A History of Money in Palestine: From the 1900s to the Present The Harvard community has made this article openly available. Please share how this access benefits you. Your story matters Citation Mitter, Sreemati. 2014. A History of Money in Palestine: From the 1900s to the Present. Doctoral dissertation, Harvard University. Citable link http://nrs.harvard.edu/urn-3:HUL.InstRepos:12269876 Terms of Use This article was downloaded from Harvard University’s DASH repository, and is made available under the terms and conditions applicable to Other Posted Material, as set forth at http:// nrs.harvard.edu/urn-3:HUL.InstRepos:dash.current.terms-of- use#LAA A History of Money in Palestine: From the 1900s to the Present A dissertation presented by Sreemati Mitter to The History Department in partial fulfillment of the requirements for the degree of Doctor of Philosophy in the subject of History Harvard University Cambridge, Massachusetts January 2014 © 2013 – Sreemati Mitter All rights reserved. Dissertation Advisor: Professor Roger Owen Sreemati Mitter A History of Money in Palestine: From the 1900s to the Present Abstract How does the condition of statelessness, which is usually thought of as a political problem, affect the economic and monetary lives of ordinary people? This dissertation addresses this question by examining the economic behavior of a stateless people, the Palestinians, over a hundred year period, from the last decades of Ottoman rule in the early 1900s to the present. Through this historical narrative, it investigates what happened to the financial and economic assets of ordinary Palestinians when they were either rendered stateless overnight (as happened in 1948) or when they suffered a gradual loss of sovereignty and control over their economic lives (as happened between the early 1900s to the 1930s, or again between 1967 and the present). Finally, it explains how the sustained absence of a sovereign state and a sovereign currency of their own affected the Palestinians’ economic behavior, and shaped their relationship to the monetary and banking apparatus of the various political regimes under which they lived. The dissertation makes two broad arguments: the first is that not having a state, and access to sovereign institutions of their own, and, especially, not having a central bank and a sovereign currency of their own, rendered the Palestinians particularly, and repeatedly, vulnerable to being dispossessed of their financial and monetary assets. The second is that, despite this vulnerability, the Palestinians nevertheless showed themselves capable, again and again over the course of this century, of fighting for their economic rights, and of exhibiting a canny understanding as to how best to protect their financial assets from dispossession. While iii Dissertation Advisor: Professor Roger Owen Sreemati Mitter they used a range of strategies to do so, one of the surprising conclusions that emerges from this work is the extent to which they turned to the law, and to the legal and judicial arms of the state, to seek protection against the executive and legislative arms of the same state, regardless of whether that state was Ottoman, British, Jordanian, or Israeli. iv Table of Contents Acknowledgments vii List of Figures xii List of Abbreviations xiii Note on Transliteration xiv INTRODUCTION 1 CHAPTER 1: The Honorable Consuls Finn and Kayat 22 CHAPTER 2: Banks, Bonds, and Bankrupts 58 CHAPTER 3: The Case of the Frozen Bank Accounts of 1948 105 CHAPTER 4: The Arab Palestinians React 140 CHAPTER 5: The Lawsuits 169 CONCLUSION 231 BIBLIOGRAPHY 250 v Acknowledgments I would like to thank the three people who have guided this project from its inception: first, Professor Owen, who has been far more than a dissertation advisor to me over the course of the decade that I’ve known him. He was the one who first encouraged me to embark on graduate studies, and the one who saw to it that I could finish them. Between that beginning and this end he has guided, directed, read, re-read, inspired, corrected, improved, and given so much of himself – towards the end, even writing daily to offer encouragement – that the only way I can think to repay him is by acknowledging here the truth, that every page of this dissertation has been written because of him. Second, Professor Charles Maier, who took me under his wing during my first semester as a graduate student and who has been, ever since, a mentor and guide in all things both academic and personal. He always knew to urge my writing and raise my spirits just when they were most flagging, and his encouragement and engagement have sustained me all through this long slog, right up to the final finish line, over which he, in fact, gently pushed me. His generosity still, even after all these years of having been spoiled by it, surprises me. Third, Professor Salim Tamari: he might not remember it, but the conversations I had with him, long ago, when I was a callow girl adventuring around Ramallah and not yet in graduate school, inspired me to try to become a historian myself. This dissertation has been shaped by the many years of delightful meandering discussions held over samak (or, on less fortunate days, qousa), during which he taught me about the Palestinian past. I am grateful to him not only for the inspiration he provides by his own writing, but also, and all the more, because he always made time to read drafts of this manuscript carefully and closely, and, through vi every fresh batch of meticulous criticism, challenged me to try to be as good a historian as I can be. I would also like to acknowledge the support and encouragement provided by Professor Caroline Elkins, who helped fund my first foray into the Israeli archives, who taught me how to manage a large research project, and who urged me to think broadly about history, method, intention and audience. I am grateful to three other professors at Harvard who helped and guided my work: Walter Johnson and Emma Rothschild provided much needed funding and encouragement at an early stage, when I was just starting out my research, while Erez Manela provided advice and support towards the end, and though his formal title is “graduate student advisor” he has been, and continues to be, far more a mentor than just a “graduate student advisor” to me. In Palestine, I am lucky to have a long list of people to thank: first, Fu’ad Shehadeh, without whose help this dissertation could not have been written. He flung open his firm’s archives to me, shared the story of his own life, told me tales from the Palestinian past from which I learned more than I could ever learn from any book, introduced me to friends and acquaintances who he thought could help make this work better, and insisted that I make his home mine. I’m grateful, too, to all the other Shehadehs, both old and young (especially Walid, Nadim, Nabil, Karim, Dina, and, of course, “Abu Dina”) for the many conversations, the memory of which I find myself returning to, again and again, to extract what I can. This is a dissertation full of stories, and I would like to acknowledge all those who told me theirs, and allowed me to retell them here: Michel Karkar spent many hours talking to me and never tired of my incessant questions and meeting requests; the poignant story of his life vii provides the chief inspiration for this work. Zahi Khoury welcomed me warmly and told me all he knew about his father’s struggles to unfreeze his bank accounts; I am especially grateful to him because he took seriously my request to “introduce me to everyone in Palestine over the age of 80,” and it is largely thanks to him that I got to know so many of the people whose stories I have recounted here. His brother Toni welcomed me with open arms in Amman and taught me everything I know about the Citrus Marketing Board. Issa Habash, Safwat Odeih, Su’ad Bishara, Shouki Bishara, Basem Khoury, Samir Sarrouf, Khaled Beitar, Sami Habib, and Alfred Kishek all gave of their time, and ungrudgingly opened up to my scrutiny a painful chapter from their past. Nahed Bishara introduced me to all her family in Haifa and Tarshiha, and came gamely hunting along with me for elderly people to interview. Sami Abu Shehadeh took me on a lovely walks around Jaffa, and taught me much about its past, and introduced me to as many elders as he could find. Three people who generously shared the story of their lives, and whose enthusiasm for this project buoyed me at a time when I felt particularly bogged down, have sadly passed away: Gabi Baramki, Abu Mitri (Ramzi) Rafidi, and Bandali al Issa. Gabi and Abu Mitri had both spent many evenings talking to me about their childhoods (and Haifa Baramki told me much about her Gazan girlhood too), while Bandali shared his entire collection of clippings from Palestinian Trade Catalogues and other financial ephemera from the mid-Mandate period, which he had collected painstakingly over the course of his life. I wish I could have written this dissertation faster, so that all three might have known how much it owes to them. viii Nura Treish, raisset al-jumhuriyya, knows that this project would never have got off the ground if it weren’t for her. Sam Bahour was the first person, after Professor Owen, to have urged me to begin graduate school, and the person who has taught me the most about how the Palestinian economy really works. Muhammad Mustafa and all my former colleagues at PIF also taught me much about the Palestinian economy.