THE GERMAN EMPIRE
"From the very beginning of my career my sole guiding-star has been how to unify Germany, and, that being achieved, how to strengthen, complete, and so constitute her unification that it may be preserved enduringly and with the goodwill of all concerned in it."--BISMARCK: Speech in the North German Reichstag, July 9, 1869.
On the 18th of January 1871, while the German cannon were still thundering against Paris, a ceremony of world-wide import occurred in the Palace of the Kings of France at Versailles. King William of Prussia was proclaimed German Emperor. The scene lacked no element that could appeal to the historic imagination. It took place in the Mirror Hall, where all that was brilliant in the life of the old French monarchy used to encircle the person of Louis XIV. And now, long after that dynasty had passed away, and when the crown of the last of the Corsican adventurers had but recently fallen beneath the feet of the Parisians, the descendant of the Prussian Hohenzollerns celebrated the advent to the German people of that unity for which their patriots had vainly struggled for centuries.
The men who had won this long-deferred boon were of no common stamp. King William himself, as is now shown by the publication of many of his letters to Bismarck, had played a far larger share in the making of a united Germany than was formerly believed. His plain good sense and unswerving fortitude had many times marked out the path of safety and kept his country therein. The policy of the Army Bill of 1860, which brought salvation to Prussia in spite of her Parliament, was wholly his. Bismarck's masterful grip of the helm of State in and after 1862 helped to carry out that policy, just as von Roon's organising ability perfected the resulting military machine; but its prime author was the King, who now stood triumphant in the hall of his ancestral foes. Beside and behind him on the dais, in front of the colours of all the German States, were the chief princes of Germany--witnesses to the strength of the national sentiment which the wars against the First Napoleon had called forth, and the struggle with the nephew had now brought to maturity. Among their figures one might note the stalwart form of the Crown Prince, along with other members of the House of Prussia; the Grand Duke of Baden, son-in-law of the Prussian King; the Crown Prince of Saxony, and representatives of every reigning family of Germany. Still more remarkable were some of the men grouped before the King and princes. There was the thin war-worn face of Moltke; there, too, the sturdy figure of Bismarck: the latter, wrote Dr. Russell, "looking pale, but calm and self-possessed, elevated, as it were, by some internal force[72]."
The King announced the re-establishment of the German Empire; and those around must have remembered that that venerable institution (which differed so widely from the present one that the word "re-establishment" was really misleading) had vanished but sixty-four years before at the behests of the First Napoleon. Next, Bismarck read the Kaiser's proclamation, stating his sense of duty to the German nation and his hope that, within new and stronger boundaries, which would guarantee them against attacks from France, they would enjoy peace and prosperity. The Grand Duke of Baden then called for three cheers for the Emperor, which were given with wild enthusiasm, and were taken up by the troops far round the iron ring that encircled Paris.
Few events in history so much impress one, at first sight, with a sense of strength, spontaneity, and inevitableness. And yet, as more is known of the steps that led up to the closer union of the German States, that feeling is disagreeably warped. Even then it was known that Bavaria and Würtemberg strongly objected to the closer form of union desired by the northern patriots, which would have reduced the secondary States to complete dependence on the federal Government. Owing to the great reluctance of the Bavarian Government and people to give up the control of their railways, posts and telegraphs, these were left at their disposal, the two other Southern States keeping the direction of the postal and telegraphic services in time of peace. Bavaria and Würtemberg likewise reserved the control of their armed forces, though in case of war they were to be placed at the disposal of the Emperor--arrangements which also hold good for the Saxon forces. In certain legal and fiscal matters Bavaria also bargained for freedom of action.
What was not known then, and has leaked out in more or less authentic ways, was the dislike, not only of most of the Bavarian people, but also of its Government, to the whole scheme of imperial union. It is certain that the letter which King Louis finally wrote to his brother princes to propose that union was originally drafted by Bismarck; and rumour asserts, on grounds not to be lightly dismissed, that the opposition of King Louis was not withdrawn until the Bavarian Court favourite, Count Holstein, came to Versailles and left it, not only with Bismarck's letter, but also with a considerable sum of money for his royal master and himself. Probably, however, the assent of the Bavarian monarch, who not many years after became insane, was helped by the knowledge that if he did not take the initiative, it would pass to the Grand Duke of Baden, an ardent champion of German unity.
Whatever may be the truth as to this, there can be no doubt as to the annoyance felt by Roman Catholic Bavaria and Protestant democratic Würtemberg at accepting the supremacy of the Prussian bureaucracy. This doubtless explains why Bismarck was so anxious to hurry through the negotiations, first, for the imperial union, and thereafter for the conclusion of peace with France.
Even in a seemingly small matter he had met with much opposition, this time from his master. The aged monarch clung to the title King of Prussia; but if the title of Emperor was a political necessity, he preferred the title "Emperor of Germany"; nevertheless, the Chancellor tactfully but firmly pointed out that this would imply a kind of feudal over-lordship of all German lands, and that the title "German Emperor", as that of chief of the nation, was far preferable. In the end the King yielded, but he retained a sore feeling against his trusted servant for some time on this matter. It seems that at one time he even thought of abdicating in favour of his son rather than "see the Prussian title supplanted[73]." However, he soon showed his gratitude for the immense services rendered by Bismarck to the Fatherland. On his next birthday (March 22) he raised the Chancellor to the rank of Prince and appointed him Chancellor of the Empire.
It will be well to give here an outline of the Imperial Constitution. In all essentials it was an extension, with few changes, of the North German federal compact of the year 1866. It applied to the twenty-five States of Germany--inclusive, that is, of Hamburg, Bremen, and Lubeck, but exclusive, for the present, of Elsass-Lothringen (Alsace-Lorraine). In those areas imperial law takes precedence of local law (save in a few specially reserved cases for Bavaria and the Free Cities). The same laws of citizenship hold good in all parts of the Empire. The Empire controls these laws, the issuing of passports, surveillance of foreigners and of manufactures, likewise matters relating to emigration and colonisation. Commerce, customs dues, weights and measures, coinage, banking regulations, patents, the consular service abroad, and matters relating to navigation also fall under its control. Railways, posts and telegraphs (with the exceptions noted above) are subject to imperial supervision, the importance of which during the war had been so abundantly manifested.
The King of Prussia is ipso facto German Emperor. He represents the Empire among foreign nations; he has the right to declare war, conclude peace, and frame alliances; but the consent of the Federal Council (Bundesrath) is needed for the declaration of war in the name of the Empire. The Emperor convenes, adjourns, and closes the sessions of the Federal Council and the Imperial Diet (Reichstag). They are convened every year. The Chancellor of the Empire presides in the Federal Council and supervises the conduct of its business. Proposals of laws are laid before the Reichstag in accordance with the resolutions of the Federal Council, and are supported by members of that Council. To the Emperor belongs the right of preparing and publishing the laws of the Empire: they must be passed by the Bundesrath and Reichstag, and then receive the assent of the Kaiser. They are then countersigned by the Chancellor, who thereby becomes responsible for their due execution.
The members of the Bundesrath are appointed by the Federal Governments: they are sixty-two in number, and now include those from the Reichstand of Elsass-Lothringen (Alsace-Lorraine)[74]
The Prussian Government nominates seventeen members; Bavaria six; Saxony and Würtemburg and Alsace-Lorraine four each; and so on. The Bundesrath is presided over by the Imperial Chancellor. At the beginning of each yearly session it appoints eleven standing committees to deal with the following matters: (1) Army and fortifications; (2) the Navy; (3) tariff, excise, and taxes; (4) commerce and trade; (5) railways, posts and telegraphs; (6) civil and criminal law; (7) financial accounts; (8) foreign affairs; (9) Alsace-Lorraine; (10) the Imperial Constitution; (11) Standing Orders. Each committee is presided over by a chairman. In each committee at least four States of the Empire must be represented, and each State is entitled only to one vote. To this rule there are two modifications in the case of the committees on the army and on foreign affairs. In the former of these Bavaria has a permanent seat, while the Emperor appoints the other three members from as many States: in the latter case, Prussia, Bavaria, Saxony, and Würtemberg only are represented. The Bundesrath takes action on the measures to be proposed to the Reichstag and the resolutions passed by that body; it also supervises the execution of laws, and may point out any defects in the laws or in their execution.
The members of the Reichstag, or Diet, are elected by universal (more properly manhood) suffrage and by direct secret ballot, in proportion to the population of the several States[75]. On the average, each of the 397 members represents rather more than 100,000 of the population. The proceedings of the Reichstag are public; it has the right (concurrently with those wielded by the Emperor and the Bundesrath) to propose laws for the Empire. It sits for three years, but may be dissolved by a resolution of the Bundesrath, with the consent of the Emperor. Deputies may not be bound by orders and instructions issued by their constituents. They are not paid.
As has been noted above, important matters such as railway management, so far as it relates to the harmonious and effective working of the existing systems, and the construction of new lines needful for the welfare and the defence of Germany, are under the Control of the Empire--except in the case of Bavaria. The same holds good of posts and telegraphs except in the Southern States. Railway companies are bound to convey troops and warlike stores at uniform reduced rates. In fact, the Imperial Government controls the fares of all lines subject to its supervision, and has ordered the reduction of freightage for coal, coke, minerals, wood, stone, manure, etc., for long distances, "as demanded by the interests of agriculture and industry." In case of dearth, the railway companies can be compelled to forward food supplies at specially low rates.
Further, with respect to military affairs, the central authority exercises a very large measure of control over the federated States. All German troops swear the oath of allegiance to the Emperor. He appoints all commanders of fortresses; the power of building fortresses within the Empire is also vested in him; he determines the strength of the contingents of the federated States, and in the last case may appoint their commanding officers; he may even proclaim martial law in any portion of the Empire, if public security demands it. The Prussian military code applies to all parts of the Empire (save to Bavaria, Würtemberg, and Saxony in time of peace); and the military organisation is everywhere of the same general description, especially as regards length of service, character of the drill, and organisation in corps and regiments. Every German, unless physically unfit, is subject to military duty and cannot shift the burden on a substitute. He must serve for seven years in the standing army: that is, three years in the field army and four in the reserve; thereafter he takes his place in the Landwehr[76].
The secondary States are protected in one important respect. The last proviso of the Imperial Constitution stipulates that any proposal to modify it shall fail if fourteen, or more, votes are cast against it in the Federal Council. This implies that Bavaria, Würtemberg, and Saxony, if they vote together, can prevent any change detrimental to their interests. On the whole, the new system is less centralised than that of the North German Confederation had been; and many of the Prussian Liberals, with whom the Crown Prince of Prussia very decidedly ranged himself on this question, complained that the government was more federal than ever, and that far too much had been granted to the particularist prejudices of the Southern States[77]. To all these objections Bismarck could unanswerably reply that it was far better to gain this great end without bitterness, even if the resulting compact were in some respects faulty, than to force on the Southern States a more logically perfect system that would perpetuate the sore feeling of the past.
Such in its main outlines is the new Constitution of Germany. On the whole, it has worked well. That it has fulfilled all the expectations aroused in that year of triumph and jubilation will surprise no one who knows that absolute and lasting success is attained only in Utopias, never in practical politics. In truth, the suddenness with which German unity was finally achieved was in itself a danger.
The English reader will perhaps find it hard to realise this until he remembers that the whole course of recorded history shows us the Germans politically disunited, or for the most part engaged in fratricidal strifes. When they first came within the ken of the historians of Ancient Rome, they were a set of warring tribes who banded together only under the pressure of overwhelming danger; and such was to be their fate for well-nigh two thousand years. Their union under the vigorous rule of the great Frankish chief whom the French call Charlemagne, was at best nominal and partial. The Holy Roman Empire, which he founded in the year 800 by a mystically vague compact with the Pope, was never a close bond of union, even in his stern and able hands. Under his weak successors that imposing league rarely promoted peace among its peoples, while the splendour of its chief elective dignity not seldom conduced to war. Next, feudalism came in as a strong political solvent, and thus for centuries Germany crumbled and mouldered away, until disunion seemed to be the fate of her richest lands, and particularism became a rooted instinct of her princes, burghers, and peasants. Then again South was arrayed against North during and long after the time of the Reformation; when the strife of creeds was stayed, the rivalry of the Houses of Hapsburg and Hohenzollern added another cause of hatred.
As a matter of fact, it was reserved for the two Napoleons, uncle and nephew, to force those divided peoples to comradeship in arms. The close of the campaign of 1813 and that of 1814 saw North and South, Prussians and Austrians, for the first time fighting heartily shoulder to shoulder in a great war--for that of 1792-94 had only served to show their rooted suspicion and inner hostility. Owing to reasons that cannot be stated here, the peace of 1814-15 led up to no effective union: it even perpetuated the old dualism of interests. But once more the hostility of France under a Napoleon strengthened the impulse to German consolidation, and on this occasion there was at hand a man who had carefully prepared the way for an abiding form of political union; his diplomatic campaign of the last seven years had secured Russia's friendship and consequently Austria's reluctant neutrality; as for the dislike of the Southern States to unite with the North, that feeling waned for a few weeks amidst the enthusiasm caused by the German triumphs. The opportunity was unexampled: it had not occurred even in 1814; it might never occur again; and it was certain to pass away when the war fever passed by. How wise, then, to strike while the iron was hot! The smaller details of the welding process were infinitely less important than the welding itself.
One last consideration remains. If the opportunity was unexampled, so also were the statesmanlike qualities of the man who seized it. The more that we know concerning the narrowly Prussian feelings of King William, the centralising pedantry of the Crown Prince of Prussia, and the petty particularism of the Governments of Bavaria and Würtemberg, the more does the figure of Bismarck stand out as that of the one great statesman of his country and era. However censurable much of his conduct may be, his action in working up to and finally consummating German unity at the right psychological moment stands out as one of the greatest feats of statesmanship which history records.
But obviously a wedded life which had been preceded by no wooing, over whose nuptials Mars shed more influence than Venus, could not be expected to run a wholly smooth course. In fact, this latest instance in ethnical lore of marriage by capture has on the whole led to a more harmonious result than was to be expected. Possibly, if we could lift the veil of secrecy which is wisely kept drawn over the weightiest proceedings of the Bundesrath and its committees, the scene would appear somewhat different. As it is, we can refer here only to some questions of outstanding importance the details of which are fairly well known.
The first of these which subjected the new Empire to any serious strain was a sharp religious struggle against the new claims of the Roman Catholic hierarchy. Without detailing the many causes of friction that sprang up between the new Empire and the Roman Catholic Church, we may state that most of them had their roots in the activity shown by that Church among the Poles of Prussian Poland (Posen), and also in the dogma of Papal infallibility. Decreed by the Oecumenical Council at Rome on the very eve of the outbreak of the Franco-German War, it seemed to be part and parcel of that forward Jesuit policy which was working for the overthrow of the chief Protestant States. Many persons--among them Bismarck[78]--claimed that the Empress Eugénie's hatred of Prussia and the warlike influence which she is said to have exerted on Napoleon III. on that critical day, July 14, 1870, were prompted by Jesuitical intrigues. However that may be (and it is a matter on which no fair-minded man will dogmatise until her confidential papers see the light) there is little doubt that the Pope at Rome and the Roman hierarchy among the Catholics of Central and Eastern Europe did their best to prevent German unity and to introduce elements of discord. The dogma of the infallibility of the Pope in matters of faith and doctrine was itself a cause of strife. Many of the more learned and moderate of the German Catholics had protested against the new dogma, and some of these "Old Catholics", as they were called, tried to avoid teaching it in the Universities and schools. Their bishops, however, insisted that it should be taught, placed some recalcitrants under the lesser ban, and deprived them of their posts.
When these high-handed proceedings were extended even to the schools, the Prussian Government intervened, and early in 1872 passed a law ordaining that all school inspectors should be appointed by the King's Government at Berlin. This greatly irritated the Roman Catholic hierarchy and led up to aggressive acts on both sides, the German Reichstag taking up the matter and decreeing the exclusion of the Jesuits from all priestly and scholastic duties of whatever kind within the Empire (July 1872). The strife waxed ever fiercer. When the Roman Catholic bishops of Germany persisted in depriving "Old Catholics" of professorial and other charges, the central Government retorted by the famous "May Laws" of 1873. The first of these forbade the Roman Catholic Church to intervene in civil affairs in any way, or to coerce officials and citizens of the Empire. The second required of all ministers of religion that they should have passed the final examination at a High School, and also should have studied theology for three years at a German University: it further subjected all seminaries to State inspection. The third accorded fuller legal protection to dissidents from the various creeds.
This anti-clerical policy is known as the "Kultur-Kampf", a term that denotes a struggle for civilisation against the forces of reaction. For some years the strife was of the sharpest kind. The Roman Catholic bishops continued to ban the "Old Catholics", while the State refused to recognise any act of marriage or christening performed by clerics who disobeyed the new laws. The logical sequel to this was obvious, namely, that the State should insist on the religious ceremony of marriage being supplemented by a civil contract[79]. Acts to render this compulsory were first passed by the Prussian Landtag late in 1873 and by the German Reichstag in 1875.
It would be alike needless and tedious to detail the further stages of this bitter controversy, especially as several of the later "May Laws" have been repealed. We may, however, note its significance in the development of parties. Many of the Prussian nobles and squires (Junkers the latter were called) joined issue with Bismarck on the Civil Marriage Act, and this schism weakened Bismarck's long alliance with the Conservative party. He enjoyed, however, the enthusiastic support of the powerful National Liberal party, as well as the Imperialist and Progressive groups. Differing on many points of detail, these parties aimed at strengthening the fabric of the central power, and it was with their aid in the Reichstag that the new institutions of Germany were planted and took root. The General Election of 1874 sent up as many as 155 National Liberals, and they, with the other groups just named, gave the Government a force of 240 votes--a good working majority as long as Bismarck's aims were of a moderately Liberal character. This, however, was not always the case even in 1874-79, when he needed their alliance. His demand for a permanently large military establishment alienated his allies in 1874, and they found it hard to satisfy the requirements of his exacting and rigorous nature.
The harshness of the "May Laws" also caused endless friction. Out of some 10,000 Roman Catholic priests in Prussia (to which kingdom alone the severest of these laws applied) only about thirty bowed the knee to the State. In 800 parishes the strife went so far that all religious services came to an end. In the year 1875, fines amounting to 28,000 marks (£2800) were imposed, and 103 clerics or their supporters were expelled from the Empire[80]. Clearly this state of things could not continue without grave danger to the Empire; for the Church held on her way with her usual doggedness, strengthened by the "protesting" deputies from the Reichsland on the south-west, from Hanover (where the Guelph feeling was still uppermost), as well as those from Polish Posen and Danish Schleswig. Bismarck and the anti-clerical majority of the Reichstag scorned any thoughts of surrender. Yet, slowly but surely, events at the Vatican and in Germany alike made for compromise. In February 1878, Pope Pius IX. passed away. That unfortunate pontiff had never ceased to work against the interests of Prussia and Germany, while his encyclicals since 1873 mingled threats of defiance of the May Laws with insults against Prince Bismarck. His successor, Leo XIII. (1878-1903), showed rather more disposition to come to a compromise, and that, too, at a time when Bismarck's new commercial policy made the support of the Clerical Centre in the Reichstag peculiarly acceptable.
Bismarck's resolve to give up the system of Free Trade, or rather of light customs dues, adopted by Prussia and the German Zollverein in 1865, is so momentous a fact in the economic history of the modern world, that we must here give a few facts which will enable the reader to understand the conditions attending German commerce up to the years 1878-79, when the great change came. The old order of things in Prussia, as in all German States, was strongly protective--in fact, to such an extent as often to prevent the passing of the necessaries of life from one little State to its Lilliputian neighbours. The rise of the national idea in Germany during the wars against the great Napoleon led to a more enlightened system, especially for Prussia. The Prussian law of 1818 asserted the principle of imposing customs dues for revenue purposes, but taxed foreign products to a moderate extent. On this basis she induced neighbouring small German States to join her in a Customs Union (Zollverein), which gradually extended, until by 1836 it included all the States of the present Empire except the two Mecklenburgs, the Elbe Duchies, and the three Free Cities of Hamburg, Bremen, and Lübeck. That is to say, the attractive force of the highly developed Prussian State practically unified Germany for purposes of trade and commerce, and that, too, thirty-eight years before political union was achieved.
This, be it observed, was on condition of internal Free Trade, but of moderate duties being levied on foreign products. Up to 1840 these import duties were on the whole reduced; after that date a protectionist reaction set in; it was checked, however, by the strong wave of Free Trade feeling which swept over Europe after the victory of that principle in England in 1846-49. Of the new champions of Free Trade on the Continent, the foremost in point of time was Cavour, for that kingdom of Sardinia on which he built the foundations of a regenerated and united Italy. Far more important, however, was the victory which Cobden won in 1859-60 by inducing Napoleon III. to depart from the almost prohibitive system then in vogue in France. The Anglo-French Commercial Treaty of January 1860 seemed to betoken the speedy conversion of the world to the enlightened policy of unfettered exchange of all its products. In 1862 and 1865 the German Zollverein followed suit, relaxing duties on imported articles and manufactured goods--a process which was continued in its commercial treaties and tariff changes of the years 1868 and 1869.
At this time Bismarck's opinions on fiscal matters were somewhat vague. He afterwards declared that he held Free Trade to be altogether false. But in this as in other matters he certainly let his convictions be shaped by expediency. Just before the conclusion of peace with France he so far approximated to Free Trade as to insist that the Franco-German Commercial Treaty of 1862, which the war had of course abrogated--- war puts an end to all treaties between the States directly engaged--should now be again regarded as in force and as holding good up to the year 1887[81]. He even stated that he "would rather begin again the war of cannon-balls than expose himself to a war of tariffs." France and Germany, therefore, agreed to place one another permanently on "the most favoured nation" footing. Yet this same man, who so much desired to keep down the Franco-German tariff, was destined eight years later to initiate a protectionist policy which set back the cause of Free Trade for at least a generation.
What brought about this momentous change? To answer this fully would take up a long chapter. We can only glance at the chief forces then at work. Firstly, Germany, after the year 1873, passed through a severe and prolonged economic crisis. It was largely due to the fever of speculation induced by the incoming of the French milliards into a land where gold had been none too plentiful. Despite the efforts of the German Government to hold back a large part of the war indemnity for purposes of military defence and substantial enterprises, the people imagined themselves to be suddenly rich. Prices rapidly rose, extravagant habits spread in all directions, and in the years 1872-73 company-promoting attained to the rank of a fine art, with the result that sober, hard-working Germany seemed to be almost another England at the time of the South Sea Bubble. Alluding to this time, Busch said to Bismarck early in 1887: "In the long-run the [French] milliards were no blessing, at least not for our manufacturers, as they led to over-production. It was merely the bankers who benefited, and of these only the big ones[82]."
The result happened that always happens when a nation mistakes money, the means of commercial exchange, for the ultimate source of wealth. After a time of inflation came the inevitable collapse. The unsound companies went by the board; even sound ventures were in some cases overturned. How grievously public credit suffered may be seen by the later official admission, that liquidations and bankruptcies of public companies in the following ten years inflicted on shareholders a total loss of more than 345,000,000 marks (£17,250,000)[83].
Now, it was in the years 1876-77, while the nation lay deep in the trough of economic depression, that the demand for "protection for home industries" grew loud and persistent. Whether it would not have been raised even if German finance and industry had held on its way in a straight course and on an even keel, cannot of course be determined, for the protectionist movement had been growing since the year 1872, owing to the propaganda of the "Verein für Sozialpolitik" (Union for Social Politics) founded in that year. But it is safe to say that the collapse of speculation due to inflowing of the French milliards greatly strengthened the forces of economic reaction.
Bismarck himself put it in this way: that the introduction of Free Trade in 1865 soon produced a state of atrophy in Germany; this was checked for a time by the French war indemnity; but Germany needed a permanent cure, namely, Protection. It is true that his ideal of national life had always been strict and narrow--in fact, that of the average German official; but we may doubt whether he had in view solely the shelter of the presumedly tender flora of German industry from the supposed deadly blasts of British, Austrian, and Russian competition. He certainly hoped to strengthen the fabric of his Empire by extending the customs system and making its revenue depend more largely on that source and less on the contributions of the federated States. But there was probably a still wider consideration. He doubtless wished to bring prominently before the public gaze another great subject that would distract it from the religious feuds described above and bring about a rearrangement of political parties. The British people has good reason to know that the discussion of fiscal questions that vitally touch every trade and every consumer, does act like the turning of a kaleidoscope upon party groupings; and we may fairly well assume that so far-seeing a statesman as Bismarck must have forecast the course of events.
Reasons of statecraft also warned him to build up the Empire four-square while yet there was time. The rapid recovery of France, whose milliards had proved somewhat of a "Greek gift" to Germany, had led to threats on the part of the war party at Berlin, which brought from Queen Victoria, as also from the Czar Alexander, private but pressing intimations to Kaiser Wilhelm that no war of extermination must take place. This affair and its results in Germany's foreign policy will occupy us in Chapter XII. Here we may note that Bismarck saw in it a reason for suspecting Russia, hating England, and jealously watching every movement in France. Germany's future, it seemed, would have to be safeguarded by all the peaceable means available. How natural, then, to tone down her internal religious strifes by bringing forward another topic of still more absorbing interest, and to aim at building up a self-contained commercial life in the midst of uncertain, or possibly hostile, neighbours. In truth, if we view the question in its broad issues in the life of nations, we must grant that Free Trade could scarcely be expected to thrive amidst the jealousies and fears entailed by the war of 1870. That principle presupposes trust and good-will between nations; whereas the wars of 1859, 1864, and 1870 left behind bitter memories and rankling ills. Viewed in this light, Germany's abandonment of Free Trade in 1878 was but the natural result of that forceful policy by which she had cut the Gordian knot of her national problem.
The economic change was decided on in the year 1879, when the federated States returned to "the time-honoured ways of 1823-65." Bismarck appealed to the Reichstag to preserve at least the German market to German industry. The chances of having a large export trade were on every ground precarious; but Germany could, at the worst, support herself. All interests were mollified by having moderate duties imposed to check imports. Small customs dues were placed on corn and other food supplies so as to please the agrarian party; imports of manufactured goods were taxed for the benefit of German industries, and even raw materials underwent small imposts. The Reichstag approved the change and on July 7 passed the Government's proposals by 217 to 117: the majority comprised the Conservatives, Clericals, the Alsace-Lorrainers, and a few National Liberals; while the bulk of the last-named, hitherto Bismarck's supporters on most topics, along with Radicals and Social Democrats, opposed it. The new tariff came into force on January 1, 1880.
On the whole, much may be said in favour of the immediate results of the new policy. By the year 1885 the number of men employed in iron and steel works had increased by 35 per cent over the numbers of 1879; wages also had increased, and the returns of shipping and of the export trade showed a considerable rise. Of course, it is impossible to say whether this would not have happened in any case owing to the natural tendency to recovery from the deep depression of the years 1875-79. The duties on corn did not raise its price, which appears strange until we know that the foreign imports of corn were less than 8 per cent of the whole amount consumed. In 1885, therefore, Bismarck gave way to the demands of the agrarians that the corn duties should be raised still further, in order to make agriculture lucrative and to prevent the streaming of rural population to the towns. Again the docile Reichstag followed his lead. But, two years later, it seemed that the new corn duties had failed to check the fall of prices and keep landlords and farmers from ruin; once more, then, the duties were raised, being even doubled on certain food products. This time they undoubtedly had one important result, that of making the urban population, especially that of the great industrial centres, more and more hostile to the agrarians and to the Government which seemed to be legislating in their interests. From this time forward the Social Democrats began to be a power in the land.
And yet, if we except the very important item of rent, which in Berlin presses with cruel weight on the labouring classes, the general trend of the prices of the necessaries of life in Germany has been downwards, in spite of all the protectionist duties. The evidence compiled in the British official Blue-book on "British and Foreign Trade and Industry" (1903. Cd. 1761, p. 226) yields the following results. By comparing the necessary expenditure on food of a workman's family of the same size and living under the same conditions, it appears that if we take that expenditure for the period 1897-1901 to represent the number 100 we have these results:--
Period. Germany. United Kingdom. 1877-1881 112 140 1882-1886 101 125 1887-1891 103 106 1892-1896 99 98 1897-1901 100 100
| Period. | Germany. | United Kingdom. |
|---|---|---|
| 1877-1881 | 112 | 140 |
| 1882-1886 | 101 | 125 |
| 1887-1891 | 103 | 106 |
| 1892-1896 | 99 | 98 |
| 1897-1901 | 100 | 100 |
Thus the fall in the cost of living of a British working man's family has been 40 points, while that of the German working man shows a decline of only 12 points. It is, on the whole, surprising that there has not been more difference between the two countries[84].
Before dealing with the new social problems that resulted, at least in part, from the new duties on food, we may point out that Bismarck and his successors at the German Chancellory have used the new tariff as a means of extorting better terms from the surrounding countries. The Iron Chancellor has always acted on the diplomatic principle do ut des--"I give that you may give"--with its still more cynical corollary--"Those who have nothing to give will get nothing." The new German tariff on agricultural products was stiffly applied against Austria for many years, to compel her to grant more favourable terms to German manufactured goods. For eleven years Austria-Hungary maintained their protective barriers; but in 1891 German persistence was rewarded in the form of a treaty by which the Dual Monarchy let in German goods on easier terms provided that the corn duties of the northern Power were relaxed. The fiscal strife with Russia was keener and longer, but had the same result (1894). Of a friendlier kind were the negotiations with Italy, Belgium, and Switzerland, which led to treaties with those States in 1891. It is needless to say that in each of these cases the lowering of the corn duties was sharply resisted by the German agrarians. We may here add that the Anglo-German commercial treaty which expired in 1903 has been extended for two years; and that Germany's other commercial treaties were at the same time continued.
It is hazardous at present to venture on any definite judgment as to the measure of success attained by the German protectionist policy. Protectionists always point to the prosperity of Germany as the crowning proof of its efficacy. In one respect they are, perhaps, fully justified in so doing. The persistent pressure which Germany brought to bear on the even more protectionist systems of Russia and Austria undoubtedly induced those Powers to grant easier terms to German goods than they would have done had Germany lost her bargaining power by persisting in her former Free Trade tendencies. Her success in this matter is the best instance in recent economic history of the desirability of holding back something in reserve so as to be able to bargain effectively with a Power that keeps up hostile tariffs. In this jealously competitive age the State that has nothing more to offer is as badly off in economic negotiations as one that, in affairs of general policy, has no armaments wherewith to face a well-equipped foe. This consideration is of course scouted as heretical by orthodox economists; but it counts for much in the workaday world, where tariff wars and commercial treaty bargainings unfortunately still distract the energies of mankind.
On the other hand, it would be risky to point to the internal prosperity of Germany and the vast growth of her exports as proofs of the soundness of protectionist theories. The marvellous growth of that prosperity is very largely due to the natural richness of a great part of the country, to the intelligence, energy, and foresight of her people and their rulers, and to the comparatively backward state of German industry and commerce up to the year 1870. Far on into the Nineteenth Century, Germany was suffering from the havoc wrought by the Napoleonic wars and still earlier struggles. Even after the year 1850, the political uncertainties of the time prevented her enjoying the prosperity that then visited England and France. Therefore, only since 1870 (or rather since 1877-78, when the results of the mad speculation of 1873 began to wear away) has she entered on the normal development of a modern industrial State; and he would be an eager partisan who would put down her prosperity mainly to the credit of the protectionist régime. In truth, no one can correctly gauge the value of the complex causes--economic, political, educational, scientific and engineering--that make for the prosperity of a vast industrial community. So closely are they intertwined in the nature of things, that dogmatic arguments laying stress on one of them alone must speedily be seen to be the merest juggling with facts and figures.
As regards the wider influences exerted by Germany's new protective policy, we can here allude only to one; and that will be treated more fully in the chapter dealing with the Partition of Africa. That policy gave a great stimulus to the colonial movement in Germany, and, through her, in all European States. As happened in the time of the old Mercantile System, Powers which limited their trade with their neighbours, felt an imperious need for absorbing new lands in the tropics to serve as close preserves for the mother-country. Other circumstances helped to impel Germany on the path of colonial expansion; but probably the most important, though the least obvious, was the recrudescence of that "Mercantilism" which Adam Smith had exploded. Thus, the triumph of the national principle in and after 1870 was consolidated by means which tended to segregate the human race in masses, regarding each other more or less as enemies or rivals, alike in the spheres of politics, commerce, and colonial expansion.
We may conclude our brief survey of German constructive policy by glancing at the chief of the experiments which may be classed as akin to State Socialism.
In 1882 the German Government introduced the Sickness Insurance Bill and the Accident Insurance Bill, but they were not passed till 1884, and did not take effect till 1885. For the relief of sickness the Government relied on existing institutions organised for that object. This was very wise, seeing that the great difficulty is how to find out whether a man really is ill or is merely shamming illness. Obviously a local club can find that out far better than a great imperial agency can. The local club has every reason for looking sharply after doubtful cases as a State Insurance Fund cannot do. As regards sickness, then, the Imperial Government merely compelled all the labouring classes, with few exceptions, to belong to some sick fund. They were obliged to pay in a sum of not less than about fourpence in the pound of their weekly wages; and this payment of the workman has to be supplemented by half as much, paid by his employer--or rather, the employer pays the whole of the premium and deducts the share payable by the workman from his wages.
Closely linked with this is the Accident Insurance Law. Here the brunt of the payment falls wholly on the employer. He alone pays the premiums for all his work-people; the amount varies according to (1) the man's wage, (2) the risk incidental to the employment. The latter is determined by the actuaries of the Government. If a man is injured (even if it be by his own carelessness) he receives payments during the first thirteen weeks from the ordinary Sick Fund. If his accident keeps him a prisoner any longer, he is paid from the Accident Fund of the employers of that particular trade, or from the Imperial Accident Fund. Here of course the chance of shamming increases, particularly if the man knows that he is being supported out of a general fund made up entirely by the employers' payments. The burden on the employers is certainly very heavy, seeing that for all kinds of accidents relief may be claimed; the only exception is in cases where the injury can be shown to be wilfully committed[85]. A British Blue-book issued on March 31, 1905, shows that the enormous sum of £5,372,150 was paid in Germany in the year 1902 as compensation to workmen for injuries sustained while at work.
The burden of the employers does not end here. They have to bear their share of Old Age Insurance. This law was passed in 1889, at the close of the first year of the present Kaiser's reign. His father, the Emperor Frederick, during his brief reign had not favoured the principles of State Socialism; but the young Emperor William in November 1888 announced that he would further the work begun by his grandfather, and though the difficulties of insurance for old age were very great, yet, with God's help, they would prove not to be insuperable.
Certainly the effort was by far the greatest that had yet been made by any State. The young Emperor and his Chancellor sought to build up a fund whereby 12,000,000 of work-people might be guarded against the ills of a penniless old age. Their law provided for all workmen (even men in domestic service) whose yearly income did not exceed 2000 marks (£100). Like the preceding laws, it was compulsory. Every youth who is physically and mentally sound, and who earns more than a minimum wage, must begin to put by a fixed proportion of that wage as soon as he completes his sixteenth year. His employer is also compelled to contribute the same amount for him. Mr. Dawson, in the work already referred to, gives some figures showing what the joint payment of employer and employed amount to on this score. If the workman earns £15 a year (i.e. about 6s. a week), the sum of 3s. 3-1/2d. is put by for him yearly into the State Fund. If he earns £36 a year, the joint annual payment will be 5s. 7-1/2d.; if he earns £78, it will be 7s. a year, and so on. These payments are reckoned up in various classes, according to the amounts; and according to the total amount is the final annuity payable to the worker in the evening of his days. That evening is very slow in coming for the German worker. For old age merely, he cannot begin to draw his full pension until he has attained the ripe age of seventy-one years. Then he will draw the full amount. He may anticipate that if he be incapacitated; but in that case the pension will be on a lower scale, proportioned to the amounts paid in and the length of time of the payments.
The details of the measure are so complex as to cause a good deal of friction and discontent. The calculation of the various payments alone employs an army of clerks: the need of safeguarding against personation and other kinds of fraud makes a great number of precautions necessary; and thus the whole system becomes tied up with red tape in a way that even the more patient workman of the Continent cannot endure.
In a large measure, then, the German Government has failed in its efforts to cure the industrial classes of their socialistic ideas. But its determination to attach them to the new German Empire, and to make that Empire the leading industrial State of the Continent, has had a complete triumph. So far as education, technical training, research, and enlightened laws can make a nation great, Germany is surely on the high road to national and industrial supremacy.
It is a strange contrast that meets our eyes if we look back to the years before the advent of King William and Bismarck to power. In the dark days of the previous reign Germany was weak, divided, and helpless. In regard to political life and industry she was still almost in swaddling-clothes; and her struggles to escape from the irksome restraints of the old Confederation seemed likely to be as futile as they had been since the year 1815. But the advent of the King and his sturdy helper to power speedily changed the situation. The political problems were grappled with one by one, and were trenchantly solved. Union was won by Bismarck's diplomacy and Prussia's sword; and when the longed-for goal was reached in seven momentous years, the same qualities were brought to bear on the difficult task of consolidating that union. Those qualities were the courage and honesty of purpose that the House of Hohenzollern has always displayed since the days of the Great Elector; added to these were rarer gifts, namely, the width of view, the eagle foresight, the strength of will, the skill in the choice of means, that made up the imposing personality of Bismarck. It was with an eye to him, and to the astonishing triumphs wrought by his diplomacy over France, that a diplomatist thus summed up the results of the year 1870: "Europe has lost a mistress, but she has got a master."
After the lapse of a generation that has been weighted with the cuirass of Militarism, we are able to appreciate the force of that remark. Equally true is it that the formation of the German Empire has not added to the culture and the inner happiness of the German people. The days of quiet culture and happiness are gone; and in their place has come a straining after ambitious aims which is a heavy drag even on the vitality of the Teutonic race. Still, whether for good or for evil, the unification of Germany must stand out as the greatest event in the history of the Nineteenth Century.
NOTE TO THE SECOND EDITION
The statement on page 135 that service in the German army is compulsory for seven years, three in the field army and four in the reserve, applies to the cavalry and artillery only. In the infantry the time of service is two years with the colours and five years in the reserve.
FOOTNOTES:
[72] Quoted by C. Lowe, Life of Bismarck, vol. i. p. 615.
[73] E. Marcks, Kaiser Wilhelm I. (Leipzig, 1900), pp. 337-343.
[74] Up to 1874 the government of Alsace-Lorraine was vested solely in the Emperor and Chancellor. In 1874 the conquered lands returned deputies to the Reichstag. In October 1879 they gained local representative institutions, but under the strict control of the Governor, Marshal von Manteuffel. This control has since been relaxed, the present administration being quasi-constitutional.
[75] Bismarck said in a speech to the Reichstag, on September 16, 1878: "I accepted universal suffrage, but with repugnance, as a Frankfurt tradition."
[76] The three years are shortened to one year for those who have taken a high place in the Gymnasia (highest of the public schools); they feed and equip themselves and are termed "volunteers." Conscription is the rule on the coasts for service in the German Navy. For the text of the Imperial Constitution, see Lowe, Life of Bismarck, vol. ii. App. F.
[77] J.W. Headlam, Bismarck, p. 367.
[78] Busch, Our Chancellor, vol i. p. 139, where he quotes a conversation of Bismarck of Nov. 1883. On the Roman Catholic policy in Posen, see ibid. pp. 143-145.
[79] Lowe, Life of Bismarck, vol. ii. p. 336, note.
[80] Busch, Our Chancellor, vol. i. p. 122, quotes speeches of his hero to prove that Bismarck himself disliked this Civil Marriage Law. "From the political point of view I have convinced myself that the State . . . is constrained by the dictates of self-defence to enact this law in order to avert from a portion of His Majesty's subjects the evils with which they are menaced by the Bishops' rebellion against the laws and the State" (Speech of Jan. 17, 1873). In 1849 he had opposed civil marriage.
[81] For that treaty, and Austria's desire in 1862 to enter the German Zollverein, see The Diplomatic Reminiscences of Lord A. Loftus, vol. ii. pp. 250-251.
[82] Bismarck: Some Secret Pages of his History, by M. Busch, vol. iii. p. 161 (English edition).
[83] German State Paper of June 28, 1884, quoted by Dawson, Bismarck and State Socialism, App. B.
[84] In a recent work, England and the English (London, 1904), Dr. Carl Peters says: "Considering that wages in England average 20 per cent higher in England than in Germany, that the week has only 54 working hours, and that all articles of food are cheaper, the fundamental conditions of prosperous home-life are all round more favourable in England than in Germany. And yet he [the British working-man] does not derive greater comfort from them, for the simple reason that a German labourer's wife is more economical and more industrious than the English wife."
[85] For the account given above, as also that of the Old Age Insurance Law, I am indebted to Mr. Dawson's excellent little work, Bismarck and State Socialism (Swan Sonnenschein & Co., 1890). See also the Appendix to The German Empire of To-day, by "Veritas" (1902).