Dark Side of ‘Neutrality’

Switzerland was the money launderer for gold looted by Nazi Germany during World War II, but other officially neutral nations--Portugal, Spain, Sweden and Turkey--”played an equally critical role in sustaining the [German] war effort,” says a State Department-coordinated report. Specifically, the four countries provided the German war machine with minerals essential for producing the steel alloys used in machine tools, armored vehicles, weapons and ball bearings.

The report quotes Albert Speer, Hitler’s armaments minister, as saying Germany might have been unable to continue fighting until May 1945 without some of the materials it received from the neutrals. The inescapable inference is that the business these countries did with Germany helped prolong the war and in so doing added to its enormous military and civilian death toll.

The new report follows by a year revelations detailing how Switzerland bought from Germany hundreds of tons of gold stolen from occupied countries and recycled from the teeth and wedding rings of Holocaust victims. A Swiss historical commission recently put the value of that gold at about $300 million--at 1998 prices, about $2.6 billion. The four other neutrals got about $240 million in looted gold.

Switzerland and the others were told by the Allies as early as 1943 that they were trafficking in stolen gold and warned to stop trading with Germany. But the commerce continued until almost the final months of the war. Moreover, despite a postwar agreement, very little of the looted gold has been returned to its legal owners.

Undersecretary of State Stuart Eizenstat, who oversaw the new report, says its purpose is not to embarrass any country for past deeds but to fill out the historical record. Indeed, Eizenstat has expressed some sympathy for the position in which some of the neutrals found themselves; if they didn’t trade with Germany, they feared invasion. But Eizenstat also notes that by 1943, when the Allies first warned against continuing exports to Germany, the tide of battle had turned. Germany was stalemated in the east and preparing for an expected cross-channel invasion from the west. It would have been hard-pressed to use military force against the neutrals. And certainly by 1944, with Germany in retreat, any attack on the neutrals was simply not in the cards.

So while the fear of occupation may have initially motivated the neutrals to do business with the Nazis, it was ultimately greed that kept the wheels of trade turning.

The neutrals, to their credit, could also act decently. Among them, they provided haven to several hundred thousand refugees from the Holocaust--a record far better than that of the United States--and in some cases rescued and protected Allied airmen.

But the fact remains that all emerged from the war richer than when it began, and all provided vital aid to the Nazi effort long beyond the time they may have felt compelled to do so. This too deserves to be noted in the history of the world’s most costly and destructive war.