Aloof Switzerland Rethinks Self-Image

It was a tough year to be Swiss. Citizens of this alpine state nestled in the heart of Europe have long taken pride in their independent spirit, confident of safety and stability in a world of ever-closer ties.

But a series of traumatic events has changed all that.

More than any other single incident, the deaths of three dozen Swiss tourists in November's massacre in Luxor, Egypt, symbolized ongoing and profound changes in this country's national identity.

Swiss have long thought their passports guaranteed safe passage due to the nation's longstanding neutrality. The ironclad belief was shredded, not because Swiss citizens were specifically targeted - Germans, French, Japanese, English, Egyptians, and others also died - but because terrorism increasingly does not discriminate by nationality.

"We've believed we are a special island protected by God, but now that old way is changing. Because of the events of this year, we're realizing we have to deeply transform our identity," says Swiss journalist Pierre Hazan, who is writing a book about the national identity crisis.

The tragedy in Egypt was followed within weeks by the announcement of the merger of Switzerland's two largest banks. The merger will result in layoffs of at least 7,000 people, in a population of about 7 million.

The shock and disbelief was not unlike the reaction that might follow a US state's biggest and otherwise profitable industry suddenly deciding to shut its doors and move out of the country.

The new unified bank will concentrate on international business, not on local banking.

The merger has sparked a national outcry that big business and globalization are trampling Swiss citizens. The local press acidly commented that the Swiss banks built a financial empire on the country's upright reputation and are now ignoring their social obligation to employees.

Some also feel betrayed because it was the banks' dealings in the funds of Holocaust victims during World War II that brought the recent shower of disrepute on Switzerland.

Two years under the international spotlight have left the Swiss resentful and defiant about bowing to outside pressure. American Jewish leaders recently upped the ante, calling for a rapid and final single payment, or "global settlement," to atone for wartime wrongdoing.

Switzerland insists that its own historical commission complete its work - a process that could take years - before any such payout.

Even the effort to begin some payments, to a Latvian woman in Riga this fall, seemed to backfire when the $400 payment was called a "token" in the international press, provoking ire across Switzerland.

The country is still reeling from the shocks, but some commentators believe its historic mountain-siege mentality has kicked in. This could inhibit Switzerland's joining in world affairs. The isolationism has long been a sensitive spot in the more internationally minded western part of Switzerland and fuels continued separateness from neighboring countries. All of these belong to the European Union, which is preparing to launch a common currency.

Before taking office Jan. 1, Switzerland's incoming president, Flavio Cotti, urged EU membership "for our own good."

Ernst Leuenberger, who heads Switzerland's House of Representatives, says the adjustment will take time. "We're less certain now. We've avoided two wars; this made us feel special. Now we're finding that we're like others, with all the problems. It takes some getting used to," he says.