Shaking down the Swiss

Politics professor Norman Finkelstein's controversial book accuses Jews of exploiting the Holocaust for profit. Tim Cornwell reports

Fifty-five years on from the liberation of the concentration camps, the wrongs perpetrated against the Jews of Europe are still being busily righted, to the tune of billions of dollars.

Swiss banks this month inched tantalisingly close to a $1.3 billion settlement of bank accounts that Holocaust victims or their heirs allegedly found difficult, if not impossible, to use. Germany has just approved a $3.3 billion fund for Nazi-era slave labourers. Austria has been hit by claims over assets seized from Nazi victims. In New York, the World Jewish Congress has released 1945 US Treasury documents describing American conduct in the war. They are said to show that a major US bank helped funnel assets back to Nazi Germany from France.

Fair compensation, scandalously overdue? Moral blackmail, according to New York professor Norman Finkelstein, in his book The Holocaust Industry, published this week. In a short, sharp, copiously noted polemic, he claims that multiple acts of extortion have lined the pockets of Jewish advocacy groups and their lawyers while shortchanging the few true living victims. Finkelstein argues that as this "Holocaust industry" plays with numbers to boost the tally of "needy survivors", it has strayed into saying that the Final Solution was not so ruthlessly efficient.

Meanwhile, "anti-Semites gleefully mock the 'Jew liars' who even 'huckster' their dead", Finkelstein writes. The "shakedown" of wealthy Western Europe has paved the way for a new round of multibillion dollar compensation claims from the impoverished former Soviet bloc. "Pursuing this end with reckless and ruthless abandon, it (the Holocaust industry) has become the main fomenter of anti-Semitism in Europe," he says.

Inflating the numbers of living survivors by hundreds of thousands - twinned with the demand they must be compensated before they die - has allowed the likes of historian David Irving to claim that "another Holocaust victim is born every day". But does Finkelstein not run the risk of reviving a dangerous stereotype -the money-grabbing Jew? "I am not going to deny that dangers arise," he says. "But it seems to me that exposing these people will serve a better purpose."

Finkelstein, who teaches politics at the City University of New York, is straying into dangerous territory here - something only the son of two survivors of the Warsaw ghetto and concentration camps could get away with, and barely even then. In the book, he repeats how Leon Wieseltier, literary editor of the widely read New Republic magazine, described him to the president of Henry Holt, his then publisher. "You don't know who Finkelstein is. He's poison, he's a disgusting self-hating Jew, he's something you find under a rock."

Finkelstein was born in 1953, to parents who met in an Austrian refugee-holding camp after the war and moved from there to the US. He got his doctorate in politics from Princeton. He won academic kudos in the mid-1980s with his critique of the scholarship behind From Time Immemorial, by Joan Peters, who claimed that Palestinans were but recent arrivals in Palestine. He is a self-described "person of the left", a long-time critic of Israeli conduct who roomed with Palestian families during Intifada summers.

In 1998, Finkelstein once again confronted a popular thesis - as co-author of a fiercely critical attack on Hitler's Willing Executioners. Daniel Goldhagen's book encountered a fair few scholarly caveats, but it rode the American and German bestseller lists by arguing that the German population, not just a minority of SS fanatics, willingly joined the genocide of the Jews. Like Peters's work, Goldhagen's was embraced by what Finkelstein calls "the Holocaust circuit".

In this latest book, Finkelstein raises some important questions, angrily questioning the number of true Holocaust victims, contrasting them to the fees and salaries of those who claim to champion them. The question is whether anyone will answer his criticisms. "Mostly I'm ignored," he says. And it is true that the American response to his new book has been, as of this week, negligible. Verso, the publisher, made a concerted effort to reach the American audience, says Finkelstein. Barring an expected review in The Los Angeles Times, "the reaction was a flat zero".

There is a sharp contrast in Britain. The New York scholar's answer to J'accuse has been serialised in The Guardian, reviewed in advance in The Sunday Times, and broadcast by the BBC. Why the different treatments? Well, says Finkelstein, the book implicates every level of the American government. Indeed, no one escapes Finkelstein's lash, from leading congressmen to pillars of the media, The New York Times and Time magazine - all accused of jumping on the bandwagon led by the likes of the World Jewish Congress or the Simon Wiesenthal Centre.

Americans came late to the Holocaust. Until the late 1960s, only a handful of books and films and barely one university course dealt with it; by the late 1990s, new Holocaust museums had opened in several US cities. The reason for this shift? Conventionally, that survivors were simply loath to dwell on the past. But after the 1967 six day war, Finkelstein argues, the "American Jewish elites" became the interlocutors for America's newest strategic asset: Israel. To bolster American support for Israel it became politically expedient to memorialise the Holocaust. "Evoking historic persecution deflected present-day criticism," particularly with regard to the Palestinians. From here, the "Holocaust industry" was born, well-armed for the "double shakedown" of the Swiss, to which Finkelstein devotes a large portion of the book.

The claims against the Swiss suddenly gathered steam in the mid-1990s, with allegations that banks denied Holocaust victims and their families access to dormant accounts worth $7 billion or more, through such tactics as demanding death certificates for those who died in death camps. In April 1996, the Swiss - saying the figure was closer to $30 million - agreed to abide by the findings of an independent committee, chaired by former US federal reserve chairman Paul Volcker. But before the Volcker commission could even meet, the Swiss were hit by three class-action law suits, Senate hearings, the threat of an economic boycott and a slew of negative publicity. "They demanded the money beforehand, without anyone doing any accounting (for it). It became a shakedown of the industry."

The Swiss banks agreed on a $1.25 billion settlement. The Volcker commission would later conclude there was no evidence of systematic discrimination or obstruction of access to bank accounts, nor wholesale destruction of records, although it discovered nearly 54,000 accounts probably linked to people persecuted by the Nazis, and criticised some banks for "questionable and deceitful actions".

The passion of Finkelstein's polemic leads him to make some questionable points. It is not particularly surprising to learn that American students now know more of the Holocaust - in terms of victims and dates - than of the American civil war. But he pushes the bounds of taste when he says, sarcastically, that there are so many survivors of concentration camps touted that "conditions couldn't have been harsh at all".

Finkelstein says he wrote the book, however, to honour "on a moral level" his late parents' legacy. His mother and father lived in the Warsaw ghetto - separately - until the uprising of May 1943. His mother, Maryla, went via the Maidanek concentration camp to two slave labour camps. His father, Zacharias, went to Auschwitz, survived the death march as the Nazis drove the inmates into Germany in the face of the Russian advance, and was eventually liberated by the Americans. Zacharias qualified for a German pension, reaching $600 a month at the end of his life, perhaps $250,000 in all, under early agreements compensating those who suffered physical harm. "My father had a hole in his head," Finkelstein says. "He got it in Auschwitz. He never said how."

His mother recieved the small lump sum of $3,500. She had no outstanding physical injuries. Although she suffered severe hysteria, a Jewish doctor concluded that it was not from her experience in concentration camp but from difficulties adjusting to life in the US.

The German government entered agreements in the early postwar years to compensate people like his mother, who had fallen through the cracks: 85 per cent of the money did not go to victims, Finkelstein says. "My father and mother loathed Germans," he says. "Every one, they did not discriminate. But my father never once complained about distribution of the compensation. The Germans delivered the cheques to the last day of his life. The money that my mother was supposed to receive - she never received a dime."

Neither he nor his brothers, however, have any interest in collecting it. "I hold the memory of my parents too sacred," he says, "to be part of a shakedown operation."

The Holocaust Industry is published by Verso, Pounds 16.00.