A. Elon

The New York Times Magazine, April 12, 1998

Switzerland's Lasting Demon

By Amos Elon

For a moment, as I was walking down Zurich's Bahnhofstrasse, I couldn't help feeling a certain thrill. It had happened to me before during visits to Switzerland, a country that has been at peace for three centuries. (I happen to live in Israel, where there has been war since anyone can remember.) Other foreigners must have felt this too. It is a compound of admiration and envy, perhaps resentful envy.
I remember some years ago, waiting in line for a ski lift in the Swiss Alps, when I noticed a sign that read: ''Swiss Ski-Lift Factory. Built 1941.'' I turned to my wife, saying: ''Look at these awful Swiss. All of Europe is in flames and what are they doing? Building a ski lift!'' But I quickly had second thoughts: ''Look at these lucky Swiss. Only they manage to stay out of the carnage.''
The luck of the Swiss came, of course, at a price that has been the subject of controversy ever since. One Swiss banker quoted Samuel Johnson, the 18th-century English wit, who said that people are rarely so innocently engaged -- and so committed to peace -- as when they are buying and selling. It's what the Swiss have been doing for hundreds of years while others have made wars.
The banker then spoke glowingly of Switzerland's past. ''We made mistakes,'' he said, ''but we weren't downright criminals like others.'' The world would be a better place, he argued, if other countries had emulated Switzerland instead of demeaning her, as Orson Welles did in ''The Third Man'' (nothing but cuckoo clocks) or pillorying her for her role in the last war, as people in America, Britain and Israel have been doing recently.
Every country has its own politics of memory, and memory is nearly everywhere shrouded by powerful national myths. This landlocked country in the heart of Europe has always seen itself as a special case, an exception in Europe's otherwise bloody history; a land populated by peace-loving burghers and peasants, watchmakers, bankers and hoteliers, committed to upholding Switzerland's ''everlasting neutrality,'' as stipulated by the Congress of Vienna in 1815. It is the land of Heidi and the home of the International Red Cross, ''Europe's pharmacy'' and perpetual first-aid station.
Younger historians and some of Switzerland's best-known novelists have been trying for years to revise the conventional tale of Calvinistic rectitude, dependability, direct democracy and peace. While Switzerland's deeds were certainly not as awful as those of her neighbors, they say, its history is a mixed bag of piety and greed, luck, prejudice and cynical opportunism -- from William Tell (whose legend was borrowed from a Norwegian saga) down to Henri Guisan, the general who commanded the Swiss Army of reservists in 1939.
Generations of Swiss schoolchildren were brought up to believe that the valor of Guisan's soldiers, drafted from behind plows or tending cows grazing in remote mountain valleys, had effectively deterred the Nazi Wehrmacht and preserved Swiss independence. The obvious utility for the Nazis of retaining Switzerland's independence and neutrality -- allowing Swiss industry, immune to Allied air attacks, to work full steam for the German war effort -- was conveniently overlooked. (General Guisan, a great Swiss hero to this day, has gone down in history for one of the more phantasmagoric military strategies. In the event of a Nazi invasion, he planned to abandon the women, children and older people of Switzerland to their fate while withdrawing with his men to a fortified redoubt under the St. Gotthard massif. There he would hold out for years, if need be. It is not clear how this strategy might have deterred the Germans, and if it had not, what the Nazis would have done with Guisan's redoubt other than allow the thousands of men in it to starve to death.)
The late playwright Friedrich Durrenmatt warned his countrymen long ago that their vaunted neutrality had never been a moral but a political tactic. But the legends were comfortable and deeply ingrained. The tight clique of bankers, businessmen and politicians that has governed Switzerland during the past 150 years has always known how to put them to good use. Bankers and politicians often happened also to be high-ranking reserve officers in the Swiss Army. The triad of state-business-army committed to upholding Switzerland's ''everlasting neutrality'' boosted the national myths and was in turn boosted by them.
But the line between profiteering and neutrality is always and everywhere blurred, as evidenced by the recent revelations of Switzerland's role during the Second World War. Extravagant accusations have savaged the country for more than two years. They have caused a national debate and, according to many observers, a ''crisis of identity.'' In the newspapers, one often reads nowadays about the ''end of the Swiss myth.''
To begin with, Switzerland is now said to have bought and laundered so much more looted Nazi gold than was previously assumed (about $4 billion, at today's prices) that it might be guilty of having prolonged the war by months. Stuart Eizenstat, Undersecretary of State for Business and Economic Affairs and the leading American official in the Swiss affair, suggested as much last year. One Swiss scholar, the sociologist Jean Ziegler, estimates that the war was extended by between one and two years.
A Swiss report last December quantified for the first time the amount of gold laundered by the Swiss National Bank and by Swiss private banks during the war: around a sixth is now thought to have been robbed from individuals who, prior to being carted away to the death camps, had to hand over all their valuables. This sixth very probably included gold melted down from wedding rings and gold teeth cut out of corpses at Auschwitz. The more one hears about this ''sixth'' -- and we haven't heard the last -- the more horrible this story gets.
The remaining five-sixths of the gold was looted by the Nazis from central banks in Belgium, Holland and other occupied countries, or it came from Germany's own reserves.
Next, there is the continuing scandal over the unclaimed, or ''dormant,'' accounts of Holocaust victims that Swiss banks have withheld for more than half a century. The history of this controversy is telling. When investigations first began rather lamely, in the late 1950's, the banks refused all information, citing Switzerland's vaunted banking-secrecy law. When, in the face of renewed international pressure, the Parliament finally mandated search and disclosure, the banks in 1962 announced they had been able to find no more than 9 million francs (then worth $2 million) in unclaimed accounts. Later, under more pressure, the banks raised the total to about 47 million francs. The chicanery of some of the banks continued. Presumptive heirs were asked to prove their claims by presenting the death certificates of those known to have been gassed at Auschwitz and Sobibor.
More than 30 years passed before the World Jewish Congress raised the issue once again, in 1995. The group was now run by Edgar M. Bronfman, an aggressive Canadian-born billionaire who refused to be cowed by evasive Swiss bankers. Threatened by sanctions in California and New York and class-action suits in United States courts -- and by Senator Alfonse D'Amato, the head of the Senate Banking Committee, who also happens to be looking forward to an election campaign -- Bern panicked. Things finally began to move.
An international commission of ''eminent persons,'' headed by Paul Volcker, was appointed to investigate the banks' books, which it has been doing for about a year now. At an alleged cost until now of more than $130 million, a high official in Bern assured me (probably overstating the case), it has been able to uncover only an additional $47 million in hitherto unidentified accounts.
Also intimidated by the international scandal, the Swiss Parliament has approved the appointment of a second international commission. Its members include a number of well-known Swiss and foreign historians. Their task is to look at Switzerland's role during the war -- its political, cultural, economic, financial, diplomatic and refugee policies.
The commission plans to investigate insurance companies, law firms, art dealers and investment banks and others who had bought up Jewish property at bargain rates after 1933. If they uncover new skeletons in the closets, as is generally expected, their interim reports during the coming year are likely to keep the national scandal alive.
The outcome of all this is difficult to foresee. It may boost the isolationism that has kept Switzerland out of the European Union, and even out of membership in the United Nations. (There are already widespread warnings that anti-Semitism is marginally on the rise.) Or it may finally induce Switzerland to confront its past, as it should have done long ago. First steps in this direction have been taken, but many layers of denial remain. The one certain conclusion, to which even die-hard Swiss traditionalists may not be immune, is that looted gold can get you into trouble even if you did not have to kill for it.
The Bahnhofstrasse, with its luxury shops and banks, cuts through the heart of Zurich from the railroad station to the lake. There are probably more banks per square acre here, and more gold bullion in their vaults, than in any other European city. Private fortunes estimated at $1.6 trillion are said to be administered from here.
The late Swiss novelist Max Frisch described the Bahnhofstrasse as the well-kept, well-protected treasury house of a ''small master race.'' In a World War II memoir, Frisch insisted that Switzerland's famous neutrality had been bought at a terrible moral price. He singled out the Government's decrees on the entry of refugees and the harsh treatment of those who had been admitted. Switzerland granted asylum to ''political refugees,'' but refugees persecuted in Germany for their race were specifically excluded.
In a sequel, ''Switzerland Without an Army,'' Frisch told the harrowing tale of three young Jews who were trying to escape the S.S. by swimming the Rhine near Basel. Two drowned in the rushes. One reached the Swiss side and clung to a wooden pier. A Swiss lieutenant came along ''who knew his orders and stepped on the four clinging fingers with the heel of his boot,'' Frisch wrote. ''The young Jew must have drowned before the Rhine became a German river again.''
It was always known that German or Austrian Jews whose Swiss visas had expired were expelled or were handed back to the Gestapo after entering Swiss territory illegally. Their number was once thought to have been around 10,000. At the Swiss national archive in Bern I met the leading Swiss authority on this subject, a young historian named Guido Koller. He told me that many police files on the expulsion of refugees were willfully destroyed in the 1950's. The number of those sent back to certain death, or who didn't even try to enter Switzerland -- knowing what was facing them there -- is now estimated to be between 70,000 and 100,000, he said.
Switzerland during the war did not really have a refugee policy, it had only a ''Jewish policy,'' the Swiss historian Jacques Picard, a member of the commission, told me the next day. Picard is the author of a tome titled ''The Swiss and the Jews.'' Bern lived in fear of what was defined as uberfremdung (ethnic contamination), he said. Heinrich Rothmund, a high-ranking Swiss police official in charge of dealing with refugees, was obsessed by this fear. He spoke and wrote about it all the time.
In 1938 Rothmund went to Berlin to ask the Nazis to mark the passports of German Jews with a big J. He wanted to prevent their entry into Switzerland. (Bearers of unmarked German passports at that time were able to enter Switzerland without visas.) The Germans were ready to comply with Rothmund's request but demanded as ''reciprocity'' that the passports of Swiss Jews be similarly marked. The Swiss cabinet had some misgivings about this. Rothmund assured the ministers that this was a mere ''formality.'' The Swiss Government, in a secret protocol, gave in, according to the widely acclaimed Swiss television series ''Switzerland During the War: 1935 - 45.''
Jean-Pascal Delamuraz, then the President of Switzerland, complained in 1996 that the Jews were ''ungrateful'' to Switzerland for all it had done for them. Auschwitz was in Poland, he said, not in Switzerland, and the campaign about dormant bank accounts was a form of blackmail or a plot ''to destabilize Switzerland and destroy its banking industry.'' This was too much for the Swiss novelist Adolf Muschg, who caused a sensation when he wrote that Auschwitz was not only everywhere, ''it was also in Switzerland. It was not disgraceful to stay out of the war at any price. But when we finally knew that price we should have called it by name. These people had names. To save ourselves we traded their lives, and afterward their gold.. . .We were silent partners in the industrial destruction of humans and made a profit on it.''
The Bahnhofstrasse was crowded that morning with shoppers. In the pale winter sun, a lone protester picketed the headquarters of the Union Bank of Switzerland, causing a minor commotion. He was a man in his early 60's who wore a three-piece suit and looked like a banker himself, except that his suit was made of heavy tweed. With his right hand he held up a placard that read, ''Punish the banks for their sins, during and after the war -- not the taxpayer!''
With his left, he handed out leaflets accusing the Government of planning to squander Switzerland's ''family silver'' to finance a bogus ''Solidarity'' fund for needy survivors of the Nazi Holocaust. There was some argument about this in the small crowd that had gathered. The Jews, murmured an elderly man, were squeezing Switzerland like a lemon. Why do they pick on us? What about the Swedes, the French and the Dutch? Weren't they worse? Nonsense, said another man, we should have settled this debt long ago. It would have cost a fraction of what it's going to cost now.
Everything was said in good-natured, even slightly lethargic tones. Nobody raised his voice. And all the while, from behind the huge glass doors leading into the bank, the commotion in the street was overseen by two tall, frozen-faced security guards.
It had been inside this same bank building a little over a year ago that the long-lingering scandal over dormant accounts had reached a spectacular climax. Switzerland has not been the same since. Last January, another U.B.S. security guard, Christoph Meili, was working the afternoon shift in the basement of the bank (where, it was later claimed, he had no business to be) when he noticed a cartload of prewar bank ledgers ready to go into a shredding machine -- a clear violation of Swiss federal law. Meili packed some of the ledgers into a plastic bag, smuggled them out of the building and gave them to a Jewish organization, which turned them over to the Swiss Police.
The clumsy way Meili was treated after this was consistent with the narrow-minded legalisms of the Swiss authorities and banks in the past. Meili might have been rewarded and made a public hero for his deed. Instead, he was fired. The chairman of U.B.S. darkly hinted at Meili's ulterior motives. The Zurich district attorney started a criminal investigation of him for violating the Swiss bank-secrecy act, but never filed charges.
Meili is still often bad-mouthed here as a Mossad agent, a dropout, a drug addict. And yet the uproar in Switzerland and abroad about Meili put the banks -- and Bern -- completely on the defensive.
They have remained there ever since. ''Switzerland at the Pillory,'' the headlines have been screaming for months. The scandal has been the subject of a dozen instant books. Nor has Switzerland, judging from press reports during the past year, ever felt so lonely, isolated and without friends in the world. History has caught up with William Tell and exposed him as a pimp, said the economist Gian Trepp, the author of a book on shady Swiss deals with Germany during and after the war. Trepp thinks that it was not greed or heartlessness that made the bankers so rigid on dormant accounts (the sums involved were relatively small) but a desire to advertise the unique secrecy of numbered accounts in Switzerland.
Trepp's most recent book, ''Swiss Connection,'' explores the role Swiss banks have played in recent years in the recycling of billions of dollars on behalf of corrupt Italian politicians, Mafiosi and income-tax evaders of all nations. Trepp says that the banks will not retain for much longer the domestic political support they enjoy now. The big banks are less and less Swiss. They are vast multinational enterprises. Most of their business is abroad, which is what makes them so vulnerable to sanctions.
Within Switzerland itself, the big banks are firing thousands of employees. Nor is the old symbiosis between the banks and the army likely to survive. The army is no longer the breeding ground for future C.E.O.'s, according to Trepp. The Harvard Business School is. Today's overworked C.E.O. does not have the time to play reserve officer in the evenings. Over the weekend, the new Swiss C.E.O. prefers to play golf.
In Zurich and Bern I heard politicians groan that the major banks had committed ''every possible mistake and blunder.'' They had been ''arrogant,'' ''clumsy,'' ''unfeeling,'' ''stupid.'' Yet, according to Stefan Keller, another historian and an editor with Zurich's Wochenzeitung, during the first stages of the crisis ''the banks literally kidnapped the Government and the entire country. The banks became a tribal emblem, much like a national soccer team. For a while, even the homeless here identified with the big banks,'' Keller says.
In the fortresslike isolation of the first few months, a special task force was set up to manage the crisis and to improve Switzerland's tainted image abroad. It comprised more than 30 diplomats, historians and legal and public-relations experts. Their work was not made easier by embarrassing leaks and infighting in the Foreign Ministry and the banks, and by rash statements from leading politicians. President Delamuraz's statement about ungrateful Jews drove the task-force people up a wall. Muschg had not been the only one to criticize Delamuraz. But there were other voices claiming that Delamuraz had said the truth. Delamuraz never took back his accusation. He merely announced that he was ''sorry'' if he had offended some people. ''This had not been my intention,'' he said.
The Swiss press is still filled almost daily with reports and critical comments on the crisis. The conservative press keeps complaining of ''fantastically exaggerated'' accusations in the foreign media. It mocks the ''claims and wild expectations'' of the World Jewish Congress and of lawyers filing class-action suits for billions of dollars in United States courts. ''Switzerland felt insulted before it was truly shocked,'' Zurich's Tagesanzeiger observed last month.
There is continuous squabbling. Did the Swiss really press Jewish refugees into concentration camps, or were they only put into prisons like common criminals or forced into work camps where they had to cut trees and break rocks and plant potatoes for their living, even though the Swiss Jewish community was paying for their upkeep? Had the Swiss Jewish community been blackmailed into paying up by implied threats that the refugees would be otherwise expelled? (Jacques Picard says that the thorough exploration of this question is one of the tasks of the historians' commission.) Did Switzerland really permit German cattle cars loaded with Italian Jews to cross the country on their way to the death camps, as was claimed recently in a BBC report? Or were refugees only stopped on the frontier, leaving it to the Nazis to murder them? (Nobody now denies that after Italy's capitulation, the Swiss railroads agreed to transport Italian forced-laborers to Germany.)
Did Swiss bankers knowingly accept the gold teeth and wedding rings of dead Jews, melted down into bullions marked with the Reichsbank's swastika? Or did they merely suspect that the gold was robbed and stained with blood? ''The daily recounting and contradicting, rejecting and counterarguing has little to do with the ascertainment of truth,'' Tagesanzeiger said. It was a form of escapism. ''We have sent thousands to the gas chambers but our cattle cars remained clean.''
The daily and weekly press continues to be flooded with documents and accounts of what happened half a century ago or of what people today think happened or might have happened if the old police officer, Rothmund, had been more lenient and the banks less greedy. The bulk of the material published remains critical of official actions. The leading serious daily, Neue Zurcher Zeitung, has especially excelled in this, though, at times, in a rather cramped and apologetic way.
The most painful chapters of Swiss history have been told and retold and commented upon: the heartless rejection of refugees, the recycling of Nazi gold (only a few years earlier, the same paper had dismissed this same subject as mere historical ''marginalia''). Much of what has been ignored in school textbooks or repressed, pooh-poohed or faced only half-heartedly has resurfaced. In years past, the material could have been found in dozens of books. But how many people bothered?
There have been accusations against the Swiss-run International Red Cross, which apparently knew about death camps early on but did not speak out for fear of offending the Germans. And there is the final chapter of the seemingly never-ending tale of a Captain Grueninger of the St. Gallen Police Force. Grueninger was a decent man within a tightly run, merciless frontier patrol. In 1938 he manipulated some police records to enable 2,000 Austrian Jews to remain in Switzerland. For this he was fired in disgrace (without pension) and fined. It took 40 years and five vain appeals to have him rehabilitated.
Neue Zurcher also revealed that, at the request of the Swiss Writers Association, which complained of unfair competition, internationally admired writers like Ignazio Silone were ordered by the police not to work and not to publish in Switzerland. The critically ill Romanian tenor Josef Schmidt was forced to chop trees in one of the labor camps for refugees. Schmidt died there.
The real story of the man honored until last month with his portrait on the highest denomination Swiss bank note (1,000 francs) has not yet made the Swiss papers. Auguste Forel (born in 1848) was not only a noted psychiatrist and a great expert on ants but also a wild racist whose rhetoric antedated the Nazis. He believed in euthanasia and wrote that only the able should be allowed to reproduce and that ''certain races are dangerous, especially the negroes who are bodily fit and strong but spiritually inferior. . .the world is teeming with untermenschen that must be prevented from breeding.''
Most of this information has been public knowledge for years, available in many books. For some reason, the educational system and the political culture absorbed it only marginally. Nearly everybody I talked to said that none of the special measures, none of the commissions and none of the generous funds that have been made available to survivors of the Holocaust would have come into being without pressure from abroad. ''Without Senator D'Amato, whatever his motives, or Bronfman, however exaggerated his claims, we would probably still be where we were years ago -- nowhere,'' a Bern legislator reluctantly agreed.
The latest Swiss offering -- some may call it a sop -- to dispel the nightmare is the agreement last month by the three main banks to negotiate a ''global settlement'' with the Jewish groups and various plaintiffs. In return, a panel of state and local officials from the United States agreed to suspend sanctions indefinitely.
In the end, it comes down to what the banks understand best: money. Linus von Castelmur, secretary-general of the international historians' commission and a former Swiss diplomat, told me that no less than half the profits of the Swiss banking industry originate in the United States. Hence, the enormous impact of the protests and threats voiced there during the last year. The power of the banks in Switzerland? ''We are a very small country with very big banks,'' he said with a thin smile.
Castelmur speaks of an identity crisis in Switzerland today. Many Swiss do. Hans-Ulrich Jost, a prominent Lausanne history professor, has gone as far as suggesting the dissolution of the Confederation of Switzerland. He said this by way of hyperbole, to emphasize how serious the crisis was. The Confederation of Switzerland is most certainly not going to be dismantled but, I think, it will never be the same.
On my last day in Zurich I walked to the modest second-floor office in the Schweizergasse of Sigi Feigel, a well-known Swiss lawyer and the former head of the Zurich Jewish Community. He interested me because, while fully supporting the claims against the banks, he has criticized the World Jewish Congress for its ''exaggerations.'' Why was everybody ganging up on the Swiss when the French record during the war was much worse? If America had accepted as many refugees on a per capita basis as Switzerland, seven million (more than all who perished in the Holocaust) might have found a safe haven, Feigel says. Not enough consideration is given to the extenuating circumstances that forced Switzerland's hand at a time when it was entirely surrounded by Nazi Germany.
Feigel has a point. The Swiss were not Nazis, though many were obsessed with being ''contaminated'' by alien Jews. The bankers were heartless and greedy. So are some Israeli bankers, according to recent reports in the Israeli press, who have barely lifted a finger during the last 50 years to locate the heirs of their own dormant accounts. Auschwitz was not in Switzerland, as Adolf Muschg claimed in the heat of the debate last year, unmindful that by saying this he was inadvertently belittling the real Auschwitz. What the Swiss did or did not do, during and after the war, was bad enough. The real trouble is that they have not faced up to it until now.