Bismarck and the Origins of World War I.


 

 


Otto von Bismarck


 

The recent excellent histories on the factors leading up to World War One don’t go back far enough in time.

 

The main contention of this essay is that the road to World War One begins with the long-run consequences of the policies and strategies of Otto von Bismarck and the way he created the First German Reich in 1871.

 

The heart of the Treaty of Vienna at the end of the Napoleonic Wars (1815) was the “Holy Alliance,” an agreement of the monarchs of Russia, Prussia (later Germany) and Austria (later Austria-Hungary) to stamp out any return to the revolutionary ideals of the French Revolution. The three monarchies cooperated until the Crimean War.

 

The Crimean War (1853-56) was triggered by Russian attempts to expand its influence around the Black Sea, force the Ottoman Empire to allow Russian warships through the Dardanelles and increase influence in the Balkans as the Ottoman Empire retreated. To keep Russia bottled up in the Black Sea and out of the Mediterranean, England and France came into the war on the side of the Ottoman Empire. Prussia remained neutral. Austria-Hungary also remained neutral but Russia expected Austrian support. After the war, Russian leaders believed that Austria used the war to expand its own influence in the Balkans.  Russia and Austria-Hungary became rivals in the Balkans, with increasing Russian paranoia and anger towards Austria-Hungary. This broke up the "Holy Alliance" and began the long-term rivalry of Russia and Austria-Hungary.  (For an excellent history of the Crimean War, its origins and consequences, see Orlando Figes, The Crimean War).

In the next decade, Otto von Bismarck began his series of wars to unite the various German states under Prussian hegemony and create modern Germany. He was anti-Austria at this time because he wanted to unite the German states under Prussia and replace Austrian influence in the southern German states. After being defeated in battle by Prussia in 1866, Austria focused on the Balkans because its German neighbors in the German Confederation had become part of the new Germany. 

 

The last war Bismarck initiated was the Franco-Prussian war of 1870-71. Prussia and its German allies won a quick victory over France and declare the creation of the first German Reich. The Prussians rubbed their noses in it by creating the new Germany at Versailles. The new Germany annexed the French provinces of Alsace and Lorraine.

 

Bismarck had achieved his goal of a united Germany but at the expense of creating an implacable foe in France, bent on revenge and recovery of lost territory.

 

The German Reich was to be dominated by Prussia. The monarch was both the king of Prussia and the emperor (kaiser) of Germany. Bismarck was the head of both the new German and Prussian governments.

 

Bismarck was a Junker (Prussian landowning noble) and deeply conservative. Prussia had a strong military tradition; there would be few checks on the German military from the elected national parliament (Reichstag). German foreign policy was made by a small group of men who did not answer to the public or to their elected representatives. Germany was to become an autocratic state with little input from the public or its representatives in the parliament.

 

The parliament (Reichstag) had limited powers. In the new German Reich, all the top government officials and military officers were appointed by the kaiser, not the parliament. With a weak emperor, that meant Bismarck appointed the officials.

 

Bismarck also skillfully managed the German parliament, to limit any democratic influence on his government. He was usually successful, sidelining the Social Democratic Party and liberal parties from having influence on domestic policy.

  

Bismarck's domestic policy was to weaken or eliminate any political party or organization (like the Catholic Church) that he thought threatened Prussia's hegemony. He succeeded but at the expense of alienating many of Germany's organizations and political parties, including the largest, the Social Democratic Party (the SPD). This would have serious consequences when Germany entered the World War I and there was little cooperation between the military and political parties on the management of the domestic economy.

 

Bismarck spent the next twenty years managing the creation of the new state under Prussian dominance and Germany's European security.  His foreign policy strategy was to make sure Germany would never have to fight a two-front war. He signed a formal treaty with Austria-Hungary in 1876, becoming allies. He also had a separate secret agreement with Russia not to attack each other. This isolated France and reduced the chances that a combination of Russia and France would attack Germany.

 

Even though Bismarck had created a powerful Germany that disrupted the “balance of power” equilibrium of Europe, his careful diplomacy kept the peace. Germany did not try to expand in Europe and opted for stability. Bismarck opposed the creation of an overseas colonial empire, which might have antagonized Britain. He counted on the rivalry between Russia and Britain for influence in central Asia and Persia to keep the two countries from cooperating against Germany.


But even before Bismarck was forced to resign by Kaiser Wilhelm in 1890, Bismarck's careful European political structure was unraveling. Russia refused to renew secret "reinsurance" (nonaggression) treaties with Germany, mostly because of Russia's increasing anger at Austria-Hungary's policies in the Balkans, and by extension its German ally. Russia and France began talks that would culminate in a treaty containing secret military cooperation aimed at the alliance of Germany and Austria-Hungary.

 

In sum, Bismarck used warfare rather than political negotiation to create a powerful, militaristic Germany. The new constitution and his actions after unification aimed to guarantee the dominance of Prussia and Prussian values. Bismarck centralized power in himself as the embodiment of an authoritarian government. Parliament and democratic parties were legal but had little power or influence over the policies of Bismarck. Rather than moving towards a more open and democratic political structure, Bismarck’s Germany remained a reactionary bulwark in a rapidly changing world.


His careful policies of detente with Russia, not antagonizing England and no overseas empire began to unravel towards the end of his regime. The ascension of Wilhelm to kaiser in 1890 accelerated the change and created a military alliance of Russia, France and England against Germany.  

 

======================================================================

For the beginnings of World War I, its consequences, and a bibliography, see The Beginning of the Twentieth Century:  The Path to World War I.

 

Also see other related posts:

 

 Wealth and Power in Pre-World War I Europe 

 

The Austro-Hungarian Empire Before World War I


 The Immediate and Long-Run Historical Consequences of World War I

 

The Maxim Machine Gun and Smokeless Powder

 

Go back to the List of Posts by Topic

Comments

Post a Comment

Most Popular Posts

Adam Smith's Pin Factory

Image
Adam Smith - Our Founding Father ADAM SMITH VISITS A PIN FACTORY   Adam Smith’s description of a pin factory is on the first page of  The Wealth of Nations .  (Chapter 1 – “Of the Division of Labour”)  Drawings of pin factories of this period show workers using hand tools. Smith says the process can be broken down into 18 distinct steps, including packaging the pins. Smith mentions that pin factory workers were poorly paid, despite their high productivity.    Adam Smith says he visited a pin factory employing 10 men who produced 48,000 pins per day.  If each of the ten workers had done all the steps themselves, Smith says each worker could produce only 10 or 20 pins per day.  So the pin factory replaces 2,400 to 4,800 pin makers. The increase in labor productivity (output per person per day) is as high as 50 times that of individual pin makers.     This reduction in unit cost or average cost (AC) and the huge increase in quantity produced do not just replace older methods of organiza
Read more

Bilateral Oligopoly

Image
The best movie about the Gunfight at the O.K. Corral is titled My Darling Clementine. A great western - great cast, great photography.  DEFINITION OF A BILATERAL OLIGOPOLY Models of market structure assume that the demand side is represented by a large number of buyers.  The structure of the market, and the assumed market outcomes, depends on the number of suppliers and how they compete.  Suppliers either post one price or exploit their knowledge of buyer categories by using price discrimination.  Despite the comments about the key role of consumers in determining economic performance, consumers are fairly passive when the discussion focuses on imperfectly-competitive industries.  But many markets are not structured this way; the buyers are not passive consumers but large corporations that do not passively accept suppliers’ prices.  Net prices are actively negotiated.  These markets are often bilateral oligopolies. In a bilateral oligopoly the buyers are not an undiffe
Read more

The Stock Market Crash of 1929 and the Beginning of the Great Depression

Image
Famous Headline Introduction The usual reasons given for the Great Depression – the stock market crash of 1929 and the later collapse of the banking system – do not tell the whole story. Available economic data indicate (there were no national income accounts in 1929) that a recession had already begun before the stock market crash. The crash of October and November of 1929 was a catalyst that made the recession worse but the partial stock market recovery in early 1930 did not end the recession. Industrial production continued to fall quickly and unemployment rose rapidly in 1930. Continuing farm and businesses failures over the next two years wiped out thousands of small rural banks and threatened total financial collapse in early1933.  For a fuller explanation, we have to go back to the 1920s to see additional reasons for the origins and the rapid decline in output at the beginning of the Great Depression. We have to look at the internationa
Read more

List of Posts By Topic

FIND POSTS BY CATEGORY CATEGORIES Basic Concepts and Theory Market Behavior and Structure Market Dynamics and Information:  How Markets Work The Industrial Revolution in England American Economic History American History Demographics and Economics Management World War I:  The Beginning of the 20th Century The Roman Republic and America - Differences and Some Possible Parallels Economic and Fiscal Policy Financial Markets and Investment Strategies Foreign Exchange Markets The United States American Foreign Policy and International  Relations Geopolitics and the Global Economy Geopolitics of Oil and Natural Gas Visionaries BASIC CONCEPTS AND THEORY Introduction to Economic Theory Economic Development and Economic Growth Production Functions and Supply Chains Demand  Analysis The following post was contributed by Dennis Schuchman. Artificial Intelligence (AI) and Real Intelligence (RI) You, Your Brain and Credit Card s Critique of Basic Economic Theory MARKET BEHAVIOR AND STRUCTU
Read more

Explaining Derivatives - An Analogy

Image
You go around to farmers with cows. You buy all the cows and pay the farmers a small fee to milk the cows and sell the milk. You pay for the cows with ass(et)-backed securities called MBSs (Milked Bovine Securities) that you tell investors are udderly safe. But some of the cows don't give enough milk (cow flow problem) or give no milk at all. You take some of the asset-backed securities, say they're backed by the subprime cows, and use them as collateral to sell another set of securities called CMOs (Cow Milk Obligations). Then you buy CDSs (Cow Dried-up Swaps) from AIG (Angus Insurance Company) to insure the CMOs when the cows stopped giving milk. If you work it right, you collect more on the CDSs than you pay out to retire the CMOs. The money you get from selling the dead cows go to pay the CLOs (cow leather obligations). You could also sell CDOs (cow dung obligations) that depend on how much cow dung is produced. This is a typical Wall Street product - turning sh
Read more

Government Finance 101. Fiscal Policy: Welcome to Alice in Wonderland

Image
  PRELIMINARY SUMMARY OF FISCAL 2024 BUDGET The deficit in fiscal 2024 will be around $1.9 trillion, about $4.9 trillion in revenue and $6.8 trillion in expenses. Interest on the national debt this year is around $960 billion, over twice the interest on the fiscal 2021 budget. Interest expense this year passed outlays for the military. Leaving aside Social Security and Medicare, interest expense is about 20% of total budget outlays. Interest expense is about half the budget deficit.    SOME BASIC DEFINITIONS AND A LITTLE DETAIL Some basic definitions for people in government suffering from political amnesia:   Deficit.    The difference between the federal government’s spending and its revenue in one fiscal year.  The fiscal year starts on October 1.  So fiscal year 2024 started on October 1, 2023. You know right away this is going to be confusing. Debt .  Short for national debt or federal debt .  The sum total of all past yearly deficits minus yearly surpluses. Commentators o
Read more

John von Neumann Sees the Future

Image
John von Neumann JOHN VON NEUMANN CREATES THE FUTURE If you want to understand the world we live in, you have to know about the thinking of three men – Alan Turing, Claude Shannon and John von Neumann.   I’ve talked a little about Alan Turing in an earlier essay.   All three men knew each other, discussed their ideas with each other and promoted each other’s ideas. John von Neumann has been called the smartest individual of the 20 th Century.   Even an outline of his accomplishments, which you can read about in  Wikipedia, is hard to believe.   He invented game theory, which I discussed in two earlier posts.   He headed up a group of mathematicians who invented new statistical techniques at Los Alamos that made the atomic bomb possible.   In 1944, he wrote a memo that outlined the structure of the modern computer.   He then managed the design and building of a modern general computer and consulted on the building of virtually all the early computers. JOHN VON NEUMANN
Read more

The Roman Republic Commits Suicide: A Cautionary Tale for America

Image
Roman Legion Why Study Rome? Americans have focused on comparisons between Rome and America twice in American history.  The first time was during the period from before the Revolution to after the ratification of the Constitution and Bill of Rights, when the founding fathers and others looked to the Roman Republic for ideas and inspiration on how to structure the new government. After the American Revolution, the founding fathers, having read the Roman authors detailing the collapse of the Roman republic, worried about internal threats to the survival of their new republic.   The second time was when the United States became a superpower, especially after WWII, and then again after the collapse of the Soviet Union in 1991. Commentators compared America to the Roman Empire at the height of its power. There was some discussion about how America became a permanent warfare state and how it affected domestic democracy and civil society. And now a th
Read more

Josiah Wedgwood, the Wedgwood Pottery Company, and the Beginning of the Industrial Revolution in England

Image
Wedgwood Anti-Slavery Cameo A better introduction to the beginning of the Industrial Revolution than Adam Smith is the history of Josiah Wedgwood and the Wedgwood Pottery Company. This is how one company actually ushered in the Industrial Revolution. The revolutionary generation that first adopted steam engines saw the following trends and changes: Manufacturing was being modernized by a small group of entrepreneurs. Much of the new raw material processing and manufacturing was concentrated in a small area in the middle of England, away from London. These modernizing entrepreneurs formed a new economic, intellectual and social network. Modernizing entrepreneurs like Wedgwood tended to be members of Dissenting sects (like Quakers) or Nonconformist churches (not members of the Church of England), Whigs (liberals) in politics, and believers in “progress.” They were optimistic about the future, influenced by the ideas of Hume, Rousseau, Locke and Adam Smith. They believed
Read more

“Pax Americana”: The World That America Made

Image
There are two kinds of empires: the kind that rules through ruthless exploitation, and the kind that seeks to induce allies into defending themselves through economic incentives. (George Friedman) INTRODUCTION America's power and influence in the world rests on three broad, interrelated bases: 1) Overwhelming military power that can be projected anywhere in the world,   supplemented by security arrangements with allies and supporters. 2) A large, innovative, dynamic domestic economy as the basis for global economic and technological leadership. The economy provides the resources and technology to support the military and a global foreign policy. 3) Claims to moral and ideological leadership and influence, particularly the promotion of liberal democratic societies and supporting political institutions. This post will discuss the economic aspects and related security objectives of American foreign policy. It will focus on the structure of the global econ
Read more