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Chapter 1. A Time of Crisis: 1929-1932

[1.8. The actions of the Joint against poverty of Jews in Eastern Europe]

[Late 1920s: Eastern Europe: JDC actions against Jewish poverty]

The activities of JDC in Eastern Europe were motivated by the desire to avoid relief work as much as possible; the relatively small sums could not, in any case, alleviate mass suffering. Work was therefore concentrated on reconstruction. This found expression in (p.33)

four aspects of JDC activities: medical work, education, child care, and the provision of cheap credits. (It was Dr. Kahn's principle not to engage in the latter work directly but to subsidize those organizations that were most effective at it).

[1921: Poland: Foundation of medical organization TOZ - TOZ activities]

As far as the health program was concerned, JDC had founded TOZ in Poland in 1921. This group of medical workers and administrators ran their society on the basis of a dues-paying membership that controlled the organization, and they demanded certain minimal payment for a small part of their otherwise free services. Collections, government subsidies, and JDC subsidies made up the rest of their budget.

By 1929 TOZ had 63 branches in Poland, with 14,854 members. It provided health education in the form of lectures, films, and publications. It ran summer camps ("colonies"), anti-TB clinics, dental clinics, and milk stations for children, and various school programs. (p.34)

(End note 10: TOZ had a medical staff of 397 in 1929. It ran 31 hospitals, 21 anti-TB clinics, and 26 dental clinics. JDC contributed 337,000 zloty to its 2 million zloty budget. In its summer camps there were 7,820 children in 1927, 7,633 in 1928, and 6,427 in 1929. (p.308)

In the other areas of Eastern Europe, JDC assisted in reviving the Russian Jewish health organization known as OSE.

[1912: Russia: Foundation of medical organization OSE / OZE]

(Footnote: OSE (OZE) - Obshchestvo Zdravookhraneniya Yevreyev (Society for the Protection of the Health of the Jews), founded in 1912)

[Since 1919: OSE / OZE: Creation of a system of health centers in Ukraine, Baltic states, Danzig, Bessarabia, and Austria]
Despite the fact that this old and well-established group was now cut off from its former base of operations in Russia, it continued after the war and was active in the Ukraine, the Baltic states, Danzig, Bessarabia, and Austria. In those countries it set up a system of health centers.

However, it did not attain the singular importance there that TOZ had in Poland, and Kahn was apt to be rather critical of what he considered its conservatism. Nevertheless, OSE did very useful work in its own areas.

[1923: Poland: JDC founds child care federation CENTOS]
As far as the care of children was concerned, JDC was instrumental in setting up in 1923 a child care federation of Poland, known as CENTOS, which engaged in social work with orphans and poor children, and cooperated with TOZ in summer camp programs and similar activities.

[1923: Warsaw: JDC founds school for nurses under Amelia Grunwald - better economic position of the nurse in whole Poland]

One of the direct achievements of JDC work in Poland was the establishment of a modern school for nurses in Warsaw by Amelia Grunwald in 1923. Miss Grunwald was an expert nurse and an efficient administrator who left her post in the United States to take (p.34)

over this venture. JDC spent some $ 95,000 on the school up to 1929 and, as a result, the government and the Warsaw municipality participated to an ever-increasing extent in the institute's budget. The school, which was attached to a municipal hospital treating mainly Jewish patients, had effected a significant change in the nursing profession in Poland generally. The nurse had been looked upon as a somewhat specialized servant of the doctor, but the school, along with another institution established by the Rockefeller Foundation, helped to transform her into a respected member of the medical profession. This found its expression not merely in a somewhat better economic position, but mainly in the social standing the nurse could now hope for. This achievement was a guide to the kind of pilot project JDC should engage in in other spheres of activity as well.

[Poland?: JDC supporting Jewish schools]

Schooling was another area where JDC, in its efforts at reconstruction, tried to maintain certain institutions so as to help build a generation of Jewish people who would be well adapted to the world around them without forgoing the kind of Jewish education the elders wanted for them. Subsidies usually came through the three original constituent organizations of JDC: the Orthodox Central Committee for the Relief of Jews Suffering through the War, the socialist People's Relief, and JDC itself, acting as AJRC [American Joint Relief Committee]. JDC's Cultural Committee was composed of representatives of these organizations, and the monies they sent were supposed to be divided according to a "key" that gave

-- 55 % to the Orthodox,
-- 17.5 % to labor (actually Yiddishist Culture) and
-- 27.5 % to all the rest (Tarbuth Hebrew schools, assimilationist schools, and some religious schools not supported by the Central Committee).

This rather lopsided arrangement, which prevailed till the early 1930s, was a reflection of a European mentality rather than an American one, and superseded the arrangement of 1920 whereby each of the three groups supported, more or less independently, its own institutions. Government education was either inaccessible or anti-Jewish, or both; as a result, about half the Jewish pupils went to Jewish schools.

(End note 11:
There were 540 Orthodox schools for boys and 148 (Beth Yaacov) schools for girls, with over 81,000 pupils (the girls received only ten hours of schooling a week); Orthodox yeshivoth had 18,298 pupils, and evening classes were visited by another 6,700 - a total of over 106,000 pupils. The 471 Hebrew-oriented Tarbuth schools had 44,370 pupils, and 210 Yiddishist schools had 19,500 pupils; altogether some 170,000 pupils visited Jewish schools (see Executive Committee, 12/4/30 [4 December 1930]).

[Since 1924: Poland: JDC founds the American Jewish Reconstruction Foundation - the loan kassas]

However, the main effort of Dr. Kahn was directed toward (p.35)

economic reconstruction. To this end, the Reconstruction Committee of JDC had joined forces in 1924 with ICA to establish the American Jewish Reconstruction Foundation, which was run by the two organizations with Kahn (for JDC) and Dr. Louis Oungre (for ICA) as managing directors. The governing body of the foundation was composed of six members from each of the two founding organizations, and eight members who were supposed to be responsible Jewish leaders representing the Jews of Poland, Lithuania, and Bessarabia. The list included some labor representatives, some representatives of merchant circles, an Orthodox Jew, and a Palestine Zionist. But both the Orthodox member (Jacob Trockenheim) and the Zionist (Berl Locker) failed to put in appearances at the foundation council meetings.

The main task of the foundation was conceived to be the establishment of cooperative credit institutions known as "loan kassas". These kassas would call for the payment of share capital, accept savings and deposits (to a certain extent), and lend money at a reasonably low rate of interest, mainly to Jewish merchants and artisans. The idea behind this movement was that the merchants - actually petty traders - and artisans, who constituted the overwhelming majority of the Jewish population in Poland and East European countries, were suffering from a lack of cheap credit. If financed in a conservative and businesslike way, they would not only be able to compete with non-Jews, but would also regain their self-respect as useful members of their community. With the help of political bodies, including some of the Zionists and the Bundists, (p.36)

Table 1: Kassas of the Reconstruction Foundation
Year	No. of kassas	No. of members	New foundation investments (net)
1929	747	310,000	$ 246,000
1930	768	321,000	$ 865,000

[Foundation of the Verband to control individual kassas]

a central federation known as the Verband was set up to exercise control over individual kassas, and a bank was established to serve as the financial instrument. This economic movement was undoubtedly popular.

[1924-1926: Poland: The effect of the kassas: Help only for credit-worthy Jews]

Well over a third of the Jewish population in Poland were reached by the kassas. The loans were small, averaging about $ 50, and were usually repaid on time; cases of defaulting debtors were relatively few. However, these kassas only reached that portion of the Jewish population that was still credit-worthy, if only to a limited degree; it was quite clear that the poorer groups could not be included in this venture. Yet ICA did not see its way clear to supporting something akin to relief for these people.

[1926: Poland: Kahn establishes kassas with mercy and credit without interest rate: Free Loan kassas / Kassas Gemiluth chessed - popularity of the Joint]

Kahn, representing JDC, looked for some kind of solution, and in 1926 he established in Poland a series of institutions with the traditional name of Free Loan, or Gemiluth Chessed, kassas Gemiluth chessed (giving of mercy) was the traditional term for almsgiving. However, in the nineteenth and early twentieth centuries the term was expanded to include interest-free loans. Kahn now enlarged on this notion and established credit societies that would grant very small loans in large numbers at a nominal rate of interest, or no interest at all. Here again share capital was invited, but the low-interest JDC credits covered a much greater part of the needs of these kassas than they did of the loan kassas.

The Free Loan kassas apparently filled a crying need. By 1930 there were 545 of them in Poland, with 100,000 members. The total resources came to $ 1.1 million, of which $ 665,000 had been invested by JDC. A traditional concept had successfully been adapted to a modern situation, and as a result the popularity of the Joint among Polish Jews increased considerably.

[Since 1926: JDC Kahn looks for definite solutions - plan for the industrialization of Polish Jewry]

All these ventures alleviated Jewish suffering to a considerable degree, and were vastly important in the lives of the millions of Jews in Poland. However, Kahn was too much of a realist not to see that he had not really touched the core of the Jewish economic problem. The kassas were really no more than an instrument to soften the economic blows from which the Jews were suffering to (p.37)

an ever-increasing degree. It was quite obvious that the poorest of the poor - a third of Polish Jewry - could not benefit even from the Free Loan kassas. To spend the precious dollars for outright relief would not only be degrading but also futile. Could anything be done to change the situation and give Poland's Jews a real chance to rebuild their economic lives?

Kahn very clearly thought that with purposeful action on the part of American Jewry, Polish Jewry could be so changed as to adapt itself to the society now emerging in Poland. In the summer of 1929 he appeared before the leadership of JDC in Zurich, while the Jewish Agency discussions were being held there, to propose a plan for the industrialization of Polish Jewry.

[1929: Kahn's plan for industrialization of the Polish Jewry]

There were several aspects to Kahn's plan. He thought that Poland was going to be industrialized and that anti-Semitism would not be powerful enough to blind Polish statesmen to the interdependence of Polish Jewry and the Polish economy. Therefore, it might be possible to interest the government in a scheme that would integrate the Jews into the economy. He assumed that there would be a steady stream of American money at the rate of about $ 1.1 million yearly for five years; properly applied, this not very large sum could work wonders.

Also, Kahn considered emigration to be no solution and felt that the problems of Polish Jews would have to be solved in Poland.

Another assumption was that the program would be implemented by American Jewry acting through JDC - in fact, through Kahn. He does not seem to have considered the possibility of any participation in planning or direction by Polish Jews themselves. He also insisted with great clarity and conviction that no planning was possible except on a minimal five-year basis, with funds that would insure the fulfillment of that first stage. This is what had been done for Russia, and Kahn obviously relied on the experience gained there in his attempt to deal with Polish Jewry.

Given these assumptions, Kahn proceeded to outline his plan.

We must try to create a healthier economic structure of the Jewish masses and do away with the present competition among (p.38)

the various classes of Jews, create an economic situation which is so constructed that the various groups can rely on one another: the workman on the artisan, the tradesman on the industrialist, etc., in which the individual parts supplement one another economically.

But a sudden radical change of the economic structure is not possible. The chief occupation of the Jews will be the same for many years to come. Industry, trade, commerce, crafts, professions, in which 70-80 % of the Jews are employed, will continue to be the basis of their earnings.

These professions must be regulated, competition decreased in the smaller industries, and production adjusted. Trade is not systematic, there is no order or calculation in business, the crafts are one-sided, some branches overcrowded, there is too little variety and not enough specialization, and lastly the artisans have not had sufficient training and are using old-fashioned methods.

When we talk about the "restratification of the masses" we must not only try to create new professions in which a large number of Jews can be employed, but also rearrange all professions. Great numbers will be excluded in industrial branches and trade, although we are going to do everything possible to maintain the Jewish economic position in trade and industry. Those who are thus excluded may find positions as employees.

A regeneration of Jewish trade and industry will bring about normal conditions for employees. Everywhere now employees are taking the place of the independent small tradesman and industrialist. The number of employees is increasing rapidly, much more rapidly in proportion than the number of laborers. ...

Another means of adjusting larger masses of Jews to the new economic order is to be found in industrialization. As yet, there are comparatively few Jewish factory workmen and industrial labor men, who did work at home for factories and workshops and worked in small workshops. They are not mechanics. The progress of the machine has left these workmen unemployed, prevents more Jewish workmen from obtaining employment. Artisans too must find employment in shops where machines are in use if they wish to secure any employment at all.

It is well known that the Jewish workman, especially the Jewish industrial worker and factory worker, is unemployed. It is further known that the masses of Jewish workers are not mechanics and that in "the shifting of the masses" it is absolutely necessary to place larger groups of Jewish workmen in industry and factories.

With our small means we have made a start in Lodz. Here together with Jewish manufacturers, we have taken over a small (p.39)

textile factory in which we employ workmen and are placing Jewish weavers at machine work, who, after a short period of training, go out into Jewish factories, so that there is a continual training of Jewish workmen going on. ...

If we are able to continue the organizing of this work, I believe that after a few years we will have strengthened the position of the Jews to such an extent that a gradual prosperity for them will set in.

(End note 12: File 42, 7/10/29 [10 July 1929])

The financial requirements were very modest; apart from Kahn's normal budget, which would go into very much the same type of work as before, he would require $ 625,000 annually to proceed with a minimum program embodying his proposals: mainly, the organization of factories operated by Jewish employers who would train Jewish youngsters to become factory workers.

Kahn's industrialization plan was an imaginative attempt to tackle the economic problem of the Jewish masses by modern means and in line with the developing economy of Eastern Europe. It was bold, it was based on a set of hard facts, and it would be in the hands of a first-class administrator and economic expert.

[November 1929: Stock market crash in New York destroys all plans - Polish anti-Semitism would have blocked the plan - question of a market for Jewish products]

But the plan never got off the ground because at the end of 1929 the Great Depression set in. However, it is doubtful whether the plan had any real chance to succeed. It assumed too blandly that anti-Semitism was an economic phenomenon, that if Polish Jewry was helped, then the benefits accruing to Polish society would neutralize anti-Jewish feeling among the population and the government alike. Without the help - or at least the benevolent neutrality - of the Polish government, it was unthinkable that the project could succeed.

More important, the project assumed that one could remold the Jewish economy in Poland without at the same time remolding the Polish economy as well. This seems to have been a fallacy - and JDC was not really strong enough, even in a time of prosperity, to tackle the whole of Poland. Also, Kahn thought that by proper export arrangements Jewish production would find a market. This was an assumption based on the existence of boom conditions in the U.S. and elsewhere. But in Europe, 1929 was not a very good (p.40)

year, and we have already mentioned the crop failures in the East that had diminished the purchasing power of the peasantry. If the position of the peasantry was not improved, who would buy the Jewish products - or any other products for that matter?

[Russia: Absorption of Soviet Jewry - Kahn's plan for Jews in Poland would have functioned only with an expanding economy]

The success of the economic absorption of Soviet Jewry a couple of years later was a good guideline to the possibilities in other countries. In Soviet Russia the solution of the economic problem came when Jews were accepted as laborers in a swiftly expanding economy suffering from a labor shortage. Without an expanding economy, however, it is difficult to see how Kahn's industrialization plan could have worked in Poland. Yet this has to be remembered: of all those who made an effort to find a solution to the Polish Jewish problem, Kahn came nearest to a positive and practical approach. It was not his fault that his program never materialized.

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