In the Republic of Utopia, because of the bad economic crisis ailing the nation, the Jews are made the scapegoats for the economic and social ills affecting the population.

When the Christian Social Party comes to power, the new Chancellor Dr. Schwerdtfeger, a fanatical antisemite, sees his people as being ruled by the Jews, and wants to expel them. He, therefore, has a law passed by the National Assembly forcing all Jews to emigrate by the end of the year. The law is enthusiastically received by the non-Jewish population, and the Jews leave the country. Cultural life later becomes impoverished, in the theatres only plays by Ludwig Ganghofer and Ludwig Anzengruber are still performed. Many cafes are empty, or are converted into beer halls selling sausages. After an initial upturn, the economy declines, as business has greatly diminished, and has moved to other cities, such as Prague and Budapest. Inflation and unemployment are consistently depicted.

Herr Leo Strakosch (Johannes Riemann) is among the exiled. He is engaged to Counsellor's Linder's daughter, Lotte (Anny Milety), a typical Viennese girl. Linder is a member of the National Assembly who voted for the banishment of the Jews

Finally, the National Assembly resolves to bring the Jews back. However, to achieve the necessary two-thirds majority, Lotte (Anny Miletty) and Leo, who have already illegally returned to Austria with forged papers identifying him as a French painter, have to remove the antisemitic parliamentary representative Bernard (Hans Moser), which they do by getting him drunk. He is committed to a psychiatric institution represented in Expressionist scenery, where in a claustrophobic and asymmetrically painted cell, he sees himself threatened by Stars of David.