Bill Would Delete Reparations from Income for Social Security

A bill is circulating in the U.S. House of Representatives that would exclude Holocaust reparations payments from countable income in determining eligibility for Supplemental Security Income (SSI).

Reparations to Holocaust survivors for personal injuries suffered during World War II are provided under the Federal Law on the Compensation of Victims of the National Socialist Persecution, enacted by West Germany in 1956.

The bill was introduced last month by Rep. Henry Waxman (D.Calif.) after the case of a constituent, Felicia Grunfeder, was brought to his attention. Grunfeder’s SSI payments, provided to Social Security recipients on the basis of need, were terminated by the government after it declared her monthly reparations payments as unearned income, placing her total income over the eligibility limit for SSI.

Grunfeder, who lost her father to the Nazis at a young age, survived the Warsaw Ghetto uprising and was later smuggled out of the ghetto to the protection of a gentile couple. She was subsequently interned as a gentile at a work camp in Poland, where she was found by her mother at the war’s end.

Still suffering from the psychological scars left by her experiences under Nazi Germany, Grunfeder had been using her SSI payments for psychiatric counseling. When the payments were ended last summer, she filed suit against the government.

GOVERNMENT ARGUES AGAINST EXCLUSION

In a legal paper submitted to the court last year, the government argued that Grunfeder “obviously can use the funds received from the German Government to meet her basic needs… and thus obviate any need for the need-based SSI benefits.” Consequently, the brief stated, “plaintiff is on equal footing with all others whose excludable income, from whatever source, exceeds the SSI standards.”

Grunfeder’s attorney, Josh Lazar, argued that the reparations were supposed to be punitive payment against the German government and in no way were they to be considered a welfare-type payment. He also pointed to exemptions granted American Indians who received reparations from the U.S. Government.

But a brief prepared by Assistant U.S. Attorney James Arnold concluded that the granting of exemptions to certain American Indian tribes “is based on the moral obligation of the United States to those tribes…” In contrast, the paper continued, “the United States has no corresponding moral obligation to victims of Nazi persecution.”

COURT RULING DUE

U.S. Magistrate John Kronenberg issued a tentative ruling on the case last December, when he recommended that the courts not be involved in the Federal Health and Human Services decision process and suggested that Grunfeder seek relief from the Legislature. “I have a choice of frustrating the intent of Congress or frustrating the intent of German laws,” Kronenberg said. “It’s up to Congress to correct the matter.”

Grunfeder’s case has since been referred to Federal District Court Judge Cynthia Halcomb Hall in Los Angeles, who is scheduled to hear it later this month. A ruling is expected at the end of July or beginning of August.

Meanwhile, the bill introduced by Waxman would amend a provision of the Social Security Act which includes Holocaust reparations as countable income in determining SSI eligibility. Waxman’s bill has 34 co-sponsors.