Shortly before the latest rulings by Chief Judge Edward R. Korman of the U.S. District Court in Brooklyn in the Holocaust Victim Assets litigation, an ad in this and other newspapers stated that food packages were being provided for 250,000 needy Jewish seniors in 2,734 cities and villages throughout the former Soviet Union. Whatever we may think of the accuracy of these figures, the ad sheds light on the issue that is before Judge Korman.
The litigation arises out of the settlement that required major Swiss banks to pay $1.25 billion in recompense for their looting of the accounts of Nazi victims. That agreement, now in its fourth year, was largely brokered by Judge Korman who exerted enormous pressure on the banks. He evidently regards his role in the litigation as a sacred obligation, as a way to do justice for some survivors and for the heirs of the great many who did not survive. He also regards the litigation as an opportunity to establish a record of the perfidy of Swiss banks.
By the time that the settlement was reached, it was not possible to reconstruct anything approaching a full record of what had transpired, nor was it possible to locate a sufficient number of survivors or heirs whose claims could be verified, even through tangential evidence. In February, Judge Korman provided a lucid roadmap detailing the sordid actions of the banks as they transferred assets, destroyed records, closed accounts and set up roadblocks in a systematic effort to thwart recovery. This opinion deserves wide circulation.
Judge Korman may yet compel the banks to establish a data base for all 1933-45 accounts and to publish a list of “possibly” looted accounts, measures that they have resisted. If it is within his authority, he should hold them in contempt for their delaying tactics. At the end of the day, though, only a relatively small portion of the funds will go to those whose claims have been affirmed, probably no more than $200-$250 million. More has been spent on lawyers, accountants, experts, advisors and others for whom settlement accounts are a feeding opportunities. Major accounting firms have apparently pocketed hundreds of millions of dollars – far more than account holders or their heirs have received – for work on behalf of the Volker Committee, a body that for all of the prestige of its chairman did not acquit itself well. I understand that the accounting fees have been paid by the banks, which is to say that the looters have in turn been victimized.
Judge Korman’s task is to determine what to do with the excess funds. He has already authorized significant distributions to certain survivors, but there is quite a bit left over and this has inevitably provoked greed and internecine Jewish warfare. Mainly out of public view, there is a global Jewish civil war going on, with some who aren’t Jewish thrown in for good measure. Israel is asserting that as the Jewish state it should receive the lion’s share of these funds.
How to balance the competing demands is Judge Korman’s dilemma. His decision is to distribute these funds according to a comparative needs assessment of Nazi victims in the U.S., Israel and the FSU, an exercise that has resulted in his giving ten percent to non-Jewish survivors and three-quarters of the remaining ninety percent to Jews in the FSU. He reasons that there is widespread poverty among these Jews and their situation is exacerbated because there is no public or communal safety net to assist them, while there are safety nets in Israel and the U.S.
I do not intend any disrespect in suggesting that Judge Korman is wrong in placing substantial emphasis on perceptions of economic need. Need assessments are nearly always problematic because of a tendency to exaggerate; besides, as he notes, “A comparison of needy survivors is by definition an odious process.” I believe that he relies too heavily on limited and, at times, questionable data, including from a team of deservedly respected scholars at Brandeis University who themselves note repeatedly that the data they are providing does not give a complete picture. Furthermore, he fails to sufficiently consider factors that might result in a different allocation scheme, a subject that I shall address in my next article.
It is true, of course, that FSU Jews are worse off than Jews elsewhere, a situation that arises largely from comparative standards of living and this isn’t going to change even if all of the excess funds and then some are sent to the FSU. But FSU Jews are not, in the aggregate, destitute. If they were, there would be widespread starvation and many thousands of deaths throughout Russia and Ukraine among the 99+ % of the population that isn’t Jewish because their situation is significantly worse than the situation of the 1% who are Jewish.
Judge Korman gives us the following from Dovid Katz, a professor at the University of Vilnius: “The last elderly Jews of Eastern Europe, whose lives were ruined by the Holocaust, and who choose to live out their days in the towns of their ancestors, are suffering acutely from malnutrition, poverty and lack of medicine, while the millions (or billions) from Germany, Switzerland and the great American Jewish organizations pass them by.”
In fact, since the collapse of Communism fifteen years ago, there has been an extraordinary influx of Jewish philanthropic funds, including from the Israeli government, to assist FSU Jews. This commitment runs into the many hundreds of millions of dollars.
There are some very needy Jews in the FSU. I also know from personal experience that the medical services available to the Jewish elderly and the rest of the population are generally primitive. Philanthropy has a role to play in this regard. But it is a different matter whether it is justified to allocate nearly all of the excess funds to the FSU.