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Chapter 1. A Time of Crisis: 1929-1932

[1.9. Stock market crash in New York in November 1929 - JDC funds are going down - Jewish disaster in Eastern Europe - new anti-Semitic wave]

[November 1929: Stock market crash: JDC funds are going down - Jewish disaster in Poland - reduced programs]

The Great Depression that started in America in 1929 was a major turning point in world history generally, and in Jewish history in particular. Just as JDC was about to become a permanent fund-raising organization, with serious financial commitments designed to contribute materially to a radical improvement in the conditions of the Jewish masses in Europe, it found itself swept off its feet by an economic disaster that threatened to cut off its financial basis in the United States; and this at a time when the conditions of European Jews were seriously deteriorating.

It must be borne in mind that Eastern Europe had been suffering from a local economic depression even prior to the major disaster emanating from America. The conditions of the Jews there had prompted the regeneration and mobilization of JDC resources just described, but there was no comparison between the plight of Polish Jews in 1932 and in 1928. Bad as the situation in 1928 was, in 1932 it was incomparably worse. At the same time, the income from collections in the United States reduced the JDC budget to $ 340,000 in 1932.

(Footnote: See the appendix for a table of JDC income and expenditure during this period).

At the end of 1929, owing no doubt, to the better relationships (p.41)

prevailing between Zionists and non-Zionists as a result of the establishment of the Jewish Agency, an Allied Jewish Appeal was launched for $ 6 million, $ 3.5 million of which was earmarked for JDC. In fact, however, the JDC share of the monies collected in 1930 was a mere $ 1,632,288. The strains of a campaign conducted in an atmosphere of gloom were too much for a united fund-raising effort, and in 1931 the Zionists and JDC conducted separate appeals. The $ 740,000 collected in 1931 and the $ 385,000 collected in 1932 were inadequate to the point of disaster.

Warburg was associated with the Jewish Agency, as well as with JDC, but not even he could improve the collections for either of the appeals. In the face of these developments, budgets had to be cut drastically -

-- no more industrialization plans,
-- no more expansion.

The contribution of JDC to Free Loan kassas, child care, and medical aid became minimal, and often only symbolic.

[1930 approx.: JDC strategical discussions]

At this juncture, opinions were divided into two camps. James N. Rosenberg thought that JDC was no more than a disbursing agency of American Jewry. If American Jewry could not or would not provide JDC with funds, JDC should close down and merely maintain a skeleton staff in New York against the possibility of reviving the organization whenever the funds collected justified it. He repeatedly expressed this opinion in 1931 and 1932.

The other point of view was expressed by Kahn, Warburg, and Baerwald. They maintained that a complete cessation of funds from America would not only destroy the Jewish institutions that had been built up at such tremendous expense after World War I, but that these institutions, once closed down, would never be rebuilt. These differences of opinion were resolved in favor of the stand taken by Warburg, and JDC continued to supply dollars in driblets to the starved Jewish institutions in Eastern Europe.

The crisis and its consequences did not, however, materially affect the Reconstruction Foundation work, as this was done with a fairly large amount of capital that was at least partly used as a revolving fund; credits were granted to the foundation loan kassas, and repayments on these loans and credits were coming in regularly. (p.42)

JDC itself was doing the same thing with the Free Loan kassas, but on a much smaller scale. Thus, the foundation's activities now assumed major proportions, and its relations with Eastern European Jewry became very important.

[1930-1932: Poland: Struggle about supervising the work of the kassas - reduction of the kassa bank in Poland - protests in the Jewish "US" press against Kahn]

In 1930-32 a struggle developed between the Reconstruction Foundation and the leadership of the loan kassas' central institutions in Poland: their bank and the Verband. Ostensibly the disagreements were economic and financial: the Verband was not supervising the work of the kassas to Kahn's satisfaction and tried to free itself from the foundation's supervision as much as it could. As a result, its affairs were mismanaged. More important, the bank, (in effect run by the members of the Verband) had become an ordinary banking institution charging high rates of interest; it also tried to free itself from Kahn's meticulous control by rather doubtful procedures. In these it failed miserably. In addition, practices were uncovered that were dangerously close to being corrupt. The bank had loaned money to private individuals who could not pay it back and had practiced what amounted to a misappropriation of funds entrusted to it by the loan kassas. In the end, after many attempts at saving the situation, Kahn was forced to insist on the liquidation of the bank.

But this was a financial crisis on the surface only. In reality, it was a crisis of confidence between representatives of Polish Jewry and JDC. Kahn had managed only with difficulty to persuade his ICA friends to set up the bank, and its liquidation was accompanied by many "I told you so"s on the part of JDC's more conservative partners in the Reconstruction Foundation.

The Zionist and Bundist press attacked Kahn personally, and some of these attacks were printed in America. Kahn was accused of being a cold bureaucrat, of not having come to the aid of the bank when it still could have been saved, of refusing to consider the fate of the kassas themselves if the bank was liquidated, and of superciliousness toward the Jews of Poland. These accusations were factually quite incorrect, but, as the Warsaw paper Hajnt put it, Kahn would probably win a court action but might not do well (p.43)

in front of a jury - in other words, though Kahn was legally right, his policy could be questioned on moral grounds.

Should he have insisted on a strict attitude toward the Polish Jewish organizations (to which, of course, he was fully entitled), or should he have taken a softer line and thus saved the prestige and self-confidence of the people he was dealing with?

[Reasons for Kahn to reduce the kassa banks in Poland]

On the whole, it seems that he was trying to do the best he could with a critical Dr. Louis Oungre at his side and a woefully inadequate supply of money. After the failure of his industrialization plan, he was determined to take drastic steps to avoid wasting the little money he had. Also, he was out to imbue the Polish Jews with a realization that only correct business methods and solid banking operations could help them. There had to be casualties on that road, and Kahn judged it to be in the best interests of Polish Jews themselves to pay the price. Right or wrong, he was convinced that it was not the crisis that had been the cause of the difficulties of the bank and of some of the kassas, but weak leadership and bad business methods.

As a result of Kahn's policies, the loan kassas of the Reconstruction Foundation and the Free Loan kassas of JDC maintained themselves on the whole, despite the withdrawal from them of one-half of the 60 million zloty in deposits in 1931.

The kassas saved the money of many Jews who lost their deposits when important banks in Poland collapsed during the depression. What could be saved of Poland's Jewish middle class - and (p.44)

Table 2: Development of Loan Kassas and Free Loan Kassas in Poland
Loan kassas					Free Loan kassas
Year	No. of kassas	No. of members	Credits granted (in mio. of $)		No. of kassas	No. of members	Credits granted (in mio. of $)	No. of loans
1930	768	321,000	16		545	100,000	1.2	180,000
1931	756	313,000	13
1932	744	295,000	12		664	100,000	1.8	164,000

not very much could be saved - was achieved largely through the kassas. This, of course, did not even begin to touch the core of the problem of Polish Jewry, but it was all the Reconstruction Foundation and JDC could do at the moment.

Another question must be asked at this point: What were the methods by which this relative stability was achieved? The answer is that the methods were occasionally rather grim.

[Kassa systems in Romania, Bessarabia and Bucovina]

As we have noted, there were kassas not only in Poland, but in other countries as well. In Romania for instance, in 1930 there were 86 loan kassas with 64,000 members; in 1933 the same number of kassas had 54,000 members. In Romania, and especially in Bessarabia and Bucovina, the conditions of Jewish life were as hard as in Poland. There, too, the Reconstruction Foundation opposed the acceptance of deposits by the kassas, especially of short-term withdrawable deposits. Any infringement of that rule brought an immediate breaking of relations with the foundation.

(End note 13: File 19, 6/22/32 [22 June 1932]; annual report by Aronovici)

[Kassas: Bundist Victor Alter wants to give all the collected money without any interest rate and obligations]

This general situation was clear, not only to Kahn and Oungre, but also to members of the Reconstruction Foundation's council, including the representatives of East European Jews. One of these was the famous Bundist leader Victor Alter. Alter led a rebellion against the foundation at about the same time (1931) that the difficulties with the Verband and the bank started. Alter objected to the high-handed methods of Kahn and Oungre. His attitude was very simple: the funds collected in America for the needy Jewish population in Eastern Europe undoubtedly belonged to that population. The foundation was considered to be an intermediary for the disbursement of funds, the administration of which properly belonged to representatives of East European Jews.

[12 March 1930:

-- Bundist Victor Alter claims that kassas would not help against the basic problems of Jewish poverty in Eastern Europe]

On March 12, 1930, Alter submitted a memorandum to Kahn in which he stated that the chief task of the Reconstruction Foundation was to prepare the ground in Poland for what he termed "healthy economic activity". However, he pointed out that the foundation's concentration on loan kassas did not produce the hoped-for results. "Were the lack of credits the main obstacle in (p.45)

the economic activity of the Jewish population or the principal cause of its depressed economic condition - then the credit kassas would be of permanent constructive importance. Unfortunately, this is not so, and the experience of the past years has proved that despite the growth of the credit kassas, the economic position of the Jewish population (including the petty traders and artisans) has become much worse."

-- Bundist Victor Alter claims Jewish traders competition is too much - some have to emigrate

He thought that since the Jewish small trade was in a very bad way, and since the situation moreover was being aggravated by cutthroat competition among the Jewish traders themselves, there was no possibility that this segment of the population would be able to establish itself on a sound business basis. On the contrary, he said, the only solution for this vast mass of people would be to reduce the number of small traders and shift some of them to other walks of life.

-- Bundist Victor Alter claims the right for work and to further education for all Jews

The situation of the artisans was, in his opinion, similar. The only solution for the Jewish problem in general terms, Alter thought, "is to have a part of them attempt to capture fields of industrial activity in which they are not represented as yet and to have the other part raise their technical standards, so that they may be able to meet the extreme competition."

The larger the number of workers who would enter industry, especially large-scale industry, the better. Since many Jewish employers refused to employ Jewish workers, the institutions connected with the Reconstruction Foundation should grant credit only to those persons or companies who employed Jewish workmen and employees. The credits were to be in proportion to the number of Jewish workers and employees occupied in the undertaking. The foundation should help create establishments that employed Jews, and assist in finding new markets for them.

[Bundist Victor Alter wants to change the JDC strategy of banking - "US" labor leaders insist on the banking system]

These proposals were submitted at a time when personal relations between Alter and Kahn had deteriorated considerably. Alter was a politician, an excellent speaker, and a very difficult man. In ICA and JDC he saw capitalist organizations that did not really understand the Jewish workingman, and he hoped to change their aims with the help of his labor friends in the United States, Bundist (p.46)

and even Zionist. But he met with a rebuff. Hyman and Baerwald did not have to work hard to convince the American labor leaders; Charney B. Vladeck, Alexander Kahn, Bernard Zuckerman, and Meyer Gillis agreed with JDC's view that Dr. Kahn's authority must be upheld, that JDC was responsible to the Jews of America for the way the money was used, and that it could not become a simple disbursing organization providing monies to Jewish political leaders in Poland for their economic programs. They expressed this view in a cable sent to Alter on June 11, 1931.

(End note 14: File 20)

[Kahn justifies the kassa system with steps of progress in the East European Jewry]

Also, many were convinced by Kahn's practical answers. Kahn's contention was that

the foundation was created in order to secure, strengthen, and extend what was already in existence. The foundation is the administrator of a fund that must always be so applied as to guarantee the maintenance of the institutions which we have created, or now support, but that can only be accomplished if the repayment of the monies advanced is made as certain as possible. The foundation cannot make investments that are essentially experimental and therefore do not offer great possibility of being returned. Mr. Alter's criticism of the credit cooperatives must be challenged by the fact that the extension and strengthening of the credit cooperatives' systems in Poland, just as in all other Eastern European countries, has accomplished a great deal in maintaining the economic positions of the Jewish masses.

(End note 15: File 31, foundation council meeting, 1/26/31 [26 January 1931])

Kahn also said that something had already been done to strengthen working-class institutions and producers' cooperatives, but that the result of these attempts left much to be desired. He considered the industrialization program advanced by Alter to be an experiment that could not be justified to the Reconstruction Foundation's council.

[August 1931: JDC: Final fight between Kahn and Alter]

Matters came to a head. In August 1931 Oungre and Kahn declared that if Alter remained on the foundation's council they would not carry on. Alter had urged, they said, that the foundation "limit itself virtually to labor cooperative work" (which was not true), and had introduced a vote of censure against them. Leonard L. Cohen, the ICA representative, who was president of the foundation, (p.47)

declared himself to be reluctant to preside at meetings where Alter was present, and ICA members generally thought that the experiment of having representatives of East European Jewry participate in running the foundation had misfired. With difficulty they were convinced by JDC not to change the system of administration of the foundation, and to carry on "with one or two of the obstreperous 'C' members removed."

[16th December 1931: JDC: Alter interrupts all contacts to the Joint]

On December 16, 1931, Alter finally submitted a letter of resignation that was intended for publication. All contact was severed between himself and the foundation.

[JDC: Kahn's proposal 1929 and Alter's proposal 1931 have almost the same content - Kahn eliminates Alter for personal reasons]

Ironically, Alter's proposal was substantially the same as what Kahn had suggested in 1929; in fact, the two proposals are almost identical. And lest we think that by 1931 Kahn either was convinced that his own 1929 plan was premature or had changed his mind, here are his words to a JDC Executive Committee meeting on November 11, 1931 - just about when the Alter controversy was at its peak. He described his 1929 plan as an extensive program "of industrialization of the Jewish masses, a specialization, and thereby a vitalization of Jewish craftsmanship, an extensive induction into agricultural pursuits, a revival of ruined Jewish industries, the protection of deteriorating business enterprises, instruction of manual workers for the factories; in a word, a general resuscitation of all economic vocations that still have a means of livelihood, or the introduction of new and timely vocations for the Jewish masses."

Then, he said, "a frost fell on a night in spring. In the midst of our negotiations with the Polish authorities, I received a telegram from the Joint Distribution Committee warning me not to proceed further" because of the economic depression that hat set in. Now, in 1931, he was still in favor of starting something along the lines that he had suggested in 1929 and stated that he could get some kind of program started with half a million dollars yearly.

It seems quite clear that Kahn objected to Alter, rather than to his policy. This may have been because of a conviction that to succeed, an industrialization plan would have to be implemented (p.48)

not by the supposedly quarreling, hairsplitting theorists of Eastern Europe but by the seasoned businessmen of the West.

(End note 16: A similar proposal to Alter's was submitted by Moses Burgin of the Central Committee of Jewish Artisans in Warsaw in 1931).

[JDC: Kahn's further works: Support for children]

It must not be thought that, because of the crisis, Kahn worked only with the kassas. Fully realizing how essential it was to make maximum use of every dollar, he decided to concentrate on work for children. Of the paltry sums he had at his disposal, in 1932 he gave 62 percent to the various schemes to feed children, establish summer camps for them, and pay for vocational training and trade schools. Of the total budget of the Polish child care organization centers, JDC contributed only 17.57 % of the money; but this was decisive. There were 8,386 children under constant care in 1932: 3,053 were trained in vocational schools; 20,050 were sent to 152 summer camps. In a situation where, for example, 73 % of the Jewish children in Lodz belonged to families living in only one room (83 % of these rooms had no plumbing), JDC gave money for feeding children in the schools. During the winter of 1931/2 an average of 32,000 children were fed monthly. In Subcarpathia 2,800 children were fed in a famine that broke out there in the spring of 1932; the same was done with 12,607 children in the Máramaros district.

At the same time, Kahn continued to subsidize ORT,

(Footnote: Organization for Rehabilitation through Training - the English rendering of the original Russian name)

TOZ, and OSE, all of which received small and inadequate sums. He continued to object to handing out money for relief, though he changed his policy at least as far as the children and some of the health institutions were concerned. He said, "I could spend less than 20 % on relief if I did not from time to time get admonitions from New York that I should do more relief work."

[Early 1930: JDC: Quarrel between Romanian Jews and Kahn about a soup kitchen in Czernowitz]

His policy came into sharp focus in a little incident that occurred in early 1930, when Hyman was pressed by Romanian Jews in New York to do something for a soup kitchen in Czernowitz at the Morgenroit Institute. After some rather angry correspondence, Kahn finally wrote: "I have promised $ 300 for the kitchen at the Morgenroit Institute, (p.49)

since you evidently place importance on this for campaign purposes. Of course, I must also give something to the Poalei Zion, which likewise has a kitchen. I only hope that these forced subventions will not spread to the whole of Bucovina."

(End note 17: File 127, 5/3/30 [3 May 1930]. The facts and figures about the social conditions of Polish Jews are based on Kahn's reports - the figures about Lodz, specifically, on his "condensed report", April 1935, 44-5, pp. 14-15)

[JDC: Hyman gives the money to help organizations which Kahn would never have given...]

While in this instance - and many others - pressure by contributors made Hyman urge a more lenient policy on Kahn, it was undoubtedly a matter of principle with Hyman to press for the allocation of a larger proportion of funds for relief. "In the case of the work of the OSE and the TOZ and the Child Care Federation of Poland, it was necessary, in view of the unusual suffering and very bad economic conditions, to go much more slowly in absolute and rigid insistence" on the non relief policy than Kahn was doing.

(End note 18: File 42, 1/20/30 [20 January 1930], Hyman to James A. Becker)

[1931: Fire in Saloniki - floods in Vilna - fire in Plungiany - anti-Semitic destruction of Borsa in Transylvania]

Even Kahn relented in 1931. Quite apart from the depression and anti-Semitic outbreaks, there were natural and man-made calamities. A fire destroyed much of Saloniki's Jewish quarter in June 1931. There were floods in Vilna and a fire at Plungiany. On July 4, 1931, anti-Semitic peasants set fire to the largely Jewish townlet of Borsa in Transylvania. This came on top of the most acute suffering in Poland and Romania.

[1931: Poland: 100,000 Jewish families in starvation]

Kahn reported that half or more of the employable Jews in Poland were out of work, and that 100,000 families (which included 75,000 children [??]) were "on the verge of starvation".

(End note 19: Executive Committee, 11/11/31 [11 November 1931])

70,000 Jewish merchants, and 11,000 industrialists were reported to have closed their doors.

(End note 20: 1931 report on Poland, JDC Library)

Jews were starving in Poland "as in periods of the worst famines."

(End note 21: File 36, work of the AJDC in 1932)

[1931: Romania: Jews in starvation - crop failures - no salaries - anarchy and anti-Semitic riots]

The situation in Romania was deteriorating rapidly. The government was actively encouraging Romanians to compete with Jews, and Maniu's government had an ax to grind against Filderman and the Zionists, who had not supported it politically. The crop failures already mentioned completely disorganized the administration; a JDC report on Romania declared that the country was "faced with complete collapse".

(End note 22: File 19, 5/22/32 [22 May 1932])

Government employees and the army received salaries for only one month between December 31, 1931, and June 1932. Agricultural prices were one-quarter of the 1929 level. Filderman, who had continued to carry his public burden (p.50)

with the active encouragement of Kahn, was near collapse himself. "The teachers", he wrote in December 5, 1932, "held a meeting and decided not to carry on teaching. Their salaries have not been paid for 4 1/2 months. ... The same applies to the rabbis. The milk vendors refused to supply milk to the (Jewish) hospitals."

The peasants, especially in Bessarabia and Bucovina, refused to pay their debts after 1930. They argued that they were selling to the Jews too cheaply and buying from them too dearly. Peasants unrest was thus turned against the Jews by anti-Semitic agitators, such as the notorious Professor Cuza and others. Anti-Jewish riots were the order of the day. The Old Romanian provinces, Moldavia and Walachia, which up to then had been relatively prosperous, now suffered as much as the others.

[1931: JDC: Kahn gives up his strikt banking policy]

In the face of all this, Kahn declared that "today I am a convert to relief work in some measure. We cannot silently and unmoved pass by the spectacle of suffering of the Jewish masses. At least we must give some help to the starving Jewish children; we must give some subventions to the Jewish institutions that, without our help, will never survive the crisis."

[Hyman supports Kahn's change - Baerwald not]

While Hyman agreed with this, there were others who pondered whether this was the right approach. James N. Rosenberg wrote to Paul Baerwald on July 27, 1932: "If I were the recipient of charity I would sooner starve to death and be done with it than starve slowly over six months." Similarly, Baerwald wrote that

we know that there are numbers of Jewish people in Poland who live in misery. It is doubtful if even large sums would be effective in bringing about a big change in their condition. Does everybody agree that a more liberal support for the Jews in Poland would definitely work for their ultimate benefit? Will not the Jewish people in Poland by sheer necessity be forced to a quicker recognition on their part that their own best policy is a greater attempt to become part of the political and social structure of Poland instead of keeping up their isolation?

(End note 23: File 26, 5/3/31 [3 May 1931])

Only an assimilated Western Jew could possibly have written these lines of utter incomprehension about the nature of Polish Jewry, words reflecting a mood that was dangerous for Kahn's (p.51)

work. He must have sensed the pessimistic atmosphere, which was amply augmented by his own gloomy reports. As David A. Brown wrote in the American Hebrew and Jewish Tribune: "We might just as well have tried to scoop out with a soup spoon the water rushing into a leaky boat as to attempt to solve the Jewish problem in Poland."

(End note 24: File 121, 9/30/32 [30 September 1932])

[1932: Eastern Europe: Kahn's report about suffering Jews]

Kahn himself reported that "the need in Eastern and Central Europe is acute, overwhelming, desperate, hope is dying."

(End note 25: Executive Committee, 12/4/1932 [4 December 1932])

[Ends 1931: JDC: Kahn appeals for new action for suffering Jews in Eastern Europe]

While it was true that Kahn felt that he should report the situation as it was, it was equally true that he had to encourage his own organization to carry on in its task. He praised JDC for its past work,

(End note 26: Executive Committee, 11/11/1931 [11 November 1931])

but he emphasized that it would take a long time, a generation and more, to accomplish a restratification of the lopsided Jewish economic structure. The Eastern Jews had been caught by the crisis in the midst of a process of economic rebuilding that JDC had inaugurated. If JDC now stopped work, long years of endeavor would be lost. On another occasion he said that if JDC were to cease work, the result would be calamitous in every sense of the word.

(End note 27: File 39, 11/18/1931 [18 November 1931])

Jews would be even more pauperized than before. The economic rehabilitation that had just begun would be endangered, and despair would engender radicalism and Communism among the younger Jewish generation if no help came from the outside. He cautioned that the fate of East European Jews would never be an isolated one, and a demoralized, despised Jewry in Europe would mean disaster for all Jews, including those in America.

[Kahn's postulate that Siberia would be a refuge for Polish Jewry - support by Waldman and the American Jewish Committee AJC]

Kahn believed that in time Eastern Europe would take on some shape that would enable the Jews to live under fairer conditions. Siberia (sic!) might ultimately become a haven of refuge for Polish Jewry, but in the meantime JDC's help had to continue.

Kahn was supported by, among others, Morris D. Waldman of the American Jewish Committee [AJC]. Despite everything Kahn's position was positive, even optimistic, in tone.

Of course, larger plans had to remain on paper in the meantime, and the economic restratification that Kahn talked about had never really gone beyond the planning stage.

[Late in 1930: AJC action: Interventions with the Polish government - no concessions of the PL government to the Jews]

Attention had to be concentrated (p.52)

on immediate ways of helping Polish Jews. One of these was intervention with the government of Poland. This was not really JDC's province, but that of the American Jewish Committee. In late 1930, following an interview given by Tytus Filipowicz, the Polish minister to Washington, protracted negotiations began with the American Jewish Committee, during which the committee tried to obtain some concessions from the Polish government.

These efforts were of no avail. Although the government had accumulated a reserve of 464 million zloty in gold, in accordance with the prevailing economic doctrine they refused to part with it.

Also, in April 1930 the Sejm, the Polish parliament controlled by the opposition, had been dissolved. Immediately afterward the peasants' groups organized in a powerful new political body, which was certainly not pro-Jewish. In this precarious situation the government could not be bothered about the unpopular Jews.

On the other hand, the attitude of JDC was a mixed one of respect for authority - any kind of authority - and distrust. As Warburg wrote to the Polish minister, Stojowski: "Whatever the government decides to do must be satisfactory to us and we are watching with a great deal of interest."

(End note 28: File 121, 2/24/31 [24 February 1931])

While appreciating the efforts of the Polish government in behalf of the Jews, he hoped that, practically at least, the government monopolies would be thrown open to Jewish employment. In fact, the government did just the opposite. Yielding (not quite unwillingly, it appears) to its anti-Semitic critics, it paid less to the Jews and extracted more from them.

(End note 29: Thus the Ministry of Education had a budget of 300 mio. zloty in [the school year] 1930/1. Out of that sum, the Jews got 242,593 zloty, or less than one-tenth of 1 percent.

-- In [school year] 1931/2, they got 189,011 zloty;
-- in [school year] 1932/3, 201,000,
-- and in [school year] 1933/4, 197,000).

On the political scene, by manipulations and rigging the Jews were deprived more and more of their representation in the Sejm, except for the Agudists, who cooperated with the government.

The other way of reacting to the crisis lay in a tightening of belts, as rigorous policy toward the kassas. In the last resort, what else could JDC and the Reconstruction Foundation do?

[ORT and OSE try to get funds from JDC]

In this crisis situation the various agencies supported by the JDC did not obtain what they thought they should. OSE and ORT tried at one time or another to get additional allocations from JDC by (p.53)

using friends or contacts in America who were in positions of influence. OSE was not really powerful enough to prevail, but ORT had an American Committee; some of the members of the JDC Executive, such as Alexander Kahn, one of the great American Jewish labor leaders, and Henry Moskowitz were also members of the ORT American Committee. ORT had received considerable subsidies from the JDC.

(End note 30: ORT received $ 46,000 in 1926, $ 154,000 in 1927, $ 80,200 in 1928, and $ 49,800 in 1929).

[1931: ORT get funds from JDC for their Machine Tool Supply Company]

ORT had also founded and now operated the Machine Tool Supply Company, to supply European branches of ORT with tools and machines. JDC also used these services for its operations in Russia. When the depression came, the company got into trouble and was faced with an ever-increasing accumulation of debts. Since ORT had very few reserves of its own, it asked JDC to grant it more money. After a great deal of pressure, they were allocated 7 % of the 1931 budget ($ 68,000), at a time when all JDC staff salaries were cut, part of the staff were dismissed, and JDC generally was cutting down on all activities.

This served to show that JDC was vulnerable to pressure from contributors and members of its own committees who might represent outside influences. Kahn and Hyman, especially the latter, were by no means happy with this state of affairs. On one occasion Hyman wrote to ORT that

-- "first, the obligations of JDC to you were embodied in a written agreement;
-- second, we have lived up to our agreement;
-- and third, we have no money."

(End note 31: File 13, 21 August 1931)

But for once he had no choice. ORT got its appropriation and it was far lager than what it normally should have received.

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