Demonization by Association:

In an  essay about Hannah Arendt's relationship with her coreligionists, the author Gabriel Piterberg describes the exact moment in which, according to Arendt, modern antisemitism emerged:

Though contemporary persecutions clearly drew on ancient antecedents, Arendt distinguished sharply between the medieval ‘hatred of Jews’ and the emergence of modern antisemitism: the former ‘was about Jews, and not much more than that’, whereas the history of antisemitism ‘conceals many other tendencies’, in which Jews do not necessarily play a central role. To blur that distinction was ‘to abstract the Jewish Question out of the historical process and to destroy the common ground on which the fate of both Jews and non-Jews is decided.’ [13]

... Modernizing absolutist states, Arendt argued, deliberately turned to Jews to finance the expanding bureaucracies and standing armies that they required to counter both the old aristocracy and the rising bourgeoisie; they were happy to pit Jewish suppliers against craft guilds to advance mercantile manufacturing. Eighteenth-century absolutism benefited not just the wealthiest Jewish financiers, who might now be granted ‘exceptional’ civic rights and titles on an individual basis, but a broader layer of merchants and traders. By 1803, 20 per cent of Prussian Jews were ‘protected’ in some way, and over 3,000—Rahel Varnhagen’s family among them—had been granted dwelling rights in Berlin; they formed what Arendt terms a ‘collective exception’ to the unprotected and impoverished Jewish masses of West Prussia and Posen. [15]
Assimilation and antisemitism

It is at this juncture that Arendt locates the appearance of modern antisemitism: heralded, paradoxically, by the victory of Napoleon, emancipator of the Jews. The bourgeois intelligentsia’s discovery of German patriotism, in opposition to Napoleon, bred fears that the Jews might be tempted to support him; while the surrender of the eastern provinces deprived the ‘exceptional’ Jews of their necessary social backdrop, the non-exceptions.

Simultaneously, the rising German bourgeoisie included the Jews in its attack on Junker landowners—‘the aristocracy is so closely bound to the Jews that it cannot continue without them’, in the words of liberal publicist Friedrich Buchholz—while the Junkers’ counter-attacks against both the growing economic power of the bourgeoisie and the liberalizing moves of the state between 1806 and 1812 (permitting land sales, lifting trade regulations), highlighted the role of the ‘protected’ Jews as beneficiaries of marketization and allies of the state. The Junkers’ polemics against the bourgeoisie—promoters of industry and speculation as opposed to crafts and agriculture; of crass materialism against God’s order; of vain talent versus honourable character—rallied an alliance of farmers, guild members, shopkeepers: all ‘backward-looking or necessarily apprehensive strata’. [16]

In Arendt’s view, it was the Junkers’ success in portraying themselves, rather than the bourgeoisie, as the embodiment of the budding nation-state, that lay at the root of modern German antisemitism. The Junkers not only ‘otherized’ the bourgeoisie as everything the aristocracy was not but, crucially, prevailed upon it to internalize that ‘otherization’ as a truthful description—hence alienating the bourgeois citizen from himself. The final step was that the bourgeoisie, in order to rid itself of that portrayal, in turn projected it upon the Jews. ‘The malicious description of the bourgeoisie is the historical wellspring of almost all antisemitic arguments’, Arendt avers:

The only thing lacking here is . . . to apply it to the Jews. This proved relatively easy to do and was originally merely intended as the ultimate defamation: the bourgeois man is in truth no different from the Jew. For this, one needed only to declare that earning a living by profit and interest was the same as usury: the bourgeois citizen was nothing but a Jew and a usurer. The only people with a right to an income free of labour are those who already possess wealth. The ‘wild ambition’ unleashed by freedom of trade produces nothing but social parvenus—and no one rises from greater social depths than the Jew. [17]

She sums up:

What proved dangerous to the Jews was not the aristocracy’s historically determined hatred of the financiers of the modern state, but rather that arguments and characteristics trimmed and tailored for totally different people ended up attached to them . . . That the Prussian aristocracy succeeded in drilling these categories and value judgements into the head of the German bourgeois citizen until he was ashamed to be one—that is the real and, as it were, ‘ideological’ misfortune of German Jewry. For in the end the liberals’ truly destructive self-hatred gave rise to hatred of the Jews, that being the only means liberals had of distancing themselves from themselves, of shifting slander to others who, though they did not think of themselves as the ‘bourgeoisie’, were forced to be its 100 per cent embodiment. [18]

This observation is worth repeating, since its shrewdness easily leaps over the temporal and geographical gap, to apply today as accurately as it did two centuries ago:

For in the end the liberals’ truly destructive self-hatred gave rise to hatred of the Jews, that being the only means liberals had of distancing themselves from themselves, of shifting slander to others who, though they did not think of themselves as the ‘bourgeoisie’, were forced to be its 100 per cent embodiment.

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I keep going back to the primary antisemite paradox, that it is not a Jewish affliction and it is not up to Jews, or within their power, to cure the world of this disease. We know, however, who keep invoking Jews, Jewish sentiments, Jewish traditions, Jewish names, etc., when they wish to de-legitimize a policy or a movement. But the movement often works in reverse, as well. A Jewish public figure automatically is dubbed this or that unpopular policy, on the assumption that his/her Jewishness must be responsible for his/her choice of policies. Mention a Jew in reference to a controversial policy, and you have no more honest intellectual work to do.