Wealth and Power in Pre-World War I Europe
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| Krupp Steel Works, Gun Shop #1, 1917 Library of Congress |
New nation-states were formed in Europe at the beginning of this period – Italy in 1867, Germany in 1870, Austria-Hungary in 1867, and new nation-states carved out of Ottoman empire in the Balkans in the 1870s.
Other countries pursued new policies. France and England expanded their colony empires and fought a number of wars against native resistance (this was the first time machine guns were used). Russia attempted to expand its influence and control into Central Asia and the Far East (Siberia and Manchuria). Under pressure from the outside, Japan ended its isolation and started rapid industrialization in the 1860s and 1870s. By the 1890s, Japan began imperialist expansion by defeating China in a war and establishing control of Korea, Taiwan and part of Manchuria. The Chinese dynastic system came to an end in 1911, starting a period of internal chaos and violence. The United States also began to pursue an imperialist policy, defeating Spain in a short war to expand into the Caribbean and the Philippines. Combined with building the Panama Canal and control of Hawaii, America was becoming a Pacific power.
These geopolitical changes would have serious consequences in the period leading up to World War I and later. They led to increased national rivalry in Europe and national confrontations in Africa, Central Asia and East Asia. Russia, China and the United States would all come up against Japanese imperial expansion in the 20th century.
Nation-states in Europe were bigger, with access to more resources, including new, deadlier weapons (for one example, see the post The Maxim Machine Gun and Smokeless Powder).
1870 – 1914: New Political and Economic Dynamics in Europe
Most of history has been the story of the struggle for power. Conflicts, wars, conquests, and civil wars among the political and warrior elites. Peasants who worked the fields for the landowning elites and paid taxes to the political elite, did not count for very much in this story.
This narrative began to change with the coming of the American Revolution, the French Revolution, and the Industrial Revolution. Economic competition was added to political competition. New sources of wealth and power were created. The spread of literacy, the expansion of the franchise (right to vote), and the formation of political parties, representing the new middle class and industrial workers in the late 1800s and early 1900s, began to challenge the political dominance of king, the governments they appointed, and the landowning aristocracy that supported the status quo. This happened in Russia, Germany, and Austria-Hungary. In England, royalty and the nobility lost most of its political power. The House of Lords, a bastion of the old order, was stripped of its veto power, and new tax laws were undermining the economic base of the landowning aristocracy. Both political parties were headed by politicians with middle-class backgrounds. In France, unresolved ideological tensions were heightened during this period, culminating in the Dreyfus Affair of 1894-1906 that bitterly divided society between conservative and liberal groups. As a result, the Catholic Church, an important part of conservative power, was stripped of much of its political power and influence by new laws passed by a liberal government in the early 1900s.
It was a period of tremendous economic development, economic growth, and social change. Some economic historians call this period the Second Industrial Revolution. Much of the technology of the modern world was created during this period - electricity, steel, skyscrapers, autos, oil refining, chemicals, telephones, radio, movies, record players, and airplanes. There was a large expansion of railroads and steamships. A global telegraph network was built (called the “Victorian Internet” by Tom Savage’s delightful book of the same name). Everywhere there was the rapid expansion of mass production of industrial products, food and clothing, new consumer products, in factories, industrial centers and modern corporations. To finance this was a parallel expansion of banking and financial institutions. An increase in the international trade in food products threatened established national economic groups with political power, especially European landowners and peasants (except in Austria-Hungary). New industrial centers arose and the population of cities exploded.
As the Industrial and Transportation Revolutions accelerated after 1870, new socioeconomic groups were formed and expanded, collectively creating new economic structures and great wealth. A small group of industrialists and financiers who owned or financed the new corporations became immensely wealthy. The spread of large and complex economic organizations created a demand for a new type of manager; a new industrial and organizational management class was formed. The new industrial and information technology also created a new social group based on scientific, engineering, intellectual and professional knowledge. Professional societies were formed, helping to raise the status of the new technological elite.
The new economic class of industrialists and capitalists were legitimatized by the political philosophies of free-market capitalism and liberal democracy. They lived in an intellectual post-Enlightenment and post-French Revolution atmosphere. These groups often came from poor backgrounds or religious and ethnic minorities.
The new economic order did not go unchallenged. It threatened the wealth, power and status of the traditional elite groups, especially the landed aristocracy and gentry. This elite from pre-industrial society often led the opposition to liberal democracy and bitterly opposed the disruptive changes of the Industrial Revolution. They upheld and defended the traditional values of the pre-Industrial Revolution world. They destroyed or tried to limit attempts by liberal or social democratic political parties to share power.
This was a period of great technological and organizational change. These changes created rapid urban growth and disrupted the traditional agrarian social order. It caused great social stress and anxiety, especially among groups who felt they were socially or racially superior. (see Philipp Blom, The Vertigo Years: Europe, 1900-1914, for an insightful analysis)
Trade among the nations of Europe greatly increased. One consequence of the spread of international trade was it directly threatened the landed aristocracy who lived off rents. Their incomes declined as the price of agricultural output fell due to regional and international trade in agriculture products (watch the later episodes of Downton Abbey). Lower tariffs, less protection, lower prices. The aristocracy relied more on service in government, especially in the foreign affairs offices and as ambassadors, and in the military, to retain power, income and status. Examples include Junkers (landed Prussian aristocracy and gentry) in Germany and the landed aristocrats in Russia and Austria-Hungary.
The landed aristocracy controlled the top positions in government and military. Over 80% of top German military officers at the beginning of World War I were of Junker (Prussian titled nobility) background. They allied with other conservative, reactionary, and anti-modern groups – kings, churches, dispossessed artisans, peasants, and political and intellectual conservatives and reactionaries - who formed conservative political parties and influenced public opinion. Ideology and mythology romanticizing pre-industrial societies were used to denounce the effects of liberalism and capitalism. Related arguments demonized groups that benefited from these trends, especially Jews. Political anti-Semitism was effective in Austria-Hungary, especially in Vienna (see the post Austria-Hungary Before WWI). It was a potent weapon during the Dreyfus Affair in France. The tsarist regime in Russia promoted deadly pogroms (race riots against Jews) to divert national anger heightened by the disastrous Russo-Japanese War (1904-1905) and the violent suppression of the 1905 Revolution.
Conservatives everywhere tried to divert opposition by appealing to nationalism, racism and imperialism. Bismarck and successor Prussian leaders successfully co-opted large industrial and banking companies, tying them to reactionary Prussian-dominated Germany, partly with government military contracts.
World War I
World War I shattered the political power of pre-capitalist, reactionary groups in Russia, Austria-Hungary and partly in Germany. It seemed possible that liberal democracy, national self-determination and free market capitalism would triumph in Europe. The war broke up the empires of Russia and Austria-Hungary, creating new states in Central Europe. The Treaty of Versailles reduced the size of Germany and greatly limited the size of its military. But WWI led to chaos and violence in Central Europe, Communism in Russia, fascism in Italy and bitter, and violent opposition to the Weimar Republic in Germany. The Versailles Treaty in Germany was the target of German nationalist rallying cries.
HISTORICAL ANALOGIES (AND LESSONS?)
We may be returning to the political world of the early 1900s. After World War I, appeals to nationalism and prejudice by anti-democratic demagogues were used against the “failure” of liberal democracy and capitalism. Now, “populist” national parties and their political leaders rally opposition to the new “liberal” economic and social order, angry at the growing wealth and power of new elites. International organizations and global trade are denounced. National “populists” expand power by demonizing ethnic and religious “enemies.”
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BIBLIOGRAPHY
GENERAL HISTORY OF THE 19TH CENTURY
Richard J. Evans, The Pursuit of Power: Europe 1815 – 1914. 2016.
Good, general history of Europe.
Jurgen Osterhammel, The Transformation of the World: A Global History of the Nineteenth Century. First published in German, 2009. English translation, 2014.
Large, dense book that discusses the 19th century by topics and themes rather than chronology. Covers an incredible range of topics. Pick and choose.
BEFORE THE STORM
Charles Emmerson, 1913: In Search of the World Before the Great War. 2014.
Attempts to describe what the world was like just before the war. A world tour of 21 cities. Some interesting material and commentary. Reenforces the idea that almost no one in Europe or elsewhere thought about the conflicts in the Balkans or the prospect of war.
AUSTRIA-HUNGARY AND VIENNA.
For a more detailed look at Austria-Hungary before WWI, see the related post
Carl Schorske, Fin-De-Siecle Vienna: Politics and Culture. 1980.
Brilliant, seminal book on how the liberal, capitalist, upper middle classes lost political and cultural dominance in Vienna. Their newly-found influence and power were symbolized by the Ringstrasse and the buildings on it. Rise of mass movements to challenge existing political order, including the use of anti-Semitism as a reactionary political weapon. (Observed by a young Adolf Hitler.) Cultural (and psychoanalytic) attack on rationalist and ordered culture of Vienna. In the background, the gradual disintegration of Austro-Hungarian Empire. Tie-in with Morton’s book.
Geoffrey Wawro, A Mad Catastrophe: The Outbreak of World War I and the Collapse of the Habsburg Empire.
Excellent history of the combination of unreality, arrogance and stupidity of the military and political leaders of the Austro-Hungarian Empire that led to World War I. Mostly a military history of the performance of the Austro-Hungarian army during the first year of the war. Incredible incompetence leading to defeats against Serbia and Russia, resulting in horrific casualties.
Stefan Zweig, The World of Yesterday.
A literary and moral autobiography. The tragedy of Europe as seen in the life of a literary intellectual who believed in a European community of intellectuals. Dreamed of a peaceful, united Europe. Committed suicide in exile.
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For related posts, which could be read in order, see
The Beginning of the Twentieth Century: The Start of World War I
For a list of all posts, with links, see List of Posts by Topic.
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