned of Cohen's July 13 meeting to discuss the wider permission, Landauer contacted Hartenstein and asked to be included. Hartenstein of course agreed. [4] Proceeding under this mistaken impression, Hartenstein and his colleagues commenced the July 13 meeting as though both Cohen and Landauer were partners. Neither Cohen nor Landauer disturbed the illusion.

The most pressing issue for Hartenstein was foreign currency. Consul Wolff's letter on behalf of Cohen had offered more than half the merchandise price in actual foreign currency. This startled Landauer. The more foreign currency the Reich received, the less the emigrants received. To deliver foreign currency would not be a transfer as much as a discount purchasing plan. The Germans turned to Cohen and asked about Consul Wolff'soriginal foreign-currency promise. [5] The Foreign Ministry aides almost certainly carried copies of Consul Wolff's letters. The Reichsbank director would be anxious to report an influx of needed foreign exchange to Hjalmar Schacht. And Hartenstein could only justify setting aside the £1,000 Palestine entry money in actual sterling if some larger sum of foreign currency flowed into Germany. But with no extra foreign exchange coming in, how could the cash-desperate Reich participate in this transfer scheme at all?

The Reich negotiators were told that initially the transfer must confine itself to blocked marks, with no foreign currency involved. The Zionists undoubtedly offered a rationale they would later use to deny breaking the boycott, namely that the absence of foreign currency deprived the Reich of the basic benefit of a true merchandise sale -- foreign exchange. Without foreign exchange, the transaction was precisely the noble endeavor the Zionists claimed it was -- a transfer. [6]

The Reich negotiators provisionally accepted the arguments of the Zionists and agreed to extend a low limit of transfer without foreign currency -- a few million, the precise figure would be worked out later. However, after this first stage, some percentage of foreign currency would be required, just as Wolff had promised several weeks earlier. [7]

The rest of the meeting concentrated on transfer procedures. Landauer's concept called for two clearinghouses. Landauer explained that the first would be headquartered in or affiliated with a major German bank to convey the reliability needed if German Jews in great numbers were to participate. Emigrants would deposit their money in numbered blocked accounts. A corresponding clearinghouse would be established in Palestine, comprised of leading merchandise importers. This second clearinghouse would actually import the German wares and then instruct the German clearinghouse to remit merchandise payments from the blocked accounts. At that point, the German exporter was satisfied. [8]

When the Palestinian importer sold the merchandise for sterling, that money would be deposited in a corresponding numbered Palestinian bank account. Upon arrival in Palestine, the emigrant would take over the Palestinian account, thereby transferring part of his assets in cash. [9] He was then able to start a new life.

Landauer stressed that the second clearinghouse in Palestine must also be in a reputable financial institution and suggested the Anglo-Palestine Bank. He intended to cut Sam Cohen out of his caretaker role by reducing Hanotaiah to just one of the many importers, none of whom would be entrusted with actual disbursements of money. That job, asserted Landauer, was unalterably the province of a bank, not a real estate company. [10]

Landauer added that the certainty and speed of the emigrant receiving his money once in Palestine would be the key to convincing Germans to emigrate. [11] None would want to move penniless to a new land. They would prefer to hang on indefinitely in Germany waiting for conditions to improve.

Landauer's insistence on quick payment and bank supervision must have certainly hit Sam Cohen as a threat to his entire plan. Cohen had never intended to turn much cash over to the emigrants. He had intended to reimburse them mainly with a parcel of land, cheap farm structures, or perhaps some agricultural equipment, all at a value he himself would set. [12] In this way, Hanotaiah and Cohen would reap the windfall profits that would justify battling the Jewish world by breaking the boycott. Moreover, Hanotaiah expected to control all the transactions through its own bank accounts, reimbursing emigrants' transfers at its own rate.

But Landauer understood that German Jews would never accept destitution in Palestine over destitution in Germany. The transfer plan had to be attractive. Families could not arrive in Palestine only to be shocked by the loss of their transferred assets and the virtual necessity of settling on the sandy acreage designated by Hanotaiah. The word would quickly filter back: Go anywhere but Palestine. The transfer would be a short-lived get-rich-quick scheme for Cohen. But the dream of bringing the Jewish people of Germany to Palestine would be dissolved.

Cohen's reaction to Landauer's presentation is unknown. He probably knew enough to say little and go into action later. But however he reacted, there was no hint to the Germans that Hanotaiah and the ZVfD were not in perfect coordination. The illusion was sustained. As the meeting ended, Hartenstein asked Landauer to crystallize all transfer questions into a brief memo. [13] At the same time, Reich bureaus would consider the foreign-currency disappointment.

Although the Reich's decisions were not finalized at that moment, it seemed clear that Germany would agree to a multimillion-reichmark arrangement encompassing a gamut of merchandise, and they would forgo foreign-currency benefits for the time being. Hitler's Reich had too much to gain from the transfer under almost any format. First, the Reich and the Zionists knew that the transfer and the boycott could not coexist. Merchandise could not be used as the medium of transfer if it could not be sold somewhere. The Zionists would be forced to sabotage the boycott if they expected to sell German merchandise.

Second, export orders meant jobs in Germany. This was as important as breaking the boycott. Hitler was desperately striving to rehabilitate Germany's work force. With exports already drastically reduced, the merchandise could be dumped, let alone transferred at market value, and the government would be satisfied, because German men and women would continue working.

Third, once commenced, the transfer benefits would escalate. Foreign currency would quickly become a demandable part of the bargain. Furthermore, the purchase of German machinery, cars, and equipment carried the promise of German spare parts and service technicians to keep them in good working order for years to come.

Fourth, Hitler's Reich craved a Germany without Jews. On a political agenda dedicated to economic recovery, the elimination of the Jews was nonetheless paramount. Transfer was Germany's hope for a Jewish exodus. The need to promote emigration became ever more compelling in mid-July as German Jewish refugees actually began returning to Germany. With capital punishment facing the dispenser of so-called atrocity stories, with Germany doing all it could to inhibit foreign journalists from reporting all but the most concretely verifiable incidents, many German Jews had wrongly presumed that the period of anti-Semitic violence in Nazi Germany had passed. The Reich interned most of these first returnees in a concentration camp. But when the repatriation began to reach into the hundreds, Germany feared she might actually regain many of the 30,000 Jews already frightened away. [14]

Transfer was crucial to the Third Reich. Both sides knew it. The Wilhelmstrasse meeting took place just before the July 16 Board of Deputies vote on the boycott and on the Joint Foreign Committee takeover. The Reich made clear what it expected the Zionist hierarchy to do. The German Zionists made clear what they expected in return. Nazi Germany was ready to deliver. The next move was up to the Zionist hierarchy.
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Re: THE TRANSFER AGREEMENT: THE DRAMATIC STORY OF THE PACT B

Postby admin » Fri Jun 26, 2015 6:18 am

21. The World Jewish Economic Conference

THE WORLD JEWISH ECONOMIC CONFERENCE was still waiting for a new date, but once scheduled, its success seemed assured. It would rally the Jews of the world in a new sense of self-defense. They would replace their leaders with men who accepted the credo so aptly described in the premiere issue of Lord Melchett's boycott journal, The Jewish Economic Forum: "In these days, when international wars are fought with economic weapons, and peace treaties and alliances take the form of trade agreements, a conscious awareness of the economic role of Jewry in the affairs of the world is not only desirable but necessary for the preservation and future development of out people. From this day forth we shall confront our enemies not with weak appeals to their dormant humanity, but with the irresistible argument that it does not pay to persecute us." [1] Late on July 13, the rallying slogan "Germany will crack this winter" appeared to be a promise the Jews would keep.

But things started to change the next morning. On July 14, Joint Foreign Committee co-chairman Neville Laski called an emergency meeting to rescind Lord Melchett's takeover resolution of July 12. Melchett himself did not attend the sudden session. [2] After little discussion, the abdication of July 12 was unanimously rescinded. Melchett's original eight-point takeover memorandum was then redebated clause by clause, with a shorter seven-point proposal resulting. The new proposal covered much of the same ground but in more ambiguous language. More important, the revised proposal changed Melchett's status. Instead of Melchett leading a panel that would supersede the Joint Foreign Committee, the JFC voted to remain active, but include Lord Melchett and other representatives of popular organizations previously beyond the JFC's horizon. While the vital clause advocating boycott was toned down, the boycott suggestion itself was not deleted. [3] In short, the JFC retained control of foreign policy for the Jewish community, but agreed to become more responsive to popular demands.

Lord Melchett went along with the replacement proposal for the sake of unity. He was convinced there was too much "squabbling over mere words." Whether the boycott bore an "official" imprint was not as important to him as that the boycott became organized. If working through established channels instead of around them was the best way to create a unified anti-Nazi front, so be it. [4]

But the new question was: Would Melchett sway establishment Anglo- Jewish leaders to boycott, or would they convince Melchett to join the ranks of quiet diplomacy and foresake his movement?

***

The Board of Deputies, co-parent body of the Joint Foreign Committee, was prepared to induct Lord Melchett. But a sudden "technical arrangement" delayed board ratification. [5] The technical problem was not explained, but the JFC probably could not formally induct Lord Melchett for one embarrassing reason. He was not Jewish.

In fact, Lord Melchett was of assimilated German Jewish stock that in the late nineteenth century relinquished its Jewish identity. His father married a Christian woman, and Melchett himself was raised Anglican. On July 15, 1933, he was still a prominent member of the Anglican Church. Despite his Anglican affiliation and a Christian mother, which under Jewish law established that he was indeed not Jewish, Lord Melchett maintained a considerable Jewish identity. Somewhere deep inside he knew he was a Jew. This Jewish identity could not find expression in ritual because he was an Anglican. Instead, Melchett became a leading funder and organizer of Zionist projects, including Palestine's embryonic industrial works. When Hitler rose to power, Melchett's inner summons propelled him to the forefront of the boycott movement. [6] A good Zionist and a good boycotter he was. But neither of those distinctions earned him a place on the Board of Deputies or the Joint Foreign Committee. The JFC had restructured itself twice in two days to accommodate Melchett. But one precept could not be overridden. He had to be Jewish.

So on June 15, Lord Melchett converted. It was planned as a secret ceremony, but it quickly produced headlines from New York to Jerusalem, as all the picturesque details were chattily published below banners such as "WELCOME BACK" or "LORD MELCHETT COMES HOME." [7] This done, he was now ready to assume his place spiritually as well as physically in the economic war against Germany.

Melchett now came under increasing pressure from those who opposed the boycott conference. The traditional leaders of British Jewry, such as Neville Laski, rejected any formal boycott in fear of Reich retaliation against German Jewry. But Anglo-Jewish leaders also harbored a special fear that transcended the Hitler emergency. For decades, the Jewish people had fought the fallacies of economic internationalism contained in the Protocols of the Elders of Zion. And here was the very proof Jew-haters would use to verify their claims. [8] After all, was not the boycott conference's avowed goal to smother Germany's industries, choke off its foreign exchange, and topple its government?

The Zionist hierarchy in London continued its active resistance to the conference because boycott and transfer were mutually exclusive. Ironically, in expressing themselves, the Zionist hierarchy in London could speak with three voices. First, they were the voice of Zionism. Despite popular Zionist demands for protest and boycott, the hierarchy was denouncing any anti- Nazi agitation as a barrier to a Reich accommodation for Palestine. Second, the Zionist hierarchy functioned in England as the voice of Germany's Jews. German Zionist Martin Rosenbluth had set up the official German Jewish liaison office in London. [9] Third, Zionists often spoke for popular Anglo-Jewry. The men at the helm of the Zionist Organization frequently held key leadership positions in Diaspora Jewish groups. Most of these groups were actively Zionist, so it was only natural that Zionist notables should lead them.

The triple Zionist voice in London was becoming increasingly assertive. For instance, Zionist Organization president Nahum Sokolow was also the president of the Federation of Polish Jews in Britain. The Federation reflected the boycott fervor of their landsmen in Poland, America, and Palestine. Yet at a mid-July rally held at the height of London's anti-Nazi agitation, Sokolow, in his capacity as Federation president, advised an anti-Nazi Polish-Jewish rally to forgo boycott plans. [10] And Chaim Weizmann and other key Zionist figures repeatedly advised the Deputies to persist in their non- boycott policy. [11]

The Zionist hierarchy and establishment Anglo-Jewish leaders knew they would have to abort Melchett's conference decisively-and quickly. By mid-July, American boycotters Samuel Untermyer and George Fredman were already in London conferring with European boycott advocates. All were anxious for Melchett to reschedule the conference. [12] However, Zionist and traditional Anglo-Jewish leaders suddenly learned that they would be joined in opposing the conference by one of the boycotters' own, one whose counsel would be heeded. No one could accuse this opponent of not being in the forefront of the anti-Nazi movement. He had just arrived in London from America, and he was as determined as anyone that the World Jewish Economic Conference never take place. His name was Rabbi Stephen Wise.

Wise was dedicated to a worldwide boycott of Germany and equally committed to supplanting the old Jewish leadership that advised silence in the face of Hitlerism, but Wise was against the conference. His reasons were political, strategic, and personal.

Politically, Melchett's convention was openly intended as a counter-convention to the World Economic Conference then meeting in London. As such, the boycott convention would undercut President Roosevelt's initiative to revive the world's depressed economies. If the London intergovernmental meeting failed alongside a World Jewish Economic Conference that claimed success, Jews would surely be blamed. Wise believed that major Jewish American involvement in the counterconvention would only alienate FDR, whose sympathies Wise was still trying to arouse. [13]

Strategically, the Melchett conference had divided Anglo-Jewish leaders from the masses. Like Melchett, Wise saw the advantage of working within the established leadership system and creating a united front. A publicly discredited boycott convention in London would hurt the boycott's quest for legitimacy and broad acceptance. Moreover, Wise was hoping to maneuver such establishment leaders as Neville Laski and Leonard Montefiore into a coalition with American and East European Jews that would create the World Jewish Congress. [14]

Personally, and perhaps most important, while Melchett was the spiritual sponsor of the conference, it was clear that Wise's old rival Samuel Untermyer was the popular hero of the boycott movement. Conference organizers openly agreed that their conference represented a coup d'etat among the Jewish people. They announced that the anti-Nazi boycott would be the springboard for a worldwide Jewish organization that would supplant all major established groups. [15] If the World Jewish Economic Conference did convene, Untermyer would be catapulted to a dominant position in both the anti-Nazi movement and world Jewish leadership. Wise was convinced this leadership belonged to him and to his long-sought and soon-to-be World Jewish Congress. [16] Two world Jewish organizations could not exist side by side. It would be Wise or Untermyer to lead the Jewish people to battle against Adolf Hitler. And so, as is often the case, the struggle to achieve justice was subordinated to the struggle to claim the credit.

Therefore, Wise urged Lord Melchett to turn away from an ad hoc boycott and instead join him in creating the World Jewish Congress. Once constituted by such organizations as the American Jewish Congress, the Board of Deputies, and France's Alliance Israelite Universelle, the new World Congress -- imbued with Wise's fighting spirit -- would be a powerful defense force. This new Congress would dramatically proclaim the coordinated global boycott. [17]

Suspicion and confusion had spread among the world's boycott circles from the moment in early July when Lord Melchett announced the postponement. Although calculated to strengthen the offense against Hitler, the postponement in fact delivered a damaging blow to boycott momentum. Many boycott organizers had already journeyed to London to participate. Their time, effort, and money was now wasted. By the second week of July, with no new conference date set, Polish boycotters warned Lord Melchett that with numerous boycott committees ready to assemble, they might insist on going ahead without him in either Paris or Amsterdam. [18]

The fear of a sell-out by their own leaders was intensified following the publication of two news items. The first was an early-July story in the Frankfurter Zeitung alleging that Anglo-Zionist leader Sir Herbert Samuel, former high commissioner for Palestine, had promised Germany's ambassador in London that any formal British boycott action would be stymied by public denunciations from Neville Laski and Leonard Montefiore. Normally, such German press notices were viewed skeptically. [19]

But then the Jewish Telegraphic Agency distributed the story unchallenged on its international wires. In an accompanying report, the JTA announced that its London bureau had verified the Frankfurter Zeitung claim: "It is definitely learned here that an agreement was reached during the latter part of March between certain Jewish leaders and the German Ambassador." The JTA juxtaposed this confirmation to a reminder that Laski had promised to resign should a formal boycott resolution be adopted by Melchett's group. [20]

The JTA's confirmation was given the widest credence in Jewish newspapers throughout Europe and America. [21] Since it came at the same time as vague media reports about reversals of the Joint Foreign Committee takeover, boycott organizers concluded that Lord Melchett was caving in to establishment pressure to kill the World Jewish Economic Conference slowly, via a series of postponements. The London Jewish Chronicle, acknowledging the demoralizing effect of the Frankfurter Zeitung story, staunchly denied that Melchett had capitulated, and even castigated the JTA's London bureau "confirmation" as a false item that really originated in the JTA's Paris office. [22]

Clearly, each day that passed without a firm boycott announcement only heightened the suspicion and rebelliousness of the boycott community. Then Neville Laski used his authority as president of the Board of Deputies to postpone until July 23 both the boycott vote and ratification of the JFC's new composition. [23] No reason was given. Lord Melchett's people, sensing further disaffection in the boycott movement, issued statements that the conference would definitely take place in early October. [24] But delays could no longer be tolerated by the boycott community. The Deputies' boycott-vote postponement, July 16, was the final signal.

On July 18, Samuel Untermyer and a team of boycott associates announced that the World Jewish Economic Conference would be convened within forty-eight hours -- not in London under the auspices of Lord Melchett, but in Amsterdam under Untermyer's guidance. The announcement was met with immediate support by all boycott groups. [25]

An article in The New York Times correctly identified Untermyer's move as a battle between Eastern European and Western European Jews for the leadership of the Jewish people. "Among the Western Jews," explained the article, "it was the German branch ... to which leadership was willingly granted. . . . The present situation is that Poland, with her 4.5 million Jews -- the largest colony of them in Europe -- threatens to assume by sheer weight of numbers the direction of the racial protective battle." [26]

Many Polish Jews were Revisionist Zionists. Hence, Untermyer's move also portended a victory for Revisionism within the Zionist movement over the question of whether to fight the Nazis. The last paragraph of the Times article delineated the stakes: "The only question now is which part of the race shall assume the new leadership. That will be decided in Amsterdam and London." [27]

Although Lord Melchett was convinced that Stephen Wise's World Jewish Congress would yield a more effective boycott, Melchett was unwilling to relinquish the momentum of his own ad hoc movement. So when Untermyer announced the Amsterdam Conference, Melchett publicly promised either to attend or to send his own representatives as the British delegation. [28]

Untermyer's sudden, well-publicized leadership leap boosted him to the vanguard of the anti-Nazi movement. For the moment he had even eclipsed Wise as the single most revered champion of Jewish rights. Even the leaders of the American Jewish Congress, Wise's personal power base, began to doubt whether Wise was still the man to follow. [29]

Dr. Wise tried to reassure his own loyal supporters in a late-July letter to the Congress Executive. He denied responsibility for the Melchett conference delays, but insisted that only the World Jewish Congress could or should lead the boycott struggle: "Personally, I have a suspicion that ... the American Jewish Committee inspired the plan ... to head off the Melchett- Untermyer Conference." Wise added, "It is almost impossible in writing to tell you the story of ... my own meetings in London with the gentlemen in respect to the Congress .... [Zionist leader] Dr. Goldmann and I labored with them time and again. I mean especially four men: Laski, Major Nathan [a Melchett boycott ally], Montefiore, and Lord Melchett." Wise insisted that his goal was united action toward a World Jewish Congress that would represent all Jewish people. [30]

He indicated that the supraorganization's planning commission would assemble in Prague during late August, just before the Eighteenth Zionist Congress. Wise assured that "a world boycott decision might well be reached in Prague." Even though many members of the World Jewish Congress would come from the solidly anti-boycott camp, Wise reasoned that established Jewish leaders would be outvoted and forced to submit to popular demand. He had taken pains to explain to conservative Anglo-Jewish leaders that a de facto popular international boycott already existed: "In Poland, it is incredibly good; in Czechoslovakia, fantastically good; in France, good; in England, fair; in America, very good." [31]

Ultimately, Wise expected to win Jewish unity against Hitler. But in his late-July letter to New York he drilled home his determination that he would have to be the man to lead such an international movement. It could not be Untermyer, even though Untermyer's worldwide following was already in place. "[I] adhere to my judgment," Wise wrote, "that a world boycott cannot be publicly proclaimed by anyone group in world Jewry. This is our grievance against Untermyer and his two fellow musketeers." [32]

Rabbi Wise accused Untermyer of actually wrecking the boycott: "Without conferring with anyone, they took this great step [the Amsterdam Conference] in such a way as to do a minimum of hurt to German commerce and a maximum of damage to the Jewish people." [33]

But Congress leaders in New York were wondering whether Wise's World Jewish Congress would really be effective, especially with its inclusion of so many establishment anti-boycott leaders. In a rebellious action taken even before Wise wrote his late-July letter of defense and explanation, the American Jewish Congress suspended the subsidy for Nahum Goldmann, Wise's chief organizer in Europe. One hour after receiving a cable informing of the suspension, Wise objected in a letter he hurriedly mailed without even correcting spelling errors. "I cannot understand this," he protested. "This is only another way of saying there shall not be a World Jewish Congress . That decision should not and cannot be made while I am in Europe It would be just as impossible to run the American Government without Washington, as the World Jewish Congress without the services of Goldmann .... Very earnestly, I protest against such a decision which should only have come after conference with me." [34]

Stephen Wise was methodically erecting an international boycott apparatus in his own way. He did not want to be rushed. But many others would not wait.

***

Provided with only forty-eight hours' notice, not all of the thirty-five national boycott committees could attend the suddenly convened World Jewish Economic Conference in Amsterdam. Only sixteen national committees actually sent delegates. They came from Lithuania, Belgium, France, Finland, Czechoslovakia, Egypt, Poland, Latvia, and other countries. Britain's delegation represented Lord Melchett as promised. Ten more national committees, unable to attend due to the conference's off-on nature and the suddenly switched site, sent telegrams of solidarity. To avoid any appearance of rivalry, Untermyer labeled the two-day gathering as preliminary to the actual conference Lord Melchett was still planning to host in London in October. [35]

From the moment on July 20 that Untermyer called the several dozen delegates to order in the hall of Amsterdam's Carleton Hotel, the conference was a procession of militancy. Each representative declared what damage his countrymen had wrought on German trade, what steps had been and could be taken to integrate non-Jewish anti-Nazi movements. [36] The Dutch delegates were among the most active, boasting a 40 percent decline in Reich exports to Holland.

Fiery speeches and a feisty determination to crack German economic staying power created an impressive spectacle that finally put the world on notice that some element of the Jews was united in the war against the Third Reich. One of the most stirring testaments to the conference was recorded by The New York Times, which saw the convention as so important to Germany's survival that they flew their veteran Berlin correspondent, Frederick T. Birchall, to London to cover the event. When the conference moved to Amsterdam, Birchall followed. [37] His front-page coverage began:

AMSTERDAM, July 20 -- In this city upon free Dutch soil where, almost four hundred years ago, Jews driven from Spain and Portugal found a safe refuge, establishing a colony which in the next generation produced the great philosopher Spinoza, some thirty representatives of world Jewry met today to deal with Germany's modern revival of Jewish persecution. They elected Samuel Untermyer of New York president and adopted this resolution:

"Whereas ... unanimous outcry, protests and demonstrations of Jews and non- Jews throughout the civilized world against the incredibly inhuman policy toward the Jews of Germany have been unavailing ... Whereas the Hitler government has repeatedly expressed its determination ... to annihilate them economically, to deprive them of their citizenship ... and eventually exterminate them ... now, therefore, be it Resolved, That boycotting of German goods, products, and shipping ... is the only effective weapon for world Jewry and humanity by way of defense and protection of Jewish rights, property and dignity in Germany .... We earnestly urge all the men and women of the civilized world, irrespective of race or creed, to support and join in this movement against brutal fanaticism and bigotry and to help lead it to a victorious conclusion and until the last traces of barbarous persecutions have been eliminated." [38]

The declaration of war officially proclaimed, the soldiers of Israel broke up into three businesslike commissions. The French, the Polish, and the Czechs composed policy resolutions. The Dutch, the Egyptians, and the Americans handled organizational questions. The British, the Belgians, and the Lithuanians tackled financing problems. [39] Commercial rerouting was of course the real power of the conference, and this was made clear in the newspaper coverage. One of Birchall's reports, for example, explained, "The matter of supplying equally satisfying substitutes for German exports at no greater cost ... is regarded as the real key to making the boycott efficient. . . . The meeting will organize methods of obtaining and supplying this information in the minutest detail." [40]

The World Jewish Economic Conference was the spectacle Germany had hoped somehow to delay. In vain, the Nazis wondered if perhaps individual conferees might be intimidated. If any of them were German Jewish refugees, their families back home could be targeted. The German consul-general in Amsterdam inquired of the Carleton Hotel manager if any of those attending were German? The manager checked with Samuel Untermyer. Untermyer gave the manager a message for the consul, which Birchall of the Times discreetly reported this way: "Mr. Untermyer suggested that the Nazi Consul might be invited to go to a warmer climate." [41]

Working with great speed, the conferees unanimously established the new world organization they had promised. Named the World Jewish Economic Federation, it would be headquartered in London, with Lord Melchett as its honorary chairman and Untermyer as its president. [42] International media coverage and a broad multinational character seemed to imbue Untermyer's new Federation with the legitimacy it desperately needed to be taken seriously. But this legitimacy was intolerable to Stephen Wise, who saw his rival. Untermyer on the verge of global success. Wise began a subversion campaign.

Working through conservative Dutch leaders analogous to the American Jewish Committee, Wise issued salvo after salvo accusing Untermyer's people of representing no one and misleading world opinion. The principal mouthpiece for these attacks was David Cohen, a leader of the Dutch Jewish Committee. While the conference was in session, Cohen declared publicly that Untermyer had no right to convene his group, and that organized Dutch Jewry had not been consulted and in fact deplored the entire convention. [43] Cohen then issued an "American" statement authorized by Wise in London condemning Untermyer's gathering and incongruously declaring that the great majority of American Jews were not in favor of any boycott whatsoever against Germany. [44] Such pronouncements by Stephen Wise, the acknowledged leader of America's protest movement, did the expected damage to discredit Untermyer's new Federation.

Untermyer shot back with a widely circulated press statement castigating Wise's "apparent determination to discredit every movement he cannot lead." He publicly challenged Wise "to tell Jewry frankly whether or not he personally favors a boycott," since no one had yet been able to solve the mystery. [45] There was no answer because Wise was proffering different postures at different times, trying to walk a fine line between the protest movement and the establishment leaders he needed to bring his World Jewish Congress into reality. [46]
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Re: THE TRANSFER AGREEMENT: THE DRAMATIC STORY OF THE PACT B

Postby admin » Fri Jun 26, 2015 6:19 am

22. Reversals and Reprieves

EYEN AS the Amsterdam conference was struggling for acceptance, anti-Nazi reaction in London continued its schizophrenic course. The Jewish masses were demanding that all Britain boycott German goods. Jewish leaders were counseling against vocal protest or organized boycott.

The dichotomy became most visible on July 20, 1933, the day of a giant protest and boycott parade. West End Jewish leaders had bitterly opposed the demonstration; all Jews were asked to not participate, and non-Jews were cautioned to ignore any that did march. [1]

Despite the denunciations, the July 20 parade was universally proclaimed the largest demonstration ever undertaken by British Jews, bearing all the drama of the May 10 rally in Manhattan. London newspapers reported closed shops throughout Jewish districts, a cross-section of participants, and a sea of banners: MAKE GERMAN GOODS UNTOUCHABLE ... BE LOYAL TO THE BOYCOTT AND AVOID GERMAN GOODS. Braving searing summer heat, the estimated 50,000 formed an orderly column, at times two and a half miles long, and urged the thousands of spectators to join the movement. [2]

The intent was to create an unmistakable wall of unity. But the newspapers could not avoid mentioning that West End Jews "took no part in the demonstration except to stare at the thousands of their co-religionists straggling past." Irrepressible notices of condemnation were issued by the Board of Deputies and the Anglo-Jewish Association even as the protestors marched, giving a bewildering approach-avoidance character to Jewish defense. [3]

Nonetheless, on the day of the London march, British labor provided a pivotal display of solidarity. The National Joint Council, comprised of the 1rades Union Congress, the Labour party, and the Parliamentary Labour party, circulated a binding boycott manifesto to its members. Citing a long list of prohibited German merchandise, the directive asked workers to announce to "shopkeepers and others when purchasing goods or services that they will not buy from the country whose government has so outraged the conscience of the world." The manifesto closed with this assurance: "Against an awakened and sensitive public opinion no tyranny can stand." [4]

British labor's logic was sound, but it became difficult to mobilize Britain when protest and boycott were incongruously disowned by Jewish leaders themselves. Christian perceptions could not penetrate the complex Jewish fears of becoming highly visible or triggering dormant British anti-Semitism. They saw only unfathomable inaction.

On July 19, traditional Anglo-Jewish leaders reached a turning point. For decades, the stalwarts of the Board of Deputies and the Anglo-Jewish Association had remained steadfastly anti- and non-Zionist. But since the German Zionist mission to Britain at the behest of Goering in March, Anglo- Jewish leaders slowly came to see Zionism as the answer to German Jewry's dilemma. The Zionist solution gained momentum after the July 13 meeting at Wilhelmstrasse, when Werner Senator went to London to join high-ranking Zionist officials to lobby for transfer. [5]

On July 19 at 5:00 P.M., the Joint Foreign Committee held its decisive session. Neville Laski devoted much of the meeting to a clause-by-clause review and modification of the seven-point compromise memorandum of July 14. Laski then explained that the list of new members would be much shorter than originally suggested. It would include Melchett and his boycott colleague Maj. J. L. Nathan, but no others from the boycott community. And while the original list did name leading Anglo-Zionists, the final list would upgrade Zionist representation to include the movement's most influential voices. Chaim Weizmann was one of those discussed. Ultimately, the list of twelve additional names to be inducted included Zionist Organization president Nahum Sokolow, former Palestine attorney general Norman Bentwich, Palestine academic Philip Hartog, Zionist investor Sir Robert Waley-Cohen, and the non-Zionist president of the Jewish Agency (oversight) Council Osmond d'Avigdor-Goldsmid. [6]

Laski then read a classified briefing based on an interview with Gen. Jan Christian Smuts, deputy prime minister of South Africa. Smuts, formerly of the British Imperial War Cabinet, was, together with Chaim Weizmann, mainly responsible for the Balfour Declaration. Although not Jewish, Smuts was one of Zionism's most important supporters. On condition that the press not be informed, Laski revealed that Smuts was "optimistic as to the future of the Jews in Germany." Optimistic was a word thus far unheard in the lexicon of the Hitler crisis. Laski mentioned some important developments in Germany, adding Smuts' personal advice: "Take the long view of the situation," do not allow "discretion to be overridden by sentiment," and remain strongly opposed to an organized boycott. The JFC members were impressed by the briefing and decided that Smuts' news could be read in secret at the next Board of Deputies meeting -- just before the boycott vote. [7]

Laski finally read a letter from Nahum Goldmann inviting the JFC to attend Stephen Wise's.World Jewish Congress gathering in Geneva in early September. [8] This was Wise's coordinated global boycott. Laski and the JFC decided to defer acceptance of Goldmann's invitation, thus increasing the ambiguities about Anglo-Jewish cosponsorship of an international boycott Jewish conference. [9]

It was all very confusing. On July 12, Lord Melchett's eight-point takeover memorandum called for an international conference to convene in October. Presumably, this was to be the rescheduled World Jewish Economic Conference. Heightened pressure then focused on Lord Melchett to abandon any conference with ad hoc boycott leaders and instead work within the system. On July 14, Neville Laski engineered a rescission of Melchett's July 12 coup, and Melchett's eight-point memorandum was replaced by a new seven-point proposal, which still mentioned an October conference. But presumably, the reference was now to Wise's World Jewish Congress. Wise even wrote back to New York, "It represents a great triumph for the democratic and nationalistic Jewish ideals. For the first time, these London gentlemen have been forced to ... sit down and publicly confer with representatives of the Jewry of the world -- something they have never done before." [10]

Then Samuel Untermyer's Amsterdam conference founded the World Jewish Economic Federation, whose inaugural convention would still be held in London in October under Lord Melchett. Now, on July 19, a new world gathering in London was being discussed for October, this one sponsored by Zionist and Anglo-Jewish leaders to focus on "relief' and fundraising to the exclusion of boycott. [11]

So many rival suggestions for a world Jewish gathering were vying for recognition by July 19 that nobody was sure which idea was under discussion at any given time. Laski's move to defer a decision to accept Goldmann's invitation to Wise's World Jewish Congress only prolonged the confusion. The longer such confusion existed, the less likely anyone except the Deputies could properly organize a conference -- which is why Untermyer suddenly called his Amsterdam conference. Similarly, Stephen Wise decided he could no longer wait for the Deputies to co-convene the World Jewish Congress. So Wise and other Congress advocates scheduled something called the Second World Jewish Conference for early September in Geneva, which would finally construct a worldwide anti-Hitler boycott-with or without the Anglo-Jewish establishment.

Melchett was trying to walk a line between his own grass-roots support and the establishment Joint Foreign Committee of which he was now a member. So after the boycotters in Amsterdam proclaimed him chairman of the World Jewish Economic Federation, Melchett felt compelled to issue press statements denying his involvement and counseling against any "officially proclaimed" boycott. Yet at the same time, his own boycott journal, The Jewish Economic Forum, assured boycotters that the long-awaited anti-Nazi "conference" would indeed convene in October in London. To pacify conservative Jewish leaders, however, it would be called a general conference, not an economic conference. But Melchett promised that the preliminary work in Amsterdam would be a major focus. The Forum stressed that whether the boycott was proclaimed or un proclaimed, official or unofficial, was not as important as ensuring that the boycott was indeed organized. [12]

However, Melchett's equivocation soon gave way to indecision. Perhaps the boycott was not a good idea. Melchett was an ardent Zionist. Like the others in the JFC, he had heard Laski foreshadow a great development for German Jews. Was it better to continue the struggle to topple the Hitler government -- a prospect that seemed more difficult as each day passed, a prospect that carried the certainty of bloody reprisals, but a prospect that made the Jews the sole force willing to organize the war against Nazism internationally? Or was it the heartbreaking duty of Jewish leaders to renounce the fight in advance, struggling instead to save who could be saved, convert the anguish of Nazi Germany into the future of Jewish Palestine, and thus solve such tragedies forever more? Melchett was unsure. Others in Anglo-Jewish leadership were unsure. The decision would be made on July 23, at the Deputies' final meeting of the season, when the JFC's pro-Zionist shift and the boycott would both come up for debate and a vote.

***

The Board of Deputies was a representative Jewish body. But a core of longtime elected members, including Neville Laski, were able to control the votes in part because of chronic roll-call absenteeism. [13] However, for the July 23 final session, 185 Deputies packed the auditorium. Many would support the Laski line. But many were determined to vote the boycott through.

After dispensing with questions of kosher slaughter, honorary mentions of academic achievements, and congratulations on the seventieth birthday of one of the Deputies, the topic finally turned to Germany. [14] Laski began by assuring the Deputies that the many delays were misleading. During previous days, JFC members had been busy working with Jewish organizations throughout the world to alleviate the plight of German Jewry, including initiating "constructive" assistance. "Constructive" in Jewish relief parlance meant the rebuilding of Palestine. Laski acknowledged that for the first time he would attend the Zionist Congress and that this should be interpreted as a major change in the Deputies' longtime antagonism for Jewish nationalism. [15]

Laski then alluded to enormous efforts under way to liquidate German Jewish assets. He declared emotionally that he yielded to no man in his sincerity or the sincerity of his colleagues. Laski readily acknowledged that others at the gathering, especially those who supported boycott, did not see "eye to eye" with him, but he would not challenge their sincerity either. The audience applauded. [16]

But the Deputies had still heard no persuasive reason to abandon the boycott. Deputy Joseph Wimborne objected that too much of the Jewish public had been "in the dark" about negotiations with Germany. Whatever it was that Jewish leadership was doing, it was not helping Germany's Jews. Mr. Wimborne demanded "more information" and "brass tacks." Laski answered that certain matters were still secret and could not be divulged in public. Deputy Percy Cohen spoke up, agreeing that the Jews had been fighting on "too narrow a front" and that it was time to broaden the offensive. [17] Boycott was the obvious alternative.

Deputy Michael Levy then urged Laski and his colleagues to heed the warning of British Jews who had just three days earlier staged a spectacle of protest through London. The people, declared Mr. Levy, "want to be led." But unless the board took that lead, "the masses would lead themselves." [18]

Laski saw the mood. So he invoked his privilege as president and declared that the boycott debate would now go into secret session to explain certain developments that could not be uttered in public. There could be no outside observers, no reporters, no minutes. All the Deputies participating would be sworn to secrecy as well. Laski promised that after his statements, the Deputies would understand the secrecy. [19]

Presented with such drama, the Deputies reluctantly agreed. With all outsiders barred, the stenographer's pen capped, and the doors closed, Laski read from the document given to him by General Smuts. In this moment of decision, with the Deputies torn between the instinct to fight and the inclination to allow their leaders to engage in quiet diplomacy, Smuts' secret document would have to make the final, compelling case against boycott. [20]

After reading the document, Laski delivered an impassioned hourlong speech explaining why it was now absolutely necessary to forgo the boycott against Germany. When he concluded, Laski felt certain he had swayed the Deputies, even those adamantly pro-boycott. Again using his authority as president, he limited other speakers to five minutes each, saying that it was "a poor case that could not be stated in that time." Only one or two pro-boycott Deputies were permitted to speak. [21]

Many had come to demand that their leaders organize a boycott fight against all odds for persecuted German Jewry. They saw this as their duty to God and man. But they had heard the hard facts of Jewry's endangered position. And although their organizations officially rejected Zionism, as individuals they believed in the destiny of Jewish people to finally find redemption and peace on the soil of their forefathers. Torn between the anger in their veins and the vision in their hearts, one by one they cast their votes to battle or to build.

The vote: 27 to boycott, 110 against. Two hours after it had begun, the secret session was adjourned. [22] No boycott.

***

In July 1933, influential Anglo-Jewish leaders committed themselves to the Zionist solution of the German Jewish crisis. In so doing, they would help bring to sudden fruition the dream of Jewish nationhood. Unlike previous Jewish emergencies, this time Palestine would come first. When the next persecution descended upon a Jewish people, Israel would be there to receive them.

That noble goal was also desired by Jews advocating combat with the Reich. But they believed the better answer was boycott. For them, Wise's Second World Jewish Conference would indeed be the last chance to organize. And Wise wanted it that way. He was counting on his ability to achieve a dramatic eleventh-hour breakthrough, producing the unified economic death blow needed to end Hitlerism.

But plans were even then afoot to undennine Wise's culminating efforts. Just after the Deputies' final July 23 vote, Nahum Goldmann, the main Congress organizer, arrived back in Geneva and promptly wrote a short letter about a fund-raising question to his friend Mr. Sam Cohen, who had by then reached London. At the end of the letter was this addendum: "Stephen Wise is presently in Paris and will arrive here [Geneva] Thursday evening." [23] The events of July 1933 represented more than a series of reversals in the evolution of the Jewish response to Hitler. They represented a reprieve for the Third Reich, a letup in the anti-German offensive. This reprieve could not have come at a more decisive moment.
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Re: THE TRANSFER AGREEMENT: THE DRAMATIC STORY OF THE PACT B

Postby admin » Fri Jun 26, 2015 6:19 am

Part 4: Pact

23. Druck van Unten


THE THIRD REICH'S campaign of social, economic, and political terrorism against Jews was endless. During June 1933, the chain of anti-Jewish government decrees was itself overshadowed by numberless unofficial acts of repression. For example, Jews were no longer allowed to advertise in the phone book or rent stalls in the Frankfurt markets, and were terminated en masse from hundreds of German companies. Even companies owned by Jewish principals could no longer withstand the popular demand to fire all Jewish employees. [1]

The paper pogrom against Jewish economic participation was the dull edge of the knife. The sharp edge was a continual stream of anti-Jewish boycott actions, many of them violent. For example, in late June, scores of Jewish merchants in Essen and Muenster were picked up and delivered to concentration camps. In Frankfurt, thousands of frenzied Storm Troopers paraded through the streets chanting "Kill the Jews" and demanding that Jewish shops be closed. [2]

These acts of terror were widely publicized throughout the world. In fact, in mid-June The London Sunday Referee actually published a Berlin street map locating a dozen Nazi torture houses. [3] The daily outrages in Germany only heightened the moral justification for anti-Reich action. So in spite of the Zionist hierarchy, the Deputies, and the American Jewish Committee, the grass-roots anti-Nazi boycott continued to widen. In simple terms, men and women all over the world of all religious and political beliefs were repulsed by the very thought of conducting business as usual with Nazi Germany.

The crippling effects of international retaliation were only magnified by domestic business disruption caused by the disintegration of the Jewish economic sector, and the pillaging of non-Jewish German companies by NSDAP cells. The battering from without and the deterioration from within weakened Germany during late June to a state of near collapse, and the hairline cracks were beginning to show.

The greatest pressure came from those without jobs. Chain-reaction unemployment triggered revolutionary chaos as the jobless began redefining their loyalties. Nazi splinter groups became rampant. Many such groups consolidated their popularity with time-buying employment tricks. For example, local Nazi groups began forcing factory owners to rehire men let go because business was down. Companies refusing to do so were subject to a thorough financial review. Those with any cash reserves were obligated to rehire the men until those reserves were totally depleted. In Upper Silesia, managers of closed coal mines were arrested; the mines were then reopened by a Nazi kommissar determined to keep them operating until the very last moment. Elsewhere throughout Germany, bankrupt Jewish storeowners were threatened with a charge of "economic sabotage" unless they reopened. Once again, the intent was to keep the employees working beyond the moment of economic infeasibility and right up to the instant of economic exhaustion. [4]

Such employment tricks did buy the Third Reich a little more time. But in many ways the time was not bought in the name of Adolf Hitler as much as in the name of dissident Nazi splinter groups unhappy about rampaging unemployment. To survive, these dissident groups needed to guarantee their adherents -- for just a little while longer -- what every political machine needs to guarantee its followers: jobs.

To head off political insurrection, Hitler set in motion a series of party absorptions that digested allied right-wing parties, such as the Center party and the Nationalist party. But the real threat was not vestigial parties, it was Nazi splinter groups, which in their fanatic frustration were about to stage a second coup, this one more violent than the first. [5] Goebbels, a chief fomenter of this second wave, did not fail to egg on his supporters. In a speech in Hamburg on June 24, he declared, "The revolution is not yet finished. Worse events are still in store." [6]

In June 1933, Hitler named businessman Kurt Schmitt to be Economics Minister. In Schmitt's view, saving Germany's economy stipulated a return to normalcy, a drastic reduction in anti-Jewish provocations, and an end to interference by kommissars. Hitler approved of Schmitt's approach, but when Schmitt tried to impose his restrictions, Nazi fanatics refused. On June 30, the four highest-ranking NSDAP subordinates in the Economics Ministry began rallying Nazi commercial organizations to oppose Schmitt's appointment. They favored Dr. Otto Wagener, Reich Kommissar for Business and Industry, a longtime party economic leader, chief of the kommissars, and a man of immense power due to his control over thousands of private-sector jobs. [7]

No time was wasted in suppressing the rebellion. Dr. Wagener and his assistants were promptly sent to a concentration camp. The charges were summed up as attempting to "rob the Fuhrer of his freedom of decision." [8] This set off a wave of anarchy, with mid-level Nazi leaders jailing businessmen and taking over companies. [9]

Later that day, June 30, British Ambassador Rumbold reported the chaos in a letter to Foreign Secretary Simon. "Can he [Hitler] control them? ... Nobody can foresee the actions of leaders like Frick, Goering, Ley, and Wagener, who seem to possess authority to incarcerate anyone at a moment's notice .... It is doubtful whether the Nazi .leaders in the provinces even trouble to refer to Berlin for authority to make arrests. [10]

The madness continued for days, with contravening Nazi authorities ordering private businessmen to make large donations, abrogate contracts, suspend debts, rehire workers and postpone layoffs. Those who did not seem to cooperate fully were arrested and tried by party bureaus. [11] In many instances, fear and fear alone kept companies operating.

On July 2, Hitler gathered all major SA and SS leaders at Bad Reichenhall and admitted what the diplomats had been saying for weeks -- the success of the Third Reich depended wholly on a solution to the unemployment crisis. And he was aware that the swelling ranks of unemployed Brownshirts were creating the impetus for a second revolution. He promised to crush ruthlessly any such action because any second wave would only bring chaos. [12] That chaos would probably result in civil war.

Hitler's July 2 rebuke did not work. The hairline cracks were becoming distinct as the unemployment panic escalated the batteries against German business. A Bavarian director was told to consider himself lucky for being ordered to contribute as little as RM 30,000 to the local Nazi unit. The Berlin Municipality was forced to hire unemployed men to work in imaginary public works programs. The Municipality announced that its normal creditors would therefore not be paid. [13]

A prominent Saxon Nazi employed as a salesman was unafraid to inform the British embassy's commercial section that his local faction had decided to forbid all foreign goods and rule Saxony's commerce as they saw fit. When the embassy staffer reminded the man of Hitler's speeches forbidding interference with private enterprise, the salesman answered that the Nazi leaders of Saxony "had lost patience" with the government and would do as they pleased. [14]

The anarchy was most visible in a massive resurgence of anti-Jewish boycotts. Such boycotts had been forbidden shortly after the aborted April First attempt. Reich leaders knew that of all the foreign provocations, boycotting Jews was the most likely to provoke like retaliation. Yet provincial Nazi units, in open defiance of instructions from Berlin, ordered local newspapers to publish boycott notices. In many districts, party members were ordered to denounce for arrest any Aryan seen entering a Jewish store. [15]

Anti-Jewish boycotts of course increased general unemployment. Although it appeared as though Jewish commerce was being diverted to Aryan businessmen, thereby increasing Aryan employment, the exact opposite was true. Jewish firms ruined by boycott were invariably forced to fire their German employees and default on their debts.

The spiraling effect on employment of these Jewish defaults was made clear to Hitler personally during these first days of July. His new economics minister, Kurt Schmitt, appealed for an emergency meeting to discuss the imminent bankruptcy of Germany's second-largest department store chain, the Jewish-owned Hermann Tietz stores. The massive Tietz chain operated over one hundred stores throughout western Germany, employing 14,000 people directly and providing employment to thousands more who worked for Tietz suppliers. Furthermore, there were several other Jewish department stores that, like Tietz, had been boycotted into near bankruptcy. Schmitt explained to Hitler that if these chains went bankrupt -- Tietz in particular -- the entire German economy would suffer a major overnight increase in unemployment. The employees of Tietz and many of its suppliers would lose their jobs, and hundreds of creditors would be ruined. Schmitt told Hitler the only solution was to reach somehow into dwindling government reserves and provide Tietz with a special subsidy. Hitler was outraged. The very thought of diverting precious government funds to subsidize a Jewish enterprise was blasphemy. At that point, Schmitt showed Hitler a stack of financial analyses of what would happen if Tietz went out of business. For example, the financial condition of food-processing plants, whose products were well represented in Tietz's stores, would be dangerously weakened. The excited debate lasted two hours. But in the end, money was found to bail out the Tietz operation. It was a stunning lesson in economics for Adolf Hitler. [16]

Der Fuhrer took immediate steps. On July 5, Hitler addressed an open letter to the leading Nazi officials of Brunswick to stop mass arrests and trials of businessmen and industrialists. Hitler stressed that business must be allowed to function normally. The next day, Hitler's minister of labor issued a similar warning to the so-called Nazi Cell Organization, which included numerous bottom-echelon clerical workers. Later on July 6, Hitler chastised key party leaders in Berlin for National Socialist experiments that were destroying the remnants of German industry. "History will not judge us," he warned, "according to whether we have removed and imprisoned the largest number of economists but . . . whether we have succeeded in providing work." [17]

But once more Hitler's warnings went unheeded. The cancerous decay of German business was spreading. In a report to Washington, American charge Gordon, described how explosive the unemployment issue was: "The tremendous pace at which the new revolutionary wave ... [is] sweeping over Germany ... shows that what is known here as the 'Druck von Unten' -- that is to say, the pressure from below on the part of the rank and file of the Nazi Party who feel that ... they have in no wise obtained the material benefits which ... they feel are due them ... is still a very acute reality." Gordon added that Germany was on the very brink of the so-called "second revolution," and Hitler had decided to stop it. [18]

And so on July 11, Hitler announced that "the revolution was over." Interior Minister Frick circulated a grave warning to all high-ranking government and police authorities, stipulating in plain German: "The Chancellor has made it clear beyond doubt that the German revolution is closed.... The foremost task of the government is now to lay intellectual and economic foundations .... But this task will be seriously endangered by further talk of a continuance of the revolution, or of a second revolution. He who talks thus must realize that ... he is rebelling against der Fuhrer himself and will be treated accordingly. Such utterances ... are particularly calculated to expose the German economic system .... the marked fall of unemployment, must in no circumstances be disappointed." [19]

The warning was again ignored. Transparent references to a "marked fall in unemployment" fooled no one. When 5 to 6 million wage earners in a country of approximately 15 million households have been out of work for two or three years, they know it. Only food on the table can change such people's minds. The talk of a second revolution was indeed a frantic attempt by these 5 to 6 million jobless Germans to transfer their political loyalties to anyone who could finally accomplish that one heroic deed: put some food on the table.

Along with Frick's warning, an announcement was issued to all newspapers by Rudolf Hess, Hitler's personal deputy, ordering all boycotts against Jewish-owned department stores to stop, explaining: When the Third Reich "finds its most important task to provide work and bread for as many unemployed Germans as possible, National Socialists cannot ... deprive hundreds of thousands of employees ... of their jobs in department stores and enterprises which depend on them. I therefore strictly forbid all members of the NSDAP to take any actions against department stores or similar enterprises." [20]

In the frenzy to survive, it was not only the poor and unemployed who demanded change, but also the rich and powerful. If Hitler was going to rehabilitate the German work force and rearm, continued support from the magnates of German industry was vital. And Germany's leading industrialists enjoyed vast alliances with the underarmed, understaffed, but nonetheless fully organized German military, the Reichswehr. [21] The Reichswehr was still an uncertain factor in German politics. At the end of the second week of July, the wealthy needed immediate reassurance.

On July 13, 1933, a panel of German industrial leaders and financiers met with Minister of Economics Schmitt to hear the government's plan to seize business back from the Nazi factions. Schmitt outlined a seven-point policy, and it was just what they wanted to hear. Businessmen were to be given full police protection against Nazi interference. Government price controls would be dropped. An advisory council, comprised of Carl Bosch, Gustav Krupp, Fritz Thyssen, Karl Siemens, and thirteen other German executives, would be granted a special voice in future economic decisions. Cartels and markets were to be stabilized. The department stores were to be fully protected from "irresponsible elements." Various so-called fighting organizations of middle-class Nazis were to be dissolved. [22]

In particular, Schmitt was alarmed about the sudden rise of massive middle-class economic associations. The Estate for Handicraft and Trade was the most threatening. This Estate originated in May 1933 as a paper-shuffling party bureaucracy committed to the Nazi doctrine of native crafts and small enterprise. In recent days, however, the Estate had grown to an enormous membership and had taken a defiant position against big business. More important, the Estate had asserted itself as the sole competent authority in economic organizing and was even obligating employers to join its ranks. The Estate represented more than just a threat against big business. It represented an alternative power base with the potential to intervene and redistribute jobs. And so Schmitt assured that the Estate would be dissolved at once to avoid the danger that a "whole series of non-authorized persons would engage in experiments and seek to build up a sphere of influence so as to realize all kinds of plans." [23]

Schmitt reassured the gathered executives that the new seven-point program would commit the Hitler regime to economic recovery through traditional business methods. The industrialists heartily approved. Gustav Krupp said a word of thanks on behalf of the "German economy" [24] for the last attempt to rescue capitalism in the Third Reich.

While Schmitt was reassuring German industrialists on July 13, Hitler was espousing the new economic philosophy to a party leadership conference in Berlin. He tried to explain that in politics a single swift and decisive blow was required, but "in the economic sphere other laws of development must determine our action. Here we must move forward step by step without suddenly destroying what already exists and thereby imperiling the basis of our own existence." Hitler stressed that he was preoccupied with his prime economic task: restoring the German worker's job and consumer power. [25]

Though Nazi leaders agreed that the paramount issue was jobs, there was now considerable disagreement over the best way to preserve and restore them. Schmitt and Hitler in their new alliance with the German magnates had their ideas. But the Estate, which pursued a more common man's commerce, had its ideas. If any entity could play a role in a second revolution, it was this new Estate. [26]

So the next day, July 14, the Reich issued a new emergency measure stating unequivocally that the Nazi party was the only legitimate party in Germany. Political activities were limited to privileged members of the party. No new parties of any kind could be initiated. This was a telling emergency measure since the Nazis had been the only real political party since April, and even the remnants of their right-wing affiliates had been wholly absorbed in late June. Whatever Estate leaders were planning, under whatever name, Hitler would not allow it. United States Ambassador Dodd, explaining the new law to Washington, commented, "There can be little doubt now that this law was directed not so much against the defunct political parties as against attempts to split the Nazi Party from within." [27]

A few days after the July 14 proclamation, Hermann Goering was vacationing on the Island of Sylt in the North Sea when his entire Prussian cabinet suddenly assembled on the island for an urgent conference. The next day, Goering cut short his vacation and flew back to Berlin. At the airport he said little except that he would move "with an iron hand" against the enemies of the state. [28]

Goering then convened an emergency conference of all the Prussian prosecutors, police chiefs, presiding judges, Gestapo heads, and senior SA and SS commanders. Wholesale arrests of entire dissident Storm Trooper units were already under way, but Goering wanted arrests stepped up. Prosecutors were ordered to clear their dockets of all but dissident cases to provide the swiftest possible punishment. [29]

On July 15 the final figures for Germany's balance of trade were made public. For June, the surplus dropped 68 percent compared to the month before; for the entire first half of 1933 it was down 51 percent. That six-month loss would have been greater except that the anti-Hitler boycott had not really commenced until late March. Overall export volume had also dropped, almost 9 percent from May to June. France's purchases alone decreased by 25 percent, finished goods suffering the greatest losses. [30]

The German Chamber of Commerce issued a brave report admitting that the export decreases were caused by the "growing shutting out of German goods from many countries." The word boycott could not be used. And Deutsche Bergwerks Zeitung, the newspaper of the powerful Ruhr industrialists, editorialized that the latest figures now made the acquisition of foreign exchange and the increase of exports the Reich's greatest priority. [31] All this occurred about the time Samuel Untermyer proclaimed that his World Jewish Economic Conference would suddenly convene in Amsterdam.

Outrages against Jewish citizens, especially the anti-Jewish boycott, increased the legitimacy of Untermyer's demand for a worldwide economic war against Germany. So the suppression of "atrocity propaganda" was revived as a Reich imperative. It now became clear to Goering that the only real way to diminish atrocity tales was to outlaw the atrocities themselves. The new adamancy about suppressing anti-Jewish acts and forbidding business interference was certain to provoke mass disobedience. The ranks would insist on taking drastic measures to redistribute Germany's remaining economy, and of course deprive Jews of whatever remaining resources they enjoyed.

United States Ambassador Dodd warned of the coming clashes in a July 17 letter: "Hitler realizes that any further attempts at Nazification of business and industry might throw the German economy completely out of joint and thus imperil the existence of his regime." Dodd predicted, "Many of Hitler's followers will resent this sudden change of policy as a betrayal of the Party's program." To illustrate the likelihood that dissident Nazi groups might set up their own kommissar-dominated mini-governments, Dodd quoted a recent warning by Interior Minister Frick: "Any form of auxiliary government is incompatible with the authority of the totalitarian State." Dodd ended his letter by focusing on the "danger that the numerous extremists in the Nazi Party may get out of hand once they realize they have been deceived." [32]

On July 23, Goering called a press conference and announced extraordinary measures to combat any insurrection among the ranks. First, a political prosecutor's office was established to work with the Gestapo. Second, all violations of law that interfered with German reconstruction and offenses against the Storm Troopers, Stahlhelm, or the police would be punished ruthlessly "no matter by whom they are committed." The families of persons convicted of such offenses would be disqualified from any unemployment or relief benefits. Third, a sentence of fifteen years to life imprisonment and possibly death by decapitation would be imposed on "any person who kills, plots, or instigates to kill a policeman, a member of the Storm Troopers or Stahlhelm; or who brings into Germany foreign periodicals or pamphlets with political content, which may be regarded as treasonable in the sense of existing decrees ... proscribing certain organizations ... [or] the formation of new parties." [33]

Although the law seemed designed to protect Nazi party units, the real object was to prevent members of the party from turning on each other in a bid for control. Any encouragement of such action, especially if violence were involved, would be deemed by Goering an act of "atrocity propaganda." And any Brownshirt advocating violent anti-Jewish behavior would simply be accused of infiltrating SA ranks to foment atrocity propaganda. Any provocative leaflets or unauthorized newspapers preaching disobedience or loyalty to new factions would be deemed "foreign" and once again "atrocity propaganda." Goering stressed that dissemination of atrocity propaganda was punishable by death. [34]

Despite the sternest of government warnings, anti-Jewish boycotts continued unabated and in the most public fashion. Newspapers throughout Germany published locally ordered boycott ordinances in open defiance of der Fuhrer's orders. For example, the Dortmund Generalanzeiger circulated a boycott ordinance on behalf of the local party unit. The Chemnitzer Neuesten Nachrichten publicized a boycott sponsored by the Chemnitz Chamber of Commerce. And at the height of Goering's demands that public violence against Jews be abolished, Julius Streicher's followers arrested 300 Jewish shopkeepers in Nuremberg and marched them through the streets in a humiliation rite. The embarrassed Bavarian authorities quickly released the Jewish internees and warned the local press not to mention the incident further. [35]

By late July, a clash of fanatics seemed unavoidable. To the lower-downs, the Reich's economic failures seemed a symptom of laxity and loss of faith. One local NSDAP unit even refused to rescind its boycott when directly admonished by Berlin. Their answer: "We don't need to check with Berlin. On this matter the platform of the Nazi Party is clear. That is good enough for us." [36]

It is unknown how far the "second revolution" had advanced by July 25. There is no way to know whether the threat '""as greatest from the forces of former economics minister Hugenberg, Nazi theoretician Julius Streicher, imprisoned chief kommissar Otto Wagener, the growing throngs of the Estate for Handicrafts and Trade, or any of a dozen other coalitions and political factions. But on July 25, action was taken.

Precisely at noon, 1 million policemen, Storm Troopers, and SS officers whose loyalty to Hitler could be assured, brought Germany to a standstill. Everything was searched. Trains, cars, waiting rooms, railway stations. The countrywide operation lasted about an hour. The results were never revealed, since the action was executed under Goering's decree promising death to atrocity mongers. [37]

But even the mobilization of a million men could not restrain the druck von unten, the pressure from below.

No one knew the precise answer: whether the total breakdown would come in a week, a month, or in two months -- or whether it would come at all. That was the question that kept people guessing. But the clear connection between Germany's jobless and national unrest was widely known. All the desperate Nazi speeches and economic alarms of July 1933 were openly reported in the newspapers of London, New York, Paris, Amsterdam, and Washington.

Yet in the face of those headlines and seductive encouragements to strangle the Reich economically, key Jewish leaders were doing all they could during July to block the anti-Nazi boycott. Clearly, the Third Reich was prone, in chaos over unemployment, frantic for time to save its economy, and unable to withstand further erosion of its export trade. But imponderables plagued the international Jewish community: Could the boycott work fast enough? If it did succeed, would German Jewry not be left in ashes beneath the rubble of the Reich?

Those who rejected boycott in favor of the Zionist solution questioned whether Jews could ever truly win such a war, and if they did, would the battles only continue from generation to generation? They believed that the only way to win such wars was to avoid them. If constructing Palestine could achieve the Zionist ideal of Jewish independence, then the victory would not be transient; it would be everlasting. This was the torment of the times for Jewish leadership: to fight fire with fire, or to fight fire with foresight.
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Re: THE TRANSFER AGREEMENT: THE DRAMATIC STORY OF THE PACT B

Postby admin » Fri Jun 26, 2015 6:19 am

24. Landauer vs. Cohen

IN THE MINDS of Zionists, Jewish life in Germany could not be saved, only transferred. Even if Hitler and the German economy were crushed, Jewish wealth in Germany would be crushed with it. The wealth had to be saved. Through the speedy liquidation and transfer of that wealth, the Jewish Homeland could be built, thus creating the refuge needed for a mass transfer of the people. Zionism had declared from the moment of Herzl that anti- Semitic regimes were not to be opposed. They were to be cooperated with in the transfer of Jews and their assets.

As Landauer saw it, vast amounts of money -- from immigrants as well as so-called potential immigrants -- would be at the disposal of Zionist institutions. Thus, a virtually endless bank account could finance Palestine's development: roads, water supply, housing, and the unique Zionist enterprise of coaxing the desert into bloom.

The great threat to this reach for utopia was Landauer's erstwhile partner, Mr. Sam Cohen. During the July IS meeting, Landauer had stressed that an agreement could be realized only under the supervision of a special Zionist clearinghouse controlled by the Anglo-Palestine Bank, the bank most Jews and Zionists trusted. This stipulation would deprive Hanotaiah of its monopoly on the futures and fortunes of German Jewry.

The Anglo-Palestine Bank could of course be relied upon to implement the decisions of the Zionist Organization. Established in "1902, the oldest and most respected bank in Palestine was owned by the Anglo-Palestine Company. The Anglo-Palestine Company was in turn a wholly owned subsidiary of the Jewish Colonial Trust Company. All controlling shares of the Jewish Colonial Trust Company were owned and managed by the Zionist Organization in London. [1]

Although the bank was still a small financial institution, this transfer project held the potential to make the Anglo-Palestine Bank one of the world's strongest. Years later, Anglo-Palestine would indeed become one of the top one hundred banks in the world. And it would change its name to Bank Leumi -- the most important bank in Israe1. [2]

To ensure that Sam Cohen would not again intercept the transfer, Landauer decided the ZVfD would maintain constant communication with both the Economics and Foreign ministries. So on July 14, the day after the Wilhelmstrasse meeting, Landauer sent a letter to Currency Control director Hans Hartenstein, with a copy to Hans Schmidt-Roelke at the Foreign Ministry. Landauer's letter was a simple confirmation that, as requested during the July 13 meeting, a memo crystallizing transfer procedures would be delivered shortly. Until then, wrote Landauer, "I find it important to reemphasize in advance what I said during that session: It is of the utmost importance that the clearinghouse proposed for Palestine be a public organization which enjoys the full confidence of the Jewish public .... Only the Anglo-Palestine Company is available for this purpose." [3]

In a not so subtle move to preclude another Sam Cohen trick, Landauer explained to Hartenstein why he was reiterating his position even before further negotiations. "I want to avoid the possibility of losing this resource through any individual negotiations which might take place prior to the implementation of the overall agreement." [4]

With German unemployment soaring, and with transfer as the only ready means of breaking the boycott, Landauer was feeling eminently more confident than just weeks ago when he was afraid to even contact the government. That surge of confidence was apparent in the July 14 letter as Landauer made it clear the Zionists would not agree to just any deal. They wanted the deal that was right for Palestine. And so Landauer's short letter closed with what must have appeared like a warning, or even a threat. "I wish to emphasize this in writing beforehand because I consider it important to inform you that the [Zionist] authorities which will be dealing with emigration to Palestine will hardly be able to agree to any other method." Schmidt- Roelke was a little astonished when he read that language and he penciled two exclamation marks next to it in the margin. [5]

Landauer also moved against Cohen at the very center of Cohen's power, Hanotaiah Ltd. Lev Shkolnick, manager of Yakhin, was to negotiate in Berlin the final details of joint implementation with Sam Cohen and Hanotaiah co-owner Moses Mechnes. By June 30, Mechnes had arrived but nothing concrete could be done without Cohen, who was still en route from Tel Aviv to Trieste, and from there to Geneva and then London before finally reaching Berlin to finalize specifics. Employing an old technique of Mr. Sam Cohen himself, Landauer used the opportunity of Cohen's absence to meet with Mechnes and other Hanotaiah personnel to extract a promise that they relinquish any transfer monopoly. [6]

At the same time, Yakhin's desire for a joint venture with Hanotaiah quickly dissipated. Telegrams sent by Hanotaiah to Yakhin were answered in vague terms. Yakhin managers realized they no longer needed their competitor Hanotaiah. By mid-July, the publicly controlled Yakhin, which gave the private company Hanotaiah its air of public sanction, had disassociated itself from Sam Cohen [7] and was ready to support Landauer.

Landauer spent almost a week polishing his two-and-a-half-page transfer memorandum, which was typed on the stationery of the Palastina Amt or the Palestine Office. The Palastina Amt was the actual Zionist emigration office and thereby colored Landauer's memorandum as the official emigration and transfer proposal. On July 19, it was delivered to Hartenstein at the Foreign Currency Control Office. A copy went to Schmidt-Roelke at the Foreign Ministry with a cover letter that again made the point: "1 emphasize that our offices in Palestine are particularly anxious to see money and transactions handled by agencies which enjoy the trust and confidence of the public." [8]

Landauer also sent a letter that day, July 19, to E. S. Hoofien, general manager of the Anglo-Palestine Bank, who was then in London. Landauer's letter asked Hoofien to establish a bank-supervised trust company in Palestine ready to commence on a moment's notice. He made it clear that speed was essential because there was always the threat of Sam Cohen. [9]

To further neutralize Cohen, Landauer urged Hoofien to have the Anglo- Palestine Bank people in Jerusalem "keep in close contact with the German Consul." Just as Wolff had been the avenue to Cohen's recognition at Wilhelmstrasse, so would Landauer's project receive official endorsement-if only Wolff would transmit his approval. [10]

Even before Hoofien received Landauer's July 19 memo, the London Zionists were busy preparing for a massively enlarged transfer plan. Werner Senator, who had attended the July 13 Wilhelmstrasse meeting, was preparing a major report to the Zionist Executive in London that outlined the new proposals formulated by Landauer. At the same time, Professor Brodestsky asked his contact A.C.C. Parkinson once more to request the assistance of the British Foreign Office. Senator would be returning to Germany to finalize details of the transfer. To drape Senator in the cloak of legitimacy, Professor Brodetsky wanted the British embassy to allow Senator to use their offices. [11] Foreign Office officials objected that the whole request was "another of Professor Brodetsky's attempts to get us identified with Zionism abroad." But the Colonial Office ultimately struck a compromise whereby Senator would be allowed to call at the embassy but would not be allowed the use of embassy facilities such as telegraph or telephone. [12]

Landauer had indeed gone to extraordinary lengths to reclaim the authority to conclude the agreement with Germany. He had convinced Hanotaiah to withdraw from its monopoly. Yakhin had retreated from joint participation with Hanotaiah. E. S. Hoofien and the Anglo-Palestine Bank would quickly establish a bank-supervised trust company in Palestine. Anglo- Palestine Bank people in Jerusalem would convince Consul Wolff to switch his endorsement from Cohen to Landauer. Landauer was staying in very close touch with Hartenstein, with copies of everything going to Schmidt-Roelke. And Senator, of the Jewish Agency, would be joining Landauer soon as the official representative of the Jewish government in Palestine, complete with British embassy trappings.

At stake was literally the future of the Jewish national home. If the huge transfer expansion the Reich planned was put into force through Sam Cohen, Jewish emigrants would quickly discover an essentially cashless existence in Palestine. By the time they discovered the unattractiveness of Cohen's transfer, their money would nonetheless become blocked marks in Hanotaiah's special bank account. Only Cohen would have use of the money. When bad experiences became widely known, German Jewry would seek refuge anywhere but the Jewish national home.

But if Landauer's project were put into force through the Anglo-Palestine Bank, German Jewish emigres would be free to pursue whatever existence they chose in Palestine. They would have the £1,000 entry money in hand, and shortly after they arrived, as German goods were sold, they would receive even more of their money, perhaps a second £1,000. In a nation like Palestine, where wages amounted to no more than a few pounds daily, a £2,000 head start would guarantee a comfortable life. The transferred Jews would in turn become consumers, purchasing familiar German goods coming in as part of the transfer. This in turn would support the transfer of even more German Jews.

Shortly after Landauer's transfer memorandum to the Economics Ministry was delivered, Hartenstein invited Landauer to a conference to discuss details of the transfer. It was finally going as Landauer wanted. He was in control. To make sure all aspects of the negotiations remained fully in hand, he asked his friend Herman Ellern, of the Ellern Bank of Karlsruhe, to visit Schmidt-Roelke beforehand and support Landauer's initiative. [13]

At Wilhelmstrasse on July 20, Hartenstein was most cordial as the meeting began. But as the conversation progressed, Landauer probably wondered if they weren't talking about two wholly different concepts. Landauer's memorandum outlined the future expansion of the transfer. Yet Hartenstein explained the transfer had already been expanded two days before. With whom?

With Mr. Sam Cohen, explained Hartenstein. Cohen had assured the ministry that the ZVfD would organize a special Hanotaiah office in its Berlin headquarters to serve as the German clearinghouse. Hanotaiah's main office in Tel Aviv would function as the Palestinian merchandise clearinghouse. Hanotaiah would process all Palestinian transactions through its bank accounts in Palestine, which would be opened in both the Anglo- Palestine Bank and the German-controlled Temple Bank. [14] Was it not exactly as Landauer had insisted: two clearinghouses, one in Germany, one in Palestine -- with the money channeled through the Anglo-Palestine Bank?

Hartenstein then showed Landauer a letter on the stationery of Economics Minister Kurt Schmitt, signed by Schmitt's deputy, Dr. Reichart. Dated July 18, 1933, the letter to Hanotaiah confirmed, "On the basis of the renewed negotiations between Mr. Sam Cohen and my experts, I am willing to support the emigration of German Jews to Palestine by allowing the following facilities for an extended transfer of their assets." The second paragraph authorized voluntary deposits into Hanotaiah's blocked accounts for both actual emigrants and for any other Jew considering emigration or "willing to participate in the development of Palestine." [15] That covered every Jew living in Germany.

Reflecting the uproar about unemployment and the dramatic decrease in exports of finished goods due to the anti-Nazi boycott, the Schmitt-Reichart authorization specified that "finished goods" would be exported to Palestine to achieve the transfer. The order acknowledged that deposits made by German Jews would be handled through "an office at the German Zionist Federation, Berlin, Meineckestrasse 10." Yet Landauer, director of the ZVfD, hadn't even been consulted. [16]

The letter also stipulated that German Jews, upon arriving in Palestine, would receive cash from the merchandise sales. [17] Landauer had emphasized how important cash would be in enabling Jews to rebuild their lives and making mass emigration viable. But Landauer was certain that Cohen would keep most of the sale cash, repaying emigrants with whatever parcels of sandy acreage Cohen felt sufficient.

The July 18 order listed Hanotaiah's initial expanded permission as RM 3 million -- $15 million -- and superseded Cohen's original RM 1 million deal. Unlimited additional permissions were allowed, but the letter demanded an unspecified minority percentage of foreign currency for transfers beyond the first RM 3 million. Dr. Reichart was explicit: "I wish to point out what my experts have repeatedly and decidedly emphasized to Mr. Cohen, that after the 3 million reichmarks have been used up ... foreign exchange must be received in payment" for at least part of the purchase price. [18]

The final words of the permission letter indicated that emigration to Palestine was absolutely linked to German exports to Palestine. If Germany was to continue providing precious foreign exchange to emigrants to meet the British entry requirement, she could do so only as part of an overall export program. The first RM 3 million then was an inducement. Thereafter, the Third Reich wanted real money. [19]

Landauer was now forced to crack the illusion of partnership and told Hartenstein, "I cannot acknowledge that Mr. Sam Cohen or Hanotaiah are authorized by responsible national institutions." As for Cohen's clearinghouse office at the ZVfD, Landauer declared that it simply did not exist. He added, "I doubt very much if Mr. Sam Cohen or Hanotaiah have the possibility to satisfy [reimburse] the emigrants if they do not sell the goods in an appropriate manner." And such sales would essentially be impossible, Landauer said, since in truth Hanotaiah was an orange grove company, not a retailer or a distributor. "Therefore," Landauer declared, "I cannot assume the responsibility of advising emigrants to undertake their financial transactions with Hanotaiah." [20]

Hartenstein, undoubtedly shocked, answered, "Mr. Sam Cohen has been accredited by the German Consul General in Jerusalem .... He is a leading person and has all the authorizations of national institutions." Therefore, Hartenstein said, he would allow Hanotaiah's expanded permission to stand. Hartenstein tried, however, to reassure Landauer with a promise to watch Hanotaiah's work and make sure Cohen's company lived up to all expectations. [21]

Landauer would not yield. He told Hartenstein that he could not trust any program implemented by Hanotaiah. As the head of the ZVtD, which controlled the Palastina Amt, he was therefore going to counsel all emigrants that anyone transferring via Hanotaiah was doing so at great financial risk. At the same time, he was going to instruct the Zionist authorities immediately to establish a competitive trust company supervised by the Anglo-Palestine Bank as outlined in the transfer memo of July 19. [22] This was a tense moment. Landauer was speaking to a high German government official. He was declaring that he would create an economic organization to frustrate an important export program. Landauer's adamancy came at a time when high-ranking Nazi officials were being sent to concentration camps for proposing alternative economic plans. It was a time when Economics Minister Kurt Schmitt had received Hitler's authority to crush anyone who did not fully cooperate with economic directives.

But the exodus of Jews to Palestine, the employment that would result from the exports, the foreign currency that would be earned, and most significantly the anti-boycott effect of finalizing the transfer were all too vital to let lapse. So Hartenstein backed down and agreed to stay Hanotaiah's expanded permission briefly, pending a verification from the Foreign Ministry, through Consul Wolff, of Cohen's authority. If Hanotaiah was discredited, Hartenstein would vest the transfer authority with the ZVtD and allow Hanotaiah to participate as a mere importer. However, if Cohen was vindicated and the much-touted Anglo-Palestine Bank trust company did not quickly come into existence, then Hanotaiah would be granted full transfer authority-and Landauer could tell the emigrants anything he chose. [23] With that compromise, Landauer left the Economics Ministry and went right to work.

A coordinated plan of action was called for. It began that same day, July 20, with Hermann Ellern, who had access to Schmidt-Roelke at the Foreign Ministry. While traveling back to Karlsruhe, Ellern had made contact with Landauer, probably during a train stop at Frankfurt. After learning of the unexpected Sam Cohen development, Ellern telegraphed Schmidt-Roelke: "WILL SEND YOU COMMENTS RE TRANSFER PLAN TODAY STOP WOULD APPRECIATE YOUR CONSIDERATION OF SAME IN IMPLEMENTATION DIRECTIVES" [24]

The next morning, Landauer sent an urgent correspondence to Anglo- Palestine Bank director Hoofien in London. He explained the sudden crisis, how apparently between the July 13 Wilhelmstrasse conference and Landauer's follow-up July 20 meeting with Hartenstein, Cohen had made additional unauthorized representations to the Economics Ministry that once again placed the entire transfer in his hands. In writing his letter, Landauer tried to control his anger. "It is clear that the Reich Economics Ministry and the Foreign Ministry should not have done this thing without asking us. Mr. Sam Cohen's behavior is for me entirely unclear. He has operated with the most impossible remarks. For instance, he said that he will get an office with us, and he is our authorized agent." [25]

Cohen's coup could be reversed, but "only if all parties in Palestine establish an office within the week to take over the merchandise and if the APB immediately takes the initiative." Landauer urged Hoofien to "treat this matter urgently" and his letter ended with the simplest distillation of the crisis: What happened in the next few days would "decide in the long run the fate of German-Jewish emigrants' money." [26]

Once Hermann Ellern arrived in Karlsruhe, he sent Schmidt-Roelke his personal transfer suggestions. These closely followed Landauer's ideas. This was to show Schmidt-Roelke the widespread acceptance of Landauer's viewpoint. Ellern added his comments: "This plan is intended to facilitate for Jewish emigrants the transfer of a majority of their assets to Palestine and reopen a large market for German products. This proposal [however] may have been overtaken by events, namely the agreement . . . with Hanotaiah." [27]

Ellern's demarche continued, "I am in close contact with the ZVtD in this matter and feel a personal obligation to inform you of some misgivings, since 1 want to take a position as early as possible with respect to matters which might be harmful to all parties concerned .... Last night I was told at the offices of the ZVtD that, contrary to statements made by Mr. Sam Cohen, there is no question of opening a Hanotaiah office.... Also, 1 have spoken with a representative of Yakhin who stated that Mr. Cohen is not speaking for that company." [28]

To retain his own credibility, Ellern disparaged Cohen carefully: "I don't know Mr. Cohen personally and have no reason to doubt his veracity, but 1 have gained the impression that a transaction of this magnitude, if it were to be conducted solely by Hanotaiah, would not be greeted with universal trust and confidence. This also conforms to various opinions which I have heard about Hanotaiah in Palestine." [29]

Realizing his assertions went against everything Schmidt-Roelke had been told, Ellern explained, "Mr. Cohen is a very clever businessman and his sweeping powers of attorney and letters of recommendation may be based on the fact that the situation in Germany is not well known there [in Palestine] and that every idea is welcomed which could conceivably lead to a transfer of capital ... by emigrants, thus facilitating the establishment of a new existence for these emigrants in Palestine, as well as to again make the Palestine market accessible to Germany." [30] This last comment was a clear reminder that the boycott in Palestine could be stilled only by the Zionist authorities there.

Expanding on the issue of official Zionist approval, Ellern asserted that Yakhin and Palestinian workers "who are a key element, will have no part of it if Hanotaiah is put in sole charge." Ellern added the manufacturers, importers, and Jewish consumers of Palestine to the list of "will nots." Summing up, Ellern wrote that such widespread opposition "would of course damage the main objective: the stimulation of German exports. All these dangers would be obviated if the leadership role in this matter were to be entrusted to the Anglo-Palestine Bank rather than Hanotaiah .... Under no circumstances should the name Hanotaiah be used in the designation of the account." In conclusion, he urged Schmidt-Roelke to accept Landauer's transfer memorandum. [31]

Ellern's letter would reach Schmidt-Roelke by Monday, July 24. At the same time, Schmidt-Roelke would receive a letter from Hartenstein following the revelations of the Landauer meeting.

Dated July 22, Hartenstein's letter explained how Landauer had urged the Hanotaiah transfer decree be set aside in favor of a bank-supervised transfer. "He [Landauer] indicated ... that in view of news he had received from Palestine during the last few days, he had serious doubts whether Mr. Sam Cohen and Hanotaiah could be considered legitimate .... Hanotaiah, he said, is just one of several plantation companies, which would now have an undesirable monopoly. He [Landauer] doubted that Mr. Cohen would be successful in selling, without loss, the merchandise valued at RM 3 million which Hanotaiah plans to buy. Under these circumstances, he [Landauer] and his friends could hardly assume the responsibility of recommending to Jewish emigrants to make deposits ... to the account of Hanotaiah because they have reason to fear that the equivalent funds would not ... be paid back to depositors." [32]

Here was the point. Either the emigrants received their money in Palestine and could reconstruct their lives there -- or they did not. Clearly, the Jews would not give up Germany to live a life of poverty in Palestine.

Hartenstein's July 22 letter continued, "I do not have sufficient information about conditions in Palestine and about the attitude of the various organizations to be able to react to Dr. Landauer's misgivings. Nor am I in a position to examine Mr. Cohen's legitimacy, and have in this respect fully relied on your point of view, which is based on the reports of the Consulate General in Jerusalem, some of which I have seen." Prudence dictated, wrote Hartenstein, that he stay Hanotaiah's permission and "request the Consulate General in Jerusalem to provide a statement whether the proposed procedure ... guarantees for the emigrants the receipt of their money immediately upon arriving in Palestine, or whether the agreement with Hanotaiah should be put on a broader basis by including the appropriate national Jewish organizations." He urged Schmidt-Roelke to speak with Landauer directly and take the other steps necessary to determine once and for all who represented Zionism: its official institutions, or an enterprising gentleman named Mr. Sam Cohen. [33]

Monday morning, July 24, Schmidt-Roelke read letters from Hartenstein, Ellern, and others suggesting that Sam Cohen was a fraud, that he was incapable of selling the merchandise except at a great loss, and that German emigrants would never receive much if any of their transferred assets. A message was dispatched to Consul Wolff: "After negotiations with Cohen, Hanotaiah has obtained authority to transfer a total of RM 3 million via exports to Palestine. After conclusion of negotiations, Zionist Federation and the Jewish Agency expressed doubt as to Cohen's authority to negotiate for Palestine authorities. They declare Hanotaiah monopoly to be undesirable and doubt that RM 3 million worth of goods can be transferred without loss. . . . Doubts expressed also on whether emigrants would receive their money immediately and without loss. Local Jewish organizations therefore had misgivings about authorizing payments to Hanotaiah. Request info on whether misgivings are justified, especially whether it is true that Hanotaiah does not have support of appropriate authorities in Palestine, which is the exact opposite of what Cohen indicates." [34]

Schmidt-Roelke and Hartenstein would have summoned Cohen himself to clarify the questions. But Cohen was not in Germany. He had gone back to London to coordinate with the Zionist Organization and do what he could to quash the chances for a unified world boycott.
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