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Office of the Press Secretary

For Immediate Release December 15, 1999
                             PRESS BRIEFING BY

                             The Briefing Room

2:05 P.M. EST

MR. SIEWERT: Here to brief on the President's statement is Deputy Secretary of the Treasury Stu Eizenstat. This is on the record and on camera.

DEPUTY SECRETARY EIZENSTAT: Just a very brief statement. We're engaged in the last phase of the last great compensation related negotiation arising out of World War II. As a result of Chancellor Schroeder's letter to the President, responding to the President's letter of December 13, we believe that we have made an enormous step to bringing this to a positive close.

This will benefit tens of thousands of Americans, Christian and Jewish, who were slave or forced laborers for German industry, for SS companies, and for German public companies during World War II, and over a million others in Central and Eastern Europe who fall into that same category. It will also benefit those whose insurance policies have never been paid and whose property was Aryanized in confiscation. And importantly, as the President emphasized, it will do so in their lifetimes in ways that lengthy litigation could never have accomplished. These payments will go to persons who have largely been uncompensated for some of the worst crimes of the Nazi era.

We would not have gotten to today without the President's direct involvement and leadership in several letters to Chancellor Schroeder, in a meeting he had with the Chancellor in Florence a few weeks ago; in the personal involvement of John Podesta with his counterpart; Sandy Berger with his counterpart; Secretary Albright with Foreign Minister Fischer; and Secretary Summers with Finance Minister Eichel*.

There also were a number of members of Congress -- Chairman Gilman, Chairman Leach, Senator Schumer, Senator Lieberman, Congressman Lantos -- who were also very involved.

There are still important issues in implementing this 10 billion d-mark, or $5.2 billion settlement, but we are hopeful that with this agreement on a capped sum, the rest of the remaining issues will fall into place.

By the action taken today, Germany has set a standard for living up to a nation's moral obligations and responsibilities. It provides a lesson for all of us as we prepare for a new millennium.

And I'll be glad to take your questions now.

Q Has there been any decision on compensation for the lawyers? At one point they were seeking as much as 5 percent.

DEPUTY SECRETARY EIZENSTAT: It has been agreed that the amount to be paid for the attorneys will be a negotiated sum, rather than a percentage of the total amount, as one would get in a normal contingent fee or class action amount. And we will be setting a process up to determine that negotiated amount. But it will not be a percentage, based on a percentage figure.

Q What would the average payment be, per capita, for, first, a slave laborer, and second, a forced laborer?

DEPUTY SECRETARY EIZENSTAT: It is impossible at this point to know, and the reason is that the remaining work that we have to do includes the allocation of this $5.2 billion sum among and between various claimants -- slave laborers; that is those who worked for German industry and German SS companies and other German companies during the war and lived in concentration camps or forced ghettoes; forced laborers who are in a separate category, who worked for the same companies, but lived in labor camps and other facilities; and then we have an insurance account, a bank Aryanization account, and a future fund which will benefit heirs through social programs and will go for projects of tolerance.

And until that internal allocation is determined, it is impossible to say. What we do know is that a very significant percentage of the 10 billion d-marks will go for slave and forced laborers, and we all believe that this will provide a dignified sum to those workers.

Q The President mentioned doing whatever he could to remove the legal cloud hanging over German companies operating here in the United States. Can you elaborate on that a little bit?

DEPUTY SECRETARY EIZENSTAT: Yes. The crucial element from the standpoint of German companies was that they not pay twice, once into this foundation and a second time into U.S. courts. And we've worked with the plaintiffs' attorneys, who deserve a tremendous amount of credit for their ingenuity and creativity and flexibility, and with the German companies and their representatives to provide legal peace.

And it would work as follows: There will be, essentially, two documents. There will be an executive agreement between the U.S. government and the government of the United States* in which we will indicate that we will file a second document in any current litigation and in future litigation, and that is a statement of interest. And that statement of interest on behalf of the United States will indicate that the foundation initiative should be the exclusive remedy for all claims. And the reason for that is because it is a much more efficient and effective way than litigation of providing elderly survivors money; and that, as a policy matter, we would support dismissal of cases with respect to those who could benefit or potentially benefit from the foundation initiative.

Q Is this legally binding, then, or is it simply a statement of administration policy?

DEPUTY SECRETARY EIZENSTAT: It is a statement of administration policy and the court which we hope would be taken very seriously.

Q Does that apply to different lawyers as well -- those who didn't take part in the negotiations?

DEPUTY SECRETARY EIZENSTAT: It would apply to all cases now and in the future, consensual cases and nonconsensual cases, those who have participated and those who have not.

Q Mr. Eizenstat, you've mentioned the insurance money. So does that mean that insurance money is included in the 10 billion deutsche marks?

DEPUTY SECRETARY EIZENSTAT: There will be an amount set aside for insurance, and one of the issues that remains to be

implemented is the relationship of that to the Eagleburger Commission and their process, which includes not only German insurers, Alliance, but also other insurers, and that is one of the issues that we'll be working on.

Q How many total beneficiaries or total victims combined, including --

DEPUTY SECRETARY EIZENSTAT: There will be a claims period still to be determined -- perhaps 12 months or so -- and only when that is finished will we know precisely how many. But our best estimates are there there are around 240,000 people who are still surviving, who fall into the slave labor category. We believe that, roughly, half of those are Jewish and half are non-Jewish, perhaps 55-45, and that of the roughly 100,000 to 120,000 slave laborers who are Jewish, about half are in the United States.

There are also upwards of 10,000, and perhaps more, non-Jewish forced laborers who are American citizens as well, and I have met with the Polish American Congress and others and they will be included. And for the second category of forced workers, we believe there are between 1 million and 1.5 million surviving forced laborers who live in Central and Eastern Europe.

Q Just to follow, the campaign of linking justice to the Jews, or the victims of Nazis in Germany and elsewhere, what message are you sending to the rest of the world for the 21st century?

DEPUTY SECRETARY EIZENSTAT: First of all, it's important to understand that the overwhelming majority of people who will benefit from this are non-Jewish. They are the Central and Eastern European survivors who have largely been unpaid, and as I mentioned, even half the slave laborers are not Jewish. It's very important to understand that.

But I think that the message that's being sent is that countries can live up to their moral obligations. Even though Germany has paid $60 billion for Holocaust survivors, there was still a desire by German industry and by the German government to provide compensation for those who had not been fully compensated -- namely forced and slave laborers and those whose insurance policies and property were confiscated.

So I think it is an important moral statement of accountability, and that it should be a very important lesson for other countries and for other groups to live up to their responsibilities as well.

Q What lesson does the United States, in particular, draw for living up to its obligations about its own legacy of slavery?

DEPUTY SECRETARY EIZENSTAT: First, let me say that the United States, although belatedly, has compensated out of congressional funds Japanese Americans to the tune of about $20,000 per person. And although it took many decades for that to occur, those Japanese Americans who were interred, largely on the West Coast, but elsewhere as well, there has been a moral accounting by the United States as well.

I think with respect to slavery, that the President has set up a commission to deal with this whole issue. He has indicated his profound regret and concern about the legacy of slavery, and many of the things that this administration -- and if I may say so, previous administrations -- have done and Congress has -- affirmative action programs, special set-aside programs in procurement -- all of these are efforts to try to rectify the vestiges of slavery.

Q Could you specify what percentage of the money is being paid by the German government and how much by companies?

DEPUTY SECRETARY EIZENSTAT: That is an amount that they will have to announce themselves. It has been determined, but I think they should make that announcement.

Q If I could follow up on my earlier question, do you think that the United States can extract a lesson from Germany in trying to specifically address or even acknowledge its efforts to address the issue of reparations for descendants of African slaves in a similar way, in some sort of compensation package.

DEPUTY SECRETARY EIZENSTAT: That's an issue I really can't comment on. I think it goes beyond the jurisdiction of what I'm dealing with. But again, I think that there have been many efforts over the decades, albeit belatedly, to try to deal with the vestiges of discrimination through the civil rights laws and other efforts that have been made over the past several decades, but those certainly have been belated.

Q Mr. Eizenstat, as you know, there were two lawsuits in New Jersey on slave labor claims that were dismissed. What did the dismissal of those -- how did those dismissals impact negotiations, and why didn't the United States government intervene in those lawsuits with an amicus brief, with some kind of interpretation of the treaties that were being decided?

DEPUTY SECRETARY EIZENSTAT: I think I would have to leave it up to the lawyers to tell you what impact it had. We were not asked by those judges for our opinions, so we did not provide them.

Q -- reports about contributions from American companies of about $500 billion. What about this amount, this contribution?

DEPUTY SECRETARY EIZENSTAT: The contributions that are being made toward the German fund are being made by German companies. And there are several U.S. companies which are considering the best way that they can participate in this overall effort. But the payments for the German industry side will come from German companies that are in Germany.

Q What was the breakthrough at the end? Was it the amount of money, or were there other issues involved?

DEPUTY SECRETARY EIZENSTAT: It was a combination of our coming to agreement on how to achieve legal peace and getting an agreement on an overall capped amount.

Q Mr. Secretary, will the heirs of deceased slave laborers have any recourse?

DEPUTY SECRETARY EIZENSTAT: There will not be a direct compensation payment to them, but they will have recourse to what we call Article 5, which is the future fund. And that will have social programs, perhaps -- this is still to be determined, but perhaps educational programs, scholarships and the like, for heirs.

Also, one of the things that we still have to negotiate is, as of a particular date, if a slave or forced laborer passes away -- and, as I've mentioned, the rate is 10 percent a year, almost 1 percent a month -- at what point does their claim vest in their heirs? That's still to be determined.

Q Sir, following up on an earlier question about slavery, President Clinton a couple of years ago, when he started his initiative on race, said that African Americans are too far removed for reparations. Do you think that that's a fair policy for the administration, for other groups to be getting these --

DEPUTY SECRETARY EIZENSTAT: Again, I've been spending my full time on this issue, and I'm not --

Q But it's related to this issue.

DEPUTY SECRETARY EIZENSTAT: -- really able to speak to the slavery issue. I'll have to let other people do that.

Q This is an unrelated issue, but something that you're about to go into a meeting on. Could you talk at all about what the President might do using his executive authority at the Treasury Department to improve gun safety next year?

DEPUTY SECRETARY EIZENSTAT: Well, that's one of the issues at the meeting at 2:00 p.m. I'm supposed to be at, so hopefully we'll have more for you later.

Q When are you going to Berlin, and who are you going to see?

DEPUTY SECRETARY EIZENSTAT: We'll be going to Berlin tonight. I'll be meeting with Count Lambsdorff -- and by the way, I should have recognized Count Lambsdorff's enormous contribution to this effort. This would not have happened without his direct involvement, creativity, perseverance and determination. We'll also be meeting with other German officials, including the President of Germany, who will have an announcement himself to make on Friday.

Q One last unrelated question, something you've been dealing with as well, WTO. Do you think it's possible to get talks started before 2001? There's some speculation in Europe that because of the elections next year it's very unlikely to happen.

DEPUTY SECRETARY EIZENSTAT: I think I should limit this briefing to the issues I'm dealing with.

Q Mr. Secretary, as we repair the past, and during these holidays of Hindus, Muslims and Jews, Southern Baptists are issuing -- have made angry in this country Jews, Hindus and now Muslims about issuing a prayer book and all that. What do you relate these questions, on one side President Clinton, who's also going to the Baptist church, or trying to repair the past and all the slavery and victims are now -- this Southern Baptist church is going in a negative direction?

DEPUTY SECRETARY EIZENSTAT: My assignment has been to deal with this issue. It's taken a great deal of time, and I need to focus on that.

Q Back to the compensation for lawyers. Would that money come out of the capped fund, or would there be some mechanism --

DEPUTY SECRETARY EIZENSTAT: That's one of the issues we have to resolve.

Q That has not been resolved?

Q Mr. Eizenstat, some Jewish are pushing to make the difference between the groups A and B to be 5 to 1, and some others are pushing, like Poland, are pushing to make it 2 to 1. What is the United States position on that?

DEPUTY SECRETARY EIZENSTAT: First of all, we want there to be dignified payments to the Central and East European forced laborers, as well as to the slave laborers, because they also were deprived of their liberty and worked under harsh conditions -- albeit, everyone is agreed, not as harsh as slave laborers.

The precise per capita amounts and the ratios will significantly depend on the following decision: We've agreed that the German foundation would make payments to five Central European reconciliation foundations -- a German-Belarus, German-Czech, German-Polish, German-Russian, and German-Ukraine foundation. Those foundations will have a significant amount of discretion as to which beneficiaries in their countries should be paid.

If, for example, they decide in addition to industrial workers to pay agricultural workers, that obviously would reduce the per capita amount. So until those decisions are made, it's not possible to say. But I think that we have a figure in DM10 billion, or $5.2 billion, which permits a dignified payment to be made to all beneficiaries.

Q What will the victims have to present in order to make claims?

DEPUTY SECRETARY EIZENSTAT: There will be a claims process established, and that claims process will be significantly delegated to the five foundations, and to the Jewish Material Claims Conference, which has been also very instrumental in our work. And they will handle the Jewish claims.

There will be relaxed standards of evidence. The companies will try to match claims against their own records. We hope that individuals will have some records of their own, but frankly we know that with the passage of years, the age of the victims, that we have to have relaxed standards of evidence, and there will be relaxed standards

END 2:23 P.M. EST