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Imperfect Justice: Looted Assets, Slave Labor, and the Unfinished Business of World War II

Imperfect Justice: Looted Assets, Slave Labor, and the Unfinished Business of World War II

by Stuart Eizenstat, Elie Wiesel (Foreword by)

In the second half of the 1990s, Stuart Eizenstat was perhaps the most controversial U.S. foreign policy official in Europe. His mission had nothing to do with Russia, the Middle East, Yugoslavia, or any of the other hotspots of the day. Rather, Eizenstat's mission was to provide justice—albeit belated and imperfect justice—for the victims of World War II


In the second half of the 1990s, Stuart Eizenstat was perhaps the most controversial U.S. foreign policy official in Europe. His mission had nothing to do with Russia, the Middle East, Yugoslavia, or any of the other hotspots of the day. Rather, Eizenstat's mission was to provide justice—albeit belated and imperfect justice—for the victims of World War II.

Imperfect Justice is Eizenstat's account of how the Holocaust became a political and diplomatic battleground fifty years after the war's end, as the issues of dormant bank accounts, slave labor, confiscated property, looted art, and unpaid insurance policies convulsed Europe and America. He recounts the often heated negotiations with the Swiss, the Germans, the French, the Austrians, and various Jewish organizations, showing how these moral issues, shunted aside for so long, exposed wounds that had never healed and conflicts that had never been properly resolved. Though we will all continue to reckon with the crimes of World War II for a long time to come, Eizenstat's account shows that it is still possible to take positive steps in the service of justice.

Editorial Reviews

The Los Angeles Times
Imperfect Justice is Eizenstat's exciting account of his six-year effort to obtain compensation for Nazi victims from Swiss banks while he served as a high-ranking State Department official. The Harvard-trained lawyer was glad to be tapped to mediate the sensitive issue threatening U.S.-Swiss relations. Then, according to Eizenstat, "lawyers hijacked the Swiss bank dispute." — Benjamin B. Ferencz
Publishers Weekly
Think of this book as one-stop shopping to learn about the Holocaust restitution negotiations of the late 1990s. Eizenstat was at the center of the tornado, as European companies and banks belatedly made compensation for their WWII-era behavior. In this comprehensive, well-written and unsparing reflection on those negotiations, the former Clinton administration official offers a behind-the-scenes look at how agreements were reached to provide Holocaust survivors with monies they or their families had lost during the war. He begins with the unusual pair of World Jewish Congress (whose president, Edgar Bronfman, was a friend of Clinton's) and Republican Sen. Alfonse D'Amato, who teamed up to make this an issue that Europe could not ignore. Whether writing about the most well-publicized of these negotiations-the German slave labor agreement or the "Swiss gold" affair, which eventually led to a $1.25-billion settlement-or some of the lesser-known accords, Eizenstat tells his story with flair and with due regard for the role of politics (D'Amato, for instance, "milked the Swiss controversy for everything it was worth"). According to Eizenstat, some elements of the survivors' cases carried little legal weight, but European governments and firms wilted under public relations pressure, often purposefully intensified by lawyers on behalf of the survivors. While other books have been written about this subject, none has been as comprehensive or as balanced. 8 pages of b&w photos, not seen by PW. Agent, Ronald Goldfarb. (Jan.) FYI: The New York Times recently reported on the furor created by the book jacket-a gold swastika superimposed on the Swiss flag (see p. 47)-in Switzerland. Copyright 2002 Cahners Business Information.
Foreign Affairs
Eisenstat's account of his mission to negotiate compensation from European countries for the "looted assets, slave labor," and other misfortunes (such as unpaid insurance policies) that befell Jews in Europe during World War II has created a furor because of its cover: gold ingots assembled in the form of a swastika against a white cross background. If anything, the content of the book is far more explosive. It is a detailed, often blunt report of contentious diplomacy involving not only the notoriously resistant banks and government of Switzerland, but also other countries whose desire to provide justice on Eisenstat's terms was less than forthcoming — including Germany on the issue of slave labor; Austria, used to seeing itself as a victim of, not a partner in, Nazism; and France, whose legal culture is very different from that of the United States. What gives Eisenstat's story its strength is his undiplomatic but talented set of portraits of all the people involved. What emerges most clearly from Imperfect Justice is the determination and commitment of the author.
Library Journal
Eizenstat, who was U.S. ambassador to the European Union under President Clinton, provides a clear and penetrating account of his personal involvement with the search for Holocaust restitution from former belligerent and neutral nations. In addition to victims seeking compensation for slave labor in Nazi camps and industrial plants, a number of individuals have been trying for years to retrieve family assets held in Swiss banks. Indeed, the material on Switzerland, and the lengths many Swiss were willing to go to cover up their complicity in Nazi financial activities, is particularly interesting. If Eizenstat's account only revealed the labyrinth that negotiations with individual governments and corporations followed, it would be of interest only to specialists. In addition to the legal bargaining, however, Eizenstat raises important questions about how Europeans and Americans have come to grips with the legacy of war and genocide. Such discussions, while not new to this book, are nonetheless interesting when juxtaposed with the legal questions inherent in restitution. Eizenstat's account effectively complements Tom Bower's Nazi Gold and Jean Ziegler's The Swiss, the Gold, and the Dead: How Swiss Bankers Helped Finance the Nazi War Machine. Recommended for larger public libraries, Judaica collections, and law libraries.-Frederic Krome, Jacob Rader Marcus Ctr. of the American Jewish Archives, Cincinnati Copyright 2003 Cahners Business Information.
Kirkus Reviews
A former official in the Clinton administration chronicles the struggle to identify and retrieve Holocaust victims’ financial assets and to determine how to compensate those the Nazis displaced, robbed, and used as slave labor. Eizenstat was a principal player in these complicated efforts. After a brief survey of the situation—and a couple of shots at both the moral blindness of the US during the war and at the publication of Anne Frank’s expurgated diary, which he says encouraged 1950s readers to feel hope rather than sufficient moral outrage—the author launches into a lengthy account of all the negotiations, betrayals, surprises, personalities, venues, complications, and compromises that the settlements required. Eizenstat worked on several recovery efforts. The first was to extract from the Swiss banking industry a full accounting of their unconscionable and even nefarious reluctance to locate and return assets of Jewish depositors. This story dominates here, and the author does not have much good to say about either the dilatory Swiss or American class-action lawyers. Eizenstat worked as well to locate stolen personal property; the Nazis took as many as 600,000 paintings, 100,000 of which are still missing. Then he became involved in the negotiations to compensate those forced into slave labor during the war, which resulted in the establishment of a fund of ten billion Deutschmarks. Finally, he went after the Austrians and the French, both nations understandably eager to deemphasize the extent of their involvement in Nazi atrocities. Nonetheless, both ended up cooperating and contributing impressive sums of money to settle. Given what he achieved, it’s perhaps unsurprising thatEizenstat’s tone is a tad arrogant; "I" is a favored word. He’s also given to clichés that clog the prose and excessive detail that sometimes obscures his vital message. Despite its stylistic flaws, though, a compelling narrative of an enormously important story. (8 pp. b&w photos, not seen)

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Imperfect Justice

By Stuart E. Eizenstat


Copyright © 2003 Stuart E. Eizenstat
All right reserved.

ISBN: 158648110X

Chapter One

Through the Valley of the Dry Bones

On a typically dreary, wet winter day in Brussels in January 1995, I was working in my office at the United States Mission to the European Union. Carolyn Keene, my longtime assistant, told me that Richard Holbrooke, assistant secretary of state for European affairs, was on the line. Dick and I had been friends and colleagues for almost twenty years. I had brought him to Atlanta in 1976 as a foreign policy adviser to Jimmy Carter's presidential campaign, for which I was the chief policy adviser. After Carter's victory, I helped Dick become the youngest assistant secretary of state in modern history. I respected his boundless energy, creativity, and dedication to public service. And I recognized his ambition for higher office.

This call would change my life. It would also help propel onto the world's agenda many shameful events that had long been buried in memory, often deliberately, and that only now were coming to light. Dick asked if I would undertake a special "limited mission" that he assured me would take only a few months. He offered me the position, in addition to my regular duties in Brussels, of the State Department'sspecial envoy to encourage the return of property confiscated from religious communities by the Nazis and then nationalized by Eastern European Communist governments. I would concentrate primarily on the Jewish communities facing the greatest barriers.

Holbrooke explained that this would help the spiritual rebirth of religion and religious institutions suppressed by Communism. But property restitution was to be part of a broader U.S. policy to encourage the rule of law, respect for property rights, tolerance toward minorities, and the creation of nonpolitical administrative and judicial processes in the former Communist countries. It was an essential part of what we called "civil society," without which the transition to viable democracy is not possible.

That I was in Brussels at all was a quirk of fate. I had worked for Bill Clinton's election in 1992, but having been President Carter's chief domestic policy adviser in the last Democratic administration, twelve years before, was actually a disadvantage in getting a post in the new administration. Bill Clinton resented Jimmy Carter, believing Carter's decision to place Cuban prisoners from the Mariel boat lift in Fort Smith, Arkansas, contributed to Clinton's defeat in the 1980 Arkansas gubernatorial election. Nor did he want his administration to look like Carter redux, given Carter's crushing defeat by Ronald Reagan. An offer in May 1993 by President Clinton's chief of staff, Thomas F. "Mack" McLarty, to be his deputy evaporated. After telling me the president needed my experience in the White House, McLarty withdrew the offer, and it was given to one of Vice President Gore's top aides, someone who had never served in the executive branch. So I was off to splendid exile in Brussels. Being sent to Europe was a way of keeping Carter people as far away as possible. It would take me several years of hard work to convince the Clinton insiders of my complete loyalty to Bill Clinton.

There was a special twist to Holbrooke's call. The previous spring, I had expected to be promoted to Holbrooke's position. He had hosted a dinner for Fran and me at his residence in Bonn, where he was serving as U.S. ambassador to Germany. Dick took pride in showing us the small framed picture of his grandfather, a German Jew, in full World War I military regalia, steel-pointed helmet and all, prominently displayed on an end table in his living room. He wanted his German guests to know that his grandfather had fought for the Kaiser-and by extension, to recognize the contributions that Jews had made to their country before, as he privately put it, "they killed them all" in the Holocaust.

As always, Dick was one step ahead of the news. He startled me by saying the post of assistant secretary of state for European affairs would soon fall vacant and that I would be asked by his other guest of the evening, Undersecretary of State Peter Tarnoff, to return to Washington and take the job. Sure enough, Peter pulled me off in a corner after dinner and made the offer. I told him I was flattered and would call him after discussing it with Fran, since we were enjoying our time abroad.

My senior staff in Brussels unanimously urged me to accept this broader platform to influence policy. When I finally decided to take the job a few weeks later, Tarnoff was suddenly hesitant. I later learned from Secretary of State Warren Christopher that I would not get the job after all-but that Holbrooke would. Christopher, clearly uncomfortable, told me that because of the rising troubles in the Balkans, Dick's negotiating experience made him the better choice. Dick had worked for me in the 1976 Carter campaign, but now I would be reporting to him. Had I gotten the job in Washington, I would never have had the opportunity to deal with the unrequited injustices of World War II, and Holbrooke might not have had the opportunity to negotiate the Dayton Accords ending the war in Bosnia. Sometimes things have a way of working out unexpectedly.

When Holbrooke called with his offer to be special envoy for property restitution in January 1995, I again did not immediately accept. It would divert attention from my full-time job in Brussels, where I dealt with a range of interesting issues between the two halves of the Western world. A mission to Eastern Europe, cut off from its Western neighbors for half a century, was unlikely to produce any tangible short-term results, and I would find myself caught between the governments of the new democracies and the Jewish communities that felt mistreated by them. What's more, the American ambassadors in the capitals of Eastern Europe would regard me as an intruder on their turf pursuing an unpopular issue.

I called one of those ambassadors, Alfred Moses, an old friend from the Carter White House who now held the post in Romania. He gave me the same warnings and added: "Why you? Because you are Jewish? You will be shot at from every direction." But in the end, with Fran's support and encouragement, I put aside such warnings and told Holbrooke I would take the job. There were too many deep emotions and my own sense of Holocaust history tugged too much at my conscience to refuse.

Holbrooke's call did not arise from a sudden brainstorm. He was under political pressure from Edgar Bronfman, a friend of President Clinton's and the president of the World Jewish Congress; Israel Singer, its flamboyant, creative general secretary; and Elan Steinberg, a gifted publicist and the head of the congress's North American division, who were already deeply involved in encouraging property restitution in Eastern Europe. All three were leaders of the World Jewish Restitution Organization (WJRO); Bronfman was also its president. Singer, joined by Steinberg and Maram Stern, the World Jewish Congress' European director, had met with Holbrooke to seek the administration's support in restoring confiscated Jewish property. Holbrooke, whose highly developed political antenna could not let him forget Bronfman's close relationship with President Clinton, agreed and asked who should lead the government's effort. Stern, based in Brussels, had already briefed me on the problem. Without advising me in advance, he told Holbrooke I was the right person.

This is a perfect example of a nongovernmental organization pushing its cause at the right time and using the levers of power to influence government policy. The leaders of the WJRO knew that they needed the U.S. government's help to accomplish anything in the former Communist lands. An umbrella body representing ten Jewish organizations, the WJRO was established in 1992 by the World Jewish Congress and the Israeli government to represent the interests of world Jewry in regaining Jewish property after the fall of Communism. On September 10, 1995, less than two months before his assassination at a peace rally in Tel Aviv, Israeli prime minister Yitzhak Rabin wrote Bronfman a letter endorsing the WJRO's quest and reaffirming that the WJRO represented the interests of the Israeli government and the Jewish people. In 1992 Bronfman had supported Rabin over Shimon Peres for leadership of the Labor Party. Rabin's letter was a political reward. But more important, it removed a headache for the Israeli government, which would otherwise be thrown into conflict with the new governments of the former Communist nations they wished to court for broader political support on other political and economic issues. Just as the Israeli government had created the Claims Conference to negotiate with the Germans in the 1950s, so here they created a nongovernmental body for property restitution to keep a difficult problem at arm's length.

Bronfman was armed not only with the exclusive mantle from the Israeli prime minister but also the endorsement of the president of the United States. On September 8, several months after I had begun my work as special envoy, President Clinton sent Bronfman a letter reaffirming my role as the administration's point man and specifically supporting the work of the WJRO. The president noted that "progress will be neither easy nor simple," and that Jewish property "seized during more than 50 years of war, occupation, and dictatorship is a complex and emotional subject." This double-barreled clout gave Bronfman the prominence that would make him an indispensable force in my property restitution efforts and in my subsequent negotiations with the Swiss, Germans, Austrians, and French.

My mission in Eastern Europe did not capture the attention of senior officials in Washington, and it was rarely even a talking point for President Clinton with any senior Eastern European leader. My office in Brussels was thousands of miles away from the seat of power in Washington. I also had to obtain support from U.S. ambassadors who had many other issues on their agendas, and this one never stood at the top. It was often only my visits that spurred them to act and follow up, which-to their credit-most eventually did with enthusiasm. I was largely on my own, slogging it out country by country, property by property. There were no external pressures from lawsuits or from the U.S. Congress, even though I wrote regular reports to congressional leaders on my visits, pointing out progress and difficulties. Aside from a 1995 European Parliament resolution generally encouraging property restitution, we received no support from the European Union, which could have used the leverage of its own admission process to encourage prospective member states in the former Communist world to adopt modern property laws and to return property confiscated during the Nazi and Communist eras.

Even more difficult to accept was the Israeli government's reluctance to use its political capital with the governments of Eastern Europe to help the reawakened Jewish communities. Despite several direct appeals to prime ministers Benjamin Netanyahu and Ehud Barak, in which I told them that Israel should be embarrassed by its disengagement, little was done for the cause of Eastern European property restitution. Israeli diplomats in Eastern European countries were unhelpful because they felt that anything that might assist the Jewish community to strengthen its roots in Europe would impede immigration to Israel and because they believed they had more pressing issues to pursue. It was ironic that the government that purports to represent the interests of world Jewry would have left the field to the U.S. government.

* * *

In fact, in ways neither Holbrooke nor I nor anyone else could have imagined at the time, his "limited mission" would lead me down a far different, unforeseen path, one that would wind for six more years and end with a final financial accounting for the crimes of World War II. Ahead lay tortuous, tumultuous, tension-filled negotiations involving a Shakespearean cast of colorful characters: with Switzerland over dormant bank accounts of Holocaust victims; with Germany and Austria over slave and forced laborers-Jews and non-Jews alike-and looted personal property; and with France over the financial legacy of its dark Vichy past.

Yet this first step was essential, though it lacked the dramatic fireworks of what was to come. It laid the groundwork for what would follow, creating the precedent of the United States government, at the zenith of its power in the world, intervening in a World War II issue involving what normally would be a quintessential internal matter, the disposition of property.

My work on the property restitution issue introduced me to realities for which I was unprepared. I came face-to-face with the Holocaust survivor community of Eastern Europe, which had lived through both the Nazi massacre and the Communist repression that followed. I coined a term to describe them-"double victims." I saw in their faces the brutality of our time, but I also recognized an indomitable spirit in the new young leadership that arose after the fall of the Berlin Wall. No longer were these victims anonymous people. Their quest to rebuild their religious community, together with similar efforts by their Catholic, Orthodox, and Protestant counterparts, steeled my determination and provided a sense of urgency to complete the job before it was too late for the wartime survivors.

I also became a witness to the rebirth of the decimated Jewish communities of Eastern Europe, once the flower of Jewry's religious, cultural, and artistic traditions. I saw new Jewish museums sprout up, daily synagogue services resume, Jewish newspapers flourish, kosher restaurants open, community centers bustle with activity, Jewish day schools filled to capacity from Budapest to Vilnius, from Kiev to Tallinn. A particularly moving experience occurred on a rainy night in Vilnius, Lithuania, a great center of Jewish culture that had been eradicated by the Nazis and then buried by the Communists. The experience exemplified for me the effort to reconnect to the traditions of the past. I visited a small class learning Hebrew in the basement of a dilapidated building and came across an elderly woman struggling with this alien language. "Why are you trying to learn Hebrew now?" I asked. She replied, "I just wanted to hear the language of my ancestors before I died."

I also learned a great deal about the challenges of life in post-Communist Eastern Europe that would lead me in my later negotiations to insist that their governments have a seat at the bargaining table. I saw the harshness of life as they tried to create capitalist economies. I found a seething bitterness that their citizens, also Hitler's victims, had never received compensation from the Germans comparable to the billions paid to Jewish Holocaust victims.


Excerpted from Imperfect Justice by Stuart E. Eizenstat Copyright © 2003 by Stuart E. Eizenstat
Excerpted by permission. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.

Meet the Author

Stuart E. Eizenstat served in several high-level positions in the State, Treasury, and Commerce Departments from 1993 to 2001. He is currently the head of international trade and finance at the law firm of Covington & Burling in Washington, D.C.

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