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Berlin Offers $5.2B Slave Fund

In a gesture hailed by Washington, Germany's chief negotiator on Friday raised Berlin's compensation offer to Nazi laborers by more than $3 billion. Now, Germany says its government and industries will split a $5.2 billion compensation fund for victims of the Nazis' campaign to keep German companies running as Hitler pursued his war in Europe.

"Germany must and will accept responsibility for the darkest chapter in its history," chief negotiator Otto Lambsdorff said at a meeting with U.S. Secretary of State Madeleine Albright, chief U.S. negotiator Stuart Eizenstat, industry representatives and lawyers for the victims.

Lambsdorff said the foundation, which will administer the compensation fund, would be established "as quickly as possible."

Negotiations over the fund began after German firms announced a foundation to pay compensation in February. A breakthrough in the talks came this week after the German government agreed to raise its offer from $1.6 billion. Lambsdorff said industry and government would each pay $2.6 billion.

"It was the government of the Reich that hunted cheap labor on the streets of Poland and the Ukraine," Lambsdorff said. "We are talking here about state-sponsored crimes."

Although victims' representatives have criticized the deal, they said they realized that waiting for a better solution would not bring any greater benefit to survivors -- thousands of whom are dying each year.

As many as 2.3 million people could benefit from the fund, which includes about 230,000 slave laborers who were made to work while being held in concentration camps. Most of the victims are non-Jews from central and eastern Europe.

In exchange for paying the compensation, companies will receive total legal immunity from lawsuits relating to their Nazi-era activities.

Albright, an infant when her Czech parents fled the Nazis, welcomed the fund as "the first serious initiative to acknowledge the debt owed those whose labor was stolen or coerced during that time of outrage and shame."

"Because of my own personal background, let me offer once again my gratitude and congratulations," a visibly emotional Albright said.

Germany has already paid about $60 billion in pensions and other war crimes programs, but industry has never paid for its actions in wartime. The compensation fund would also repay those whose insurance policies and bank accounts were stolen by the Nazis, as well as people who can prove they still suffer hardship from Nazi persecution but were unable to make earlier claims because they lived behind the Iron Curtain.

Before the payments can be made, there are still critical issues to be negotiated as to how the payments will be split up among the various classes of victims. Slave laborers in concentration camps will receive more than the forced laborers, who were deported from their homes to work in Germany.

Germany is lso working to collect the money that will be used for the fund. Government officials are trying to convince cities and states -- which also used Nazi-provided labor during the war -- to pay into the fund.

Industry has also been trying to get more companies than the 60 firms now participating in the fund to sign on. Almost every company operating in Germany during the war used some of the estimated 12 million forced and slave laborers. Experts estimate up to 600 companies that still operate have used the laborers.

Companies that have pledged their participation in the fund include some of the biggest in world business, including DaimlerChrysler, Deutsche Bank, Siemens and Volkswagen.

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