The Founding Fathers of Hollywood : AN EMPIRE OF THEIR OWN : How the Jews Invented Hollywood <i> by Neal Gabler (Crown: $24.95; 491 pp.) </i>

Years ago at the elaborate annual SHARE fund-raising party in Hollywood, Phil Silvers and Polly Bergen did a number called “The Rabbi and the Nun,” in which he and she, suitably costumed, argued over who had the most influence in the industry, the Jews or the Catholics.

The nun offered the likes of Loretta Young, Irene Dunne, Bing Crosby and Leo McCarey, the director. The rabbi countered with Louis B. Mayer, Harry Cohn, Sam Goldwyn, the Brothers Warner, Adolph Zukor, Carl Laemmle and an inexhaustible list of producers, directors and actors.

The contest was so one-sided that at last the nun said in exasperation, “The next thing you know, you’ll be telling me that our Dear Lord Himself was. . . .” Her voice trailed off.

The fact is that Hollywood, a.k.a. the American film industry, was “founded and for more than thirty years operated by Eastern European Jews,” as Neal Gabler says in his lively and scholarly history of the phenomenon, “An Empire of Their Own.”

He adds that the studio system was perfected by a second generation of Jews. Even now, in a Hollywood profoundly changed by the coming of television, the industry behind the cameras, from its top leadership through the ranks of producers, marketers, talent agents, business managers and legal counsel, is still preponderantly Jewish, although far from exclusively so and with far less sense of community than in prewar days.

The extraordinary paradox, Gabler points out, is that through their movies, the Jewish patriarchs painted an idealized portrait of an American society to which they were denied access. For Jews, one of the lures of the industry was simply that it let them in. “There were no social barriers in a business as new and faintly disreputable as the movies were in the early years of this century,” Gabler says. “There were none of the impediments imposed by loftier professions and more firmly entrenched businesses to keep Jews and other undesirables out.”

The mating of Jews and the film industry had indeed a kind of historical inevitability. The founding moguls shared what Gabler calls “a patrimony of failure.” They had come out of hard times and oppression in Eastern Europe, and most, remarkably, also shared a heritage of strong mothers and weak fathers. It became the common drive among these men to break with the past, to commit what Gabler calls “a kind of patricide” and to embrace the new country.

They had a hunger for assimilation and, in the face of resistance and exclusion, “the Jews could simply create new a country--an empire of their own, so to speak . . . an America where fathers were strong, families stable, people attractive, resilient, resourceful, and decent.” The 20th-Century American Dream was to a considerable degree depicted and defined by Hollywood.

The industry leaders became superpatriots, although for years, their patriotism was held slightly suspect and there was, Gabler notes, a strong taint of anti-Semitism throughout the rancorous investigations of Communist influence in Hollywood, culminating in the hearings of the House Un-American Activities Committee.

The same strain of anti-Semitism surfaced again this Summer in some of the far-right Christian protests against the release of “The Last Temptation of Christ” by Universal.

Rebuffed by the larger society they were celebrating, the Hollywood Jews constructed a parallel society of their own, and much the most fascinating part of Gabler’s book is his detailing of the manners and mores of that society.

If the Los Angeles Country Club was closed to them, they created Hillcrest. They created Hollywood Park and collected thoroughbreds. Louis B. Mayer did this very successfully indeed. (Gabler quotes Scott Fitzgerald’s Monroe Stahr: “the Jews had taken over the worship of horses as a symbol--for years it had been the Cossacks mounted and the Jews on foot.”)

The Jews patronized the Hollywood Bowl, bought superb paintings and sculpture and supported all the arts. They built homes, each more palatial than the last. They became active Republicans, glad to be pals with Presidents, before and after F. D. R. They played polo. They demanded the best schools for their children. They created a social pecking order as ruthless as any in Boston or old New York.

Faith itself was an uneasy matter. “Guilt ran too deep for them to disavow Judaism entirely,” Gabler says. But the founding generation tempered their faith so they could in fact assimilate without guilt, while later generations have been able “to be Jews again without guilt.”

For all their similarities, notably their uncompromising and, if need be, ruthless drives to survive and succeed, the moguls were different one from another, and to a degree, their films reflected their differences. Harry Cohn’s defiant unpretentiousness found expression in the plain-speaking common sense of Frank Capra’s heroes. The well-lit optimism of the MGM movies, best symbolized in the Andy Hardy series, perfectly embodied Louis B. Mayer’s vision of the good American life.

Mayer, Gabler writes, confronted the despairs of the Depression with “a vast, compelling national fantasy out of his dreams and out of the basic tenets of his own dogmatic faith--a belief in virtue, in the bulwark of the family, in the merits of loyalty, in the soundness of tradition, in America itself.”

It was a besetting irony, of course, that Jews as Jews, as protagonists or as players, were all but invisible in the movies the Jews made. It was a long way from “The Jazz Singer” to “Gentlemen’s Agreement.” Names were changed to uphold a screen myth of ethnic anonymity, and Julius Garfinkle became John Garfield.

At that, the moguls may have rightly understood that exclusion worked at the box office in the early days, too. The largest strength of the founding fathers--whatever their other strengths as managers, financiers, bargainers, entrepreneurs--was their closeness to the working-class audiences from which, in a real sense, they had emerged. If the chieftains prospered, it was because they knew what the crowds wanted or could be made to want, and what their aspirations, dreams and fantasies were.

It has been harder for their successors to cope with audiences that are better educated, more widely traveled, satiated with and distracted by television and confronted by a wide diet of diversions of which the movies are only one.

Everything changes. The studios, conglomerately owned, have managers instead of leaders. “The moguls’ names have faded,” Gabler says. “The estates are gone, and the power and the panache and the fear. But what the Hollywood Jews left behind is something powerful and mysterious. . . . What remains is the America of our imaginations and theirs. Out of their desperation and their dreams they gave us this America. Out of their desperation and dreams, they lost themselves.”

Gabler, a former co-host of Sneak Previews on PBS (one of the wisest and most articulate of the on-camera critics), did graduate work in film and American culture at Michigan. Fifty pages of finely printed reference notes confirm the extensive reading and interviewing that supports the book. The candor of his sources, Adolph Zukor’s son Eugene and Mayer’s grandson Danny Selznick among them, lends both vigor and conviction to the text.

It is impossible to imagine a different history for Hollywood. But for all the criticisms of the vulgarity and superficiality of the escapist fare the movies offered in their Golden Age, it is also hard to see how the society and its mass audience could have been on balance more positively served than by the Hollywood the Jews invented.