European Politics Politics

Swiss Neutrality: Convenient Practice More Than Steadfast Principle

There’s a whole laundry list of things that modern societies want out of their nation: a strong economy, stable democratic government, rule of law, friendly relations with neighbours, unchanging racial makeup, positive trade balance, an admiration for art and culture, a sense of history and patriotism and, finally, neutrality in international affairs. On the latter criterion, for most people, there exists an actual place that seemingly has it all. To them, the embodiment of neutrality is a small alpine nation wedged between France and Italy: Switzerland. Switzerland has not only never fought a war against another state for 500 years or so, but is actually recognized by the UN as a neutral country in most international affairs. I like the idea of “perpetual neutrality”, but I think the Swiss case demonstrates an important point about the reality of neutrality: staying neutral doesn’t automatically make you the good guy. I see neutrality in three dimensions: military, economic and political. Let’s begin at the deep end: military neutrality and why it was never the same as pacifism.

What even is military neutrality?

Switzerland has stayed neutral for a long, long time. In 1815, after Napoleon’s death released Switzerland from France’s grip, the Congress of Vienna enshrined the “perpetual neutrality” of the Swiss state. Even in the two World Wars, Switzerland remained neutral, as article after article breathlessly declares. There are two issues with this narrative: first, it hides the extent to which Switzerland was actually complicit in the affairs of repressive regimes; second, it also obscures how gargantuan Swiss military really was (and is).

Switzerland was never as neutral as we now think it is. In 1998, an independent inquiry headed by the Swiss historian Jean-François Bergier found that Swiss officials helped Nazi officials achieve their goals by closing off their borders to Jewish refugees, essentially dooming them to the concentration camps. Not only that, there was also a growing anti-Semitic movement within Switzerland itself that fanned the flames of the Holocaust. And what did the Swiss in their high chairs do about it? Nothing. Actually, worse than nothing. The Swiss authorities used their “neutrality” as an excuse to continue to allow Nazi sympathizers extraordinary freedoms within the borders of Switzerland, while denying Jews the same. None of this came as a result of pressure from Nazi Germany or lack of information either. The report spells out all the ways in which the Swiss military actively conspired with the Nazis. For example, Switzerland introduced “J-stamps” on the passports of Jewish citizens. So, if a Swiss Jew were to even try to help a German Jew, Nazis could easily find out who was helping whom. These stamps made surveillance and censorship comically easy. It did not stop there. Unlike the US and UK, which had no real understanding of ground realities until very late in WW2, Swiss authorities knew better than anybody else what was going on in Germany. Local exiles, aid groups and other humanitarians gathered a mountain of evidence – including photographs – that showed in remarkable detail how Jews were being deported and exterminated in concentration camps. And yet, Jewish refugees were denied entry into Switzerland.

Second, Switzerland wasn’t exactly a helpless little puppy. In 1942, Time reported that man for man, the Swiss army is second only to Germany in Europe. At its height, Switzerland maintained an army of 600,000 men that could be mobilized in less than an hour. These two armies even got into some limited confrontations from 1942-45, most famously when German planes were shot down by Swiss aircrafts for violating their airspace. Throughout the war, Switzerland was also bombed by the Allies several times, both intentionally and otherwise. Beginning in 1943 and over the space of a year or so, the town of Schaffhausen was almost flattened by Allied bombing, which led to some intense moments but no lasting damage to their relations. The Swiss also maintained a network of prisons and internment camps throughout the border regions. These were known to be places of squalor and intentionally brutal treatment of Jews. Here’s a bit from an article summarising the conditions:

The commandant was a pro-Nazi sympathiser called Captain André Béguin. He was in command despite having been expelled from the Swiss Army in 1937 for fraud and assaulting policemen. He was known to wear a Nazi uniform and signed his correspondences with “Heil Hitler”. He was hardly the right man to run a neutral internment camp and it showed. The barracks were cold sheds and prisoners slept on wooden boards covered with straw. The latrines were slit trenches, the food was atrocious and there were vermin everywhere.

Béguin publicly berated Americans, held them in solitary confinement and denied them Red Cross parcels. Prisoners would emerge from Wauwilermoos malnourished and ill. Many Swiss citizens reported that conditions in the camp were paradoxically in violation of the 1929 Geneva Convention. Despite protests from Allied countries and Swiss army officers and journalists Béguin was not removed until 1945.

Cut to the present day and the Swiss army is still no stranger to conflict. Since WW2, it has been on the ground in Iraq, Afghanistan and Korea. Even after the realities of the Iraq War were revealed, Switzerland took its own time about pulling troops out of there.

So, the facade of neutrality hasn’t exactly stopped Switzerland from brutality and violence. Is this what neutrality looks like? To most, not at all.

No such thing as free policy

Okay, the Swiss don’t have any military neutrality. But what about political neutrality? This is a moot question. There can never be a truly politically neutral state. The Non-Alignment Movement of the mid-20th century was a great statement of autonomy by its signing members, but ultimately failed. That’s because over time, staying neutral on the international stage while having to face democratic politics at home becomes untenable. Switzerland is no different. While not a part of the NAM or NATO, Switzerland is a NATO partner state. As such, it has actively sided with the US and its allies for the longest time and, at least on one occasion, sanctioned Soviet officials by preventing them from using the country’s ski resorts. Of all he things it could have done, the country picked ski resorts! Bold move, Switzerland.

Let’s also not forget that it hosts several arms of the UN, Red Cross and various other humanitarian missions. Its position, therefore, is similar (if not identical) to the positions of these agencies on most geopolitical matters. So, for all intents and purposes, Switzerland is a traditionally “liberal” Western democracy.

Where’s the neutrality in that?

War is undiluted opportunity

Quick quiz: we all know that the Nazis stole gold, jewelry and artwork from Jews throughout Germany and many parts of France. So, what happened to all that wealth once the war was over? Was it returned? Was it confiscated? And what happened to the people who helped stash all this wealth?

The answers: Not much, not really, no, nothing.

Switzerland was the country of choice for Nazi officials looking to stash their ill-begotten gains. An investigation by Israeli authorities showed that approximately 80% of all the wealth plundered from Jews was never recovered. In 1946, Switzerland returned $250 million of cash, gold and artworks and washed its hands of all responsibility. In 1997, declassified documents and deeper inverstigations showed the extent to which Swiss bankers were willing to work with any and all who were willing to bank with them. After the war, they proved impossibly hard in the Allies’ efforts to return stolen goods to their rightful owners. For Switzerland, “neutrality” just means that you can take money from all and give it back to none.

The thing is, this is an old trick that “neutral states” have played for centuries, if not forever. During the crusades, as Christian Europe was locked in a pseudo-religious battle with the Muslim states of Asia, the city-states of Venice, Genoa and Pisa projected themselves as principled “neutral” parties who could not be convinced to join either side. However, as soon as it became clear that the potential reward was Constantinople itself, everybody picked sides in an instant. And once together, they sacked and pillaged the most magnificent city of its time.

Venice in the Dark Ages was very similar to Switzerland today: a mercantile state with a strong economy and relatively stable institutions. During the Fourth Crusade, when the Christian armies fancied an attempt to take Constantinople, Venice was under the rule of Enrico Dandolo: an ambitious, cunning and mercantile Doge who justified joining the crusade by proclaiming that Venice had a duty to protect and advance her interests.

In April of 1204, Constantinople was sacked and pillaged by the Venetians and the European crusaders. After the fall of Constantinople, the Venetians and the European crusaders established the Latin Empire. The Latin Empire was the division of the city of  Constantinople and the rest of the Byzantine territories throughout the Mediterranean region among the Venetians and the other crusader-nations. The majority of Constantinople and the other Byzantine territories were held by the Venetians, and subsequently the most strategic ports, beneficial for the continuation of trade throughout the new Latin Empire, also came under Venice’s control.

University of Mary Washington, from John Norwich’s “A History of Venice”

To add another level of historical parallel to the stories of Venice and Switzerland, the Venetians brought many Byzantine spoils back to Venice and affixed them to the exterior of San Marco to represent their dominance over the fallen Byzantine Empire. Even today, many of the major landmarks of Venice like St Mark’s Basilica shamelessly bear artworks stolen from Byzantium. Just like how Switzerland today shamelessly exhibits the instruments it uses to steal works and shield them from international scrutiny. This article in Eurozine perfectly captures the blatant hypocrisy of Switzerland’s claim to neutrality:

In the post-war negotiations between the Allies and the Swiss government on the handling of German assets and looted gold, Swiss politicians at home defined the issue as a case of David versus Goliath. A strong body of opinion saw the struggle as a vain attempt to uphold the sanctity of private property against infringements by the Great Powers. In November 1946, the chief Swiss negotiator, Walter Stucki, accused the Allies of having violated the principles embodied in their own Atlantic Charter. The fact that, in March 1945, Switzerland had bowed to American pressure and agreed to freeze all German assets, prohibit dealing in foreign currencies, and restrict the purchase of gold from Germany, was, he stated, the result of pressure worse than anything Göring had ever attempted, a violation of principles in a world “lacking material and moral foundations”, where Switzerland found itself in “dangerous political isolation”. The irony of a singularly narrow-minded definition of Swiss national interest proclaiming itself to be the embodiment of universal norms only became apparent to the world five decades later, when the World Jewish Congress and the Eizenstat report confronted the Swiss authorities on the matter of wartime Jewish property.

Arne Ruth in Eurozine

William Tecumseh Sherman said “war is hell”. Switzerland heard “war is opportunity”.

Neutrality of convenience

The most perfect encapsulation of Switzerland’s strategy of “enrichment by neutrality” is this dour building in Geneva roughly twice the size a Walmart Supercenter:

Geneva Freeport

This building hosts the Geneva Freeport, the most important building of its kind in the world. This, like any other Freeport, is a building designed to be outside any financial scrutiny, and thus, exists almost as an island completely insulated from any attempts to know what goes on inside.

Such a thing, naturally, is very useful if you happen to have expensive tastes and don’t want to hide them or pay taxes on them. If you stash an artwork in the Geneva Freeport, you don’t have to pay any taxes on it. Better still, you don’t even need to pay any charges or make any disclosures if you sell it to another person who also happens to use the freeport. It’s like a black hole into which several important pieces of art have a habit of disappearing. And a bit like the black hole information paraox, there also exists a “Geneva Freeport Information Paradox”, as exemplified in the case of the Nahmad family’s attempts to hold onto a painting stolen by Nazis and then stashed away in the freeport.

The Swiss Army knife of excuses

I know I haven’t really bothered to build a strong narrative through this post. But this post isn’t about a story. It’s about the utility of “neutrality” as an argument of convenience for countries that lack the spine required to do the right thing. Yes, I’ve picked on Switzerland and yes, some of my arguments are based on a specific reading of history. But this point can just as easily be made about Sweden, Venice and Israel at various points in their respective histories. Staying impartial, many times, is just a coward’s way of agreeing with the powerful.

The case of Switzerland shows that staying “neutral” is much easier than we think, and also much more profitable than we realise.

PS: A great peek into the world of secrecy and the economics of abetment is in The Laundromat by Jake Bernstein, which breaks down what makes Switzerland such a shady dealer in the financial world, and dedicates a whole chapter to the Geneva Freeport.