The Transfer Agreement (37 page)

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
I
5
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
I
5,
this new request for an expanded Hanotaiah license.

The next day, June
I
6,
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. Land-auer 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,
I933,
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 explictly 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's June I5 letter suggesting a broadened version of Sam Cohen's deal.
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 garner 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 deal.
³⁴
As one of the German Zionists who originated the transfer concept in mid-March
I
933,
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 I933 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, I933—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,I933,
Cohen had accumulated enough written testaments of legitimacy to overcome any challenge from Landauer and the ZVfD. 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
I5
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
I5
request to expand Hanotaiah's deal from RM
I
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 Jersualem 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.

T
HE
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.