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THE EVOLUTION OF, 
MODERN GERMANY 



A SHORT HISTORY 
OF FRANCE 

By Mary Duclaux. 

With 4 Maps. Demy 8vo, cloth, 

10/6 net. (Fourth Impression.) 

" Mme. Duclaux is a true literary artist ; 
and no one, we venture to say, even among 
the writers of her adopted nation, the home 
of brilliant literature, was better fitted for 
the exact task she has here set herself and so 
charmingly fulfilled. . . . One of the chief 
merits of the book, which makes it valuable 
for all persons, and they are legion in these 
days, who wish really to understand France, 
is Mme. Duclaux's penetrating knowledge of 
the French character." — The Spectator. 

T. FISHER UNWIN LTD., LONDON 



THE EVOLUTION 

OF 

MODERN GERMANY 



BV 



WILLIAM HARBUTT DAWSON 



NEW AND REVISED EDITION 



T. FISHER UNWIN LTD. 
LONDON: ADELPHI TERRACE, W.C, 



First Edition . . 1908 

Second Impression . 1909 

Third „ . 1911 

Fourth „ . 1914 

Fifth „ . 1914 

Sixth „ . 1914 

Second Edition . 1919 



HG 
D2lZ7e.3 

628908 



{All rights rtttrvtd) 



PREFACE TO REVISED EDITION 

TEE present edition of The Evolution of Modern 
Germany appears at a time of transition. In view 
of the abnormal conditions prevailing at the moment, 
the book, as originally written, was no longer faithful to facts ; 
while, on the other hand, any useful forecast of the New Ger- 
many which will emerge from the process of reconstruction is as 
yet impossible. In the circumstances it has seemed advisable 
simply to submit the chapters to such revision as has been 
practicable, special attention being given to the completion 
of statistical data, without hazarding fixed opinions upon 
questions which are still, and may long remain, sub judice, 

W. H. D. 



INTRODUCTION 



THE title of this book sufficiently describes the aim which 
the writer has had in view : that of tracing the trans- 
formation of the Germany of half a century ago into 
the Germany which we know to-day. That transformation has 
been essentially economic ; hence economic questions largely 
occupy the following pages. At the same time several other 
problems which closely affect the internal and external develop- 
ment of the Empire have been passed in review. The chapters 
have been made as little technical as possible, though several 
of them are necessarily occupied by a recital of facts and figures 
illustrative of industrial and commercial progress. 

This book is not intended to be either a glorification or 
a disparagement of Germany from the standpoint of industry 
and labour. It seeks to show the Germans as a trading nation 
just as they are ; to describe their efforts, energies, successes ; 
to tell British readers what they ought to know, and must 
know, if they would understand how it is that Germany has 
gone ahead so rapidly during recent years, not, however, by 
way of discouraging but of reassuring them. For there is 
really little mystery about Germany's industrial progress ; 
it has been achieved by means and methods which are open 
to all the world if only people will employ them. Science, 
education, application, and an equal regard for small as for 
large things — ^these, in the main, are the causes of Germany's 
success as a rival in the markets of the world, and, speaking 
generally, it is safe to say that where the enterprise of other 
nations has fallen back in these markets it has been owing 
to deficiency in one or other of these conditions, upon which 
Germany lays special stress. 

It is the writer's opinion that German industrial competi- 
tion, far from having reached its highest point, will inevitably 
increase in severity in the near future. Several reasons seem 
to afford ample justification for this opinion. One is the com- 
parative youth of German industry. Another is the fact that 
national thought and energy are being devoted to mercantile^ 



8 INTRODUCTION 

pursuits with a whole-heartedness witnessed in no other 
Continental country. This is not to say that the German 
industriahst and merchant are superior to their rivals ; they 
do, however, show an absorption in their callings which in 
these days is not everywhere fashionable. The furor Teu- 
tonicus of old has its modern counterpart in an ardor Teutonicus 
whose object is material wealth, and this object is steadily 
being achieved. Further, German industrial competition will 
be stimulated still more by the rapid growth of population 
and the absence of German colonies suitable for settlement 
by Europeans. 

There is one other unrecognized influence which has in the 
past helped in a high degree to direct enterprise into industrial 
channels and will help in the future. It is the influence of 
that policy of nationalization and municipalization which has 
been developed in Germany as in no other country. So many 
domains of public utility have been entered, and even appro- 
priated, by the State and municipal bodies — ^the railways and 
tramways, harbours, river and canal transport, insurance, 
banking, etc—that private effort and capital were compelled 
to seek outlets in productive undertakings more exclusively 
than has been the case in countries which have fought shy of 
collective enterprise. We may judge the policy of national- 
ization and municipalization as we will, it has unquestionably 
helped to make Germany more an industrial and less a merely 
trading country than it would otherwise have been. 

On the other hand, there are some circumstances which 
may well afford assurance in circles alarmed by the extent 
and causes of German competition. Hitherto the German 
industrialist has enjoyed specially favourable costs of production, 
notably owing to the lower wages paid and the longer hours 
worked, but the existing relationships between capital and 
labour afford no reason for assuming that this advantage will 
always continue in the same measure as hitherto. Owing to 
a variety of causes Germany is also fast losing its character as 
a cheap country ; its people are no longer satisfied with the 
old simple life ; they may have larger incomes than formerly, 
but they also spend more. This breaking with the old spirit 
of frugality and renunciation may imply a rising standard of 
civilization ; it is certain that the effect is to increase such 
important elements in the cost of production as salaries and 
wages, interest, and profit. 

Viewing the question of German competition specially from 
the standpoint of his own country and its interests, it is the 
writer's opinion that British enterprise will have nothing to 
fear if only it will follow the large aims and emulate the courage 



INTRODUCTION 9 

and resolution of the pioneers of our national industry, who 
not only gave to British trade the pre-eminent position which 
is nowadays being assailed, but who even created, directly or 
indirectly, most of those German industries whose assault is 
proving most effective. The most practical and the only politic 
spirit in which to meet Germany's competition is the spirit of 
inflexible good-humour, combined with an equally inflexible 
determination not to abandon ingloriously fields of enterprise 
upon which so many victories of peace and civilization have 
been won in the past. 

W. H. D. 



CONTENTS 



PAGB 
PREFACE TO REVISED EDITION 5 

INTRODUCTION ...... .7 



CHAPTER I 

THE MODERN SPIRIT . . . . . .' .. 19 

Goethe on epochs of retrogression and progress — The intellectual 
transformation of Germany — The triumph of materialism — Fichte'a 
repudiation of world-ambitions — Effect of the French War — The 
modernizing of the schools — Professors Paulsen and Rein quoted — 
Attractions of a commercial career — The cult of force — Evidence in 
political and economic movements and in architecture — The spirit of 
modern Germanism is the spirit of subdual — Romanism in German 
character — The German imapproachable in his coromand over matter 
— His failure in the government of spiritual forces — German worship 
of systems — National faults the faults of youth. 

CHAPTER II 

TRIPARTITE GERMANY 33 

The danger of generahzing about Germany — ^A threefold division 
of the coimtry — Economic and political contrasts thus brought to 
light — Characteristics of North and South — West and East Prussia 
contrasted — The West the centre of the great industries — The inci- 
dence of population — ^The large estates of the East — ^Effect of the 
manorial system — Backwardness of the Eastern provinces. 

CHAPTER III 

THE EPOCH OF INDUSTRY ...... 51 

Economic influence of the French War and the establishment of 
the Empire— Increase of J;the " large " towns — The ratio of urban 
to rural population at various dates — Geographical incidence of the 
growth of population in recent years — The migration to the indus- 
trial districts — Comparison of occupation censuses — Classification of 
industrial workpeople in 1905 — Development of the coal, iron, and 
engineering industries since 1871 — The shipbuilding industry — The 
electrical industry — The textile trades — The tendency towards 
industrial concentration — The position of the handicrafts and the 
home industries — State efforts to encourage the rural industries. 

11 



12 CONTENTS 

CHAPTER IV 

PAGE 

FOREIGN TRADE AND SHIPPING . . . . . 75 

The growth of Germany's foreign trade — ^^Comparison of imports 
and exports — Greographical distribution of foreign trade — The trade 
with the British Empire — Germany's increasing negative balance 
of trade — Growth of the mercantile marine — The fastest vessels 
afloat — Development of the sea and river ports : Hamburg, Bremen, 
Mannheim, Frankfort, etc. 

CHAPTER V 
THE PERSONAL EQUATION ...... 83 

Industrial Germany the child of industrial England — ^Early English 
enterprise in Germany — Cobden's prophecies in 1838 — Grerman com- 
mercial enthusiasm — The first generation of industrialists — The love 
of system — Reasons for German success — The German standard of 
life — Lower salaries and wages — Modem industrial plant — Industrial 
concentration — Germany and America compared — " Mixed " versus 
" pure " iron works — Germans not inventive but imitative and 
adaptive — Consideration for customers' wishes — Government 
encouragement and help — The State railways — Inland waterways — 
International exhibitions — The central agency for industry in Hesse 
— The Emperor's influence — Chambers of Commerce, their consti- 
tution and functions — The industrial associations — Foreign trade 
agencies — The German theory of trading — The commercial traveller. 

CHAPTER VI 

TECHNICAL EDUCATION . . . . . . 101 

Value of technical education in the service of industry — ^Moderate 
cost of technical education — The technical schools of Prussia — 
The schools of Saxony cited : their number, variety, and age — 
Reliance upon private effort and sacrifice — Enthusiasm for technical 
education in Saxony — Emulation shown by the schools — The action 
of Bavaria. 

CHAPTER VII 

-> CAPITAL AND LABOUR . . . • . . .118 

The relations between capital and laboiir — The legal status of labour 
and its organizations — The trade unions and their membership — 
The Socialist organizations — The Christian (Roman Cathohc) and 
Hirsch-Duncker organizations — Revenue and expenditure — The 
" free labour " unions — Trade unions as fighting organizations — 
Strikes and their result — Progress of labour — Future of trade unionism 
— The Socialist Press — Loyalty of trade unionists to their leaders 
— An exception to the rule — Trade union contributions — Smallness 
of official salaries — The workmen's secretariates — The attitude of 
capital to labour — The industrial princes of Rhineland-Westphalia — 
Their hostility to trade unions — The Westphahan miners' strike in 
1906 — Organizations of employers — The bitterness of the struggle 
— A better feeUng in the South — Insurance against strikes and 
lock-outs — Present phases of the labour movement — The agitation 
for higher wages and shorter hours — The ten-hours' day predomi- 
nant — ^Attitude of the Imperial Government — Labour policy of the 
State and municipal authoritioi. 



CONTENTS 18 

CHAPTER VIII 

FAax 

METHODS OF INDUSTRIAL CONCILIATION . . . 189 

Statutory Workmen's Committees — The employers* objections 
to them — Ftinctions of the Industrial Courts — Their limited action 
as boards of conciliation — Chambers of Labour — Proposed estab- 
lishment of an Imperial Ministry of Labour — The wages agreements 
in the building and small trades — Their number and operation — 
Advantages and disadvantages from the workpeople's standpoint 
— Legal force of the wages agreements — Attitude of the Bavarian 
Government thereto — Attitude of the employers — Profit-sharing 
— *' Social welfare " institutions — Factory colonies of dwellings — 
Antipathy of the working classes to employers' philanthropy — 
Industrial Co-operation. 

CHAPTER IX 

THE WORKMAN . . . . • . . . 151 

The characteristics of the German workman — Comparison with the 
English workman — The difference mainly that between acquired 
and natural aptitudes — The neatness and smartness of the German 
workman — The influence of the school and the army — The factory 
bath and clothes locker — The workmen's long hours and few holidays 
— Simday relaxations — Sociahst festivities — Attractions of the 
lottery — The value of social legislation — The insurance laws and their 
popularity — Sociahst testimony in their praise — Expenditure in 
sickness and accident benefit and old-age pensions — The German 
workmen's thirst for knowledge — A visit to their educational work- 
shops — Herr Bebel as a Mutual Improvement Society debater — 
Labour education societies — University Settlement work — Attitude 
of the authorities towards labour schools — Socialism and the theatre 
— The labour temperance movement, its origin and extent — Class 
awakening. 

CHAPTER X 

THE SYNDICATES . . . . . . . 172 

The concentration of capital and industrial enterprise — ^The principal 
industries syndicated — The effect of Protection in encouraging 
the growth of syndicates — Protective duties not the cause but the 
occasion — German writers quoted on the point — The aboHtion of 
Protection would not aboUsh the syndicates — They are symptomatic 
of a movement towards the more efiicient organization of industry— 
The principal forms of industrial combination now in vogue in 
Germany — ^Examples in different industries— -The charges against 
the syndicates stated and considered — The price policy of the Coal 
Syndicate — Reference to the Spirit Syndicate — The practice of 
*' dximping " — Injury done to the manufacturing industries — In- 
stances given of imderselling abroad — Testimony of German Chambers 
of Commerce on the subject — The complaints of the retail trader — 
The standpoints of capital and labour — The absorption of small by 
large undertakings — " Mixed " versus " pure " works in the iron 
industry — Has the movement towards combination taken its final 
form ? — Trusts now openly advocated — A possible alternative is 
that the system of large combinations may break down for want of 
strong men — The attitude of the working classes — Certain trade 
imions favourable to the syndicates — Proposed legislative measures 
for the control of the syndicates — Attitude of the Association for 
Social Reform — Professor G. SchmoUer quoted — Nationalization 
of the coal mines widely advocated. 



44 CONTENTS 

CHAPTER XI 

PAoa 

STATE ENTERPRISE — RAILWAYS AND CANALS . . . 206 

German ideas as to the sphere of public and private enterprise — 
The extent of State initiative — The revenues from State undertakings 
— The State as owner of lands and forests — State insurance for agri- 
culture in Bavaria — The State railway system — Prince Bismarck's 
ideal of Imperial railways frustrated — The railway revenues and 
taxation — The profits of the Prussian railways — The extent of the 
national water-ways and canals — The Kiel Canal — Recent canal 
schemes — Freedom of river navigation. 

CHAPTER XII 

AGRICULTURE AND INDUSTRY 229 

The difficulty of preserving the right balance between agriculture 
and industry — The prevalence of one-sided views — Importance of 
agriculture in Germany — ^Agriculture and military efficiency — The 
rural movement — Number of agricultural owners — Cultivation of the 
land — The national production of grain — Com -growing in Prussia 
— Other ground crops — Vineyards, orchards, hop-growing, spirit 
distillation, tobacco -growing, the beet-sugar industry — ^Agriculture 
and fiscal policy — Effect of industry on corn imports — The agri- 
cultural State — Conflict between agriculture and industry — Prince 
Bismarck on agrarian policy — Imports and exports of wheat and rye 
in recent years — Demand of the corn-growers — The present condi- 
tions of agriculture favourable — Higher prices and increased value 
of land — The Prussian Minister of Agriculture quoted — the encima- 
berment of the land — All parties agreed that Protection cannot be 
summarily abandoned — The argument of the " National Granary " 
— Count von Caprivi quoted — ^Attitude of the Protectionists of the 
Chair — Prince Billow's claim to be an " agrarian Chancellor " — 
Agrarian and industrial duties inseparable — Demands of the 
Agrarian League. 

CHAPTER XIII 

THE SMALL HOLDINGS MOVEMENT 254 

Present extent of small holdings in Germany — Opinion of the East 
Prussian Land Commission — The creation of small holdings can only 
be at the expense of the great estates — The law of entail — The Prus- 
sion system of rent-fee farms — " Inner colonization " by land com- 
panies — The creation of labourers' holdings — ^The Prussian Minister 
of Agriculture's proposals on the subject. 

CHAPTER XIV 

THE RURAL LABOUR PROBLEM ..... 262 

Extent of rural migration — The " land-flight " of the labourer and 
its causes — the effect of machinery in increasing seasonal labour — 
Conditions of rural life — Housing and wages of the agricultural 
labourer — Rural migration and poverty : a statistical comparisoi. 
— Methods of remimeration — Payment in kind, and examples of wages 
agreements — The spirit of feudalism still perpetuated in North and 
East Prussia/ — Baron vom Stein's laws against serfdom — How the 
effect of the Edict of Emancipation was weakened — The " Servants' 
Ordinances" — Inability of the agricultural laboxirer to combine 



CONTENTS 15 



or strike — Breach of contract by agricultural labourers — Modern 
social legislation has ignored the rural labourer — A Prussian land- 
owner's opinion of lost opportunities — The system of semi-bound 
labour doomed — Proposed remedies for the " land-flight " — The 
importation of foreign labour — ^Absence of organization in rural 
districts — The unpopularity of Socialism amongst agricultural 
labourers. 

CHAPTER XV 
CO-OPERATION ........ 288 

The German genius for Co-operation — The pioneer work of Schulze- 
Delitzsch and Raiffeisen — Number and character of Co-operative 
societies and undertakings — Importance of the rural banks and 
credit societies — Distributive Co-operation not developed as much 
as in England — The Raiffeisen Co-operative movement described 
— The Prussian Central Co-operative Bank — The attitude of the 
State towards the Co-operative movement. 

CHAPTER XVI 

THE POPULATION QUESTION 304 ^ 

The crusade against infantile mortality — The decline in the birth- 
rate — Its effect on population counteracted by a decreasing death- 
rate — Vitality statistics of towns and country districts compared 
— Natality and mortality rates of Prussia, Bavaria, Saxony, and 
Wiirtemberg — Causes of high infantile mortality — Action of the 
State and municipal authorities — Decline of natural feeding and 
its encouragement — The work of the infant dispensaries in the large 
towns — Public regulation of the milk supply — The care for children 
of illegitimate birth — The protection of mothers — Provisions of the 
Industrial Code on the subject — A scheme of motherhood insiirance 
— The Kaiserin Augusta Victoria House at Charlottenburg — The 
significance of the infant mortality crusade from the standpoint 
of population — Solicitude for youth of school age — The pioneer 
work of Tiirk and FrGbel — Children spared in Germany where 
women are spared in England — The factory laws and the employ- 
ment of children — The doctor in the school — The anti-consumption 
crusade — Physical exercises and outdoor pastimes — Housing reform 
— Co-operation of the Social Democrats in social reform movements 
— Industrial legislation and the insurance laws. 

CHAPTER XVII 

liATIONAL EXPANSION 325/ 

Prince Bismarck's idea of Germany as a *' saturated State " — His 
conceptions of foreign policy — The modem development of Welt- 
politik in Germany — Weltpolitik an economic necessity for Germany — 
— The pressure of the population question — Dr. P. Rohrbach on 
Germany's economic limitations — The alternatives open to Germany : 
emigration or new trade outlets — The national food question — Limits 
of Germany's corn-growing capacity — The ideal of the agricultural 
State threatened — The present and possible density of population 
in Germany — A Socialistic view of Weltpolitik — Grerman mercantile 
competition is boxind to become more severe — The possibiUty of 
emigration — Grermany's colonies of little value for settlement p\ir- 
poses — Emigration has greatly decreased during recent years — 
Pan-Germanic projects offer no solution of the population problem — 



16 CONTENTS 

Tk9M 

Attention turned to South America and Asia Minor — The German 
colonies in Brazil — The Bagdad Railway and German expectationi 
— The policy of the *' open door " — The extension of Germany's sea 
power — Popularity of the *' large navy " movement — Two motives 
in operation, the economic and the pohtical — William II the true 
director of naval policy — ^His conceptions of worid-policy — ^The 
naval construction programmes — The nation united in calling for a 
large navy — The forces behind the movement — The Navy League and 
its propagandism. 

CHAPTER XVIII 

THE COLONIES 344 / 

Early colonial enterprises — ^The modem colonial movement — Bis- 
marck's unwillingness to give a lead — Annexation of German South- 
West Africa — Colonies acquired in West and East Africa and the 
Pacific — Bismarck's principles of colonization — " Governing mer- 
chant, not governing bureaucrat " — The Africa-Heligoland Conven- 
tion of 1890— The measures for the suppression of slavery in East 
and West Africa — ^Administrative deficiencies — Government on 
Prussian principles — The " colonial scandals " — The excesses of 
the white traders — Wars and insurrections — The Herero rising— 
The force theory of colonization. 

CHAPTER XIX 

THE NEW COLONIAL ERA 365 v/ 

Formation of a Colonial Office — Dr. Dembiirg's colonial crusade 
— The appeal to national pride and interest — Restoration of national 
confidence in the colonies — Present condition of the colonies — 
Plantation versus settlement — The cultivation of cotton — ^Mineral 
resources — Prospects of East Africa and South-west Africa — The 
development of the railways — Foreign trade of the colonies — Extent 
of the white population — Colonial finance — Present attitude of 
the nation on the colonial question — The nation's honour at stake — 
Unity of parties on the question — Attitude of the Social Democrats. 

CHAPTER XX 

CENTRIPETAL AND CENTRIFUGAL INFLUENCES . . 379 J 

The stability of the Empire — Attitude towards the Empire of the 
Prussian landed party — Prince Bismarck on Prussian particularism 
— The enthusiasm for the Empire has abated since 1871 — ^Monarchy 
has been strengthened in the interval — Goethe on the unity of 
Germany — The federal States in a stronger position than before the 
Empire was established — Reasons for the chastened mood of present- 
day Imperialism — The Reichstag has proved disappointing — German 
political parties and their fondness for criticism — The Imperial con- 
stitution a compromise between incompatible theories of government 
— The nation outside the government of the coimtry — Competence of 
the Reichstag — The Government is not independent of parties but 
can only do its work by reliance on a party alliance — Effect upon 
public life of the impotence of parties — The present trend of constitu- 
tional controversy in Germany — The Prussian franchise question — 
The redistribution question in Prussia and the Empire — The argu- 
ment against the numerical principle of representation stated — Tli« 
theory of Ministerial responsibility. 



CONTENTS 11 

CHAPTER XXI 

PAOE 

THE OUTLOOK OF SOCIALISM ..... 396 ^ 

The reverse of Social Democracy at the last elections in 1907 and 
its causes — Attitude of the small farmers and artisans — The rising 
of the middle classes — Bismarck on the apathy of the contented 
citizen — Social Democracy and the middle classes — The Erfurt 
programme — Socialism and the property-instinct in human nature 
— A propagandism of poverty and discontent — Attitude of Socialism 
towards thrift — Socialist house-owners — The triumph of 1912 — 
Progress of the Revisionist movement — The barrenness of the 
Socialist parliamentary party — Evidence of party journals on the 
subject — The negative policy of Socialism — Calwer, Bernstein, 
and Parvus quoted — The new spirit of accommodation — Opinions 
of Herr von Vollmar — Possibility and conditions of an alliance with 
the Radicals — Socialism due to the apathy of the burgher parties 
towards social evils — Socialism and monarchy — Difference between 
the Socialism of the North and South. 

CHAPTER XXII 
THE POLISH QUESTION . . . . . . . 416v 

Prince Bismarck on the Polish question — Germanism versus Polonism 
— Increase of the Polish population in the East of Prussia. — Poles 
in the West — Spread of the PoUsh movement to Silesia — Inconstancy 
of the Prussian Government's Polish poUcy — The Poles will not 
sacrifice their cause to their religion — The Polish indictment — ^The 
language question — The promise of King Frederick William III 
of Prussia — Abolition of PoUsh from the schools — The school strikes 
of 1901 and 1906 — The " Settlement " of the PoUsh provinces — How 
the Poles have counteracted the Government's endeavours — Activity 
of the Polish land banks — German landowners sell to Polish buyers 
— The competition for land has resulted in excessive prices — 
Economic results of the settlement scheme — The prosperity of the 
Pohsh districts increased — Political failure of the scheme — The 
Poles more numerous and influential than ever — The rise of a Polish 
middle class — The new expropriation law — Attitude of the Poles 
towards the Germans — Intolerance answered by intolerance — The 
Polish political associations — Prussian failure to conciliate the Poles. 



INDEX 443 



THE EVOLUTION 
OF MODERN GERMANY 



CHAPTER I 

THE MODERN SPIRIT 

Goethe on epochs of retrogression and progress — The intellectual transforma- 
tion of Germany — The triumph of materialism — Fichte's repudiation of 
world-ambitions — Effect of the French War — The modernizing of the 
schools — Professors Paulsen and Rein quoted — Attractions of a com- 
mercial career — The cult of force — Evidence in political and economic 
movements and in architecture — The spirit of modem Germanism is 
the spirit of subdual — Romanism in German character — The German 
unapproachable in his command over matter — ^His failure in the govern- 
ment of spiritual forces — German worship of systems — National faults 
the faults of youth. 

IN one of his letters to Eckermann, Goethe strikes truth 
at a deep level when he says, " I will tell you something, 
and you will often find it confirmed in your later life. All 
epochs of retrogression and dissolution are subjective ; on the 
contrary, all progressive epochs have an objective direction. 
Every resolute endeavour turns from within to the world 
without." 

No words could better characterize the change which has 
come over the land of Goethe in modern times or better 
describe the significance of that change. The fifty years 
succeeding the establishment of the North German Confedera- 
tion have witnessed the end of the old " subjective " epoch 
of self-absorption, of self-centred national life, and the opening 
and the triumph of a new " objective " era of external effort, 
expressing itself on the material side in foreign-trade ambitions 
and on the political side in aggressive foreign enterprises. 
This more than anything else is the distinguishing mark of the 
Germany with which the world to-day has to do — the abandon- 
ment of the old national forms of life and the resolute pursuit 
of world-aims and a world-career, with the determination, if 

19 



20 THE EVOLUTION OF MODERN GERMANY 

not to win absolute primacy amongst the nations, at least 
to dispute such primacy with existing or potential rivals. 

A consideration of the modern evolution of Germany, 
entirely practical though its aim must inevitably be, may then 
fitly begin with a brief survey of the intellectual and spiritual 
transformation which this evolution has meant and has necessi- 
tated for the Germany of old, the Germany which Europe and 
the civilized world knew before the economic struggle for 
existence became the greatest of international concerns. 

All progress, says Herbert Spencer, means change. It 
does not necessarily follow that all change means progress. 
The changes which have made of the disunited Germany of 
half a century ago — poor, undeveloped, and stagnant — a great 
empire, rich in material resources of every kind, with commerce 
on every sea and territory in almost every continent, is regarded 
by the politician and the man of affairs as a triumph of sagacious 
statesmanship and racial tenacity, and such a claim may be 
made with every justification. It may be, however, that for 
power which has been gained without power has been lost 
within, and that the exchange of national values has not been 
an exchange of equivalents. Whether that be so or not, the 
future alone can decide, yet the issues involved are immensely 
important, first to Germany herself, but also to the rest of the 
world — ^to Germany, because the staying power of a nation 
depends infinitely more upon its moral than its material force, 
or there would have been no German Empire to-day ; to the 
world at large, because, in taking the conspicuous place amongst 
the nations to which ambition and destiny alike seem to impel 
her, Germany will project into civilization new and powerful 
influences which may be either helpful and beneficent or the 
reverse. 

No one who knows Germany from her literature, and 
especially her poetry and philosophy, and who has followed 
her career during the past generation, can have failed to recog- 
nize the radical change which has come over the national 
life and thought. A century ago idealism was supreme ; half 
a century ago it had still not been dethroned ; to-day its place 
has been taken by materialism. This is not to say that belief 
in ideas is extinct or that high thinking has passed out of 
fashion in Germany. Even to-day scholarship is nowhere 
held in greater regard, learning is nowhere cultivated more 
sedulously for its own sake, than in that country. The univer- 
sities train from year to year a larger number of students 
than ever before, and if science and practical studies have to 
some extent challenged the supremacy of the humanities in the 
scheme of higher education, it may safely be said that study 



THE MODERN SPIRIT 21 

is still followed with all the old devotion and disinterestedness 
no less by the student than the teacher. Nevertheless, the 
dominant note of German life to-day is not that of fifty, or 
fort)^ or even thirty years ago. 

Visualizing Germany as she was at the beginning of the 
nineteenth century, one is reminded at once of the four great 
intellectual figures which then stood out unchallenged by 
their contemporaries. They were Kant and Fichte on the 
one hand, Goethe and Schiller on the other. The influence of 
these men upon the national life in different directions has 
been incalculable. For a time it might have seemed as though 
they were destined to serve in Germany as the inspirers and 
guides of the new century — Goethe and Schiller its teachers 
in the art of life, Kant and Fichte its teachers in political 
thought and social duty. And, indeed, a German culture based 
upon the ideals which found utterance in Weimar, Konigsberg, 
and Berlin at that time would have been a force not more 
powerful than beneficent in moulding the nation and in leaven- 
ing modern European thought. On the one hand Schiller, 
drawing his inspiration from classical antiquity, emphasized 
the aesthetic side of life, the claims of beauty, harmony, rhythm ; 
while Goethe stood for largeness, fulness, and completeness 
of culture. Viewing human life from the social side, Kant 
and Fichte instilled into their contemporaries the august ideas 
of duty and responsibility, applied them to civic relation- 
ships, and built them into the foundations upon which a new 
Prussia and a new Germany were soon to be built. 

For a time the teaching of these four sages, whose lives 
and work bridged the eighteenth and nineteenth centuries, ^ 
exerted a powerful directive influence upon the German nation. 
It helped more than anything else to nerve and pull together 
the sundered tribes after the humiliations of the Napoleonic 
era ; it created the spirit of self-sacrifice which not only 
brought Germany out of her troubles, but made the military 
triumphs of later years possible ; it originated the enthusiasm 
for education which caused Germany to be known even so long 
ago as a land of schools ; and it has been at the heart of every- 
thing good and wholesome in the life of Germany ever since. 

Nevertheless, the national shrines are no longer to be 
found in the " city of pure reason " in the far east of the 
Prussian monarchy or in the tranquil garden-house on the 
banks of the Ilm. A new spirit has entered into the national 
life. If the first half of the nineteenth century witnessed in 
Germany the reign of spirit, of ideas, the second half witnessed 

» Goethe lived from 1749 to 1832, Schiller from 1769 to 1805, Kant from 
1724 to 1804, and Fichte from 1762 to 1814. 



22 THE EVOLUTION OF MODERN GERMANY 

the reign of matter, of things, and it is this latter sovereignty 
which is supreme to-day. A century ago Germany was poor 
in substance but rich in ideals ; to-day she is rich in substance, 
but the earlier idealism has to a large extent disappeared. 

If one would understand how far Germany has drifted from 
the old moorings, it is only necessary to recall some words of 
Fichte's which are strangely out of harmony with the modern 
spirit. At the beginning of last century, just when Germany 
was preparing for the last great struggle which was to free her 
from the grasp of the Western python, no man so truly voiced 
the national mind and aspirations as Fichte in the eloquent 
addresses to his countrymen which he uttered from his chair 
in the University of Berlin, and it is interesting to recall a 
striking passage in which he specially protested against the 
view that Germany, the land of thinkers and idealists, could 
ever indulge materialistic ambitions. 

" Equally alien to the German," he said, " is the ' freedom 
of the sea ' which is so often proclaimed in these days. For 
centuries during the rivalry of all other nations the German 
has shown little desire to share this freedom in any great 
measure, and he will never do so. Nor need he do it. His 
richly endowed land and his industry afford him all that the 
cultured man needs for his life ; he has no lack of industrial 
skill ; and in order to appropriate to himself the little real 
gain which international trade yields, viz. the expansion of 
the scientific knowledge of the earth and its inhabitants, his 
own scientific spirit will provide him with a means of exchange. 
Oh, if only happy fate might have preserved the Germans as 
much from the indirect participation in the booty of the other 
hemisphere as it did from the direct ! If only credulity and 
the desire to live as finely and respectably as other nations 
had not made into needs the unnecessary commodities which 
foreign countries produce, if we by renouncing the less essential 
needs had created tolerable conditions for our free fellow- 
citizens, instead of desiring to extract gain from the sweat 
and blood of the poor slave across the ocean, — then at least we 
should not have given a pretext for our present fate, and we 
should not be warred against as buyers and ruined as a market. 

" Nearly a decade before any one could foresee what has 
since happened the Germans were advised to make themselves 
independent of the world-market and to close up their borders 
as a mercantile State. This proposal went counter to our 
habits, and especially to our reverence for the coined metals, 
and was hotly opposed and rejected. Since then we have 
learned by foreign force and with dishonour to do without 
much which then we declared our liberty and our highest 



THE MODERN SPIRIT 2S 

honour would not allow us to dispense with. May we seize 
the present opportunity, when luxury at any rate does not 
blind us, of correcting our ideas ! May we at last recognize 
that, while the airy theories about international trade and 
manufacturing for the world may do for the foreigner, and 
belong to the weapons with which he has always invaded us, 
they have no application to Germans, and that, next to unity 
amongst themselves, their internal independence and commer- 
cial self-reliance are the second means to their salvation and 
through them to the welfare of Europe." 

Side by side with these words may be quoted the lament 
of a recent German writer impressed by the ambiguity of 
national prosperity which is expressed in purely material 
values : — 

" One is often pained and overcome with longing as one 
thinks of the German of a hundred years ago. He was poor, 
he was impotent ; he was despised, ridiculed, and defrauded. 
He was the uncomplaining slave of others ; his fields were 
their battleground, and the goods which he had inherited from 
his fathers were trodden under foot and dispersed. He shed 
his blood heroically without asking why. He never troubled 
when the wealth of the outside world was divided without 
regard for him. He sat in his bare little room high under the 
roof, in simple coat and clumsy shoes ; but his heart was full 
of sweet dreams, and uplifted by the chords of Beethoven to 
a rapture which threatened to rend his breast. He wept 
with Wert her and Jean Paul in joyous pain, he smiled with 
the childish innocence of his naive poets, the happiness of his 
longing consumed him, and as he listened to Schubert's song 
his soul became one with the soul of the universe. I^et us 
think no more of it — it is useless. We have become men, 
and the virtues of our youth are ours no more. W^e can but 
face the inevitable and overcome it." » 

There never was, of course, happily for mankind, an entire 
nation of such unpractical hyper-sentimentalists, yet the 
picture here drawn is so far true to fact that it describes a 
mood, now no longer or rarely to be met with, which used to be 
distinctively German, and which is reflected in a host of folk- 
songs and poems that even yet have not lost their power to 
touch the imagination and stir the emotion of those who have 
not been drawn into the vortex of materialism. Germans in 
the mass, however, are made of sterner stuff. 

It is inconceivable that there could be written in Germany 
to-day such exquisite lyrics as those of Eichendorff, Riickert, 
and Geibel, so full of true inwardness and genuine sentiment 
» G. Fucha, Der Kaiser und die Zukunft des detUschen Volkes, pp. 70-71. 



24 THE EVOLUTION OF MODERN GERMANY 

without a breath of sentimentality, or such stirring epics of 
duty as those which came from the souls of men like Korner 
and Arndt little more than a hundred years ago, when Germany 
was weak and disregarded, and dreams of world-power had 
never entered the minds of her rulers and politicians. It is 
inconceivable that modern Germany could weep over the 
sorrows of Werther, or succumb to the haunting moods of a 
Lenau. It is still more inconceivable that a Fichte could 
to-day rise up and proclaim to a responsive nation the 
preciousness of poverty linked with spiritual worth. Even 
the centenary of Schiller's death passed without evoking 
any emotion that could be identified with enthusiasm, and 
of that notable anniversary the royal theatres of Berlin had 
not a word to say. 

It might be thought that in a book which purports to trace 
Germany's modern economic evolution reflections of this kind 
are out of place. In truth, the full significance of that evolu- 
tion cannot be understood without a knowledge of the conditions 
which preceded and have been supplanted by it. Germany is 
what she is to-day because the strength, ardour, eagerness 
which are inherent in the national character, yet of old were 
wont to embody themselves in ideal forms, have sought an 
outlet in new directions. It is the same Germany, yet in 
thought another ; the same nation, yet its life and pursuits 
are different. 

The comment upon all this of the practical man is that 
material progress requires the sacrifice of ideals, and that Ger- 
many would not have been able to claim a larger share in the 
world's life had she not been willing to forgo something of the 
old self-culture. This is, of course, true. The old Germany 
and the new Germany could not live side by side, and the old 
Germany has given way. The significant thing is that the 
sacrifice has been made so deliberately and so completely. 

It must be admitted that the temptations to materialism 
which came to Germany after the French War were very 
powerful, and such as would have sorely tried the moral fibre 
of more settled nations. The enthusiasm and energy which 
carried that war to a triumphant conclusion were not exhausted 
but rather increased when the Empire was established and the 
ardent aspiration of generations of patriots was consummated. 
An outlet was necessary, and the French milliards pointed the 
way. Before 1870 the economic revolution had already begun, 
and Germany would have become more and more industrial 
every year by the very necessity of things, but the develop- 
ment would have been gradual, and there would have been 
no abrupt break with the past. The war, the indemnity. 



THE MODERN SPIRIT 25 

and the new Empire together gave to material enterprise an 
abnormal impetus, an impetus so strong that it has never 
since suffered check. That in circumstances so exceptional 
the nation's mental and moral balance would be disturbed 
was inevitable. 

It is unnecessary to enlarge here upon the industrial and 
commercial successes which have gone together with this 
transformation of the national thought, for they will be passed 
in review later. The present purpose is rather to point to the 
more pregnant signs of the new spirit that is dominant in 
German life. One of these signs is the materializing of educa- 
tion, a tendency by no means confined to Germany, however, 
nor even one in which that country has set the example. The 
movement began with an attack on the Gymnasia and their 
discouragement in favour of the modern schools, and it has 
since spread in many directions. For many years prior to 
the outbreak of the Great War i the teaching of English had 
been fostered in the secondary schools of Prussia as never 
before, yet let no one suppose that it was out of compliment 
to English literature or for any intellectual or ideal reason. 
In the Ministerial decree which supplanted French by English 
as a compulsory subject, reference was made for propriety's 
sake to the value for literary and political reasons of the 
study of English, but the real motive was a practical one, 
the recognition of English as the language of commerce, and 
of a knowledge of it as the best key to the markets across 
the seas. 

It has long been a bitter complaint of the philosophical 
faculties at the universities, and of none so much as the Prus- 
sian, that the only requests for larger grants of money to which 
the Government will listen are those which come from the 
patrons of the practical sciences. " At the beginning of the 
nineteenth century," wrote the late Professor Friedrich Paulsen, 
of Berlin, than whom no one spoke with greater authority 
upon this subject, " speculative philosophy was in the ascen- 
dant, and with it went humanistic philology, both being one 
in that their aim was contemplation. At the end of the 
century natural science was predominant, and natural science 
in the service of technics and medicine. One has only to note 
the increase of technical colleges and the expenditure which 
the State incurs on behalf of science ; — for new institutes of 
natural science and medicine new millions [of marks] are 
always ready, but is any liberality shown towards the most 
modest needs of philology or philosophy ? " * 

" A onesidedness which only esteems material values and 
^ August, 1914. « Zur EtUk und Politik, p. 62. 



26 THE EVOLUTION OF MODERN GERMANY 

an increasing control over nature is destructive in its influence," 
writes Professor Dr. Rein, of Jena, " and this onesidedness 
set in during the second half of the nineteenth century in 
Germany. We Germans have ceased to be the nation of 
thinkers, of poets, and dreamers ; we aim now only at the 
domination and exploitation of nature. . . . Have we Germans 
kept a harmonious balance between the economic and the 
moral side of our development, as was once the case with the 
Greeks ? No ; with the enormous increase of wealth dark 
shadows have fallen on our national life. In the nation as in 
the individual we see with the increase of wealth the decrease 
of moral feeling and moral power." 

" One recognizes with anxious apprehension," says another 
writer, "that the active interest for natural science and 
technical improvements is not balanced by a deeper concern 
for the problems of the mental sciences and the arts, which, 
in truth, can alone beneficially appropriate the achievements 
of technical culture ; that in every department of German 
life a tendency to be satisfied with externals is visible, and the 
endeavour after knowledge and self-realization is lacking ; 
that we have, indeed, made progress in the domain of industry, 
commerce, and material life, but, on the other hand, the old 
German quality of striving after the essence of things, the 
hidden soul of phenomena, and the delight in this endeavour 
— free from all secondary ends — are more and more being lost ; 
that we have lost the old idealism and in its place have put 
phrases and pomposity and high-sounding words." i 

The attractions of a commercial career, offering high 
rewards and large possibilities of material advancement, have 
exerted a strong influence even in bureaucratic circles, from 
the lower grades to the highest. The new economic era has 
witnessed the subversion of the Chinese wall of caste exclu- 
siveness which used to surround the official class. The dignity 
and repute of this class continue as before, and there is no lack 
of applicants for admission to its charmed circle, but many 
of the ablest men are no longer found there. It is not that 
the official is less appreciated, less honoured by his Govern- 
ment, or finds a more circumscribed sphere of duty than 
hitherto. The secret of the failure of an official career to attract 
to the extent it used to do is the State's unwillingness and 
inability — probably, under existing conditions, the latter 
more than the former — to offer material inducements equal to 
those which are held out in business and professional life. 
Royal orders and decorations are distributed even more freely 
than in the past, and State officials can always count on 
* Unaer Kaiser und sein Volkp by a " Schwarzseher " (" Pessimist "), p. 150. 



THE MODERN SPIRIT 27 

receiving step by step the insignia which traditionally belong 
to their rank, but stars and crosses do not keep up the costly 
establishments which the custom of the age requires, and it 
is a perpetual complaint even in over-bureaucratized Prussia 
that the best business men are found not in the State service 
but outside, at the head of industrial, commercial, and financial 
undertakings offering to able directors and administrators 
emoluments beyond the means of the national Treasury. 

When a few years ago the Imperial Government was 
requested to take the initiative in establishing a chemical- 
technical institute, the Minister of the Interior replied that it 
would be impossible, unless the chemical industry largely 
supplemented such salaries as the Government might be able 
to offer to the necessary staff. " In private undertakings," 
he said, " able technicologists and chemists receive salaries 
such as we could never offer. I am at a great disadvantage 
that, in spite of all efforts, I am unable to secure for the 
Imperial service conspicuous ability, simply because better 
remuneration is offered elsewhere." 

Now and then outsiders of exceptional ability accept 
Ministerial positions, but they sacrifice material interests in 
doing so, and it is only because they are independent of salary 
considerations that such men elect to change the responsible 
yet highly paid duties of a commercial calling for the equally 
responsible, far more thankless, and generally underpaid 
duties of an official career. On the other hand, a far larger 
number of men leave the State service to take charge of 
large industrial companies, or enter their directorates., on 
very remunerative terms. The late Dr. Bodiker, the head 
of the Central Insurance Board, joined the firm of Siemens & 
Halske ; ex-Ministers have in recent years been attracted to 
the directorates of another Berlin electrical company and of 
Krupp's at Essen ; other high Government officials have joined 
the Steel Syndicate and the Berlin Tramway Company; and 
the directorates of some of the larger shipbuilding and shipping 
companies contain men who have or had important connec- 
tions with the Prussian Government and even with the Crown. 

To the average Englishman the chief significance of the 
aggressive movement of Germanism in modern times lies 
in the successful claim which the German industrialist and 
merchant have asserted to a large share of the world's trade. 
Yet those who look deeper will discover other and more momen- 
tous signs of the new spirit. One of these is the growth of 
what can best be described as a cult of force. Here the effect 
of the three successful wars which Prussia w^aged early in the 
second half of last century may clearly be traced. It is natu- 



28 THE EVOLUTION OF MODERN GERMANY 

rally in the political domain that the tendency to worship force 
is specially seen. The course of German politics, both domestic 
and foreign, during the past generation has largely been deter- 
mined by this spirit, which found its completest personification 
in Prince Bismarck. " Political questions are questions of 
power," was Bismarck's fixed principle, and he was never 
wanting in fidelity to it. For some of the rougher work which 
he had to do force was, indeed, the only possible instrument, 
but it was not only in war that he applied his favourite specific. 

All Bismarck's impatience with theory, all his contempt 
for the man of thought and contemplation, and all his rough- 
riding over some of the most treasured traditions of political 
and economic thought were but different expressions of the 
same absorbing belief in the efficacy of resolute action. He 
has disciples and imitators to-day — men full of the will to 
follow in his footsteps, and only lacking the strength and 
opportunity, yet in their weak and ineffectual way personify- 
ing his influence and perpetuating his spirit and tradition. 
A well-known military politician and ex-Colonial Governor 
frankly stated not long ago : " That which is lacking in our 
diplomatists we must make good in brute force," and the 
sentiment, more mildly expressed, has a considerable vogue 
in the circles which specially cultivate " real " politics. 

" Two souls dwell in the German nation," writes Professor 
Paulsen ; " the German nation has been called the nation 
of poets and thinkers, and it may be proud of the name. 
To-day it may again be called the nation of masterful com- 
batants, as which it originally appeared in history." ^ That 
is true, but an addition is needful, for the struggle to which 
Germany has since 1860 devoted undivided strength has not 
been a struggle waged consciously in the name and for 
the sake of civilization, a struggle for intellectual or political 
ideals, or ideals of any kind, but a struggle for sheer mastery 
in the realm of matter and for political ascendancy amongst 
the nations. Yet if Germany should ultimately gain all the 
material success and political power after which she aspires, 
no one will dare to say that she will mean more for civilization 
and the world than the weak and disjointed Germany of a 
century ago, which gave to mankind the Goethe and Schiller, 
the Kant and Fichte whose teachings have for the time been 
cast aside. 

The effect of this worshipping of material force is seen in 

the elevation of the State to a position of importance which 

it never held before, in the multiplication of its functions and 

the centralization of authority, without any corresponding 

1 Zur Ethik und PoUHk, p. 59. 



THE MODERN SPIRIT 29 

increase of national control. To-day everything is expected of 
the State, and in proportion to the expectations built upon it is 
the power with which it is endowed. It is seen pre-eminently 
in the huge army which Germany has created, and which 
represents the cult of force in its most universal form, since 
the army on its modern basis is to all intents and purposes 
the nation. It is the wish for more power which also lies at 
the root of the agitation for a navy which may be a fit comple- 
ment to the land force. The same tendency is seen in the 
bitter struggle of parliamentary parties, and in the absence of 
balance and of the spirit of compromise and accommodation 
which they show. It is seen no less in the economic struggle 
— between capital and labour in general, and in a narrower 
sense between the industrialists and the agrarians — a struggle 
probably fiercer than in any other country, and likely to 
become still more vehement before any conciliation of the 
contending interests will be possible. 

If, as John Ruskin has said, a nation's architecture is an 
expression of its ideals, its soul, it should not surprise us that 
here, too, the cult of force is shown. One of the most signifi- 
cant signs of the change of spirit which has come over Germany, 
and in particular over the North, is the architecture of the 
towns as rebuilt during the past forty years. No example 
is so instructive as the capital itself. One has only to compare 
the relics of old Berlin — ^the Berlin of the eighteenth century 
and earlier — with the city which has come into being since 
1871 in order to understand that influences have been at 
work which have entirely transformed the mind and concep- 
tions of the present generation. Everywhere one sees the 
worship of massivity, the striving after crude, imposing effects 
— in the modern monuments, the public buildings, the bridges, 
and not least the cathedral which has arisen upon the site of 
SchinkeFs light and dainty structure. If one is to speak of 
art in relation to these w^orks it is primitive art, wherein form 
is subordinated to size. They impress, indeed, by their mass 
and dimensions, and by the suggestion of power which they 
convey, but they are without imagination — body without 
soul — and create in the beholder a sense of unrest and oppres- 
sion. It is significant that while the statue of Charlemagne 
before the Town Hall of Aix-la-Chapelle is a finely-modelled 
life-size figure, the statue which Hamburg has erected to 
Bismarck is a monstrous structure, more like a lighthouse 
than a monument. 

It is not merely in the great public memorials, however, 
that the modern spirit of force is incorporated ; the same 
thing may be seen in domestic architecture. The mediajval 



80 THE EVOLUTION OF MODERN GERMANY 

German dwelling-house was a picturesque structure of brick 
and timber, with romantic niches and corner windows, with 
carved woodwork, diamond windows, projecting gables, and 
high-pitched roofs. It was not convenient as modern ideas 
go, and its hygienic arrangements were seldom perfect, but 
it fitted in with an age when life had still its poetrj'- and when 
people did not hurry and hustle, and it was often a thing of 
beauty and delight. One need only compare a Brunswick 
house in the Altstadtmarkt with a modern Berlin barrack- 
house, with its six stories and basement and its fifty dwellings 
crowded round a dark courtyard, in order to understand how 
different is the new spirit from the old, and wherein this new 
spirit consists. I Any one who has studied the singularly 
interesting and perfectly governed city on the Spree from 
the standpoint will understand what a recent German writer 
means when he says, " We have buildings dedicated to the 
noblest and highest functions — theatres, schools, parliaments ; 
and yet they proclaim nothing of the wonderful mysteries of 
the German soul, nothing of our stock's proud consciousness 
of mastery, nothing of our longing, our faitfi, our achievement. 
Nay, they hardly speak of the purpose for which they exist." » 
There is, indeed, a large element of Romanism in modern 
Germany, in her people's megalomania, their fondness of 
massiveness, their restless hankering after great effects, their 
exaltation of machinery and systems. All these character- 
istics may be summarized in the phrase " force-worship." 
Wherever one looks in Germany at the present day one sees 
the assertion, on a grandiose scale, of an endeavour after sheer 
mastery — in the struggle w4th natural forces which has been 
carried on with such wonderful perseverance and deserved 
success, in the strengthening of the Imperialistic spirit, in 
the irresistible advance of industry and commerce, in the 
striving after an inviolable military power, in the eager and 
jealous glances which now for over twenty years have been 
turned to the sea. In all these things the underlying thought 
is the thought of domination, mastery, subdual. Therein is 
expressed the spirit of modern Germany, in the first blush of 
a new life, her capacities still but partially developed, and 
her resources but partially discovered. 

1 " In the eighteenth century," writes W. H. Riehl, " every German (royal) 
residential to\vn wished to be a Versailles ; now every such town wishes to be 
a Paris or London. Even the smallest of towns tries at least to ape the cities, 
just as every burgher tries to ape the gentleman. These big and little ' large 
towns,' in which every peculiarity of German urban life is dying out, are the 
hydrocephaloids of modem civilization, and hydrocephalus, it is well known, 
not infrequently indicates an immature and extremely excited mental life." — 
Stadt und Land, p. 56. 

' G. Fuchs, Der Kaiser und die Zukunft des deutschen Volkes, p. 19. 



THE MODERN SPIRIT 81 

Yet, for all this, it is questionable whether unified Germany- 
counts as much to-day as an intellectual and moral agent in 
the world as when it was little better than a geographical 
expression, and the reason is that for the present its strength 
is not the strength of a nation that lives by and in the service 
of great ideals. Germany has at command an apparently 
inexhaustible reserve of physical and material force, but the 
real influence and power which it exerts in the world to-day 
is disproportionately small. The history of civilization is 
full of proofs that the two things are not synonymous. A 
nation's military and material force may coexist with intrinsic 
power, yet such power can never permanently depend on force. 
And the test is easy to apply — what remains of influence when 
the force is removed ? Rome ruled by force, and when the 
legions went Rome went, too. Greece lacked Rome's material 
force, but by power of intellect and ideals she ruled where the 
legions were impotent, and Rome itself passed beneath her 
sway. 

The analogy seems to apply with singular appositeness to 
the Germany of to-day. Half a century ago it might have 
seemed as though it had still been open to that country to 
choose whether it would play the part of a Greece or a Rome 
in modern civilization. For the present the assertion of modern 
Germanism is the assertion of material force, and it remains 
yet to be seen whether behind that assertion of force there is 
a spiritual influence that will permeate society and so become 
a permanent factor in civilization. We know what old Ger- 
many gave to the world, and for the gift the world will ever 
be grateful : we do not know what modern Germany, the 
Germany of the overflowing barns and the full argosies, has 
to offer beyond its materialistic science and its merchandise, 
or whether the later gift will be of a kind to call for either 
thankfulness or admiration. " Is there a German culture 
to-day ? " asks a recent writer. " We Germans are able to 
perfect all works of civilizing power as well and indeed better 
than the best in other nations. Yet nothing that the heroes 
of labour execute goes beyond our own border or even is 
elevated at home as a symbol of German strength, German 
love, German pride, German beauty — as if, indeed, we were 
poor in strength, love, pride, and beauty ! " ^ 

If what has been said correctly describes the influences 
which to-day are contending for, if they have not already 
obtained, ascendancy in Germany, light will be thrown on 
phases of German life and character which otherwise might 
seem difficult to understand. It is the domination of the 
* G. Fuchs, Der Kaieer und die Zukunjt dea deutachen Volkes, p. 17. 



82 THE EVOLUTION OF MODERN GERMANY 

force-cult which explains why Germany, which succeeds so 
brilliantly in governing material forces, fails so lamentably in 
governing spiritual forces. So far as command over matter 
goes, the German is not merely good, but unapproachable. 
Any work and any function that can be performed by system, 
he will perform as no other man on earth. His machinery 
will not always be the best, but in its own way it will work 
to perfection and the finished product will be the best of its 
kind — that is, the best that such machinery can produce. When, 
however, it comes to working wdth human material the German 
system breaks down, for here machine work is of little value. 
That is why Germany, which excels so conspicuously in town 
government, does not succeed in the government of men. 
That is why the German systems of education, which are 
incomparable so far as their purpose is the production of scholars 
and teachers, or of officials and functionaries, to move the 
cranks, turn the screws, gear the pulleys, and oil the wheels 
of the complicated national machinery, are far from being 
equally successful in the making of character and individuality. 
And Germany knows this — that is, the Germany which does 
not work the machinery, but submits to its pressure, or looks 
on while others submit. Hence the discontent of the enlight- 
ened classes with the political laws under which they live — 
a discontent often vague and indefinite, the discontent of men 
who do not know clearly what is wrong or what they want, 
but feel that a free play is denied them which belongs to the 
dignity and worth and essence of human personality. 

No one who genuinely admires the best in the German 
character, and who wishes well to the German people, will 
seek to minimize the extent of the loss which would appear 
to have befallen the old national ideals owing to increasing 
absorption in material pursuits. It may, indeed, prove that 
the present temper of German thought is only a stage in a 
new order of development, and there is some justification for 
this hope in the fact that Germany's faults are in the main 
the faults of youth. For the nation is still essentially young 
— younger far than it likes to be thought. " The German 
people to-day," said truly a representative of one of the 
universities at a meeting of the Evangelical Social Congress 
not long ago, " is more juvenile than the other civilized nations 
of Europe." It is true : the things which most strongly impress 
observers from countries of older civilization as specially 
characteristic of modern Germany, and not least the prevail- 
ing political ideas and institutions, nearly all suggest youth, 
immaturity, and un development, and in that fact may be 
discerned hope for the future. 



CHAPTER II 

TRIPARTITE GERMANY 

The danger of generalizing about Germany — A threefold division of the country 
— Economic and pohtical contrasts thus brought to light — Character- 
istics of North and South — West and East Prussia contrasted — The 
West the centre of the great industries — The incidence of population 
— The large estates of the East — Effect of the manorial system — Back- 
wardness of the Eastern provinces. 

IN few things is it possible to generalize in judging Germany, 
and those only will generalize who little know, and who 
still less understand, the country and its people. If a 
German were asked to describe the life and characteristics of 
his countrymen, he would probably insist that not one book 
but twenty-six would be necessary, if the peculiarities of each 
federal territory were to receive due consideration. One may 
arrive at many tolerably safe judgments without resort to 
specialization so exhaustive as that, yet in forming all these 
judgments the warning will still need to be borne in mind, 
that breadth of generalization is almost invariably at the ex- 
pense of exactitude, and that rashness is never more dangerous 
and more mischievous than when exercised in the field of 
ethnological study. 

In this case the pitfalls in the way of the imwary are multi- 
plied owing to the fact that Germany implies not one people 
but many tribes, with different cultures and different systems 
of political and social institutions. One has only to consider 
the geographical features of the country, its political history, 
the variety of its population, and the diversity of its intellec- 
tual and economic life in order to understand the difficulty 
of forming conclusions capable of wide application. 

Nevertheless, there is a certain division of the country 
which may afford a basis for definite if guarded generalization, 
and at the same time for useful comparisons and contrasts. 
To understand something of the variety of German life and 
thought one cannot do better than begin by dividing the 
country, like tola Gallia of old, into three parts. The division 
will be faulty and inadequate, yet it will serve to localize con- 

3 33 



84 THE EVOLUTION OF MODERN GERMANY 

spicuous differences of which it is necessary to take careful 
account if one's estimates of Germany and the Germans are 
to have any vahae whatever. 

And the first cleavage would be formed by a line running 
from West to East, along the frontiers of Lorraine, Baden, 
Bavaria, and Saxony, forming thus a Northern and a Southern 
German}^ A line which followed these territorial boundaries 
would apportion to the North the whole of Prussia from the 
Rhine Province, adjacent to France and Belgium, to the 
frontier of Russian Poland in the East, together with the two 
grand duchies of Mecklenburg, the grand duchy of Oldenburg, 
and the duchy of Brunswick. To the Southern territory would 
fall, besides Alsace and Lorraine, the three kingdoms of Saxony, 
Bavaria, and Wlirtemberg, and the grand duchy of Baden, 
leaving the Thuringian States as a central zone — a territory 
w^hose inhabitants differ in race, yet one which, on the whole, 
offers greater unity of character wnthin itself than it shares 
with the strong and assertive monarchy in the North. 

The second line would be perpendicular and would dissect 
Prussia herself, and following common usage it will be con- 
venient to accept the division into a West and an East Elbe area. 
To the former would be assigned, chiefly, the provinces of 
Hanover, Hesse-Nassau, Rhineland, and Westphalia ; to the 
latter the low-lying provinces of agricultural Prussia and the 
two Mecklenburgs, which together may be termed the corn 
zone of the Empire, inasmuch as this East Elbe area furnishes 
more than two-thirds of the country's entire production of 
wheat and rye. 

Such a threefold division as this, though, of course, open 
to objection from many standpoints, does yet bring into relief 
striking similarities and diversities of character and interests, 
and will permit of the formation of conclusions of far-reaching 
significance. 

In the first place, our lateral boundary line will be found 
to connote a broad political division of the German people. 
In the North, excepting notably the enclaves of Hamburg 
and Bremen, lies the centre of the great Conservative forces 
and influences which have played so large a part in moulding 
German history, and which continue to-day to determine the 
main tendencies of domestic policy. 

When the average Englishman speaks of Germany, he 
really means Prussia, and consciously or not he ignores the 
fact that in but few things can Prussia be regarded as typical 
and representative of the whole Empire. i He reads of the 
Prussian constitution, with its " three class " system of elec- 
» This is, however, no less true of the average Prussian. 



TRIPARTITE GERMANY 35 

tion, its primary and secondary voters, its shadow of popular 
representation, and its ineffectual legislative assembly, and 
probably does not know that the constitutions of the Southern 
States are altogether more modern and realize far more faith- 
fully the representative principle. He reads of Prussia's 
scientifically rigid bureaucratic system, that works almost 
with the inevitableness of a natural law% and concludes that 
the whole Empire groans under the pressure of officialism. 
He knows that much Prussian legislation is, according to his 
ideas, marked by an uncompromising spirit of reaction, and 
forgets that Prussia's Education Laws, Anti-Coalition Laws, 
and Polish Colonization Laws, upon which, as likely as not, 
he bases his judgment, would hardly at any time within the 
last half -century have been proposed in any other German 
State. It is a remarkable fact that Prussia, in material 
things the most wealthy and most progressive State in the 
Empire, in internal administration the most capable, in mili- 
tary discipline the most efficient, is in political thought and 
institutions far behind the smaller States of the South. 

In this respect, indeed, there is between North and South 
just the same difference which exists between the constitu- 
tions of the two halves of the Empire and the spirit in which 
these constitutions were originally conceded. Even to-day, 
after over two generations of parliamentary government, 
the party of royal autocracy in Prussia — and it is a large and 
powerful one — is never weary of reminding tlie country that 
the constitution under which it is governed owes none of 
its authority to popular assent, but was octroy S — that is to 
say, was voluntarily granted by the Crown moiu proi')rio, as 
something which it was the Crown's absolute right to give or 
withhold at will. That fact, to understand and allow for 
which is essential if Prussian political life is to be fairly and 
intelligently judged, neither Sovereign nor people has ever 
forgotten : to the one it is a safeguard of monarchical prero- 
gatives, to the other it is a perpetual reminder that all the 
political rights it enjoys had their origin in royal grace. It 
is the boast of the Kings of Prussia that they have never 
received anything from the people, but have always given ; 
prior to 1850 no charters, no laws, no declarations of rights 
ever limited the Sovereign's power or formally determined 
the relations of the ruler and the ruled. And because the 
Prussian constitution came into existence by the royal will, 
its provisions are rigid and inelastic ; what they meant two 
generations ago, exactly that, and nothing more, they mean 
to-day. The Crown then conceded so much of its hitherto 
unrestricted right, the people acquired this fraction of sur- 



86 THE EVOLUTION OF MODERN GERMANY 

rendered royal right ; and each party to the contract has 
jealously guarded the readjusted relationships ever since : 
the one always fearing lest more should be demanded, the 
other alwajJ^s apprehensive lest the little given should be 
recalled. 

Yet one important admission must be made here : just as 
the old Conservative party, led by Otto von Bismarck, was 
opposed to the granting of parliamentary government in the 
'fifties of last century, and accepted it against its will, so the 
modern Conservative party still sympathizes far more with 
the Crown than with the people. Speaking in the Reichstag 
on February 5, 1908, a Prussian military deputy well illus- 
trated this widespread sentiment when he said : "I have for 
a long time had the honour to be a member of this House, 
and I know that the Reichstag is necessary, yet as an officer 
I was not convinced of the necessity for its existence. As a 
lieutenant it seemed to me marvellous that four hundred 
gentlemen should feel themselves called upon to desire to 
co-operate in the government of the country with my old 
King and his great Chancellor." 

In the official programme of the party, which as a practical 
political document may be said to represent the ideals of Con- 
servatism in their least uncompromising form, one may to-day 
read : — "It is our desire to see the monarchy by the grace 
of God preserved unimpaired, and while upholding legally 
assured civil liberty for all and an effective participation of 
the nation in legislation, we are antagonistic to every attempt 
to limit the monarchy in favour of a Parliamentary rigime.^^ 
The more liberal spirit that prevails in the Southern States 
will be seen when present-day constitutional movements in 
Germany are reviewed. 

Not only in its prevailing political spirit, however, but in 
its entire culture, the North differs greatly from the South. 
In the far North and East especially there is a hardness and 
austerity of character which is in strong contrast to the 
urbanity of the South. Any one who knows the German people 
may satisfy himself of this contrast by the application of a 
very simple test. There is a fundamental distinction in 
German character which divides the whole race as by an in- 
violable line : Germans are gemiitlich or they are not gemiitlich. 
Perhaps one can best define the word Gemiitlichkeit as connoting 
the mood or disposition of the good-natured, comfortable, 
easy-going soul that can enter wholeheartedly into the simpler 
and primary joys of life. When Faust in Goethe's poem 
" sat down contented " as he watched the village festival, it 
was the Gemiitlichkeit of the scene that enchanted him. Now 



TRIPARTITE GERMANY 8T 

no one would ever imagine a North German to be gemutUch, 
and no one would ever imagine a Sovith German to be any- 
thing else. 

Only the Lower Rhine country differs from the stern temper 
of the North in general. There easier conditions of life — 
longer summers, milder winters, more sun, less working against 
Nature and more working with her — and an infusion of French 
blood are responsible for a lighter, more gracious spirit. Yet 
allowance must also be made for the fact that the culture of 
the West has been strongly influenced by Roman and later 
by Gallic influences. Throughout the whole of Western Ger- 
many, from North to South, a strong spirit of liberalism both 
in politics and religion prevails, as a result of its contact with 
France and French thought. 

On the other hand, the North and East have developed to 
a great degree on independent lines, receiving little from the 
outside. It is not too much to say that the culture of the 
far North and East of Prussia is a local, provincial culture, 
with which the intellectual and political life of the nation as 
a whole has little in common. It has ever been the claim of 
Bavaria, and still more of Wlirtemberg, that they really repre- 
sent " pure " Germany, and that Prussia is an alien element. 
A native and defender of the Prussian East, Herr Evert, ^ 
recently claimed that '' if the East be considered without 
prejudice it must be acknowledged that not only in the military 
and political but in the intellectual sphere it has, considering 
the youth of its civilization, done notable work for the good 
of the community at large," and he alleged in proof the 
East Prussian origin of licssing, Kant, Herder, and Copernicus. 
That the landed families of the East have furnished the army 
with many of its best officers, and still form a choice recruiting 
ground for the mess -room j must be conceded. The rest of 
the claim is more disputable, and the illustrations are especially 
unfortunate, for Lessing was born in the South of Prussia, 
Kant was of Scottish descent, Herder was of Slavonic ancestry, 
and philosophized and passed most of his life in South Germany, 
and Copernicus was of Hungarian parentage. 

Altogether social life is benigner in the South than in the 
North ; there is less strenuousness, and as a consequence more 
humanity in the Southerner ; he may value time less, but his 
life probably yields him more satisfaction ; social conditions 
do not offer the strong contrasts which are seen in the North, 
and as a consequence the relations between classes and between 
individuals is a less formal and a more genial one. How the 
contrasts appear to a politician may be judged from the 

^ Der detUsche Oaten und seine Landwirtschaft, p. S. 



38 THE EVOLUTION OF MODERN GERMANY 

following passage which recently appeared in a North German 
newspaper :— - 

" Class antagonisms were never so extreme and bitter in 
the South as in the North. In the South people were always 
nearer in social condition and in intercourse. This gave to 
the entire politics of the South a more amiable and more 
philistine tone. The laws were freer. The laws of associa- 
tion and public meeting especially were informxd by a singularly 
attractive liberalism. The Southerner felt very superior to 
the Northerner, just as many an English workman still feels 
superior to his Continental colleagues when he says that 
' Socialism may be very well for the poor beggars across the 
Channel, but we have a " free country," and we have no need 
of Socialism.' Bavaria has a better franchise law than Prussia 
and Saxony, and WUrtemberg has a better law of coalition." 

Not only Bavaria but the Southern States generally '' keep 
themselves to themselves " far more than the States and 
provinces of the North. Thus of the persons born in the 
German Empire who were enumerated in Bavaria proper 
(right of the Rhine) in the occupation census of 1907 no less 
than 96 per cent, were born in that State ; the corresponding 
figure for Wiirtemberg was 95 per cent., and for Baden, Alsace- 
Lorraine, and Saxony 88 per cent. On the other hand, of 
persons born in Germany who v/ere enumerated in thirteen 
of the smaller Central States (including Brunswick and Anhalt) 
only 82 per cent, were there born, and the proportion for the 
Prussian provinces of Brandenburg and Saxony was 79 per 
cent. Of the 6,887,291 inhabitants of the entire kingdom of 
Bavaria in 1910, only 202,075, or 2*9 per cent., were citizens 
of other German States, and 134,122, or 2 per cent., foreigners, 
108,731 of these being natives of Austria-Hungary ; while 
of the 4,808,661 inhabitants of Saxony 604,891, ^or*^ 12*5 per 
cent., were citizens of other German States, and 188,469, or 
3*9 per cent., foreigners, 159,615 of these being Austrians. 

But the second division, that of the Northern kingdom 
itself, brings to light contrasts no less radical. Here the 
contrasts are economic as well as political. West of the Elbe 
lies the cradle and home of German industry. Only Saxony 
surpasses, and that but slightly, the populous districts of 
Rhineland and Westphalia in industrial and commercial 
activity. With 28 per cent, of the population of Prussia, 
these two provinces had in 1910 40 per cent, of its " industrial " 
population, i.e. the workpeople employed in factories and 
workshops liable to inspection.^ In Saxony 16*5 per cent. 

* Hence the handicrafts and the building trades are to a large extent 
excluded. 



TRIPARTITE GERMANY 39 

of the population were in that year industrial workpeople as 
thus defined, and in the Prussian provinces of Rhineland 
and Westphalia the proportion was 14 per cent. In Bavaria, 
however, the proportion was only 11*5 per cent. 

The names Dlisseldorf, Essen, Dortmund, Oberhausen, and 
Gelsenkirchen are those of great, throbbing hives of industry ; 
either of these towns might be regarded as a microcosm of 
modern industrial Germany. Within the two provinces 
Rhineland and Westphalia are found at their busiest most 
of the industries to which the country owes its modern wealth 
and material advancement. Visiting Westphalia on one 
occasion Emperor William II said, with pardonable enthu- 
siasm : "In the bosom of your hills are hidden the treasures 
which, brought to light by the brave miner's busy hands, 
promote the activity of industry, an industry — the pride 
of our nation — wonderful in its development, the envy of the 
whole world." ^ 

Dortmund is the centre of coalfields which furnish more 
than half the country's entire coal production ; nowhere in 
Germany are the iron, steel, and engineering trades more 
progressive or more highly developed than in the northern 
part of the Rhine province ; while towns like Barmen, Elber- 
field, Miinchen-Gladbach, Bielefeld, and Crefeld are great names 
in the textile trades. Glass and chemicals belong also to the 
staple products of this hustling region, w^hich may be regarded 
as in a peculiar sense the workshop of Germany. Typical of 
the whole is the town and district of Essen. It is, of course, 
dominated by one powerful interest, yet its all-round industrial 
character is shown by the fact that its undertakings include, 
besides armament and munition works, coalmines, iron, steel 
and rolling works, machinery, machine tool, instrument, and 
apparatus works, chemical works, oil and colour works, textile 
factories, paper and leather works, besides a host of under- 
takings in the wood, clothing, food, drink, and tobacco 
trades. 

East of the Elbe, on the other hand, lies the great granary 
not only of Prussia, but of the Empire. To the South, in the 
province of Silesia, which Frederick the Great added to his 
Brandenburg Marches in the middle of the eighteenth centur}^ 
the coal and iron trades, and in a less degree the textile trades, 
afford a large population, to a great extent Slavonic, its principal 
source of employment, and there are industrial outposts like 
Berlin, Hanover, Magdeburg, Halle, etc. ; but in the main 
Prussia east of the Elbe is an agricultural region, given up to 
the growing of corn, and in some districts of the sugar beet, 

^ Speech at Miinster, September 1907. 



40 THE EVOLUTION OF MODERN GERMANY 

and the exclusiveness of its pastoral industr}^ increases the 
nearer one comes to the Russian frontier. ^ 

How dependent upon agriculture is a large part of the East 
may be judged from the fact that in many of the Government 
Districts from 50 to 75 per cent, of the population were found 
in 1895 to be directly engaged in pastoral pursuits — 66 per 
cent, in the Bromberg district, 69 per cent, in that of Posen, 
71 per cent, in that of Koslin, 72 per cent, in that of M&rien- 
werder, and 76 per cent, in that of Gumbinnen ; while the 
proportion for Prussia West of the Elbe was between 40 and 
50 per cent., yet only between 30 and 40 per cent, in seven 
Government Districts, and as little as 28 per cent, in the district 
of Cologne, 16 per cent, in that of Arnsberg, and 14 per cent, 
in that of Diisseldorf. Conversely the proportions of the 
population engaged in industries and trades in the three Eastern 
provinces of East Prussia, West Prussia, and Posen were 8*8, 
10*2, and 9*5 per cent, respectively, while the corresponding 
proportions in Hesse-Nassau, Westphalia, and Rhineland, in 
the West, were 19*6, 21*2, and 22*9 per cent, respectively. 
Since 1895 the growth of population has further accentuated 
the difference, for the lion's share of the increase has 
fallen to the towns of the West with their rapidly ex- 
panding industries. 

In religion there is not the same cleavage between East 
and West, for although in the centre of the kingdom Roman 
Catholicism embraces less than 10 per cent, of the inhabitants, 
both in the extreme West and the extreme East it is the faith 
of the large majority of the indigenous population, with the 
result that the Roman Catholics of Prussia form more than 
a third of the whole population. Taking the provinces indi- 
vidually, the principal confessions were represented as follows 
at the census of December 1, 1910 : — 

PROVINCES WITH A PROTESTANT MAJORITY—PERCENTAGE 
OF POPULATION. 



Provinces. 


Protestant. 


Eoman 
Catholic. 


Other 
Christians. 


Jews. 


Brandenburg . . 


89-3 


7-3 


0-60 


1-50 


Pomerania 


95-3 


3-3 


0-70 


0-62 


Schleswig-Holstein 


96-6 


3-3 


0-61 


0-21 


Saxony- 


91-6 


7-6 


0-23 


0-25 


East Prussia . . 


84-3 


14- 1 


0-84 


0-63 


Berlin (Urban Circle) . . 


81-6 


11-7 


0-53 


4-34 


Hanover 


85-1 


13'8 


0-43 


0-63 


Hesse-Nassau . . 


68-4 


28-2 


0-66 


2-33 



TRIPARTITE GERMANY 



41 



PROVINCES WITH A ROMAN CATHOLIC MAJORITY— PERCENTAGE 

OF POPULATION. 



Provinces. 


Protestant. 


Roman 
CathoUc. 


Other 
Christians. 


Jews. 


Posen 


30-8 


67-7 


0-20 


1-26 


Rhineland 


29-6 


69-0 


0-41 


0-80 


Westphalia 


47-2 


61-4 


0-56 


0-61 


Silesia 


42- 1 


66-7 


0-25 


0-86 


West Prussia . . 


46-3 


51-8 


0-99 


0-82 


HohenzoUern ^ 


6-0 


94-4 


0-02 


0-57 



The economic differentiation of the two halves of the 
Prussian monarchy is strikingly reflected in the incidence of 
population and the distribution of the larger towns. In general 
the Eastern provinces are regions of far distances and few 
inhabitants. Of the 32 " large towns " of Prussia — that is, 
towns with over 100,000 inhabitants — as enumerated in 1910, 
twelve were found in the four Western provinces, viz. Aix- 
la-Chapelle, Bochum, Dortmund, Cologne, Diisseldorf, Duisburg, 
Barmen, Crefeld, Elberfeld, Essen, Mlilheim, and Gelsen- 
kirchen, and only three in the five Eastern provinces, viz. 
Posen, Danzig, and Konigsberg, of which two are seaports, 
while the remainder were scattered in the North, South, and 
Centre, like Altona, Breslau, and Berlin respectively. Even 
of towns with over 10,000 inhabitants the three Eastern 
provinces of Posen, West Prussia, and East Prussia have only 
one-third as many as the three Western provinces of Rhineland, 
Westphalia, and Hesse-Nassau, with- an area one-third less. 

Not only so, but population has for many years increased 
far more rapidly in the West than the East, as the following 
figures show : — 





Increase or Decrease, Per Cent. 




1890 to 
1895. 


1895 to 
1900. 


1900 to 1905 to 
1905. 1 1910. 


1871 to 
1910. 


Three Western Provinces. 
Rhineland . . 
Westphalia 
Hesse-Nassau 

Three Eastern Provinces. 
East Prussia 
West Prussia 
Posen 


4- 8-40 
-1-11-23 
+ 5-55 

-f- 2-46 
-f- 4-23 
-t- 4-40 


4-12-80 
+ 18-0 
+ 8-04 

- 0-60 
+ 4-64 
+ 3-21 


4-11-76 
4-13-60 
4- 9-07 

+ 1-68 
4- 4-99 
-t- 6-27 


4-10-6 
-t-14-0 
+ 7-3 

+ 1-7 
4- 3-8 
+ 6-7 


+ 99-0 
+ 132-4 
+ 68-6 

+ 13-2 
+ 29-6 
+ 32-6 



^ A Government district, formed of the two little principalities HohenzoUern- 
Hechingen and HohenzoUern -Siegmaringen, with an aggregate population in 
1910 of 71,000. 



42 THE EVOLUTION OF MODERN GERMANY 

The disparit}^ is brought out still more clearly by the relative 
density of population. Thus, in the East the population of 
the province of East Prussia in 1910 was equal to 55-8 per 
square kilometre, that of West Prussia to 66*7, and that of Posen 
to 72*4 ; while in the West the province of the Rhineland had 
a density of 263*7 to the square kilometre, Westphalia one of 
204, and Hesse-Nassau one of 141*4. 

While the scantier population of the Eastern provinces is 
in the main due to the comparative absence of industries, 
tvro secondary causes are the large migration of labour to the 
iron and coal districts of the West which has taken place during 
the past twenty years and a relatively high death-rate, for 
which a high rate of births does not compensate. 

That the Poles of the agricultural provinces of the East 
migrated to the West in order to become industrial workers 
was strikingly shown by the occupation census of 1907. The 
following were the numbers of workmen born in East and West 
Prussia and Pomerania who were engaged in industry and 
agriculture in the Central and Western provinces of Prussia 
in that year : — 



Industry. 



Agriculture, 
Forestry, etc. 



Brandenburg and Saxony 

Berlin 

Hanover and Schle8^^^g-Holstein 

Westphalia 

Rhineland 



Total 



64,742 
52,944 
23,460 
69,206 
43,386 



243,737 



17,116 

719 

5,232 

1,378 

1,372 



25,817 



The depiction of the rural districts is a growing evil, for 
it implies the gradual starving of agriculture for want of 
labour. The East Prussian Chamber of Agriculture investi- 
gated the whereabouts of children who had left the rural 
schools of that province in the years 1895 and 1900. The 
homes of 23,000 children who left school in the former year 
were traced, and it was found that three-fifths of them had 
left their native districts and agriculture as well. More than 
one-quarter had left the province altogether and had found 
work in the industrial districts of West Germany, while others 
had gone to the larger towns of the province. Even of those 
who remained in the smaller communes a considerable pro- 
portion had entered other occupations. Of the children who 
left school in 1900 the whereabouts and occupations of 32,000, 
or 91*7 per cent., were discovered. Two-fifths were found 



TRIPARTITE GERMANY 43 

to have become agricultural labourers, one-fifth had migrated 
to West Germany, and the rest had gone to the towns of the 
province. The loss to the agriculture of the province of East 
Prussia alone by migration in 1900 was estimated at 2,450 
families, containing 10,270 young unmarried workers. 

Compared with the steady migration from the rural dis- 
tricts, the higher mortality of the East is a minor cause of the 
growing disparity in population of the two parts of the monarchy, 
though it is otherwise significant. The rate of mortality in 
the province of East Prussia was 19*3 per thousand of the 
population in 1912, against 19*6 per thousand in 1911, and 
19*5 per thousand in 1910 ; in the province of West Prussia 
it was 19*5, 19*9, and 19*7 per thousand respectively; and in the 
province of Posen it was 17*7, 19, and 19 per thousand. On 
the other hand, the rate in the province of Rhineland was 
14-8 per thousand in 1912, 17*6 in 1911, and 15*5 in 1910 ; 
in Westphalia 15*3, 17'1, and 15*4 per thousand respectively ; 
and in Hesse-Nassau 14*1, 15, and 15 per thousand. Further, 
of the nineteen Government Districts of Prussia with a birth- 
rate in 1912 below 29*8 per thousand of the population, which 
was the average for the entire State, only one was in the three 
Eastern provinces. On the other hand, six of the ten Govern- 
ment Districts in the three Western industrial provinces had 
a lower birth-rate than that of the whole kingdom. 

A further fundamental difference between East and West 
lies in the fact that the Eastern provinces are overwhelmingly 
given up to large estates, while the Western provinces, in so 
far as an agricultural character belongs to them, are the special 
home of the small owner and tenant. The difference lies in 
the mode of cultivation, arable farming being predominant in 
the East and grazing in the West. 

Of 3,400,144 agricultural holdings, with an area of 28,513,000 
hectares, enumerated in Prussia in 1907, 40 per cent, in num.ber 
and 1 per cent, in area consisted of small holdings of under half 
a hectare (about Ij acres), 22 and 4 per cent, respectively of 
holdings from half a hectare to 2 hectares, 15 and 8 per cent, 
of holdings from 2 to 5 hectares, 17 and 27 per cent, of holdings 
from 5 to 20 hectares, 5 and 31 per cent, of holdings from 20 
to 100 hectares, and 0*0 and 29 per cent, of holdings exceeding 
100 hectares. The figures on p. 44 show the incidence of the 
small holdings and the large estates respectively. 

In this respect there is the same differentiation between 
the North and South of the Empire. The occupation census 
of 1907 showed that of the area of Mecklenburg-Strelitz 
devoted to agriculture 60 per cent, consisted of holdings of 
100 hectares (247 acres) and upwards, and 30 per cent, of 



44 THE EVOLUTION OF MODERN GERMANY 



PERCENTAGE OF HOLDINGS 


AND 


AREAS 


OF SAME 


IN 




DIFFERENT PROVINCES IN 1907. 




Under 


2 to 5 1 5 to 20 


20 to 100 


Over 100 




2 Hectares. 


Hectares. 


Hectares. 


Hectares. 


Hectares. 




Per cent, of 


Per cent, of 


Per cent, of 


Per cent, of 


Per cent, of 




No. 


Area. 


No. 


Area. 


No. 


Area. 


No. 


Area. 


NO. 


Area. 


Western Provinces. 






















Westphalia 


74-6 


9-6 


123 


14-3 


10-3 


37-7 


2-8 


34-4 


01 


40 


Hesse-Nassau . . 


69-8 


11-3 


22-5 


22-6 


15-9 


43-7 


1-7 


16-5 


01 


6-9 


Rhineland 


70-8 


11-8 


15-4 ! 200 


12-3 


44-6 


1-4 


20-3 


01 


33 


Hanover 


591 


6-6 


181 12-5 


17-5 


36-7 


51 


37-6 


0-2 


6-6 


Eastern Provinces. 


i 


















East Prussia . . 


52-3 1 2-2 


14-8 


4-3 


20- 1 


17-6 


11-3 


38-8 


1-5 


371 


West Prussia . . 


54-3 2-7 


13-3 


4-2 


22-7 


23-6 


8-4 


330 


1-3 


36 5 


Pomerania 


590 2-6 


111 


3-2 


21-5 


19-7 


6-9 


23-4 


1-5 


511 


Posen 


5511 2-8 

i 


12-6 


4-2 


24-9 


27-5 


6-3 


21-5 


11 


440 



holdings of from 20 hectares (15| acres) to 100 hectares ; while 
the corresponding proportions for Mecklenburg-Schwerin were 
59*7 and 25*6 per cent., and for Anhalt 38*2 and 25*8 per 
cent. In the South the proportions were — in Bavaria 2*2 and 
28*8 per cent., in Wiirtemberg 1*7 and 17*9 per cent., in Baden 
3 and 9*2 per cent., and in Alsace-Lorraine 6*5 and 19*2 per 
cent. 

But, further, the East is the home of the large independent 
manors, which have left an indelible mark on local government, 
and have checked to a serious degree the civic and political 
development of that part of the Prussian monarchy. In the 
province of East Prussia there are 2,269 manorial districts, 
in the province of West Prussia 1,161, in the province of Posen 
1,787, in the province of Silesia 3,722, and in the province 
of Pomerania 2,382 ; while in the West there are only 333 
in the province of Hanover, 278 in that of Hesse-Nassau, 22 
in that of Westphalia, and none in the Rhine province. 

The effect of the manorial system has been to encourage 
an almost feudal relationship even down to the present day, 
in spite of the reforming influence of the Stein-Hardenberg 
legislation at the beginning of last century. Stein himself 
placed on record his sense of the almost hopeless backwardness 
and stagnation which had come over the agricultural districts 
of North-east Germany under the domination of the great 
autocratic landowners. Writing on April 22, 1802, of a visit 
to Mecklenburg, he says : — 

" The appearance of the country displeased me as much 
as the cloudy northern climate ; great fields, of which a con- 



TRIPARTITE GERMANY 45 

siderable part lies in pasture and fallow, extremely few people, 
the whole labouring class under the pressure of serfdom, the 
fields attached to single farms, seldom well built ; in one 
word, a uniformity, a deadly stillness, a want of life and activity 
diffused over the whole, which oppressed and soured me 
greatly. The abode of the Mecklenburg nobleman, who keeps 
down his peasants instead of improving their condition, strikes 
me as the lair of a wild beast, who desolates everything 
around him and surrounds him.self with the silence of the 
grave." 

When the emancipatory edict of October 9, 1807, was 
promulgated, securing to the peasants personal liberty and 
freedom from serfage and servitudes, many of the landowners, 
who had a monopoly of the official positions, tacitly declined 
to make it known, and it was only slowly that its provisions 
leaked out. In Silesia there were disturbances, and the 
landowners went so far as to call to their aid the French troops 
still in the province. The Stein-Hardenberg laws did, never- 
theless, lift the weight of legal serfage from the peasantry, 
though the spirit of feudalism has never entirely disappeared, 
and it is safe to say that it has retarded the great landowners 
themselves quite as much as the dependent peasantry and 
labourers subject to their influence. 

Dr. F. Mensel, speaking of Friedrich August Ludwig von 
Marwitz, one of Stein's most resolute opponents, lauded by 
the historian Treitschke as a " rough rider " of his time, says : 
" It is unfair to call him and the majority of his class contem- 
poraries ' Krautjunker ' (cabbage squires). The nobility of the 
Mark stood between the years 1770 and 1820 upon a higher 
intellectual level than during the succeeding half-century." 
Certainly the " Junkers " have done little to develop the civic 
and political spirit of the East. It is solely owing to them and 
to the system of great estates that down to the year 1892 no 
part of Germany was more backward in local government 
than the East of Prussia, whose provinces were then still 
organized on the principles of a law dating from 1.856. 

By the amendment of 1892, which the large landowners 
in the Prussian Diet strove at every turn to spoil and 
obstruct, and voted against as a body on the final reading, 
important reforms were introduced into local government. 
The property franchise was retained in local elections, 
but its exclusive character was taken away. Yet while the 
right to vote for and be members of local government bodies 
was given to male residents with an income of £33 per annum, 
the opponents of the law secured to the communes the right 
of withholding the franchise from any person not possessed 



46 THE EVOLUTION OF MODERN GERMANY 

of real estate by the simple device of declining to assess him 
to taxation. The three-class system of election applies still, 
as in the rest of Prussia, yet two-thirds of the representatives 
elected by each group of voters must be residents, and the 
president and the two grand-jurymen {Schoffen) must have 
been born in the parish. The plan of open voting was retained. 
Throughout the discussion of the bill the large proprietors 
strove to preserve their old privileged position in the first 
instance, and as a second line of defence to strengthen the 
position of the large peasantry as against the small proprietors. 

As has been indicated, the most obsolete feature of East 
Prussian local administration is the system of independent 
manorial jurisdiction, which still continues on a large scale. 
As early as 1850 an attempt was made to abolish m.anorial 
autonomy throughout the whole of Prussia, but the opposition 
of the large proprietors compelled the withdrawal of the 
Government's proposals so far as the Eastern provinces were 
concerned. Owing to the same hostility the law of 1802 left 
most of the manors independent administrative units, so that 
even now self-government in the modern sense does not exist 
in these districts. It is characteristic of the spirit of the East 
that until recently a relic of the old custom of servitudes 
remained in its local . government law, which empowered the 
council of a rural commune to require its citizens to perform 
" hand and span " services in connection with the execution 
of communal works. The aggregate services were estimated 
in money value, and they were allotted according to the local 
taxes paid, though, in practice, performance by deputy was 
usually allowed, or money payment to the communal funds 
might be made instead. 

Many reasons are responsible for the economic and social 
backwardness of the East of the Prussian monarchy. One 
great disadvantage is the condition of isolation created by 
the great size of the estates. The owners and cultivators of 
these estates have for generations been cut off from the 
thought, life, and manifold stimulating influences of the 
towns. Each has been a little ruler within his own sphere of 
influence, accustomed to give orders and not to receive them, 
with no one to oppose, contradict, or challenge him, and this 
unhealthy position of social superiority and ascendancy has 
checked intellectual progress and induced a spirit of stagnation 
in every department of life. Moreover, Germanism appro- 
priated the old seat of Slavonic influence between the Vistula 
and the Elbe v/ithin a period comparatively modern as counted 
in the history of civilization, and the terrible devastations 
wrought in the country, first in the Thirty Years' War, then 



TRIPARTITE GERMANY 47 

in the Seven Years' War of Frederick the Great, and finally 
by the Russians and French at the beginning of the nineteenth 
century, successively checked or destroyed the progress that 
had been slowly and laboriously made. 

The defenders of the East also justifiably plead that their 
climate is inhospitable and their land far less fertile than 
that of the West. The Yvest has on the whole a comparatively 
mild winter — the mean temperature in January being from 
one to two degrees (Celsius) above zero — and a temperate 
summer ; while the East has a severe winter, with a mean 
temperature in January of from one to fiVQ, degrees (Celsius) 
below zero, and a warmer summer. " While in the West," 
writes Herr Evert, " the average temperature keeps for a long 
time together below freezing-point only in the hilly regions, 
even in the coldest months, in the East frost prevails as a rule 
from the beginning or end of December into March ; often, 
indeed, it begins in November. While thus in the Rhenish 
lowlands field work can often be continued into December 
and in part can be resumed in February, East of the Elbe one 
expects work to be interrupted from November until April 
or May by frost, snow, and rain. In the extreme North-east 
the period of vegetation lasts only from four to five months." 

The effect of unfavourable conditions of soil and climate 
is seen in the less productivity of the country. The average 
yield of rye per hectare (2| acres) in the whole of Prussia for 
the years 1903 to 1912 was" about 36*8 cwts. The yield in the 
Western provinces ranged from 35 to 39 cwts., but none of 
the Eastern provinces exceeded 33*2 cwts., the yield of Posen, 
while West Prussia had a yield of 30*4. cwts., and East Prussia 
one of 31 cwts. 

" For a long time the East has in economic matters been 
the community's ' child of care,' " writes Herr Evert. The 
rest of Prussia knows that to its cost. The East seeks for 
and obtains a protection which falls to the agriculture of 
hardly any other European country, yet it does not thrive : 
the customs duties have to be increased every few years for 
its benefit, special legislation without parallel in any other 
German State has been passed in its interest, yet it suffers 
from perpetual need. 

As between North and South Germany generally, so between 
the West and East of Prussia in particular, there is a great 
gulf fixed in political thought. The agricultural districts 
East of the Elbe form the stronghold of Prussian Conservatism, 
whose political strength is enormously increased by a narrow 
franchise and the indirect method upon which the national 
Parliament is elected. 



48 THE EVOLUTION OF MODERN GERMANY 

'' The Prussian Junker represents the most reactionary 
class in the world," said a German political leader recently ; 
" so long as a Junkerdom exists in Germany, and is a leading 
factor in politics, there is no possible hope of progress." The 
sentiment is not free from party animus, yet there can be 
no gainsaying the fact that from the beginning of Prussian 
constitutional life the Junker party has, as a whole, acted as 
a brake upon every forward movement. The Conservatism, 
like the Liberalism, of a countrj^ like Prussia must inevitably 
differ both in kind and degree from that of countries of free 
political institutions, in which Conservatism and Liberalism 
are less the negation than the correctives one of the other. 
But the Conservatism of the provinces East of the Elbe has 
a counterpart nowhere else in Germany, or even in Western 
Europe. 

The antagonism between the agrarians of the Prussian 
rural districts and the Liberal parties, whose chief strength 
is in the towns, finds most pointed expression in the perpetual 
conflict on the subject of parliamentary representation. There 
has been no alteration in the representation of the old pro- 
vinces of the kingdom since 1858, or of the new since 1867, 
though since the latter year the population of Prussia has 
increased from twenty-four to over forty millions. The original 
basis of representation in the Lower House of the Diet was 
one member to every 50,000 inhabitants, which gave an assembly 
of 433 members. To-day over 90,000 inhabitants fall on an 
average to one seat, and if that ratio of representation were 
applied there would be a great transference of seats from the 
rural to the urban electoral districts. The metropolis alone 
would have 22 seats instead of twelve, and many other large 
towns would double and treble their representation, while 
the agricultural districts would lose proportionately. As it 
is, there is to-day one electoral district with 34,000 inhabitants 
(Hohenzollern) and another with ten times that number 
(Kattowitz). The 5,867,000 inhabitants of the Eastern pro- 
vinces of East and West Prussia and Posen elect eighty-three 
deputies, an average of 70,690 inhabitants per deputy, while 
the 13,467,000 inhabitants of the Western provinces of West- 
phalia, Rhineland, and Hesse-Cassel elect 123, an average 
of 109,500. The result of the present unequal representation 
is that an East Prussian or Pomeranian peasant, who is not 
allowed by law to form a trade union or hold a public meeting, 
has many times the representative value of a Berlin professor 
or a Westphalian merchant prince. 

The unchanging preponderance of the East Prussian 
country party in the national Diet has been detrimental to 



TRIPARTITE GERMANY 49 

progress in many ways. This party has been behind all the 
measures which have been passed and proposed both in that 
assembly and in the Reichstag for the preferential treatment 
of agriculture at the expense of industry. It has opposed 
scheme after scheme for extending — even in the West of the 
monarchy — the system of waterways so essential in a country 
like Germany, with a small seaboard and a deep Hinterland^ 
and in doing this it has candidly admitted that its purpose 
has been to prevent the cheapening of inland transport costs, 
to exclude foreign corn, and so to check the advance of 
industry. When at last its opposition has been withdrawn, 
as in 1905, it has been because concessions have been given 
in other directions, and these have generally included the 
dismissal of an obnoxious Minister. 

The same party is antagonistic to progress in education, 
and fights as vehemently to-day as a generation ago against 
the urgent need for substituting professional school inspectors 
for the clerical inspectors who unselfishly, yet in many cases 
unsuccessfully, devote their time to this difficult work. It 
is no exaggeration of the Junker's view of primary education 
to say that if he had his way the instruction of the rural classes 
of North and East Prussia would not merely be confined to 
the most rudimentary subjects, but would be mainly directed 
towards checking ambition, whether mtellectual or material, 
and towards positively unfitting the agricultural labourers' 
children for a wider life than that in which their fathers 
have been brought up. The schools and educational arrange- 
ments of Prussia are often held up to the world's admi- 
ration as denoting the highest level of excellence hitherto 
achieved in this sphere. In general it may be conceded that 
Prussia's best educational work has not been excelled else- 
where. Yet much of this work is neither excellent nor good. 
Many of the schools of rural Prussia, as of Mecklenburg, can 
only be compared with the dame schools which were swept 
away by the Education Act of 1870, or with those Irish schools- 
upon which Matthew Arnold wrote one of his delightfully 
unconventional reports. For all the features which Arnold 
noted in the educational arrangements of rural Ireland half 
a century ago are present in many of the villages and manors 
of North Germany to-day — under-staffed classes, inferior, 
tumble-down buildings, ill-paid teachers, penurious managers 
who grudge the cost of the scholars' most meagre intellectual 
equipment and administer enlightenment on homoeopathic 
principles. 

For this the Government is not altogether to blame ; it 
does what it ^an for such schools, and would do more if 

4 



50 THE EVOLUTION OF MODERN GERMANY 

there were any effective force behind it, but such a force is 
lacking : for the deputies who represent Prussia East of the 
Elbe in the Diet are content that things should remain as 
they are. It was his conviction that the Conservatism of 
rural Prussia was fair neither to the country nor to itself that 
led Prince BiJlow on one occasion to urge the country deputies 
to " take their blinkers off " and look fairly at the course of 
national events and the hard facts of life. 

If, however, the large proprietors of the East are in general 
characterized by a total lack of appreciation of modern ways 
and a marked imperviousness to the political movements of 
the times, many of them play an invaluable part in the life 
of the country, as administrators, as pioneers in progressive 
agriculture, and within a narrow sphere as disseminators of 
the newer thoughts and impulses current in the West. It 
is no paradox to say that nothing would contribute more 
effectually towards the healthy development of the rural East 
than the shattering of the bulwark of political privilege upon 
which it most relies for security. For half the deficiencies 
of the landed interest are due to its intellectual and social 
isolation, and one of the causes of this isolation is its privileged 
political position. Deprived of that enervating advantage, 
and compelled to fight in fair and equal contest for whatever 
influence it could lawfully assert, its moral power would be 
increased and its economic life invigorated. 



CHAPTER III 

THE EPOCH OF INDUSTRY 

Economic influence of the French War and the establishment of the Empire — 
Increase of the " large " towns — The ratio of urban to rural population 
at various dates — Geographical incidence of the growth of population in 
recent years — The migration to the industrial districts — Comparison of 
occupation censuses — Classification of industrial workpeople in 1905 — 
Development of the coal, iron, and engineering industries since 1871 — 
The shipbuilding industry — The electrical industry — The textile trades 
— The tendency towards industrial concentration — The position of the 
handicrafts and the home industries — State efforts to encourage the 
rural industries. 

GERMANY'S rush forward as an industrial and mercantile 
country may, for practical purposes, be dated from the 
successful issue of the war with France in 1871. That 
event, concurrently with the establishment of the Empire, gave 
to the nation new life, both politically and commercially. For 
the first time the Germans, as a nation, became conscious of 
collective power and of the great possibilities which this power 
placed within their reach. A new youth — that unspeakable 
gift which the gods so rarely bestow upon mortals — was given 
to them, and with all youth's energy, ardour, and audacity 
they plunged at once into a bold competition with nations 
of which they had hitherto stood in a certain awe, and which, 
for their part, had barely taken their young rival seriously. 
The losses in the war, by wounds and disease, had severely 
drained the manhood of the country ; but nature speedily 
made good the hurt, and history repeated the teaching which 
Malthus put into the formula : " Wars do not depopulate 
much while industry remains in vigour." 

Before the life-and-death contest with France, for which 
the Austrian campaign of 1866 had been a well-considered 
preparation, Germany had laid the foundations of an economic 
career ; and that contest fought to its victorious close, the 
nation at once applied itself assiduously to the realization of 
its ambition to win new laurels on the battlefields of industry. 

Material enterprise of every kind was fertilized by the 
capital which now became loosened, and sought new and larger 
channels of employment. Everywhere a restless spirit of 

51 



52 THE EVOLUTION OF MODERN GERMANY 

adventure asserted itself. Old cities and towns, which had 
rusticated for half a century, sprang forward, as though a 
vast accumulated momentum had suddenly been released, 
and increased enormously in population and wealth. 

In 1871 Germany had eight " large " towns of over 100,000 
inhabitants ; in 1880 the number was 14 ; in 1890 there were 
26 such towns, yet only seven whose population exceeded a 
quarter of a million ; in 1895 the number of " large '* towns 
increased to 80, in 1900 to 33, in 1905 to 41, and in 1910 to 
48, of which 16 had over 250,000 inhabitants and seven had 
over half a million. In the United Kingdom there were, in 
1911, 44 towns with a population exceeding 100,000, of which 
15 had over 250,000 inhabitants and four had over half a 
million. 

DISTRIBUTION OF THE POPULATION. 





1871. 


1880. 


1890. 


1805. 


1900. 


1910. 


Residents in "Large" Towns (of 
over 100,000 inhabitants) 

"Medium" Towns (20,000 to) 
100,000 inhabitants) . . . . J 

"Small" Towns (5,000 to 20,000 [ 
inhabitants j 


4-8 

7-7 

11-2 


7-2 

8-9 
12-6 


11-4 

9-3 

11-6 


13-6 
10-6 
13-6 


16-2 
12-6 
13-6 


21-3 
13-4 
14- 1 


Town Population 


23-7 


28-7 


32-2 


37-6 


423 


48-8 


Rural Towns (2,000 to 6,000 in-1 
habitants) ) 

Rural Communes (imder 2,0001 
inhabitants) j 


124 
63-9 


12-7 
68-6 


10-3 
57-6 


12-2 
60-2 


12-1 
46-6 


11-2 
40-0 


Rural Population 


76-3 


71-3 


67-8 


62-4 


67-7 


61'2 



Of Germany's " large " towns the metropolis has most 
increased since urban expansion became the universal rule. A 
hundred years ago Berlin was an insignificant town of some 
160,000 inhabitants. Half a century later its population had 
not reached 300,000, and when the Empire was established in 
1871 it had only just turned 800,000. From that time its 
growth was rapid. In 1875 the population was 968,600, and 
two years later the heart of the Berliner swelled with pride 
when his town became a " million town." By 1880 the 
population had reached 1,150,000, in 1885 it had grown to 
1,315,000, in 1890 to 1,578,000, in 1895 to 1,773,000, in 1905 
to 2,040,000, and in 1910 to 2,071,000. 

The effect upon the value of land has been magical, but 



THE EPOCH OF INDUSTRY 



58 



also, from the standpoint of the poorer inhabitants, deplorable. 
Rents both in and around the city have become higher than 
in any other part of Germany, and they have created a housing 
problem which becomes more acute every year. 

This growth of the large towns merely symptomizes a 
revolution which has entirely changed the ratio of urban to 
rural population. Heinrich Sohnrey has estimated that the 
population of the Empire has at various periods from 1871 
forward been distributed amongst towns and rural districts 
in the ratios shown on the preceding page. 

Thus, during a period of forty years, the population of the 
" large " towns increased to the extent of 16*5 per cent, of 
the whole (comparing with 24 per cent, in England and Wales 
in 1911), that of the " medium " towns to the extent of 5*7 
per cent., that of the " small " towns to the extent of 2*9 per 
cent., making the entire " town " population 23*1 per cent, 
larger than before ; while, on the other hand, the " rural 
towns," which constitute a sort of neutral borderland between 
town and country, declined to the extent of 1*2 per cent, of 
the whole, and the purely rural population decreased to the 
extent of 23*0 per cent. The total population of the 1,299 
urban communes in 1910 was 81,673,600, and that of the 
74,640 rural towns and communes 33,252,400.i The present 
increase of population, which amounts to over 800,000 per 
annum, in the main swells the towns, while the rural districts 
are still declining relatively and in part absolutely. 

The great growth of population which has fallen to the 
past half-century has naturally taken place in the States and 
provinces which have, during that period, developed the 
greatest industry. In 1871 the States which now form the 
German Empire had a population of 41,059,000, in 1910 their 
population was 64,926,000. The yearly increase during the first 
decennium of this period was 1*08 per cent., but during the last 
1'41 per cent. When the States are taken separately, however, 
great disparity will be seen. Thus the population of States 
with large industries increased as follows during forty years : — 



states. 


Population In i 

1 


Increase. 


Annual 
Increase 
Per Cent. 


1871. 


1910. 


Prussia 
Saxony 

Anhalt 

Bnmswick 

Bremen 

Hamburg 


24,689,000 
2,666,000 
203,000 
312,000 
122,000 
339,000 


40,165,000 

4,807,000 

331,000 

494,000 

300,000 

1,016,000 


15,476,000 
2,251,000 
128,000 
182,000 
178,000 
676,000 


1-57 
2-28 
1-68 
1-46 
8-65 
4-99 



^ Aocording to the grouping on p. 62. 



54 THE EVOLUTION OF MODERN GERMANY 



On the other hand, the population of the States with a 
decidedly agricultural character grew far less rapidly : — 





Population in 


Increase. 


Annual 


states. 


1871. 


1910. 


Per Cent. 


Bavaria 

Wiirtemberg 

Mecklenburg-Schwerin 
Mecklenburg-Strelitz 


4,863,000 

1,819,000 

658,000 

97,000 


6,887,000 

2,438,000 

640,000 

106,000 


2,024,000 

619,000 

82,000 

9,000 


1-04 
0-85 
0-37 
0-23 



The difference is seen still more plainly if the provinces 
of Prussia be divided into those of a predominantly industrial 
and those of a predominantly agricultural character : — 



Provinces. 


Population in 


Increase. 


Annual 
Increase 
Per Cent. 


1871. 


1910. 


Industrial (predominantly) 
Brandenburg 
Westphalia 
Rhineland . . 
Berlin 

Agricultuhal (predomi- 
nantly). 
East Prussia ... 
West Prussia 

Pomerania 

Posen 


2,037,000 

1,775,000 

3,579,000 

826,000 

1,823,000 
1,315,000 
1,432,000 
1,584,000 


4,093,000 
4,125,000 
7,121,000 
2,071,000 

2,064,000 
1,703,000 
1,717,000 
2,100,000 


2,056,000 
2,350,000 
3,542,000 
1,245,000 

231,000 
388,000 
285,000 
626,000 


2-63 
3-31 
2-47 
3-77 

0-32 
0-74 
0-49 
0-81 



Silesia and Schles wig-Hoist ein, though on the whole agricul- 
tural provinces, are here disregarded, since the former has 
in the south a large mining and industrial district and the 
population of the latter is largely increased by the towns of 
Altona and Kiel, to which alone falls nearly a quarter of the 
total population of the province, 

Prussia has also had for many years a large excess of 
immigrants over emigrants, and here, too, the towns and 
industrial districts have alone gained. Until 1865 Prussia 
was not able to retain its natural yearly increment of popula- 
tion, for every year a considerable number of inhabitants left 
the country in excess of those who came from other States. 
During recent years the reverse has been the case. Between 
1895 and 1900 43,222 more persons entered Prussia from other 
German States and from abroad than left it, and between 



THE EPOCH OF INDUSTRY 55 

1900 and 1905 96,645 more. A gain of population by immi- 
gration has not, however, fallen to all the provinces equally. 
East Prussia, West Prussia, Pomerania, Posen, and Silesia 
have lost heavily, and the same may be said of the kingdoms 
of Bavaria and Wlirtemberg. On the other hand, Berlin, 
Hamburg, the province of Westphalia, the Rhine province, 
and the kingdom of Saxony have gained greatly. 

It would seem, however, that within Prussia the towns 
are now no longer increasing to the former extent owing to 
immigration. While during the period 1895 to 1900 the excess 
of immigration over migration in the " large " towns was 
426,747, equal to 8*5 per cent., these same towns had an increase 
from this cause of only 282,230, or 4*8 per cent., during 
the following five years, though their number grew in the 
interval from 22 to 28. The migration during 1895-1900 
actually exceeded the immigration in one '^ large " town, 
Crefeld, and also in ten of the 76 urban circles, though some 
of these districts had important industries. During the fol- 
lowing five years, 1900 to 1905, 16 urban circles in Prussia 
had a larger migration than immigration. 

Yet a part of this loss to the larger towns is more apparent 
than real. For it is found that where the movement to these 
towns has received a check, the rural districts in the neigh- 
bourhood have rapidly increased, owing to the improvement 
of traffic facilities and the tendency to remove industrial 
undertakings into the open country. For the present these 
extra-urban areas are independent, but eventually many of 
them will no doubt be incorporated without necessary alteration 
of their rural character. At the census of 1900 Prussia had 
489 rural circles, and 73 of them reported an excess of immi- 
gration overemigration, the aggregate increase being 485,509, 
while during the following five years the number of circles 
which grew from this cause was 80, and their total excess of 
immigration was 430,055, or 55,454 less than during the 
preceding quinquennium. Many of these rural circles had old 
industries of their own, but in the main their expansion was 
a result of overflow from the large adjacent towns. 

Where an excess of migration took place it was in the main 
confined to the East of the kingdom, a central district in the 
Mark of Brandenburg, portions of North-west Silesia, and 
the agricultural districts of the West and North-west. 

Still more significant evidence of the economic transition 
through which Germany is passing, changing the centre of 
gravity from the country to the towns, is furnished by the 
occupation censuses of 1882, 1895, and 1907. 

It is estimated that in 1843 the population engaged in 



5« THE EVOLUTION OF MODERN GERMANY 

agriculture, forestry, gardening, and fishing formed 61 per 
cent, of all persons earning a livelihood. When the first 
national occupation census was taken in 1882 it was found 
that the proportion had fallen to 43*4 per cent. ; at the next 
occupation census of 1895 a further decline was found to have 
taken place to 36*2 per cent., while the proportion in 1907 was 
only 32*7 per cent. On the other hand, the proportion of all 
occupied persons engaged in industry increased from 33-7 per 
cent, in 1882 to 36*1 per cent, in 1895, and 37*2 per cent, in 
1907 ; while during the same period the percentages engaged 
in trade and transport increased from 8*3 to 10*2 and 11'5. 
Thus, while between these three enumerations the share of 
agriculture decreased by 10*7 per cent, of the whole, the share 
of industry increased by 3*5 per cent., and that of industry 
and commerce together by 3*2 per cent. 

The following table contains a comparison of the percentages 
of the occupied population engaged in agriculture, industry 
(including mining), and trade and transport respectively in 
the four largest States of the Empire at the three periods 
1882, 1895, and 1907 :— 





Agriculture and 
Forestry. 


Industry. 


Trade and Transport. 




1882. 


1895. 


1907. 


1882. 


1895. 


1907. 


1882. 


1895. 


1907. 


German 




















Empire 


43-4 


36-2 


32-7 


33-7 


36-1 


37-2 


8-3 


10-2 


11-6 


Prussia 


43-4 


36-1 


32-6 


33-7 


36-9 


37- 1 


8-4 


10-3 


11-4 


Bavaria 


56-2 


46-3 


46-6 


23- 1 


28-0 


27-4 


6-3 


8-5 


9-6 


Saxony 


22-0 


16-7 


11-9 


54-3 


65-0 


56-3 


9-8 


12-2 


130 


Wurtemberg 


48-3 


44-4 


41-3 


32-3 


33-1 


35-3 


6-1 


7-1 


8-2 



It will be observed that the proportion engaged in agri- 
culture and forestry declined in every State during the 25 
years to which the comparison applies, viz. in the Empire as 
a whole by 10*7 per cent, of the whole, in Prussia by 10*8 per 
cent., in Bavaria by 9*6 per cent., in Saxony by 10*1 per cent., 
and in Wiirtemberg by 7 per cent. On the other hand, the 
proportion engaged in industry increased in the Empire by 
8*5 per cent, of the whole, in Prussia by 3*4 per cent., in Bavaria 
by 4-1 per cent., in Saxony by 2 per cent., and in Wiirtemberg 
by 8 per cent. So, too, the proportion engaged in trade and 
commerce increased in the Empire by 8*2 per cent., in Prussia 
by 8 per cent., in Bavaria by 8*8 per cent., in Saxony by 8*2 
per cent., and in Wiirtemberg by 2*1 per cent. 

A further table showing the number of persons engaged in 



THE EPOCH OF INDUSTRY 



57 



the important trade groups in 1907, with the rates per 1,000 
of all occupied persons so engaged in 1895 and 1907, indicates 
not only which are the great staple trades and industries, but 
which of these are making the most progress : — 







Per 1,000 of aU Occupied 




Number of Persons 


Persons. 


Groupa of Trades and Industries. 


Employed in 








1907. 


1895. 


Mining and Smelting 


963,278 


31-9 


24-8 


Stones and Earths (Quarries, 








Brickworks, etc.) 


714,520 


23-6 


21-9 


Metal Working 


! 1,186,099 


39-2 


37-6 


Machine Industry . . 


907,048 


30-0 


16-8 


Chemical Industry 


158,776 


5-3 


4-6 


Ulimiinant Industry 


75,879 


2-6 


1-9 


Textile Industry 


1,057,243 


350 


41-3 


Paper Industry 


206,763 


6-8 


6-9 


Leather Industry . . 


219,443 


7-3 


7-4 


Wood Industry 


787,754 


26-1 


28-2 


Food and Luxury Industry 


1,127,516 


37-3 


38-3 


Clothing Industry 


1,421,695 


470 


67-7 


Cleaning Industry 


270,374 


8-9 


8-3 


Building Industry 


1,905,987 


630 


69-1 


Photographic Industry . . 


197,903 


6-6 


6-2 


Artistic Industry 


37,111 


1-2 


1-2 



It will be seen that there has been the greatest growth 
in the mineral and metal industries, particularly in the manu- 
facturing branches (the machine industry), while the textile 
and clothing industries both show a marked decline, which 
in the case of the former is probably to be explained in part 
by the use of improved and larger machines, and in the latter 
to foreign competition. 

These general industrial statistics may be supplemented 
by figures showing for 1912 the number of workpeople employed 
in undertakings liable to inspection by Government factory 
inspectors — ^in the main the employees in factories and work- 
shops containing at least ten workpeople. The total of such 
workpeople in the year named was 7,271,725, made up as 
follows : — 





Males. 


Females. 


Total. 


Per Cent, of the Whole. 




(a) 


(6) 


(0 


(a) 


ib) 


ic) 


Adults.. 
Juveniles 
Children 


5,339,975 

358,327 

7.780 


1,379,646 

179,964 

6,133 


6,719,521 

538,291 

13,913 


73-4 

4-9 
0-1 


190 
2-6 
01 


92-4 
7-4 
0-2 




6,706,082 


1,666,643 


7,271,725 


78-4 


21-6 


100-0 



58 THE EVOLUTION OF MODERN GERMANY 

These workpeople fell into the following groups of indus- 
tries : — 

Mning, Smelting, and Salt Works 1,184,255 

Industries of Stones and Earths . . . . . . 662,980 

Metal Working 661,974 

Machine Industries .. .. .. .. .. 1,130,740 

Textile 947,325 

Wood 451,742 

Food, Drinks, Tobacco, etc 694,320 

Clothing 423,569 

Cleaning 62,817 

Paper, etc 195,685 

Polygraphic (Printing, etc.) 197,226 

Chemical Industries 168,252 

Building Yards, etc 286,299 

Leather 116,603 

Oil, Fat, Illuminants, etc .. 81,164 

Miscellaneous . . . . . . . . . . . . 16,774 

Total ' .. ., .. 7,271,725 

Of these workpeople 4,341,253 belonged to Prussia, 839,107 
to Saxony, 621,761 to Bavaria, 276,697 to Baden, 268,7646 
to Wiirtemberg, 237,143 to Alsace-Lorraine, and 131,538 to 
Hesse. 

The more important groups were most largely represented 
in the following States : — 





Prussia. 


Bavaria. 


Saxony. 


Wttrtem- 
berg. 


. Baden. 


Alsace* 
Lorraine. 


Mining 


991,134 


20,896 


38,406 


2.239 


1,057 


55,868 


Stones and Earths . . 


367,841 


79,786 


56,236 


13,227 


15,088 


18,930 


Metal Working . . 


366,347 


48,574 


59,850 


26,932 


34,557 


8,668 


Machinery . . 


608,631 


79,447 


133,729 


57,462 


41,347 


21,782 


Chemical . . 


100,842 


23,473 


8,899 


2,769 


4,493 


3,569 


Textile 


366,197 


57,116 


231,791 


46,058 


32,306 


67,688 


Paper 


86,483 


15,885 


38,392 


9,800 


10,079 


3,093 


Wood 


232,002 


46,782 


45,971 


18,487 


16,460 


7,052 


Food, Drinks, To- 














bacco, etc. 


367,201 


51,986 


46,763 


21,947 


52,949 


15,792 


Clothing 


210,827 


35,276 


55,626 


19,803 


6,703 


6,338 



The total number of factories and workshops was 311,582. 

One may be helped to realize the advance which Germany 
has made in industry and commerce by comparing, so far as 
statistical data are available, the output in certain great 
branches of production at the present time with that of thirty 
or forty years ago. 



The Coal Mining Industry. 
Perhaps the most striking progress has been made by the 
mineral and metal industries. The principal coalfields are 



THE EPOCH OF INDUSTRY 



59 



those of the Ruhr, in Westphalia ; tlie Saar, lying below Trier, 
between the Rhine and the French frontier ; Upper and Lower 
Silesia, and Saxony (Zwickau) ; while lignite is mined on 
the Oder, on the Saale, and in Lusatia. The great movement 
of this industry began with the general industrial expansion 
which followed the French War. In 1862 the entire coal 
output of the German States and Luxemburg was 15,570,000 
metric tons ' ; in 1872 it was 33,306,000 tons. The output 
of the first five years after the war is compared with that of 
the five years from 1908 forward, the latter figures excluding 
Luxemburg : — 





Metric Tons. 




Metric Tons. 


1871 


. . 29,398,000 


1908 


. . 146.094,000 


1872 


. . 33,306,000 


1909 


. . 146,964,000 


1873 


. . 36,392,000 


1910 


. . 151,073,000 


1874 


. . 35,919,000 


1911 


. . 158,581,000 


1875 


. . 37,436,000 


1912 


. . 174,875,000 



In addition there were produced in 1912, 80,935,000 tons 
of brown coal or lignite, 31,249,000 tons of coke, and 25,422,000 
tons of briquettes, all for the most part in Prussia. 

The coal industry of Prussia has multiplied many times 
over during the past fifty years. The production in 1852 
was 5,150,000 metric tons, and by 1865 it had increased to 
18,590,000 tons. After the French war it increased as follows : 
1871, 25,950,000 tons ; 1872, 29,500,000 tons ; 1873, 32,350,000 
tons ; 1874, 31,930,000 tons ; 1875, 33,410,000 tons. From 
that time the increase was still more rapid, until in 1912 the 
output stood at 165,303,000 tons (besides 65,804,000 tons of 
brown coal or lignite), an increase of 460 per cent, in thirty 
years. The number of workmen employed had in the mean- 
time increased from 596,960, exclusive of 57,880 engaged in 
the production of lignite, and the value of the output to 
£86,128,000, exclusive of the value of lignite, viz. £6,523,000. 

The various State mines in Prussia used to produce about 
14 per cent, of the total output, but new pits have been sunk 
at a cost of several million pounds, and they have materially 
increased that proportion. 

Of Germany's coal production, the Westphalian mines 
alone yield more than one half (about 57 per cent.) and those 
of Silesia more than one quarter, while Prussia's entire share 
is about 95 per cent. 

The great centre of the coal industry is Dortmund, whose 
growth is yet of comparatively modern date. In 1792 the 

* The data contained in the foUo'wing pages are in the main taken from 
German official publications. Quantities are given, unless otherwise stated, 
in metric tons (0985 English ton) of 20 centners (110' 23 English lb,), and the 
mark is, for convenience, taken as the eqmvalent of a shilling. 



60 THE EVOLUTION OF MODERN GERMANY 

154 small coal mines which existed in the present Dortmund 
official mining district employed together only 1,357 men, 
and their output was 176,670 tons. In 1880 there were 202 
mines with 80,152 men and an output of 22,495,204 tons ; 
in 1900 the number of collieries was only 167, but that of the 
miners was 226,902, and the output was 59,618,000 tons ; 
and in 1912 the collieries numbered 165, the miners 863,879, 
and the output was 100,265,000 tons. In 1792 the production 
per man was 130 tons, but it was 270 tons in 1912 ; the 
value of the output was then £25 per head, it is now £150. 
A hundred years ago the mines had on an average nine men 
each ; to-day the average is above 2,000, while many employ 
from 5,000 to 8,000. 

The law of diminishing returns does not as yet trouble the 
German colliery industry. Technical improvements and more 
intensive exploitation of the mines have increased the output 
and have reduced the costs of production, and the return on 
capital is to-day larger than ever. It is at the same time a 
question to what extent the higher prices and profits are due 
to the syndicating of the industry and represent monopoly 
gains. The Rhenish- Westphalian Coal Syndicate controls the 
major pai;t of the total production of the country. The 
largest individual shares fall to the Gelsenkirchen Mining 
Company, the Harpen Mining Company, and the Hibernia 
Company. 

It was estimated some time ago that 70 per cent, of the total 
output of the collieries affiliated to the Syndicate was used 
directly for industrial purposes, more than one-quarter being 
supplied to smelting works and iron and steel works, about 
one-tenth to iron and steel manufactories, and an additional 
6 per cent, to other metal and machine trades. Further, 
between 6 J per cent, was used in the production of coal, coke, 
and briquettes, 15 per cent, for domestic purposes, lOj per 
cent, by the railways and tramways, and 8| per cent, in 
gas making. 

Germany still imports some ten million tons of coal annually, 
but three times this amount is exported. Almost the whole 
of the imported coal comes from Great Britain, and is supplied 
to seaports towns, though many inland towns receive it by 
river way. The Westphalian Syndicate is doing its best by 
judicious underselling to capture the English trade, but its 
efforts do not seem to commend themselves to the other indus- 
tries. " Opinion," wrote a Berlin commercial journal recently, 
'' is very divided as to whether it is to the interest of Germany 
to try to exclude English coal. It is pointed out that the 
import of this is largely, and, indeed, mainly, carried in German 



THE EPOCH OF INDUSTRY 61 

bottoms. The restriction of the trade would therefore injure 
German shipping, and do away with faciUties for the transport 
of German industrial products to England." It would, however, 
be unsafe to base on this argument any expectation that the 
Coal Syndicate will relax its efforts to drive English coal out 
of the market. The greater part of the coal exported from 
Germany goes to Austria-Hungary, Holland, Belgium, and 
France. 

The Iron and Other Mining Industries. 

The development of the iron trade has been even more 
remarkable. The production of iron ore in all Germany with 
Luxemberg in 1862 was only 2,215,000 metric tons. By 1872 
it had increased to 5,896,000 tons. Then the iron industry 
for a time declined, owing to the foreign competition in pig- 
iron, facilitated by the low duties, whose entire repeal was 
enacted in 1875 ; the production in 1876 was only 4,712,000 
tons. After 1880 there was a revival, and steady and almost 
unbroken progress has continued until the present time, when 
the output of iron ore is four times that of thirty years ago, 
though the imports have in the meantime increased until they 
double the exports. The production of iron ore was as 
follows in the years compared, the earlier figures including 
and the later excluding Luxemburg : — 





Metric Tons. 






Metric Tons. 


1872 


. . 6,896,000 


1908 




.. 18,830,000 


1873 


.. 6,177,000 


1909 




.. 20.130,000 


1874 


. . 6,137,000 


1910 




.. 22,965,000 


1876 


. . 4,730,000 


1911 




.. 24,319,000 


1876 


. . 4,712,000 


1912 




.. 27,200,000 



Further, while 32,180 men were employed on an average 
in the principal iron-ore mines in 1886, the number in 1912 
was 40,880. 

The output of other minerals in 1912 comprised : of copper 
ore, 996,400 tons ; of crude lead, silver, and zinc ore, 2,928,600 
tons ; of sulphur pyrites, 262,700 tons ; of crude mineral 
oil, 135,000 tons; of tin, cobalt, nickel, and bismuth ores, 
47,500 tons ; of wolfram ores, 5,100 tons. The imports of all 
these minerals greatly exceed the exports. 

Potash salt mining has only become an important industry 

I during the past thirty years. In 1886 there was an output 

; of 945,300 metric tons of raw salt, valued at £563,700, but 

! in 1912 one of 12,458,000 tons, valued at £6,293,000. The 

mines employed in 1912 nearly ten times as many workpeople 

as thirty years ago. 



62 THE EVOLUTION OF MODERN GERMANY 

The following were the workpeople employed on an average 
in 1882 and 1912 in the various mining industries : — 



Mining Industry. 



Coal 

Lignite . . 

Rock Salt 

Iron Ore 

Potash Salts 

Zinc Ores 

Lead Ores 

Silver and Gold Ores . . 

Copper Ores 

Coke 

Briquettes 

Other Mining Products 



1882. 



1912. 



195,958 


610,988 


26,546 


65,412 


767 


4,056 


38,783 


40,877 


3,638 


33,828 


12,781) 




20,328 \ 
6,253) 


22,314 




12,977 


13,228 


— 


29,177 


— 


22,026 


— 


3,672 



The Iron and Steel Industries. 

The development of the iron and steel industries has fol- 
lowed similar lines, being both checked and encouraged by 
the same causes. 

The production of the blast-furnaces of Germany in 1862 
was 685,000 tons ; but in 1875 it was 2,025,000 tons. The 
iron duties were then repealed and the large imports of English 
pig-iron handicapped the struggling young industry. Between 
the years 1869 and 1879 the number of ironworks had decreased 
by nearly one half, and in the latter year the number of work- 
people employed in the smelting industry was only 60 per 
cent, that of 1873. Protection was introduced in 1879, and 
since that time progress was continuous, the production 
doubling in fifteen years. In 1882 the pig-iron production of 
the world amounted to 21,000,000 metric tons, of which 
8,600,000 tons fell to Great Britain, 4,600,000 tons to the 
United States, 3,400,000 tons to Germany with Luxemburg, 
and 2,000,000 tons to France. In 1890*^ the United States 
took the first place, and in 1903 Great Britain fell back again 
in favour of Germany, which has held the second place since. 
In 1876 there were in Germany 435 furnaces, of which only 
225 were in blast ; in 1886 there were 285 furnaces, of which 
215 were in blast ; in 1906 the numbers were 315 and 288 
respectively ; in recent years the numbers out of blast have 
been : in 1910, 42 out of 304 ; in 1911, 37 out of 312 ; and in 
1912, 25 out of 316. It should be borne in mind, however, 
that the modern furnaces are capable of a much larger produc- 
tion than those of twenty years ago. The amount of pig-iron 



THE EPOCH OF INDUSTRY 



68 



produced at intervals of thirty years was as follows, the earlier 
figures including and the latter excluding Luxemburg : — 



Metric Tons. 




Metric Tons. 


.. 2,137,000 


1908 


. . 10,681,000 


.. 2,216,000 


1909 


.. 11,377,000 


. . 2,713,000 


1910 


.. 13,113,000 


. . 2,897,000 


1911 


. . 13,739,000 


. . 3,364,000 


1912 


. . 16,221,000 



Of Germany's production of pig-iron in 1912 3,055,000 tons 
were foundry pig, 370,400 Bessemer, 9,038,000 Thomas, 2,121,000 
tons steel and spiegel iron, and 509,700 puddling pig ; 102,000 
tons were cast goods of first smelting. Of this output two- 
fifths were produced in Rhineland-Westphalia. 

The larger part of this increased production has been 
needed for home consumption. While the consumption of 
pig-iron was 113 lb. per head of the population on the average 
of the years 1876-1880, it increased to an average of 220 lb. 
during the years 1891-1895, to 356 lb. in 1900, and to 528 lb. in 
1912. Down to 1901 Germany continued to import more 
pig-iron than she exported ; since then, with the exception of 
one year (1907), the exports have exceeded the imports, the 
excess in 1911 for the entire customs area being 739,000 tons 
(the imports being 481,000 tons and the exports 1,220,000 
tons). While 7,213,000 tons of pig-iron were consumed at 
home in 1896, the amount consumed in 1912 was 16,775,000 
tons. 

Thirty years ago Germany's production of steel was barely 
half a million tons annually. It now exceeds seventeen million 
tons, and since 1892 has increased sixfold, as the following 
figures show (Luxemburg is included) : — 







Metric Tons. 






Metric Tons. 


1892 




. 2,766,000 


1903 




. 8,248,000 


1893 




. 3,163,000 


1904 




. 8,930,000 


1894 




. 3,642,000 


1905 




. 10,067,000 


1896 




. 3,963,000 


1906 




. 11,135,000 


1896 




. 4,321,000 


1907 




. 12,064,000 


1897 




. 6,137,000 


1908 




. 11,186,000 


1898 




. 6,781,000 


1909 




. 12,049,000 


1899 




. 6,329,000 


1910 




. 13,699,000 


1900 




. 6,362,000 


1911 




. 14,556,000 


1901 




. 6,211,000 


1912 




. 17,302,000 


1902 




. 7,422,000 









The following has been the consumption per head of the 
population of Germany and Luxemburg of various minerals 
and metals at different periods during the past thirty years : — 



64 THE EVOLUTION OF MODERN GERMANY 

CONSUMPTION PER HEAD OF VARIOUS MINERALS AND METALS. 





Average of Average of 
1876-1880.1891-1895. 


1896. 


1900. 


1905. 


1912. 




Kilog. 


KUog. 


KUog. 


KUog. 


KUog. 


KUog. 


Coal 


'850 


1,374 


1,502 


1,744 


1,859 


2,188 


Lignite 


320 


666 


660 


860 


998 


1,328 


Pig-iron 


51-4 


100-2 


123-6 


161-8 


173-6 


262-7 


Zinc 


1-2 


1-9 


21 


2-3 


2-6 


3-3 


Lead 


1-0 


1-9 


2-3 


31 


3-3 


3-6 


Copper 


0-5 


10 


1-5 


1-9 


21 


3-6 



The Shipbuilding Industry. 

One of the industries of special interest to the United 
Kingdom which has of late years made rapid progress is the 
shipbuilding industry. Every year this industry becomes 
more independent of foreign material. A recent report of the 
Imperial Statistical Office on the imports of the year testifies 
to this. Under the Customs Tariff Law materials used in 
the " construction, improvement, and equipment " of sea- 
going ships, inclusive also of the ordinary ship utensils, have 
always been admitted free of duty subject to regulations issued 
from time to time by the Federal Council. Calling attention 
to the decreasing imports of such materials, so far as relates 
to iron and steel, the Statistical Office explained that this 
was not due to a smaller demand on the part of German 
shipbuilding yards, but to the fact that their demand was 
** increasingly covered by German iron." " This iron, and 
particularly raw ship plates," it added, " more and more super- 
sedes foreign and especially English shipbuilding iron, because 
of the lower prices and lower railway rates." Yet up to twenty 
or thirty years ago the accepted maxim was that nowhere 
else save^ in England could good ships be built, and that England 
could not build bad ones. The yards of the Tyne and Clyde 
ruled the shipbuilding industry, and when German ships of 
large tonnage were first commissioned in home yards, it was 
with fear and trembling, as much on the ground of unproved 
capacity as of doubtful financial resource. The North German 
Lloyd, which was established in Bremen in 1857, bought in 
England and Scotland the steamships with which it began 
regular sailings to the United States. One of the oldest North 
Sea yards, the Vulcan, of Stettin, which was developed from 
a smaller undertaking in 1857, kept itself alive for a long 
time by locomotive building. When in 1887 it received a 
contract for its first large ocean liner, the commission was 
regarded as a daring experiment, and several banks had to 



THE EPOCH OF INDUSTRY 65 

undertake a financial guarantee for the execution of the work, 
which, nevertheless, proved entirely satisfactory, and gave 
the Vulcan its start on a career of great prosperity. 

To-day Germany not merely builds the greater part of 
her own ships, but she builds largely for other countries. In 
1913 there were completed for Germany in German shipbuilding 
yards (including the Imperial yards) 740 ships with a tonnage 
of 485,000, and in addition 448 vessels, with a tonnage of 
975,000, were in course of building for Germany. Of the 
vessels completed 13 were ships of war, 656 merchant ships, 
and 71 vessels for river navigation. There were completed 
in German private yards for foreign countries in that year 
9 ships of war, 170 merchant ships, and 17 vessels for river 
navigation, with an aggregate tonnage of 38,000, and in course 
of building 61 other vessels with a tonnage of 32,000. During 
the same year foreign yards completed for Germany 99 mer- 
chant vessels and 4 river vessels, with an aggregate tonnage 
of 42,267, and had in course of building 29 vessels with a ton- 
nage of 65,000. Forty years ago Admiral Stosch, then Naval 
Minister, showed clear prescience when he said, " Without 
a German shipbuilding industry a German navy is inconceiv- 
able." While, however, it is true that the development of 
the shipbuilding industry has greatly stimulated the movement 
for a stronger navy, the shipbuilders have had their reward. 
When in 1906 the Navy League interrogated the private yards 
of the North and Baltic ports as to their building capacity, 
they were assured that the six largest yards were able to 
supply together fifteen vessels of war yearly and would be 
delighted to do it. 



The Electrical Industry. 

The electrical industry has also developed at giant's pace 
during the past two decades. In 1894 the number of electrical 
works in Germany was 148 ; in 1904 there were 1,028 works, 
distributed in 993 towns, with 163 more building. It is an 
industry in which there has been comparatively little syndi- 
cating, yet by the aid of unlimited capital and repeated amalga- 
mations all its more important branches have gradually come 
into the hands of a small group of powerful companies, one of 
which has a capital of five million pounds and loans and reserves 
of four millions and employs many thousands of workpeople, 
and another has a capital of two and three-quarter million 
pounds and loans and reserves of nearly two millions. Up to 
thirty years ago, when the industry was in its infancy, only 

5 



66 THE EVOLUTION OF MODERN GERMANY 

one firm, that of Siemens and Halske, of Berlin, seriously 
counted. The electrification of tramways, which began on 
a large scale shortly afterwards, led to the establishment of 
many urdertakings, some of which soon became powerful 
rivals, and in 1900 there were at least seven distinct groups. 
The depression which then set in pointed to further amalga- 
mation as the only means of staving off catastrophe in several 
cases, and that process has continued since, until at present 
something like a trust has been created. 

The growth of this industry, or more truly of the large 
companies, has been due in large measure to the policy of 
establishing or otherwise financing, with the aid of banks, 
companies for the construction and working of tramway and 
light railway schemes in the large towns and their neighbour- 
hood. Hence it is that several of these great companies have 
ramifications in all parts of the country, insomuch that w^herever 
electrical traction or power enterprise exists on a large scale 
it is almost certain that one or other of the undertakings in 
the well-known electrical group will be in or behind it. One 
of the largest of these companies, which owns a series of works 
for the manufacture of electrical machinery, plant, rolling 
stock, cables, etc., and supplies electrical power to munici- 
palities, controls over thirty subsidiary companies for the 
furtherance of its trade at home and abroad. The principal 
electrical works have their seats in Prussia, for though one 
powerful undertaking exists in Bavaria it is closely allied to 
a Berlin company. 



The Textile Trades. 

There has been a similar expansion in the textile trades, 
though the mere figures of persons employed would be mis- 
leading unless allowance were made for the altered conditions 
of production, which have operated in Germany as in this 
country — larger looms, improved machinery of all kinds, 
speeding up, and other contrivances for increasing production, 
and not least the raising of the factory age for children. In 
1875 it was estimated that 762,000 persons (employers and 
workpeople) were engaged in the whole of the textile trades ; 
the number was 637,000 in 1882, 693,000 in 1895, and in 1907 
1,057,243. The ratio per 1,000 of the population was 17*8 
in 1875, 14-1 in 1882, 13-4 in 1895, and 17 in 1907. In the 
United Kingdom 1,082,000 persons were employed in these 
industries in 1881, against 1,120,000 in 1891 and 1,008,000 in 
1901, the ratios per 1,000 of the population being 31*3, 29*7, and 



THE EPOCH OF INDUSTRY 67 

24*3 respectively. In the case of Germany the great decrease 
occurred in the cotton and woollen weaving industries. 

In 1912 there were employed in the 17,968 textile factories 
subject to inspection 853,914 adult (453,793 females over 
16 years) and 93,411 juvenile workers, a total of 947,325. 

Now, as thirty years ago, the principal centres of the cotton 
trade are the provinces of Rhineland and Silesia, in Prussia, 
Saxony, Alsace-Lorraine, and Bavaria, and of the woollen 
trade the provinces of Rhineland, Brandenburg, and Silesia, 
in Prussia, Saxony, Alsace-Lorraine, and Reuss. 

Before 1871 France headed Germany in the number of 
its spindles. The war of that year turned the scale by trans- 
ferring Alsace-Lorraine to its neighbour, which increased its 
number of spindles by 50 per cent., and the lead thus gained 
Germany has maintained since. In 1914 the total number 
of spindles in the cotton spinning industry was estimated at 
11,186,000.1 In addition, the number of spindles in other 
branches of the spinning industry were as follows in 1909 or 
1907 : Carded yarn, 1,979,000 ; worsted, 2,819,000 ; silk, 
135,000 ; flax, 304,000 ; and jute, 328,000. 

Germany's imports of raw cotton in the years 1854-6 
averaged about 50,000 metric tons, of which 12,500 tons 
were re-exported, so that the home consumption was 37,500 
tons. During the years 1875-7 the average consumption of 
raw and worked cotton reached 127,500 tons, though in the 
meantime Alsace had been annexed. Within the next twenty 
years, however, the amount doubled, and the average yearly 
consumption for 1911-1913 was 475,000 tons. 

The consumption of cotton per head of the population on 
the average of the years 1836-1840 was 0*75 lb. ; on the average 
for the vears 1846-1850 it was 1-16 lb. ; in 1856-1860 it was 
3 lb. ; in 1876-1880, 6*3 lb. ; in 1886-1890 9-2 lb. ; in 1896- 
1900 12-2 lb. ; in 1911 it was 14*7 lb., in 1912 16-6 lb., and in 
1913 15-9 lb. 

Germany still imports a large quantity of yarn, particularly 
from England, and in a minor degree from France and Switzer- 
land, but it is now for the most part in the finer counts, and 
this is a trade in which Germany's customers cannot count 
on any fixity of tenure. The total imports of yarn, both cotton 
and woollen, are hardly less than thirty years ago, but Germany 
now largely exports woollen ydrns in return. 

^ The International Federation of Master Cotton Spinners' and Manufac- 
turers' Associations estimated the world aggregate of cotton spindles in 1914 at 
143,453,000, of which Great Britain had 55,653,000, the United States 31,505,000, 
Germany 11,186,000, Russia 9,213,000, France 7,400,000, Austria 4,909,000, and 
Italy 4,600,000. 



68 THE EVOLUTION OF MODERN GERMANY 



The Chemical and Paper Industries. 

Other industries have made equal progress, among them 
the chemical and paper industries. It was estimated in 1903 
that over 150,000 workpeople were employed in the chemical 
industry, 15*9 per cent, being engaged in the dye and colour 
trade, 14*8 per cent, in the manufacture of pharmaceutical 
and photographic materials, 14*8 per cent, in the alkali and 
acid trade, 12*1 per cent, in the wood and tar distillation trade, 
and 10-1 per cent, in the artificial manure trade. The impor- 
tance of Germany's colour industry for the English market 
is proved by the promptitude with which, under the new 
Patent Law, some of the leading firms arranged for the estab- 
lishment of works in this country. Germany's exports of 
aniline and other dyes and of indigo have increased as follows 
from 1900 forward : — 





Aniline Dyes. 


Indigo. 


Alizarin, Alizarin Dyes 
from Anthracen. 


1900 


3,865,000 


470,000 





1901 


3,980,000 


635,000 


808,000 


1902 


4,465,000 


925,000 


806,000 


1903 


4,400,000 


1,035,000 


755,000 


1904 


4,430,000 


1,083,000 


742,000 


1905 


5,033,000 


1,286,000 


777,000 


1906 


6,950,000 


1,680,000 


— 


1907 


5,622,000 


2,129,000 


1,172,000 


1908 


4,954,000 


1,933,000 


1,048,000 


1909 


5,884,000 


1,974,000 


1,144,000 


1910 


6,290,000 


1,981,000 


1,064,000 


1911 


5,826,000 


2,092,000 


982,000 


1912 


6,688,000 


2,261,000 


1,182,000 


1913 


7,104,000 


2,666,000 


1,079,000 



Of the exports of aniline dyes Great Britain has for many 
years purchased to the extent of a million pounds a year. In 
1906 143 limited liability companies in the chemical industry 
had a combined subscribed capital of £23,850,000, with reserves 
of £7,700,000, and paid an aggregate dividend of £3,600,000, 
equal to 15 per cent, all round. 

The sugar industry has also made rapid progress during 
recent years. In 1848 there were 145 sugar manufactories 
in Germany, and their output was about 12,500 tons of raw 
sugar, produced from 250,000 tons of beet. In 1879 the number 
of manufactories had increased to 324, 4,650,000 tons of beet 
were used, and 425,000 tons of raw sugar were produced. In 
the eampagne of 1913-14 there were in work 378 manufac- 
tories and refineries, whose entire production of raw sugar 
was 2,716,000 tons. 



THE EPOCH OF INDUSTRY 



69 



The paper industry owes its great growth in recent years 
to the use of wood pulp, of which German paper factories 
now use more than 500,000 tons yearly. The wages paid to 
the 80,000 workpeople engaged in the paper industry in 1906 
amounted to £8,290,000, though in 1887 the wages bill was 
only £1,893,000. In this industry there has been great con- 
centration during late years, and the gro\vth which has taken 
place since 1887 has been in the size of the individual under- 
takings rather than in their number. 

Industrial Concentration. 

The tendency to industrial concentration is shown by the 
general tendency for large undertakings to multiply at the 
expense of those of small and medium size. The extent of 
this displacement may be shown by a comparison of the pro- 
portions of the occupied population ascertained by the occu- 
pation censuses of 1895 and 1907 to be engaged in " small " 
undertakings (up to 5 persons), " medium " undertakings (6 
to 50 persons), and " large " undertakings (over 50 persons). 
Percentages are given for the Empire as a whole and for the 
four kingdoms : — 



Empire 
Prussia 
Bavaria 
Saxony 
Wiirtemberg 



Small 
Undertakings. 



1895. 



39-9 
38-3 
500 
36-5 
48-3 



1907. 



29-6 
27-8 
38-6 
28-1 
33-4 



Medium 
Undertakings. 



Large 
Undertakings. 



1895. 



23-8 
23-4 
22-6 
26-6 
21-1 



1907. 



1895. 



26-0 
24-7 
24-8 
25-4 
23-8 



363 
38-3 
27-4 
380 
30-6 



1907. 



45' 6 
47-5 
36-6 
46-5 
42-8 



The tendency is illustrated more strikingly by the multi- 
plication of large companies, particularly in the mineral and 
metal industries. There were registered in all Germany in 1909 
5,222 joint stock companies with an aggregate nominal share 
capital of £737,000,000, giving an average of £141,100. The 
capital of the group of forty companies engaged in the mining, 
smelting, and metal and machine industries in conjunction give 
an average of £1,244,000, the next highest average falling to the 
88 mortgage banks, viz. £1,382,000. The 243 companies in 
the mining, smelting, and saline industries had an average 
share capital of £242,000, the average for 43 companies engaged 
exclusively in coal mining being £491,000, for 29 companies 
in the potash industry £367,000, for 66 companies in the iron 
and steel trade £225,000, and for 57 companies in the lignite 



70 THE EVOLUTION OF MODERN GERMANY 

mining industry an average of £184,000. Further, 547 com- 
panies in the machine and instrument manufacturing industry 
had an average share capital of £151,000, 90 of these, engaged 
in the production of electricity, having an average of £350,000, 
and 59 engaged in the electro-technical industry one of £253,000. 
The average share capital of 150 companies engaged in the 
chemical industry was £150,000, of 357 companies in the textile 
industry £87,000, of 63 companies in the leather and rubber 
industrv £95,000, of 101 companies in the paper industry 
£90,000. 

In spite of a steady tendency towards the concentration 
of capital and the multiplication of large undertakings, however, 
Germany is still an interesting illustration of an industrial 
country which has not as yet entirely gone over to the factory 
system of production. The handicrafts, the characteristic 
feature of which is the small, independent master- workman, 
surrounded by his handful of journeymen and apprentices, 
contend tenaciously, yet unfortunately with only partial 
success, against the oncoming tide of " great capitalism " 
(private, joint-stock, and co-operative), and the home indus- 
tries continue to afford employment to a multitude of workers 
of both sexes, estimated at half a million. It is a pathetic 
spectacle, this strenuous endeavour of the representatives of 
earlier modes of production to hold their own against the 
powerful forces w^hich steam, mechanical appliances, and 
combination of capital are able to array against them. It 
is a contest in which, as experience unmistakably teaches, 
the weaker side is fated sooner or later to go to the wall, yet 
no one dare assert that the threatened domination of gigantic 
industrial enterprises, and the sweeping away more and more 
of the small independent existences, hold out the prospect 
of unmixed economic advantage, much less of greater social 
peace. 

Here and there, however, are found striking exceptions to 
the decay of the small industries, as in the centre of the cutlery 
and small iron industry, Solingen, Remscheid, and the neigh- 
bourhood, where the supply of electric power by the municipal 
authorities and private companies has given a new lease of 
life to hundreds of independent family and individual work- 
shops which otherwise would have disappeared long ago. In 
a less degree the same thing applies to home weaving in certain 
branches of the silk trade in the Crefeld and Elberfeld districts 
and to cotton weaving in some of the rural districts of Saxony. 

In proof of the gradual supplanting of the independent 
entrepreneur it may be stated that of the persons wholly engaged 
in agriculture, forestry, etc., 31 per cent, were independent 



THE EPOCH OF INDUSTRY 



n 



in 1895, but onh' 25*3 per cent, in 1907 ; the proportions for 
industry and mining were 21*4 and 15*4 per cent, respectively, 
and for trade and transport 86*1 and 29*1 per cent. An inter- 
esting general comparison relating to industry and handicraft 
may be made for Prussia. While in 1882 there were in industry 
and handicraft together 755,176 independent masters without 
assistants or motor-power, the number in 1895 was 674,042, 
and in 1907 it was 518,574, showing a reduction of 31*3 per 
cent, in 25 years. On the other hand, the number of under- 
takings employing assistants or motor-power was, in 1882, 
466,963, with 2,635,117 persons in the aggregate, but 498,103 
with 3,898,083 persons, in 1895, and 607,299 with 5,789,865 
in 1907. The tendency towards larger undertakings is illus- 
trated by the following figures : — 





Number of Undertakings. 


Number of Persons Employed. 


Undertakings with— 


1882. 


1895. 


1907. 


1882. 


1895. 


1907. 


1 person 

2 persons 
3 to 5 

6 to 10 

11 to 50 

51 to 200 

201 to 1,000 

over 1,000 „ 


' 32,670 

217,098 

162,656 

28,431 

20,579 

4,378 

1,060 

91 


33,607 

189,591 

186,134 

43,999 

34,628 

8,235 

1,720 

189 


50,608 

228,974 

204,487 

55,282 

51,485 

13,308 

2,797 

358 


32,293 
434,196 
564,652 
211,316 
430,278 
403,049 
400,598 
158,735 


33,607 
379,182 
665,607 
323,281 
747,146 
757,357 
657,642 
334,261 


} 508,556 

726,169 

409,657 

1,146,163 

1,236,357 

1,080,842 

682,121 


Totals . . 


466,963 


498,103 


607,299 


2,635,117 3,898,083 


5,789,865 



s* 



The Handicrafts. 

But for resolute efforts made by the threatened class itself, 
seconded by legislative measures — scoffed at by the self-help 
school of politicians as " artificial " — the handicrafts would 
have been unable to withstand the advance of this relentless 
stream of economic tendency so long. In 1861 there were in 
Prussia 28*9 independent handicraftsmen to every thousand 
of the population ; in 1895 the ratio was 26*7 ; and since that 
time decline had proceeded apace, until it is now only 18 per 
1,000. Some of the handicrafts are as good as dead — spinning, 
weaving (with such exceptions as have been already noted), 
coopering, nail, rope, and button-making ; and others are quickly 
losing ground, like the pottery, cutlery, coppersmithery, and 
locksmithery, and to some extent the joinery and shoemaking 
trades ; and there are few that show no signs of decay, though 
one of the exceptions is the skilled watch and clock-making 



72 THE EVOLUTION OF MODERN GERMANY 

industry.! Meanwhile, all that can be done by State help 
and technical education to postpone the extinction of the 
handicrafts is being done. Their organization is encouraged 
in every way, though the Imperial Government has stopped 
short of compulsion, to the regret of the Conservative and 
Clerical parties, which fail to recognize that the indiscriminate 
application of direct coercion would tend to weakness, and 
that the best way to popularize Trade Guilds in an age of 
industrial freedom is by appealing to class-consciousness, 
emulation, and pride in honest workmanship. The Imperial 
Statistical Office some time ago published the result of an 
investigation into the operation of the Handicraft Laws, from 
which it appeared that in Prussia 50 per cent, of the 677,000 
independent handicraftsmen, 74 per cent, of the 648,000 
journeymen, and 65 per cent, of the 292,000 apprentices were 
organized in Guilds. 



The Home Industries. 

The home or " house " industries are making a no less 
resolute stand, and are illustrating the common experience 
that the threatened life is often the most tenacious. The 
hand-weaving industry of Silesia, one of the oldest and largest 
of them, has been declared hopeless a hundred times, yet it 
refuses to give up the struggle, and indeed the population of 
the hill country in that part of Prussia, poor as it is, would 
be plunged into far worse penury but for the employment 
offered by this industry. In the Black Forest clock-making 
is an extensive industry amongst the peasantry, and the pros- 
perity of some of the villages so engaged has long been almost 

1 In his investigation into the condition of the handicrafts, pubhshed in on© 
of the series of the monographs of the Association for Social PoUtics, Herr 
Voigt divides the handicrafts into four groups according as they are decaying, 
retrogressive, stationary, and prosperous. In the decadent handicrafts he 
classes those of spinners, dyers, weavers, nail-makers, cap-makers, millers, 
tanners, coopers, rope-makers, brewers, vamishers, gilders, soap-boilers, gun- 
makers, passementerie -makers, fiirriers, glaziers, hat-makers, turners, and 
picture -carvers. In the group of retrogressive industries he places those of 
independent potters, coppersmiths, locksmiths, tool, scythe, and knifesmiths, 
file-cutters, scissors -grinders, cartwrights, joiners, and shoemakers. The station- 
ary handicrafts he found to be chiefly those of tailors, masons, carpenters, 
stonecutters, bookbinders, goldsmiths, and saddlers. Finally, the prosperous 
handicrafts included the watchmakers, upholsterers, bakers, butchers, barbers, 
painters, roofers, chimney-sweepers, etc. 

As will be seen, the handicrafts shown as either decadent or stationary are 
in general those in which capital plays the greatest part, and which specially 
lend themselves to wholesale and associated production, while the handicrafts 
which have best maintained their position are those in which individual enter- 
prise is most effective or in which labour plays a predominant part in the cost 
of production. 



THE EPOCH OF INDUSTRY 78 

wholly dependent upon the trade done with England, the 
United States, and other countries. 

The occupation census of 1907 showed that the number 
of persons employed in the home industries was, on their own 
declarations, 405,262, comparing with 457,984 in 1895, though 
the returns of the employers and middlemen gave a total of 
482,486 for the later against one of 450,711 for the earlier 
year. A large majority of the workers were women and girls, 
and between 80 and 90 per cent, were in Prussia (about one- 
half), Saxony (about a third), Bavaria, and Wiirtemberg. It 
appeared also that one-half of the home workers were employed 
in the textile trades, and a third in the clothing trades. 

Some of these industries are carried on upon a large scale 
in the towns, such as the clothing trade in Berlin, the tobacco 
and cigar trade in Hamburg, the silk trade in Crefeld and the 
vicinity, and the hosiery trade in Chemnitz, but the great 
majority of the industries are rural. The oldest and most 
famous are found in the hilly regions of Central and Western 
Germany, e.g. the weaving industry of the Eulengebirge 
and the Riesengebirge, the glass industry of Silesia, the weaving 
and clothing industries of the Lusatian Mountains, the toy, 
small ware, clothing, and musical instrument industries of 
the Erzgebirge and Saxony, the metal, wood and meerschaum 
carving, toy and basket industries of Thuringia, the hand- 
weaving industry of the Fichtelgebirge, the clock, ironwork, 
and straw-hat industries of the Black Forest, the weaving and 
bead embroidery of the Vosges Mountains, to which may be 
added the small iron and textile industries of the Berg country, 
in the Lower Rhine region. 

Though the rural home industries find work for a multitude 
of people of both sexes and all ages, most of whom would 
otherwise be compelled either to migrate to the towns or to 
slowly starve on insufficient food at home, it cannot be ignored 
that they rather alleviate the economic conditions of rural 
existence than furnish an ideal or even a tolerable standard 
of life. In judging their practical value and their place in 
a modern industrial system, the question which it is most 
essential to ask is — " What would become of these workers 
and their dependants did such means of earning not exist ? " 
There can be no doubt that the poverty which prevails in all 
these centres of industry would become far acuter and the 
life of the small peasantry there would become far less 
endurable were these occupations to be forcibly extinguished, 
as the Socialists desire. 

It is the recognition of this fact that has led the Govern- 
ments of all the States having large populations so employed 



74 THE EVOLUTION OF MODERN GERMANY 

to encourage and assist the rural industries by every means 
in their power — by offering technical instruction of a kind 
suited to each locality, both by schools and travelling teachers, 
and by liberal grants of money in special times of misfortune. 
In Bavaria travelling teachers are appointed by the State; 
it is their duty to go from place to place in the rural districts 
where hand-weaving is still a staple industry, supervising the 
work done, advising as to new designs, and imparting instruc- 
tion to beginners. Not only so, but these teachers negotiate 
between the weavers and the dealers of the towns who purchase 
their goods, with the result that higher prices are obtained 
and the supply is more successfully adapted to the demand, 
so that the weavers are often prevented from producing super- 
fluous goods, which would have to be sold at hunger prices 
or lie long upon their hands. 

An interesting industry which combines both the factory 
and the house system, and which gives employment to an 
enormous amount of male and female labour, is the toy industry 
of Nuremberg and district, Sonneberg, Silesia, and the Erzge- 
birge. Little more than twenty years ago the total value 
of the to3^s produced in Germany was estimated at three and 
a half million pounds, of which about one half represented 
exports. In 1913 the exports alone exceeded five million 
pounds, and the value of the output of this industry was esti- 
mated at several millions more. In so far as the industry is 
carried on as a house industry the wages are low, but in the 
towns fairly remunerative employment is given in modern 
factories and workshops to an increasing number of workers 
of both sexes. At least a quarter of the exports of this 
industry, which does not require large capital nor, ^vith modern 
mechanical methods, exceptional skill, are sent to the United 
Kingdom. There is, in fact, little or nothing in the trade 
which could not be manufactured as well in England as 
Germanv. 



CHAPTER IV 

FOREIGN TRADE AND SHIPPING 

The growth of Germany's foreign trade — Comparison of imports and exports 
— Geographical distribution of foreign trade — The trade with the British 
Empire — Germany's increasing negative balance of trade — Growth of the 
mercantile marine — The fastest vessels afloat — Development of the sea 
and river ports : Hamburg, Bremen, Mannheim, Frankfort, etc. 

GERMANY'S industrial expansion is best illustrated by 
the statistics of foreign trade. It is estimated that 
the value of the imports of the German States in 1860 
amounted to fifty-four and three-quarter million pounds, and 
that of the exports to seventy millions, equal to about 
£l 12s. 8d. and £2 Is. 5d. respectively per head of the popu- 
lation. Between the years 1850 and 1860 the imports had 
doubled and the exports nearly trebled in value. In 1880 Ger- 
many's total imports for home consumption were £141,000,000, 
and her imports of manufactured goods for home consump- 
tion were £39,100,000 ; her total exports of native produce 
were £144,800,000, and her exports of manufactured goods 
of native origin were £83,500,000. The value of her imports 
in 1913 was £538,500,000, and the value of the exports 
was £504,800,000 ; the imports being equal to £8 Is. per 
head of the population and the exports to £7 lis. The 
value of the imports of raw materials for industrial purposes 
increased during the ten years 1903 to 1913 from £142,125,000 
to £250,175,000 ; the imports of manufactured and half- 
manufactured goods from £60,395,000 to £135,880,000 ; and 
those of food, luxuries, and live stock from £97,615,000 to 
£152,460,000. The exports of raw materials increased in value 
from £61,170,000 in 1903 to £75,900,000 in 1913; those of 
manufactured and half-manufactured goods from £164,060,000 
to £376,760,000 ; and those of food, luxuries, and live stock 
from £25,050,000 to £52,165,000. 

Every year manufactured goods form a larger propor- 
tion of the exports. In 1913 46*5 per cent, in value of the 
imports consisted of raw materials for industrial purposes, 

75 



76 THE EVOLUTION OF MODERN GERMANY 

comparing with 45 per cent, in 1903. The imports of manu- 
factured and half-manufactured goods formed 25*2 per cent, 
of the whole in 1913, against 19*1 per cent, in 1903. Food, 
luxuries, and live stock represented 28*3 per cent, of the imports 
in 1913, against 30*9 per cent, in 1903. The remaining imports 
consisted of precious metals. Of the exports, 15 per cent, 
consisted in 1913 of raw materials for industrial purposes, 
against 23*8 per cent, in 1903. Manufactured and half- 
manufactured goods formed 74*6 per cent, of the total exports 
in 1913 and 64 per cent, in 1903, and the proportion that fell 



EUEOPE. 

Of which — 
Russia 

Great Britain 
Austria-Hungary 
France 

Holland 

. Belgium 
Switzerland . . 

Italy 

Sweden 

Denmark 

Spain 

Amebica. 
Of which — 

United States 
Argentine 

Chili 

Brazil . . 
Canada 

Asia. 
Of which — 

British India 

Dutch Indies 

China 

Japan 

British Malacca 

Ceylon 

Africa. '\ 

Of which— • 

Egypt 

British West Africa 
„ South Africa 
Algeria 
German South-west Africa . . 

Australia and Polynesia 
Of which — 

Australian Commonwealth . . 
New Zealand 



Imports. 



Exports. 



In million pounds. 


In million pounds. 


294-46 


383-86 


71-23 


44-00 


43-85 


71-91 


41-36 


55-24 


29-21 


39-49 


16-66 


34-67 


17-23 


27-55 


10-66 


26- 80 


16-88 


19-67 


11-20 


11-49 


9-69 


14-19 


9-93 


7-15 


149-72 


77-32 


85-66 


36-66 


24-73 


13-29 


9-99 


4-89 


12-39 


9-99 


3-20 


3-02 


52-47 


27-39 


27-09 


7-63 


11-38 


4-93 


6-50 


6-14 


2-33 


6-13 


1-21 


7-36 


2-09 


0-26 


24-84 


10-63 


5-92 


2-17 


6-72 


0-83 


0-38 


1-04 


1-72 


0-31 


0-38 


1-04 


16-38 


5-18 


14-80 


4-42 


0-60 


0-6S 



FOREIGN TRADE AND SHIPPING 



77 



to food, luxuries, and live stock increased from 9*9 per cent, 
in 1903 to 10*4 per cent, in 1913 ; the balance being precious 
metals. 

The table of values (million pounds) on p. 76 shows the 
countries with which Germany had in 1913 the largest exchange 
of commodities. 

Comparing 1913 with 1907, the trade with the five con- 
tinents has increased in the following ratios (1907=100) ; — 





Imports. 


Exports. 


Together. 


Europe 


114 


147 


134 


Africa 


164 


154 


161 


Asia 


142 


167 


147 


America 


130 


126 


128 


Australia 


137 


161 


140 



The corresponding figures for Great Britain and the principal 
territories of the British Empire are as follows : — 





Imports. 


Exports. 


Together. 


Great Britain 


90 


136 


114 


British South Africa 


162 


162 


166 


„ West Africa 


184 


121 


174 


„ India 


133 


162 


137 


Canada 


662 


209 


319 


Australian Commonwealth 


130 


146 


133 


New Zealand 


624 


200 


286 


Ceylon 


277 


234 


271 



Of Germany's total foreign trade in 1913 (excluding the 
precious metals), in value £1,043,340,000, viz. imports 
£538,515,000 and exports £504,825,000, on the lowest com- 
putation no less than 204|^ millions, or 20 per cent., were with 
the British Empire. The trade with the various parts of 
the Empire is shown on p. 78. 

Not only has Germany's foreign trade thus advanced by giant 
strides, but her maritime trade is more and more carried 
in native vessels. In 1874 her" share in the mercantile 
marine of the world was 5-2 per cent, in tonnage, in 1894 it 
was 6-5 per cent., in 1905 9-9 per cent., and in 1913 it was 
estimated at a little more than 10 per cent. This is a depart- 
ment of national enterprise in which Emperor William II 
throughout his reign showed the deepest interest. The 



78 THE EVOLUTION OF MODERN GERMANY 



Imports. 



EUBOPE. 

Great Britain 

Gibraltar, Malta, and Cyprus 

Africa. 
British West 

„ South 

„ East 
Egypt 

Asia. 
British India 
Ceylon 

British Malacca 
Hong Kong 
Aden, etc. . . . . . . _ 

America. 
Canada 
British America (rest of) 

Australia. 
Commonwealth 
New Zealand 
Other British Colonies 



Totals 



In million pounds, 

43-80 
0-07 



6-72 
3-48 
0-38 
6-92 



27-09 
2-09 
1-21 
0-00 
0-02 



In million pounds, 

71-96 
0-20 



3-20 
0-80 



80 
50 
33 



110-41 



Exports. 



Total. 



83 
34 
25 
17 



7-53 
0-25 
0-73 
0-22 
003 



3-02 
0-13 



4-42 
0-53 
0-02 



94-63 



In million pounds. 

115-76 
0-27 



7-55 

6-82 
0-63 
8-09 



34-62 
2-34 
1-94 
0-22 
0-05 



6-22 
0-93 



19-22 
1-03 
0-35 



205-04 



two great shipping firms of Hamburg and Bremen owe a good 
deal of their prestige to Imperial patronage and encourage- 
ment. Some of their ships have been launched by members 
of the Imperial household, a message from the Emperor regularly- 
sent every new mammoth vessel on its first ocean voyage, 
and on the directorate of one company are found naval officers 
of high rank. 

In 1871 Germany had a merchant marine numbering 4,519 
vessels (only 3 per cent, being steamships), with a nett ton- 
nage of 982,000 ; in 1913 the number of vessels was 4,850 
(one-half being steamships), with a nett tonnage of 3,154,000. 
The North Sea ports had 1,536 steamships with a nett tonnage 
of 2,354,000, and 2,057 sailing vessels with a nett tonnage of 
384,000, and the Baltic sea ports had 562 steamships with a 
nett tonnage of 301,000, and 363 sailing vessels with a nett 
tonnage of 13,000, besides towing vessels in each case. The 
North-German Lloyd alone, w^orking with a capital of nine 
million pounds, had in 1906 a fleet of 134 sea-going vessels. 

The following statement of Germany's steamships and 
sailing vessels, forty years ago and now, gives an idea of the 
progress made (vessels under 17-6 tons are here disregarded) : — 



FOREIGN TRADE AND SHIPPING 

STEAMSHIPS. 



79 



Year. 



1871 
1872 
1873 
1874 



Number. 



147 
317 
414 
664 



Nett Tonnage. Crews. 



Year. 



82,000 
184,000 
216,000 
421,000 



4,736 
9,147 
8.657 



Number. 



1910 
1911 
1912 



14.006 i 1913 



1,950 
1,973 
2,009 
2,098 



SAILING VESSELS. 



Nett Tonnage. 



1871 
1872 
1873 

1874 


4.372 
4.426 
4,246 
3,438 


900,000 
901,000 
966,000 
855,000 


34,739 1 
33,215 ! 
31,003 i 
24,839 


1910 
1911 
1912 
1913 


2,377 
2,371 
2,401 
2,420 



2,350,000 
2,397,000 
2,514,000 
2,655,000 



405,000 
403,000 
412,000 
397,000 



Crews. 



59,421 
69,944 
60,970 
63,713 



12,962 
12,928 
13,154 
12,980 



In view of these figures it is encouraging to find a Hamburg 
commercial journal lamenting : " The increase of English 
shipping proceeds with such rapidity that the distance between 
it and German shipping increases with giant steps ; estimated 
according to population, the English mercantile marine has 
(during the past sixteen years) increased five times as quickly 
as the German, while England's foreign trade has also increased 
more quickly, though the absolute increase was less.'* 

England still leads the world with the largest and fastest 
vessels afloat, though Germany has a creditable share of the 
ships of heavy tonnage generally. Of 103 vessels of over 
10,000 tons register in service at the beginning of 1907 
Germany owned 26, and all with one exception belonged to 
the Hamburg-American (Hamburg) and North-German Lloyd 
(Bremen) Lines. The largest of these vessels were the Kaiserin 
Augusta Victoria and the Hamburg of the former line, with 
24,600 and 22,200 tons gross respectively ; after which came 
seven others of from 13,000 to 19,400 tons. Since then these 
two lines have commissioned the building of one steamship 
of 29,700 tons, another of 20,000 tons, and three others of 
from 17,000 to 20,000 tons. At the beginning of 1907 England 
owned 54 ships of over 10,000 tons, 21 belonging to the White 
Star Line, the largest the Adriatic and Baltic, with 25,000 
and 23,900 tons respectively, but the Lusitania and the Maure- 
tania, of the Cunard Line, each of 32,500 tons, later put all 
competitors into the shade. 

While no expense has been spared to increase Germany's 
maritime trade by the building of larger and faster vessels, 
there has been vast expenditure upon the improvement of 
harbour and dock accommodation. There is not a coast or 
river port that has not of late years sunk large sums in the 
increase of its shipping trade facilities. Quays and wharves 



80 THE EVOLUTION OF MODERN GERMANY 

are being provided large enough to meet the probable 
requirements of many years to come, and their equipment — 
their sidings, railway connections, warehouses, arrangements 
for loading and unloading, etc. — are as perfect as they can 
be made. 

When in 1888 Hamburg surrendered its freedom of trade 
and joined the Imperial Customs Union it received as solatium 
the sum of two and a half million pounds as a contribution 
towards the cost of extensive new harbours and docks which 
became necessary. Since then its maritime trade has enor- 
mously increased. Bremen has similarly made large dock 
extensions and river improvements, both in that port and 
at Bremerhaven, lower down the Weser, and by the time all 
the works contemplated are completed they will have cost 
eight and a half million pounds. This prosperous City State 
plans not only new harbours but a new town. Near Bremer- 
haven it has acquired, by exchange with the Prussian State 
and by purchase, an area of about 1,470 acres, upon which 
docks and quays are to be constructed, and building land is 
to be laid out for a community of from 20,000 to 25,000 
inhabitants. Hitherto the economic development of the Free 
State has necessarily led to outgrowths upon the adjacent 
Prussian territory. Bremen wishes to grow within its own 
borders, and its great harbour scheme is intended to achieve 
that end. The new docks will take the largest vessels afloat 
or likely to be built for many years to come, and, followdng 
the example of Mannheim, a special area is to be set aside 
for industrial w^orks — ^grain and oil mills, factories, etc. — 
which will be provided with ample water and railway facilities. 
Another part of the project is the construction of a canal on 
the Upper Weser at a cost of £330,000. The population of 
the entire Free State in 1910 was 299,500, so that the contem- 
plated expenditure to which the authorities have pledged 
themselves on account of this bold undertaking is nearly £30 
a head. 

The river harbours, and especially those which are acces- 
sible from the sea, have been and are being developed with 
no less energy. The enterprise of Mannheim is particularly 
interesting as an example of what a German inland river town 
is prepared to do to safeguard its prosperity. Mannheim is 
situated upon the Rhine, 160 miles above Cologne, and is the 
last port at which the larger Rotterdam river boats are able 
to call with full cargoes. In the past it was more a commercial 
than an industrial town, being a great entrepot for the trade 
of Central Germany and the South. The project of the Main- 
Rhine canal and the prospect of the deepening before long of 



FOREIGN TRADE AND SHIPPING 81 

the Rhine as far as Basel, implying the decrease of Mannheim's 
importance as a great transit trade centre, convinced the 
municipal authorities some years ago that the town would 
have to rely upon industrial enterprise more than it had 
hitherto done. , 

Accordingly, in 1895, they bought an estate of 850 acres 
of undeveloped and in part marshy land north of the town 
and near to the river, and laid out the larger portion of it as 
an industrial area, constructing alongside of it docks, quays, 
and railway communications, equipped with the most modem 
appliances for loading and unloading vessels, enabling the 
factories and warehouses to be erected to receive their raw 
materials by water, and to be in direct contact with the inland 
markets. The scheme involved the town in an outlay of 
£322,000, equal to £3 10s. a head of its then population, 
but it has succeeded beyond the highest expectations of its 
originators. Virtually the whole of the industrial area is already 
occupied by large works, the capital sunk by the municipality 
has come back with interest, the industry and trade of the 
town have greatly benefited, and in fifteen years (1895 to 
1910) the population of Mannheim (counting 14,283 inhabi- 
tants added by incorporation) increased from 105,400 to 
193,900, equivalent to 84 per cent. The spirit in which the 
project was undertaken is shown by the following words taken 
from a statement made by the municipal authority on the 
subject : *' The municipality has given an undertaking to 
the State (Baden) that it will look for no direct profit from the 
undertaking, and so will make the financial standpoint sub- 
sidiary to the economic. Not only does it renounce financial 
advantage, but it is ready where necessary to refrain from 
covering its bare costs. The only reward of its sacrifice which 
the town seeks is the economic development which will be 
experienced owing to the prosperity of industry and trade." 
The success of the undertaking has, none the less, been so 
complete that a further enterprise on the same lines is now 
contemplated. 

Frankfort-on-the-Main, with water facilities less favour- 
able, has been no less progressive in its own way. Since 1886 
this town has had a large commercial dock as well as a coal 
dock. Before these docks were constructed the trade in and 
out by water only amounted to 150,000 tons ; four years later 
it had increased to 700,000 tons, and in 1905 it was 1,565,000 
tons, so that Frankfort took the fifth place amongst the 53 
Rhine ports, its trade far exceeding that of Cologne and 
Dusseldorf. About a third of Frankfort's river trade consists 
of transit merchandise which is transhipped from or to the 

6 



82 THE EVOLUTION OF MODERN GERMANY 

higher reaches of the Main canal, which beyond Frankfort is 
now only navigable by shallow boats. Half of the entire trade 
is in coal and coke. 

During recent years the trade of Frankfort increased so 
greatly that the capacity of the existing docks was taxed to 
the utmost, and extensions became necessary. These docks, 
which lie below the town, could not, however, be increased, 
since on one side they abut on populous districts and on the 
other are blocked by locks, so it was decided to construct a 
new dock above the town on the right (Frankfort) bank of 
the river, at a cost of £2,850,000. For this purpose a site 
of 750 acres, with a length on the river side of 2f miles, and a 
depth inland of from 1,950 to 2,400 yards, had to be bought. 
Railway connections will join on to the trunk lines. When 
the scheme is completed there will be four large mercantile 
docks with a timber dock : the largest dock will be 1,400 by 
53 yards, a second will be 1,300 by 80 yards, two others will 
be 870 by 43 yards, and the timber dock will have an area of 
26j acres. As at Mannheim, an extensive area is to be reserved 
for factories, and it is hoped that a thriving industrial quarter 
will in time spring up here. Of the estimated cost of the scheme 
it is expected that at least £1,950,000 will come back by the 
sale of sites, so that the docks will only cost some £925,000, 
representing £50,000 interest per annum, which it is hoped 
to cover by dues and rents. 

Lower down the river Diisseldorf has constructed a new 
dock, 1,930 yards long by 65 yards wide at the base, with 
a large petroleum depot, and has extended the bonded dock. 
New docks are also projected at Duisburg, and the existing 
municipal harbour there has been amalgamated with the 
State harbour at Ruhrort and placed under State adminis- 
tration. 

What is being done on the Rhine is taking place on other 
important rivers, like the Elbe, Weser, and Oder, and even 
on the minor streams. While the States are deepening the 
rivers and building new canals, the towns situated upon 
navigable waterways are everywhere showing their faith in 
the future of water transit by increasing and improving their 
harbour and dock facilities on a bold scale. The importance 
of the German system of inland navigation for mercantile 
purposes may be judged by the fact that in 1912 the rivers 
and canals together carried goods to the aggregate amount 
of 93J million tons, of which 53j millions were home trade. 



CHAPTER V 

THE PERSONAL EQUATION 

Industrial Germany the child of industrial England — Eariy English enterprise 
in Grermany — Cobden's prophecies in 1838 — German commercial enthu- 
siasm — The first generation of industrialists — The love of system — 
Reasons for German success — The German standard of life — Lower 
salaries and wages — Modem industrial plant — Industrial concentra- 
tion — Germany and America compared — " Mixed " versus " pure " iron 
works — Germans not inventive but imitative and adaptive — Considera- 
tion for customers' wishes — Government encouragement and help — 
The State railways — Inland waterways — International exhibitions — Tha 
central agency for industry in Hesse — The Emperor's influence — 
Chambers of Commerce, their constitution and functions — The industrial 
associations — Foreign trade agencies — The German theory of trading 
— The commercial traveller. 

COMMERCIAL and industrial Germany is the Germany 
which possesses most interest for English people at 
the present time. We should, of course, have pre- 
ferred to see Germany continue to concentrate attention upon 
the production of music, poetry, and philosophy, and leave 
us to provide the world with machines, cloth, and cotton. 
As she has chosen to turn trader, it is well worth while to study 
the question. How has this economic change been brought 
about — what are the forces which have been at work and 
the methods which have been employed ? 

And, first, allowance is never sufficiently made for the fact 
that industrial Germany is largely the child of industrial 
England. We have deliberately created the rival of whose 
competition we now complain. Some time ago the Cologne 
Gazette reminded its readers that " It was Englishmen who in 
Germany first took in hand the construction of railways, gas 
works, tramways, and machine shops, who supplied to these 
enterprises the ample resources of British capital, and who 
thus acted as the pioneers of German material development." 
This is a generalization which it would be possible to illustrate 
in all sorts of ways. Water was given to Berlin and Hamburg, 
among other towns, by Englishmen, and the latter town per- 
petuates its benefactor in the name of one of its streets. An 
English gas company, established many years ago, still supplies 
a special reserve of Berlin, and carries on undertakings in other 

88 



84 THE EVOLUTION OF MODERN GERMANY 

Continental towns. Evidence of English pioneer enterprise 
in street locomotion survives in the naturalization of the word 
" tramway " in more than one German town. The cotton 
and woollen and engineering industries largely owed their 
introduction to English energy and capital. Many old firms 
in all these industries still trade with English names, though 
no Englishmen are now associated with them, and Miilhausen, 
the South German seat of the cotton trade, has its Manchester 
Street. The shoddy industry was established in Germany by 
Dewsbury and Batley manufacturers. At Konigshiitte, near 
Kattowitz, the chief centre of the Silesian iron industry, there 
still stands to-day a monument erected over a hundred years 
ago to an Englishman, by name John Wilkinson, forgotten in 
his own country, who did much to lay the foundations of 
that great industry. ^ 

There occurs in an overlooked report of the eventful 
meeting of the Manchester Chamber of Commerce, held on 
December 18, 1838, which proved the prelude to the anti- 
Corn Law movement, a speech in which " Mr. Richard Cobden, 
calico printer," foretold the day when the weapons which 
English enterprise and example were then placing in German 
hands would be turned against ourselves with fatal effect. 

" He had made " (he said) " the tour of Germany lately, 
and had given some attention to the progress of manufactures 
in the countries through which he had passed. He would 
allude to an industry which was making great progress, and 
which had struck him as one of the most ominous signs he 
had witnessed. He alluded to the great increase in the manu- 
facture of machinery abroad under the auspices of English 
mechanics. Previous to the time of passing the Corn Law in 
1828 the manufacturers and spinners of this country, anxious 
to share the monopoly of the landholders in some shape, 
pressed for a prohibition of the exportation of machinery, 
and it was granted. The artisan, who had been previously 
interdicted from emigrating, now demanded a law to enable 
him to carry his labour to the best market, and this, of course, 
was granted. The artisan left this country to teach the foreign 
spinner how to organize his mill, and was then sent home to 
reap the effects in a restricted market for his industry. 

1 The Berliner Tagehlatt of January, 1914, contained the following reference 
to this remarkable memento of English enterprise in Germany : "A monument 
to the iron smelter John Wilkinson, who took a large part in the founding of 
the iron industry of Upper Silesia, was recently sold at KOnigshiitte as old iron 
for 4,000 marks. The monument was erected in 1808 on one of the properties 
belonging to Wilkinson. It is reported that a group of industrialists intends 
to rescue from destruction this memorial of the beginnings of the Upper Silesian 
iron industry." 



THE PERSONAL EQUATION 85 

" But now the demand arises for the makers of machinery, 
and the same process is going on of instructing the foreigner 
in making spinning-frames that was formerly done in spinning 
cotton. Whilst at Dresden he was shown over a large 
machine-making establishment by an Englishman, who took 
him into a large room filled with machinery for spinning flax, 
with Gore and Wesley's patent improvements. ' This,' he 
said, ' was brought out from England at an expense of 85,000 
dollars (thalers) for models, and I am engaged to superintend 
the copying of it.' At Chemnitz, also in Saxony, he visited 
a large establishment, organized and conducted by English 
mechanics, for the manufacture of machinery. He found at 
Prague, in Bohemia, an establishment belonging to Englishmen 
for making machinery for manufacturers ; and at Vienna 
there were two of our countrymen accommodated under an 
Imperial roof carrying on a similar trade.' At Elberfeld and 
Aix-la-Chapelle he also found large machine-making businesses 
conducted by Englishmen. At Liege there was a similar 
concern, the largest in the world, belonging to Mr. Cockerel!, 
who was born in Haslingden, and who employs nearly 4,000 
hands ; and at Zurich he found the large establishment of 
Mr. Esher, with an Englishman at the head of the foundry 
and another at the head of the forge, casting five tons of iron 
a day, brought from England, into spindles, rollers, and wheels 
for the spinners and manufacturers of Austria, Saxony, and 
Bavaria. In almost every large town there were English 
mechanics instructing the natives to rival us." 

The process which to Cobden eighty years ago appeared 
so sinister was continued far into last century. Englishmen, 
their enterprise, intelligence, and capital were welcome ^o long 
as they were needed, and all three were freely tendered. Those 
were the days of Germany's apprenticeship, and never was 
learner more patient and industrious. Directly the apprentice 
was out of his time, however, he began business on his own 
account, and his master was told that he was not needed. We 
all know the rest. From manufacturing for their own use 
the Germans soon proceeded to supply other nations, and 
England lost control of markets in which she had for genera- 
tions held an almost undisputed position. What it is urgent 
to know is how the Germans have succeeded in their policy of 
supplanting English manufacturers and traders in foreign 
markets and even in our own. 

Perhaps more than to anything else this progress is due 
to the fact that Germany, still in the first flush of material 
prosperity, is devoting herself to industrial and commercial 
pursuits with the enthusiasm and fervour of a nation deter- 



86 THE EVOLUTION OF MODERN GERMANY 

mined to win its way to the front rank in every department of 
economic life. It is a serious question whether on the whole 
trJade is followed in England with the old zeal and application, 
or even the old respect. In Germany trade is a passion. There 
is no disposition there either to be ashamed of it or to give 
it a secondary place ; it is not an incident in a man's life, a 
variant on pleasure and sport, but the chief, primary, absorbing 
concern. The successful German business man, whether manu- 
facturer or merchant, goes to sea, lake, or mountain during 
the hot weeks of summer, but he does not find time for a second 
holiday in winter, and the English institution of the " week- 
end " appears to him a symptom of national sloth and decline. 
For eleven months of the year he is chained to his factory, 
warehouse, or counting-house, and he takes this strenuous 
life as part of the natural order of things, not to be relaxed, 
if he would achieve his ultimate purpose. The head of one 
of the largest industrial undertakings in Germany, bearing a 
name known all over the world, said to me a few years ago, 
" For fifty years I have come to my factory as soon as my 
men in the morning and I have been the last to leave in the 
evening." That has meant for him an average day of twelve 
hours — with necessary intervals — yet he has had his reward 
in the fact that he controls one of the largest and most pros- 
perous works of the kind in Europe. Nor does it as yet belong 
either to company or syndicate. 

Further, in the main Germany is still in the first generation 
of her great industrialists. In saying this I do not overlook 
the fact that many of the largest undertakings in the iron 
and steel and engineering industries have a long lineage, and 
that in every industry there are firms — not always the largest 
— that go back fifty, eighty, and even a hundred years. In 
general, however, the fact is as stated, and the consequence 
is that Germany is drawing upon reserves of energy which as 
yet show no sign of exhaustion. 

But this plodding and persistent endeavour of the Germans 
to come to the front has been supported by a skilful and even 
masterly application of means to ends. While the average 
Englishman has been accustomed to regard commerce as 
purely a rule-of-thumb matter, the German has followed it 
as a science and an art, and in reality all the methods and 
measures which he has adopted in competing with his older 
rivals for the trade of the world may be reduced to one principle, 
characteristic of the Germans in so many ways, the application 
of trained intelligence to the practical affairs of life. 

Broadly speaking, where the German outrivals his com- 
petitors it will be found that his success is due to one or other 



THE PERSONAL EQUATION 87 

of three reasons — (1) the cheaper price of his goods, (2) their 
superior or at least more serviceable character, and (3) the 
more efficient arrangements which he makes for reaching and 
attracting purchasers. 

As to the first of these reasons, the German manufacturer 
is helped in his endeavour to produce cheaply by the fact 
that the national standard of life is still far less pretentious than 
in England, and this holds good in every class of society. 
Luxury — comparative luxury — is making headway as money is 
accumulated more easily and more rapidly, but on the whole 
life is simpler, there is less personal indulgence, habits are less 
expensive, even amongst the wealthy class, than with us. 
The consequence is that the German manufacturer is con- 
tented with less profit than is expected in England. He has 
also for the present an advantage in the lower salaries and wages 
which he has to pay. An inquiry made by the German Union 
of Technical Employees into the salaries received by its members, 
engineers and other officials in the engineering and electro- 
technical industry, elicited the information that the salaries 
of 49 per cent, of these skilled men fell below £105 per annum ; 
12 per cent, received from £105 to £120, 12-5 per cent, from 
£120 to £135, and only 25 per cent, above the last-named 
figure. 

For some time the advantage which the German manu- 
facturer has enjoyed in the matter of wages and hours has 
been diminishing, and it is probable that in this respect the 
conditions of production will every year tend to become more 
equal between the two countries. Not only are the costs of 
living steadily rising in Germany, but the strength of the trade 
unions continually increases, and with their growth in numbers 
and influence both their demands and their ability to assert 
these demands become greater. The relations between capital 
and labour will, however, be treated separately and need not 
detain us here. 

On the other hand, local taxation presses upon German 
industry to an extent never experienced in this country. 
Further, until a few years ago Germany stood alone in having 
adopted a system of insurance against sickness, accident, 
invalidity, and old age applying to the working classes, a 
system which made a large call upon the resources of capital 
and labour equally. It might have been thought that this 
liability would seriously handicap Germany's industry, and 
indefinitely retard the progress of her export trade. This has 
not happened, however, for the period of Germany's greatest 
stride forward as an industrial and mercantile country has 
synchronized with these beneficial laws. It will be remembered 



88 THE EVOLUTION OF MODERN GERMANY 

that the adjustability of industry to its increasing burdens, 
within surprisingly elastic limits, has been proved over and 
over again in our own experience. 

Much is due also to progressive methods and the use of 
thoroughly modern plant. Of Germany's industrial works in 
general it may be said that if the worst are hopelessly behind 
the times and are only kept alive by local advantages — low 
wages where the works are located in rural districts, exceptional 
transport facilities, etc. — the best can nowhere be surpassed. 
The iron and steel industry is probably the best illustration 
of the efforts made to produce under the most favourable con- 
ditions which modern machinery and technique allow. In an 
endeavour to explain the falling back of the United Kingdom 
into the third place as a producer of pig-iron a correspondent 
of The Times wrote on April 7, 1906 : " Among the chief 
reasons for the decrease in the British iron industry must be 
placed the tendency to adhere to antiquated methods of 
production among English manufacturers. As opposed to this 
the German ironmasters have known how to avail themselves 
fully of modern improvements in the technical details of the 
metallurgy of iron and in the practical operation of the blast 
furnaces. In fact, though during 1905 there were fifty fewer 
blast furnaces in Germany than in Great Britain, the former 
country was able to produce no less than two million tons 
more of pig-iron than its rival, even with this great disad- 
vantage in point of plant.*' This is true ; in 1886 the average 
production of a blast furnace in Germany was 16,500 tons, 
but by the building of larger furnaces and improved methods 
the average production now exceeds 50,000 tons. 

But this is not the only or the chief explanation of the 
German ironmaster's ability to produce so cheaply that he 
can make his way into every market. A still more important 
reason is the co-ordination of the various stages of production, 
so that in all up-to-date works pig-iron and steel-making and 
rolling nowadays form part of an unbroken process. The 
pig-iron is conveyed direct into the Bessemer converter 
adjacent, and cast into ingots, and the ingots have no 
sooner cooled down sufficiently than they are at once passed 
into the rolling mill. 

In the process of rolling great improvements have been 
introduced. In many, perhaps most, works the ingots pass 
in and out of mills of different size, before they take the final 
form of rails, but in the more modern works this three- or 
fourfold process is shortened into one, for the rollers, instead 
of lying side by side, follow one another, so that the glowing 
ingot which passes from the furnace into the first grip of the 



THE PERSONAL EQUATION 89 

mill comes out at the other end a finished rail ready to be cut 
to size and trimmed off. Where formerly ingots were cast 
which made two rails of 45 feet each, ten rails of 65 feet can 
now be made out of the same ingot — a great economy in pro- 
duction and also a great saving in wastage. What such 
a combination of processes means in the saving of labour and 
fuel may easily be imagined. 

Not only so, but mechanical appliances are used nowadays 
to an extent that a few years ago would have seemed incon- 
ceivable. Menzel's famous painting of the rolling-mill, in 
which bare-breasted workmen are shown grappling at close 
quarters with the glowing ingots, will soon represent an 
obsolete page of industrial history. As the fundamental 
maxim in the obtaining of the necessary raw material is the 
saving of cost by the elimination of the middleman at every 
stage in the process of production, so the fundamental maxim 
in the later and more costly processes is the saving of labour. 
In the latest works nothing is touched by the hand that 
can be done by mechanical means, and man and machine 
are brought into the nearest possible contact by the same 
expeditious and economical means. 

It follows, as a matter of course, that electricity is em- 
ployed generally as a motive agent wherever it can be done 
to advantage. As indicating the increasing use of electricity 
in Prussia it may be stated that while in 1903 the number 
of engines employed in the production of current was 5,160, 
with 623,000 horse-power, the number in 1913 was 8,857, with 
1,415,000 horse-power, in 6,233 industrial undertakings, showing 
an increase of 71 per cent, in the number of machines and one 
of 127 per cent, in their aggregate horse-power. Even in the 
firing of furnaces, retorts, and boilers science has been intro- 
duced. The German technical schools which exist for the 
special benefit of the engineering trade have created a science 
of heating, the fundamental principle of which is to obtain 
a maximum amount of heat in the best and quickest way at 
a minimum cost. Finally, the gases which small works cannot 
employ and therefore waste are used by all the large modern 
concerns for power and heating. 

When several years ago the late Herr von Moller, then 
Prussian Minister of Commerce, visited the United States 
he found " the technics of industry there to be in many 
respects very behindhand.*' " In general," he reported, " the 
large German works are in no way behind the American except 
in products for which Germany has no adequate market." 
Incidentally also he thought America " very careless about 
the life and health of the working classes ; in the largest 



90 THE EVOLUTION OF MODERN GERMANY 

works the precautions against accident are of the most 
primitive kind." Nevertheless, American managers are to 
be found in many German engineering works and American 
machinery in still more. 

Much is being done in Bavaria, Saxony, and to some extent 
in Prussia, to utilize the water-power of these States for the 
generation of electrical current. By means of expert investi- 
gations, experiments, and actual works the Bavarian Govern- 
ment has ascertained that the rivers of the monarchy — chief 
amongst them the Isar, Lech, Inn, Iller, Alz, Ammer, Amper, 
and Wertach — should be able to supply a mean aggregate 
of over half a million horse-power, of which about one-sixth 
is to be reserved for the purposes of the State railways. All 
that is being done in the development of these hitherto dis- 
regarded sources of energy will be subject to direct State 
control. There is an increasing disposition on the part of 
public authorities to challenge the claim of private capitalists 
to control electrical-power enterprise, which has proved so 
important a factor in industrial and municipal life and also 
so prolific a source of gain. For a long time a few large com- 
panies were allowed to establish something like a monopoly in 
several of the States, to the detriment of municipal works and 
often of the public interest. In Saxony the State has stepped 
in and with a strong hand has destroyed the menace of a 
great electrical trust, while everywhere the electrical com- 
panies have sought safety by inviting local government bodies 
to co-operate with them on equal terms, so that " mixed 
undertakings " are more and more becoming the rule. 

The tendency to increased concentration, with a view to 
more economical production, has greatly stimulated the move- 
ment in favour of what are known as ''mixed" works, the 
combination taking various forms, as, for example, ore and 
coal mines, ore mines and smelting works, smelting works 
and rolling works, or larger combinations still. The firm of 
Krupp produces, in fact, everything it requires in its engineering 
and ordnance factories — ore, coal and coke, pig-iron, steel, 
rolled iron, and so on through every process to the finished 
product. 

The struggle between the " mixed " and " pure " works 
has of late years been very severe in Rhineland and Westphalia, 
and particularly since the Coal and Steel Syndicates came 
on the scene, but this form of concentration is no new one 
either there or in Silesia. The great Stumm iron works owned 
ore mines as early as the eighteenth century. The firm of 
de Vendel have owned the same since 1797 and collieries since 
1856 ; the Konig and Laura Smelting Company have had both 



THE PERSONAL EQUATION 91 

ore mines and collieries since 1802 ; the Kattowitz Smelting 
Company has from the first had its own ore mines and collieries 
since 1789 ; the Gutehoffnungshiitte at Osnabriick has mined 
its own ore since 1810 and its coal since 1857 ; the Horder 
Verein has had ore mines since 1852 and coal mines since 1859 ; 
the Union Company at Dortmund has used its own ore and 
coal since 1855 ; the Burbacher Hiitte acquired ore mines 
in 1856 ; the Dillinger Hiitte has had ore mines since 1828 ; 
the Georg-Marienhiitte at Osnabriick has had both ore and 
coal since 1859 ; the " Deutscher Kaiser " Company has had 
coal since 1876, the Hoersch Company at Dortmund since 
1898 ; and the Aix-la-Chapelle Smelting Company has had 
ore since 1892. 

In 1906 there were 41 mixed iron and rolling works or 
iron works owning their own collieries, and they together 
controlled three-quarters of the entire pig-iron production of 
the country, the greater part of the steel production, and 
three-quarters of the production of rolled goods, as wxll as 
one-quarter of the coal produced in the Ruhr basin. Of 
1,200,000 workpeople employed in the iron industry it was 
estimated that 300,000 fell to the mixed works, eight alone 
employing 170,000 men. Ten of these works represented a 
capital of over twenty-five million pounds, the largest being 
Krupp, Thyssen, Bochumer Verein, Horder Verein, Rheinische 
Stahlwerke, Gutehoffnungshiitte, Phoenix, and the Laurahiitte 
in Silesia. 

Against powerful companies like these the smaller " pure " 
works are powerless to compete, restricted as they are in 
resources and unable to take advantage of the economies in 
every direction which are within reach of the great combined 
works. The number of " pure " rolling works is now about 
60, 24 of them in the northern part of the Lower Rhenish- 
Westphalian district, 16 in the central part of that district, 
the Berg country, which is the centre of the small iron goods 
industry ; 10 south of the district, in Siegerland, and in the 
west of the Rhineland, while of the other two one is in the 
Saar district and the other in Upper Silesia. The rolling works 
which most feel the competition of the " mixed " concerns 
are the plate and bar works ; those for the present best able 
to hold their own are the wire and wire-goods works, but all 
are hard pressed, and that the more since the Steel Syndi- 
cate deliberately favours the large combined undertakings, and 
sooner or later the latter will undoubtedly hold the field. 

Herr Kirdorf, the director of the Steel Syndicate, recently 
expressed the opinion that " The entire economic development 
necessarily leads to mixed undertakings, for a company can 



92 THE EVOLUTION OF MODERN GERMANY 

only prosper permanently when besides manufacturing finished 
goods it also produces its own raw materials." On the other hand, 
Dr. H. Voelker, formerly a member of the directorate of the 
Steel Union, in his book Die deutsche Eisen und Stahlindustrie^ 
suggests that other alternatives are open to the " pure " works. 
" There are/' he says, " three ways open to the pure rolling 
works of improving their position. In the first place they 
may readjust their plant more rationally by turning attention 
to the manufacture of fine products. The large mixed works 
can do this less easily, since the directing heads are too much 
occupied to be able to devote themselves to the details of pro- 
duction. ... A second possible measure for the maintenance 
of the pure rolling works is the formation of a union with the 
mixed competitive works for the purpose of increasing the 
prices of bar-iron, wire, and fine plates. Hitherto it has only 
been possible to establish unions for fine plates and wire, and 
the first of these has been dissolved, while the efforts to 
establish a bar-iron union have invariably had but brief and 
transient success. The third way of improving the position of 
the pure rolling works is to join a mixed works, for example, 
a Siemens-Martin works, either by entering into a financial 
union or by amalgamating altogether. In this way a certain 
distribution of labour could be arranged between the pure 
and the mixed works by arranging that each concern should 
only produce the articles which, owing to its speciaJ equip- 
ment or its geographical position or other local circumstances, 
it can produce under the most favourable conditions." 

Of these alternatives the third might seem to offer 
the only real prospect of success. The resort to fusion, how- 
ever, means that the " pure " works as such will exist no 
longer. 

This, however, is not the only form of industrial concentra- 
tion. It is carried on in directions quite uninfluenced by 
the syndicate movement. In the town of Diisseldorf, for 
example, most of the larger industrial companies have at 
least several, and in some cases many, separate undertakings. 
One of these concerns is engaged simultaneously in the produc- 
tion of iron and steel pipes, plates, puddling iron, steel ingots, 
wire and bar-iron, etc. The largest of the wire-rolling works 
there combine fourteen branches, including wire-drawing, 
bar-iron rolling, puddling, wire rope, Martin, shoe-iron, and 
wire nail works, also an iron foundry, a workshop for electric 
machinery, drawn zinc works, a box factory, etc. 

The two other reasons for Germany's industrial success 
may be dealt with together. The German is not an inventive 
genius, but he excels in adaptation, which is often a gift of 



THE PERSONAL EQUATION 98 

even greater value than inventiveness. The great inventors 
have seldom become rich men ; the prizes have generally 
fallen to the men who have had just originality enough to 
recognize a good idea when they saw it, to adapt and develop 
it, and to turn it to immediate practical account. 

In their beginnings the German textile and engineering 
industries, and even the chemical industry in which Germany 
specially excels, all owed at least as much to foreign ideas and 
influences as to native talent. The loss to English industry 
owing to its neglect to recognize the commercial value of 
chemistry is incalculable and can never be made good. Never- 
theless, even at the present day it is a common complaint 
that there are English dyers who will not bring theory (in 
other words, science) to bear upon their practice, but persist 
in the old guess-work which satisfied their fathers and the 
customers they had to serve half a century ago. Not long ago 
one such dyer of the old school had the chance of a large com- 
mission provided he could promise a certain shade. " I can 
do it pretty near^''^ he said. " But it must be exactly true." 
" Well, I cannot promise to a nicety, but it shall be a good 
job." And that was all he would or could say. The work 
went abroad. 

The German chemical industry, perhaps more than any 
other, owes its expansion and prosperity to science and scientific 
methods. It is estimated that in the chemical manufactories 
of Germany there is on an average a university-trained 
chemist to every forty workpeople — a ratio of science to 
labour probably excelled in no other country in the world. 
A recent German writer makes the proud boast that " empiri- 
cism has absolutely disappeared from present-day methods of 
production ; instead of the old plan of ' trying this and that ' 
we see^t the head of our works men who would be an ornament 
to any chair of chemistry, surrounded by their staffs of 
thoroughly trained chemists. The large manufactories have 
well-equipped and often model laboratories for scientific 
research which it is a pleasure to work in. Nowhere is the 
alliance between science and technics so intimate as in Germany, 
and no one doubts that to this fact is due the pre-eminence 
of the German chemical industry." ^ '* 

A further secret of the German manufacturer's success 
is his studied endeavour to meet the needs and wishes of those 
whom he seeks to make his customers. He has put away 
from him the antiquated idea that the consumer exists for 
the producer and must be satisfied with what the latter offers 
him, and instead he acts on the principle that the buyer has 

^ Dr. A. Steigel, Die chemiache Industrie, p. 8. 



94 THE EVOLUTION OF MODERN GERMANY 

a right to have what he wants, if it can be made, and that it 
is the manufacturer's business to supply it. It is impossible 
to say how much trade has left England, never, perhaps, to 
return, owing to obstinate refusal to recognize this not 
unreasonable principle. A leading firm in a great English 
textile industry is reported, before experience tardily taught 
it a painful lesson, to have boasted that it never modified its 
manufactures, or the mode of placing them on the market, 
in any circumstances. " Our goods are made in these colours 
and these lengths," it said, " and those who are not pleased 
can go elsewhere." In due time they went elsewhere, and 
now the problem facing this firm, and many another in like 
predicament, is how to get those rebellious buyers back. 

In Germany it is different. Her strength in manufactures 
and trade, as in so many other things, lies in attention to 
little things. The buyer's requirements and tastes, however 
various and changeable, and not the manufacturer's traditions 
and prejudices, determine what sort of goods are made, and 
how these goods are placed in the merchant's hands. And 
the merchant is equally alive to his patron's convenience and 
his own interests. He does not expect foreigners to be expert 
in the German language, but addresses them in their own 
tongues — often, no doubt, with peculiar variations of his own 
— adapts his own coinage, weights, measures to theirs, and 
if letters will not answer their purpose the merchant goes 
himself or sends some one who is well able to do his business 
for him. In short, the story of the first check to British exports 
relatively to those of Germany (for we have learned much) 
was largely a story of opportunities lost or wilfully neglected 
— mostly the latter. 

It is also to be noted that the over-capitalization of indus- 
trial undertakings is far less common in Germany than in this 
country, and it will be found that one of the first things done 
by a well-managed German company is to strike altogether 
out of its ledger the item " goodwill," an item which so 
often handicaps English companies whose financial standing is 
otherwise above reproach. 

And yet, when all the points in which the German indus- 
trialist and merchant excel have been pointed out — and for 
the most part they are little points, which yet when put 
together make a large aggregate — it would be a great mistake 
to suppose that English enterprise and business acumen are 
lightly regarded in Germany. On the contrary, a profound 
respect is everywhere entertained for England as an industrial 
pioneer, and she yet stands to most Germans as a model to be 
imitated : he must be a very up-to-date manufacturer indeed 



THE PERSONAL EQUATION 95 

who will venture to disparage the country from which he has 
learned so much. 

Personal factors apart, it is undoubted that German industry 
and trade have benefited largely by the encouragement and 
practical help given by the Governments of the various States, 
and within its more limited power by the Imperial Government. 
The idea that a German ambassador is a sort of superior 
commercial agent is, of course, absurd, yet the fiction had its 
origin in a fact, which is that German diplomatic representa- 
tives abroad are very properly alive to the close connection 
of national trade and national prosperity, and are not slow to 
do industry a service when the opportunity occurs. 

A remarkable illustration of the two methods, and how 
they work, is afforded by the Bagdad Railway project and 
Germany's " peaceful penetration " of the Turkish Empire 
generally. Nothing contributed so much to gain for Germany 
her economic and financial influence in the Sultan's dominions 
than the active interest taken by her ambassador, the late 
Baron von Marschall, and her diplomatic agents generally, 
in the furtherance of their country's material interests. No 
sooner did Germany's star rise in the East than her engineers, 
financiers, industrialists, and merchants invaded the Caliphate 
in quest of concessions of all kinds, and their projects were 
warmly supported at Yildiz Kiosk by the German embassy. 
On the other hand, the late Lord Lyons has left it on 
record that during his tenure of the British Embassy in Con- 
stantinople he refused to assist any of his countrymen in the 
promotion of engineering and mercantile projects in Turkey 
from antipathy to the dubious dealings which such assistance 
would almost inevitably have entailed. The British way 
may have been the more dignified and more scrupulous, but 
the German way brought the more tangible results, as the 
event was soon to prove. It will not be forgotten also 
how during the short time that Germany replaced Great Britain 
in favour at the Moorish Court in Tangier her envoy succeeded 
in procuring for his countrymen valuable industrial and other 
concessions which proved a source of offence to France. 

The fact that the railways are, with insignificant exceptions, 
State undertakings enables the Governments to render a great 
service both to industry and agriculture by regulating transport 
charges according to special circumstances, geographical and 
otherwise, while the export trade is systematically assisted 
by means of low preferential tariffs specially designed to 
enable the home manufacturers to enter foreign markets on 
favourable conditions. It is not always possible to strike an 
absolutely fair balance between one industry and another, 



96 THE EVOLUTION OF MODERN GERMANY 

yet on the whole the trading world is satisfied with the way 
in which the railways are administered, and its grievances 
are for the most part spasmodic and relate to transient defects 
for which the State is really as little responsible as the com- 
plainants. Where a good case for the amelioration of existing 
traffic conditions and charges can be made out, especially if 
supported by official or other responsible authority, the district 
railway administrations are generally ready to make reason- 
able concessions. The result is that the question of State 
versus private railways does not exist in Germany, even in 
the most academic form. 

The State also shows its concern for the promotion of 
trade by the construction of inland waterways, a branch of 
navigation which in Germany is now hardly touched at all 
by private enterprise. There is also this difference between 
the canals of Germany and those of this country — that the 
former are generally navigable by steamships, while the latter 
are not. To this subject, however, it will be necessary to 
return later. 

How the Central and State Governments help industry on 
the occasion both of national and international exhibitions 
has been brought home to English commercial men on many 
occasions. Some of the States maintain, and still more 
subsidize, stationary and travelling exhibitions of industrial 
products within their own borders. The grand duchy of 
Hesse is one of the least of the States, with a population of 
only a million and a quarter, and with but a single large town, 
yet it has maintained since 1836 — when its inhabitants were 
only half their present number — a Central Agency for Industry 
which serves as a national information bureau on industrial 
and commercial questions. As time grew its functions broad- 
ened, and for many years it has also directed the industrial 
and technical instruction of the State, maintaining a large 
library and industrial museum and a chemical laboratory, 
and conducting examinations for masters and journeymen in 
various industries. Wiirtemberg, in proportion to its popu- 
lation and wealth, does even more for industry and commerce 
on much the same lines, though every State has agencies of 
one kind or another which achieve the same ends by different 
means. The general question of technical instruction will 
be treated separately. 

In a country whose people look so much " above " for 
encouragement and recognition the patronage so freely given by 
the late Emperor to industry, commerce, and shipping counted 
for much. It is hardly an exaggeration to say that there is 
not a department of economic activity to which this many- 



THE PERSONAL EQUATION 97 

sided man is a stranger, though he may not know as much 
as he thinks. Few are the great industrial estabhshments 
which he has not actually visited (in some of these he is under- 
stood to be a large shareholder) ; he knows every shipbuilding 
yard on the coast, and he has followed the growth of the 
mercantile marine with close interest. As he sped his ships 
of war across the ocean, the Emperor was never slow to avow 
that the protection and extension of German trade were a chief 
concern of the navy ; when a great shipping firm launched 
a new ocean greyhound, an Imperial telegram of congratulation 
was sure to reach the guests at the luncheon-table ; and he even 
allowed one of his naval adjutants to join the board of 
directors of the largest of the Hamburg shipping lines. 

While, however, the State is never slow to encourage 
national enterprise, the mercantile classes have not lost the 
spirit of self-reliance. In its dealings with the railway and 
with all Government authorities the trading world is greatly 
helped by the admirable Chambers of Commerce which exist 
in all the large towns and industrial districts. A short time 
ago the announcement was published in English newspapers 
from Washington that the United States Secretary of State 
had " decided that it will be impossible to accept statements 
by British Chambers of Commerce as prima facie evidence as 
to the value of exports to this country, as can be done in the 
case of similar organizations of Germany under the new regu- 
lations, and the reason of this is that the German Chambers 
are quasi-official organizations, while the British are not.'* 
It is not correct to say that the German Chambers of Commerce 
are even partially official in character, if by that be meant 
that they are in any way Government institutions. They 
are, however, statutory institutions, and as such they are in 
continual contact with the Government, which consults them 
upon all questions directly affecting the interests of commerce, 
and for this reason, as well as because of their representative 
composition, they carry great weight. 

Each State has its own Chamber of Commerce Law, though 
the basis, constitution, and general mode of operations are 
in all essential details everywhere the same. A Chamber of 
Commerce is elected by the whole of the registered trading 
firms in a district, and its funds are as a rule derived from a 
small tax upon these firms, forming a percentage of the trade 
or occupation tax (Gewerbesteuer) which they pay to the local 
commune for its administrative purposes. In its inner 
government a Chamber of Commerce is independent of out- 
side influences. The presidency is usually a rotating honour 
shared in turn by the leading members of the industrial and 

7 



98 THE EVOLUTION OF MODERN GERMANY 

mercantile community, the executive and committees meet 
periodically, but most of the practical work is done by per- 
manent officials, the number of whom depends upon the size 
of the town and the importance and wealth of the industries 
represented. 

Thus a powerful Chamber of Commerce like that of Berlin 
has a number of separate departments, each under an expert, 
dealing with subjects like customs duties and taxation, traffic 
arrangements and transport charges, export trade, patents, 
banks and finance, and legislation, and it is the business of 
the responsible official to know all that can be known upon 
every phase of the subjects under his care. Being in close and 
continual contact with the life of trade, being in fact its very 
eyes and ears, the Chambers of Commerce are able to render 
to the business classes invaluable service, and as a means 
of communication between these classes and the Government 
and other official bodies they perform functions of great im- 
portance. They are essentially practical, working institutions, 
never appealing to the public, as a rule keeping aloof from 
politics, yet even if tempted now and then to take sides in 
their annual reports for or against the fiscal policy now in the 
ascendant, doing so as a pure matter of business and not as 
one of partisanship ; and for the rest using every opportunity 
of defending and furthering the economic interests entrusted 
to their keeping. The Berlin Chamber of Commerce, for 
example, has just published a handbook telling commercial 
travellers everything they need to know about the commercial 
laws and usages, railway regulations, customs regulations, 
etc., of all civilized countries in the world. The use and value 
of these Chambers of Commerce cannot be more forcibly 
proved than by the fact that in their several towns and 
districts the foremost leaders of industry find time, and 
think it worth while, to take an active part in their 
deliberations. 

In many towns the ordinary Chambers of Commerce are 
supplemented by Industrial Associations in which manufac- 
turing interests are specially represented, though in so far 
as these associations seek to enlist the co-operation of the 
working classes their success is nowadays less marked than 
fifty or sixty years ago, when the relations between capital 
and labour were less strained than now. It is no uncommon 
thing for the entire technical instruction arrangements of a 
town to be dependent upon societies of employers, and in 
Berlin much of the best work in this direction is still done 
under the supervision and at the cost of the old Corporation of 
Merchant Elders. Permanent exhibitions of industrial and 



THE PERSONAL EQUATION 99 

art-industrial works organized by such societies are to be 
found in most of the large towns. 

Foreign trade is specially promoted by the existence of 
local Associations of Export Firms, especially in Prussia and 
Central Germany. These agencies maintain agents who repre- 
sent various undertakings in countries the trade with which 
does not justify the sending out of special travellers, keep 
their members versed in arrangements for the transport of 
goods, tariffs, and other charges, and conclude collective 
arrangements where possible with shipping firms at special 
rates. A short time ago the great industrialists established 
a Central Information Agency for Foreign Trade. 

A striking illustration of the German merchant's consuming 
zeal in the prosecution of the industrial conquest of the world 
is afforded by a unique society which has now existed at 
Stettin for over forty years. Directly the Empire was estab' 
lished, the wide-awake merchants of that thriving port drew 
the conclusion that their chance of fame and fortune had 
come, and that it would be their own fault if it was allowed 
to slip by. A Commercial Association was formed for the 
purpose of promoting local trade, but also for equipping the 
rising youth of Stettin with such mercantile knowledge as 
would enable it to go abroad and work in the interests of the 
town. After undergoing suitable preparation, likely young men 
were despatched to the British Colonies, the United States, 
and other countries, charged with the mission of furthering 
the trade of Stettin, by sending home periodical reports 
and generally touting for business ; and towards the cost of 
outfit and of maintenance until he could settle down each 
received the sum of £75. The rules of the Association provide 
that " those members who receive a grant shall give a solemn 
promise, accompanied by grasping the hand of the president, 
that they will conduct themselves as worthy of the confidence 
and trust placed in them by the Association, and that they 
will make every effort to obtain as much information and 
knowledge as possible, to be employed and utilized to the 
benefit of the Stettin trade." Since the Commercial Associa- 
tion was formed, a multitude of commercial pioneers of this 
kind have been sent by Stettin to the great purchasing countries 
across the ocean, and that the merchants of Stettin are 
satisfied with the results is conclusively proved by the fact 
that the enterprising society still lives and carries on its novel 
work to-day. 

The whole theory of trading as understood in Germany 
is that if business is worth having it is worth seeking. To 
iuppose that the enormous addition which has been made 



100 THE EVOLUTION OF MODERN GERMANY 

to their exports during the last generation has simply fallen 
into the laps of German manufacturers, without thought or 
effort on their part, would be to misunderstand entirely the 
secret of Germany's success. All the trade which has been 
gained in competition with other countries had to be wooed 
before it could be won, and Germany did its suitorship in 
person and not through the post. The value which belongs 
to direct representation abroad is best understood by the 
great firms, though it is a commonplace of the entire 
trading world. It is not surprising that the Essen cannon 
works should have spokesmen and touters at every seat of 
government, but there are plenty of enterprising engineering 
companies, whose productions have to compete with those 
of a hundred rivals, which maintain the same system of 
world-wide agencies. One of those, working from North 
Prussia, has a hundred independent offices or direct repre- 
sentatives in foreign countries. 

For some time a Colonial School established by private 
enterprise, but with State encouragement, has been carried 
on in Berlin for the purpose of affording special instruction 
to young men desirous of settling in the German colonies, 
either as agriculturists, planters, or merchants. Such instruc- 
tion is given to residential pupils for the small sum of from 
£40 to £60 a year, and to non-residential pupils for from £15 
to £30 a year. 

This, then, is the rival whose energies have in recent years 
been so successfully exercised in spheres of industrial and 
commercial enterprise which we had been accustomed to 
regard as peculiarly our own, and these are some of the methods 
by which it has fitted itself for the competitive task. England 
must not expect either that the efforts will be relaxed, or that 
the methods which have been employed to such signal purpose 
will be abandoned, except for others still more effective. While, 
however, Germany is no longer a force to be neglected, it is 
also not a force that must of necessity be feared, so long as 
it is encountered with weapons of skill, determination, and 
resource not inferior to her own. 



CHAPTER VI 

TECHNICAL EDUCATION 

Value of technical education in the service of industry — Moderate cost of 
technical education — The technical schools of Prussia — The schools of 
Saxony cited : their number, variety, and age — Reliance upon private 
effort and sacrifice — Enthusiasm for technical education in Saxony — 
Emulation shown by the schools — The action of Bavaria. 

GERMANY had no sooner begun her career as an indus- 
trial export country than she experienced at once the 
full benefit of the system of education which she had 
adopted long before most of her rivals had learned to regard 
public instruction as a serious affair of the State. It is interest- 
ing to recall the fact that Prussia began to recognize the import- 
ance of technical instruction no less than a century ago, when 
she was still suffering from the effects of the Napoleonic Wars. 
In 1824 the first technical school was established in Berlin, 
a proceeding which drew from Goethe generous recognition. 
" We are now assured," he wrote, " of the comprehensive 
care with which the Prussian State is endeavouring to keep 
pace with the incessant advances in technical methods effected 
by our neighbours." Other Prussian towns followed the lead 
of the capital — Elberfeld, Breslau, Stettin, etc. — and the foun- 
dations were thus laid of an imposing system of technical 
education which was to win the admiration of the whole world. 
Hence it was that when, half a century ago, industry stood 
on the threshold of a new era, destined to prove more brilliant 
than any in the past, when the incalculable value of chemistry 
as a marketable science was beginning to be recognized, and 
electricity was proving its illimitable possibilities as an economic 
agent, Germany more than any other European country found 
herself fully equipped by education for entering upon a fierce 
competitive struggle, under entirely new conditions, for the 
commercial mastery of the world. Her technical colleges turned 
out, as by word of command, an army of trained directors, 
engineers, and chemists, armed with the last discovered secrets 
of science and versed in the industrial processes and methods 

101 



102 THE EVOLUTION OF MODERN GERMANY 

which henceforth were to hold the field. In the same way 
her elementary schools — in which, in Prussia and Saxony at 
least, compulsory attendance and free instruction had been 
in operation for the greater part of a century — held in readiness 
for her factories and workshops an unlimited supply of intelli- 
gent workmen, who had not only acquired a liberal education, 
as elementary education goes, but who, even as apprentices, 
brought to the exercise of their crafts a useful grounding in 
technical knowledge and often a certain manual dexterity 
gained in the continuation or vocational school. 

Germany's advantage in these respects was immense, and 
it explains more than any other cause the rapidity and stability 
of her progress. What is remarkable is the fact that while 
these preparations for the coming industrial struggle were 
being carried on in the eyes of the whole world, most other 
nations long ignored them. And yet the best of Germany's 
large technical schools go back more than two generations, 
and many of them are more than a century old. To-day 
these schools are legion, for they are found in all the large 
towns and not infrequently in very small ones, and they cover 
the entire range of industry and industrial art. 

Nor is the cost of technical instruction at all proportionate 
to the extent and value of the work done. Megalomania has 
been the bane of not a few institutions of the greatest public 
advantage in England. We are apt to assume, as a matter 
of course, that large ideas must of necessity be realized on 
a large and ambitious scale. Excessive expense is the first con- 
sequence of this assumption, and failure, or at least limited 
success, is often the sequel. Germany possesses a multitude 
of technical colleges and schools of unsurpassed proportions, 
but expense is not allowed to tyrannize over utility. One 
will never find ornamental figure-heads in these institutions. 
The teachers are all severely practical, and the very best talent 
is obtainable — with no suspicion on either side of hunger pay 
— on terms which would be scouted as humiliating in England 
as professional expectations are in these days. What would 
be thought in this country of the managers of a large technical 
college for the building trades who offered a salary of £210 
rising to £310, for the exclusive services of an architect, with 
university education, to have under his charge the departments 
for building construction, building materials, architecture, 
stone-cutting, draughtsmanship, and ornamental writing ; or 
a salary of £175, rising to £260, for an engineer, also university 
trained, to have charge of the departments for building con- 
struction, building materials, mathematics, physics, geometry, 
statics, surveying, etc. ? Such scales of remuneration of 



TECHNICAL EDUCATION 108 

skilled service, which are, of course, instanced from real life, 
would with us excite the indignation of the professional Press, 
and would probably lead to questions in the House of Commons. 
In Germany men of the highest competency can be secured 
in any number for the best of the technical schools at moderate 
remuneration, because the standard of professional salaries 
is nowhere high, and also because there is always a large and 
ready market for service of the kind, the result of which is 
an ample supply. These facts do not, of course, prove that 
English professional men are paid beyond their deserts. What 
they do prove — and the fact is one of great importance — 
is that technical institutions in Germany enjoy in this respect 
special and very important advantages. It is both easier 
to establish and easier to maintain them in any desired 
number. 

The larger technical agencies apart, however, invaluable 
results are often achieved by the simplest and most inexpen- 
sive means — by the humble village class conducted in the 
winter evening hours by the light of the oil lamp in the low- 
roofed schoolroom ; by the travelling exhibition of samples 
of skilled handicraft which sets provincial ambitions aglow; 
by the itinerant teacher who carries a vitalizing store of rudi- 
mentary technical knowledge from hamlet to hamlet and from 
farmhouse to farmhouse in the sequestered mountain districts 
where home industry is the main support of the population 
during half the year. For the most impressive fact about 
technical education as developed in Germany is its compre- 
hensiveness ; it is applied to every occupation in which it is 
better for a workman to have it than be without it. 

Almost any one of the larger States might be taken as an 
example of this deeply-rooted national belief in the value 
and necessity of technical training, for each has its special 
characteristics. The Prussian technical schools of all kinds 
form an imposing array without equal in any country with 
the same population. A classification of these schools, with the 
number of their teachers (where known) and students (including 
in some cases occasional visitors), in the latest year for which 
information is available, will be found on p. 104. 

It is not surprising to find that the expenditure of the 
Prussian Government on technical education serving the 
direct interests of trade and industry amounted in 1913 to 
£677,000. This sum exceeded by over 50 per cent, the corre- 
sponding expenditure ten years before. Apart from this outlay 
the State expended in the same year £45,000 in assisting the 
home industries, in subsidizing the efforts of the Chambers 
of Handicrafts to strengthen the small industries generally, 



104 THE EVOLUTION OF MODERN GERMANY 



Type of School. 



Technical colleges of Berlin, Hanover, 
Aachen, Danzig, and Breslau (winter 

1912-13) 

Academies of Forestry (1912) 

Schools for forestry apprentices (four 

State, one private) (1912) 
Academies and schools of mining (1912) 
Schools and preparatory schools of 

mining (1912) 

Colleges for Social Sciences, Municipal 
Government, etc. (Frankfort, Cologne, 
and Dusseldorf) (1912-13) 
Agricultural colleges (1912) 

institutes at universities 

(winter, 1911) 
schools (1911) 
winter schools (1911) 
domestic economy schools 
(peripatetic) (1911) 
Other agricultural schools, seminaries, 

agencies, and courses (1911) . . 

Agricultural continuation schools (1911) 

Courses of training for teachers in the 

agricultural continuation schools (1911) 

Veterinary colleges (Berlin and Hanover) 

(1912-13) 

Commercial colleges (BerUn^ Cologne, and 

KCnigsberg) (1912-13) 

Colleges for Commimal Government 

(Dusseldorf and Cologne) (1912-13) . . 

Vocational schools for commercial and 

industrial administration (1912-13) . . 

Art-industrial, drawing, and ceramic 

schools (1912-13) 

Building trade schools (1912-13) 

Schools of navigation (1912) 

Industrial continuation schools for young 

people (males) (1912) . . 
Commercial continuation schools for 

yoimg people (females) (1912) 
Other industrial and commercial con- 
tinuation schools (1912) 
Guild Trade schools (1912) 
Vocational and continuation schools 
for girls (other than commercial), 

(1912-13) 

Centres for courses of instruction of 

different kinds . . 
Higher vocational schools for the textile 

industry (1912-13) 

Other vocational schools for the textile 

industry (1912-13) 

Training workshops for weaving (1912-13) 
State academies of art (1911-12) 
State art schools (1911-12) 
State academies, etc., of music (1012-13) 



Number of 


Number of 


Number of 


Schools. 


Teachers. 


Students. 


6 


902 


7,473 


2 


26 


141 





23 


227 


2 


64 


361 



64 

3 

2 

6 

34 

212 

168 

1,606 
6,349 

22 centres 

2 

3 

2 

21 

33 

26 

87 

2,236 
392 

2,332 

292j 

115 
65 



6 
13 
4 
3 
8 



269 

140 
136 

98 

308 

1,678 

307 

866 
7,654 

196 
70 

141 
67 



19,371 



87 
92 
72 



3,092 

1,382 
1,234. 

920 
5,228 
9,357 

9,630 

42,308 
86,689 

903 

709 

4,937 
438 

6,647 

17,621 
6,196 
2,145* 

396,010 

59,468 

444,425 
11,063 

0,965 



030 

687 
200 
1,013 
781 
401 



♦ Incomplete. 



TECHNICAL EDUCATION 105 

in grants in aid of productive industrial co-operation, and 
in other ways. 

Saxony may claim to have specially distinguished herself 
in this branch of education. As the technical schools of that 
kingdom depend to an exceptional degree upon the self-help 
of the towns and the industries which they serve, they will 
possess special interest for English readers, and a brief account 
of them is given here. In Saxony, almost more than in any 
other German State, technical education may be said to have 
passed into the very life of the land and its people. Nor is this 
surprising, for the oldest technical school goes back to the middle 
of the eighteenth century — the academy of mining at Freiberg, 
dating from 1766. Three years later the principle of obligatory 
education was introduced in Saxony, though it was not until 
1805 that it was systematically enforced. Chemnitz had a 
school of industrial design as early as 1796, and early in the 
nineteenth century the first three schools for lace-makers 
were established, while the town of Annaberg originated the 
system of industrial continuation schools in 1823, being imitated 
by Zwickau in 1828, and by Chemnitz in 1829. All the best 
of Saxony's technical institutions, indeed, have a long career 
of usefulness behind them. 

In 1912 (the latest year for which figures are available), 
disregarding altogether the regular schools — primary, continu- 
ation, middle, and higher — there were in this comparatively 
small country, upon a moderate computation, no fewer than 
515 special schools exclusively engaged in imparting technical 
knowledge of one kind or another. The population of Saxony 
was in 1910 4,800,000, so that there is a systematic technical 
school to every 9,320 of the inhabitants adult and juvenile, 
an extremely creditable ratio. It is no chance that 
Saxony, with one-thirteenth of the population of the Empire, 
has had a larger proportionate increase since 1871 than that 
of any other State, except the Free Cities of Hamburg, 
Bremen, and Liibeck. Between 1871 and 1910 the population 
of Saxony increased by 88 per cent., that of Prussia (with 
Berlin thrown in) by 63 per cent., that of Bavaria by 42 per 
cent., that of Wiirtemberg by 34 per cent., and that of Baden 
by 47 per cent. 

It is particularly to be noted that Saxony's wonderful 
network of technical agencies is not a forced and artificial 
growth, is not a species of pedagogy thrust upon an unwilling 
people by a patriarchal Government. It is emphatically the 
result of a spontaneous desire and enthusiasm for technical 
education ; hence it owes its existence overwhelmingly to the 
initiative and independent action and sacrifice of the people 



106 THE EVOLUTION OF MODERN GERMANY 

themselves. Even before the State seriously troubled itself 
about technical schools, these institutions existed in large 
numbers and were doing an excellent work. In the matter 
of patronage and support the Saxon Government has throughout 
gone upon a method of its own, and a method which is radically 
different from that followed in Austria, which otherwise has 
offered Saxony and other German States much helpful expe- 
rience. As far as possible the establishment of technical 
schools is allowed to proceed naturally from felt needs, and 
those who feel the need are encouraged to supply it as far as 
possible, for it is held that these schools, if they are to succeed, 
must be kept in close contact with practical life, which means 
that practical men must from first to last have the management 
of them. Only where, from exceptional circumstances, the 
requisite power of initiative is lacking, or where general and 
not merely local interests are at stake, does the State presume 
to enter in with its categorical fiat. Yet when it orders the 
provision of schools it still relies as far as possible upon local 
and interested effort. 

Who, then, establish these school ? It all depends upon 
their character, for custom has gradually set up the rule that 
the type of school very largely conditions responsibility for 
its parentage and after support. Thus the Trade Schools 
(Handelsschulen) will be found to be largely in the hands of 
the merchants and manufacturers' associations, differently 
named. The Industrial Schools (Gewerk- and Gewerbe-schulen 
of many kinds) in the main are similarly the result of private 
associated effort, most of them having been established by 
Trade Guilds and other associations, though many are municipal 
and a few are State institutions. So, too, a majority of the 
Industrial Continuation Schools (a technical differentiation of 
the Continuation Schools proper, which are not here considered), 
owe their existence to Trade and Industrial Associations. 

On the other hand, most of the higher technical schools, 
whether purely industrial or art-industrial, are State insti- 
tutions, for here a larger outlay than private bodies could well 
be expected to incur is invariably necessary; while many of 
the schools which encourage the rural house industries could 
never have been called into existence, owing to the poverty 
of the populations concerned, had not the Government wisely 
taken the initiative. 

It follows that in the making of the annual grants towards 
the maintenance of technical schools other than those entirely 
dependent on the State exchequer, the Government scrupu- 
lously follows the same principle of requiring trade societies 
and jprivate individuals to do all they can and should. For 



TECHNICAL EDUCATION lOT 

easily 'understood reasons the Agricultural Schools receive 
fairly liberal grants, while the Industrial Schools receive less, 
and the Trade Schools least of all. The last are mostly found 
in towns, and the merchants and manufacturers are ready 
to support the schools liberally, knowing by experience their 
great value. The Trade Guilds not less loyally support the 
Technical and Industrial Schools for the same reason. So 
much is expected from private sources, in fact, that the State 
is endeavouring to draw more into the background than 
hitherto, not because of any slackening of interest, or of any 
diminution in the need for schools, and schools of a high order, 
but because it is believed to be a wise policy to encourage 
the industrial and commercial classes to do all they can to 
help themselves. Probably this method would not succeed 
generally ; yet it has succeeded wonderfully well in Saxony, 
which, but for its adoption, would not occupy its enviable 
position of prominence in technical education. 

In the following survey of the technical schools of Saxony 
such special institutions as the commercial university of Leipzig, 
the conservatories for music and the drama at Dresden and 
Leipzig, and the fifty music and dramatic schools of a minor 
order in these and other towns are disregarded. The technical 
schools may be divided into five principal groups. There 
are (1) the Higher Schools or Colleges ; (2) the Art and Art- 
Industrial Schools ; (3) the Technical Schools proper, with 
their adjuncts the Professional or Vocational, the Industrial, 
and the Industrial Continuation Schools ; (4) the Commercial 
or Trade Schools ; (5) and the Agricultural Schools. 

(1) It is the object of the Technical Colleges to afford the 
highest possible technical training, both theoretical and prac- 
tical, and it is for this reason that the State has undertaken 
the greater part of the cost of this branch of Saxony's educa- 
tional system. At the head stands the Technical College of 
Dresden, founded as a polytechnic school so long ago as 
1828 and placed upon its present basis in 1871. It has five 
departments, devoted respectively to (a) architecture, {b) civil 
engineering, (c) machine construction and electrical engineer- 
ing, (d) chemical industries ; with (e) a general department 
for mathematics, natural science, political and social science, 
philosophy, philology, etc., and for the training of teachers 
in technical sciences, mathematics, and physics. The great 
majority of students come from the modern higher schools, 
few from the classical higher schools. The college is admirably 
equipped with a library and forty collections of models and 
drawings relating to the various departments of instruction. 
For the encouragement of deserving talent in needy circum- 



108 THE EVOLUTION OF MODERN GERMANY 

stances and of scientific investigation, nearly £1,700 a year 
is granted in exhibitions, gratuities to poor students, and in 
contributions towards the cost of scientific journeys and 
excursions. 

To the higher technical schools belong also the Veterinary 
Academy at Dresden (founded 1780), the Mining Academy at 
Freiburg (founded 1766), the Commercial College at Leipzig, 
founded by the Chamber of Commerce of that town in 1898, 
and the Academy for Forestry at Tharandt (dating from 1811, 
and conducted by the State since 1816), whose chief object 
is the training of skilled men for the service of the State forests, 
though private students, among them many foreigners, attend 
in large numbers. All these schools have extensive libraries 
and collections. The Mining Academy in particular enjoys 
international fame, for in addition to most European countries 
the United States, Africa, Asia, and even Australia have hitherto 
sent students. The purpose of the Leipzig Commercial College 
is the training for a commercial career of young men who 
have already passed through the higher schools, and it is like- 
wise largely attended by foreigners. 

(2) The Art and Art-Industrial Schools are admirable in 
their way. There are five higher schools of this kind — three 
at Dresden (one dating from 1705 and another from 1814), 
one at Leipzig (1764), and one at Plauen (1877). Each of 
these schools works on much the same lines as^ the South 
Kensington Department. As an evidence of the close touch 
which is in this way preserved between art and industry it may 
be noted that a large proportion of the students who pass 
through the Dresden Academy of Fine Arts are painters and 
designers in connection with various industries, carvers in wood 
and stone, art turners, engravers, lithographers, stucco workers 
and stone masons, printers and bookbinders. The Plauen 
school is carried on for the special benefit of the textile industry, 
and in connection with it there are a textile museum, a technical 
library, and a collection of samples. The Leipzig school exists 
particularly for the graphic arts and the book publishing 
trade. From these travelling exhibitions are periodically 
formed and circulated amongst the industrial towns of the 
textile districts, and the result has been the establishment in 
several of the larger places of permanent exhibitions, which 
are replenished by the frequent exchange of new articles 
from headquarters. 

(8) At the head of the Technical Schools are several of 
an advanced type. The chief are the old-established State 
Technical Institutes at Chemnitz, viz. five schools devoted 
respectively to (a) architecture and mechanical, chemical. 



TECHNICAL EDUCATION 109 

and electrical engineering industries ; (b) the building trades ; 
(c) machine construction, including the training of overseers 
for the mechanical and electrical industries ; (d) a school of 
industrial design ; and (e) a school of dyeing. Of these schools 
the oldest is that of industrial design, dating from 1796, but 
two others date from 1836 and 1837 respectively. The State 
contributes the major part of the cost of maintenance. 

There are also the Municipal Industrial School at Leipzig, 
with special departments for machine construction, printing, 
joinery, upholstering, and locomotive driving ; the Mittweida 
Technikum (1867), comprising a mechanical engineering school 
and an overseers' school, the Royal School of Design for the 
textile industry at Schneeberg (1878), the School of Engi- 
neering at Zwickau (1897), the Limbach Technikum, with 
three departments, the Hainichen Technikum (1900), the 
Riesa Technikum (1904), the Dresden Technical School, and 
the Dresden and Bautzen Municipal Industrial Schools. Most 
of these schools have laboratories, libraries, and valuable 
collections of models, etc. 

Next in rank come State schools for the building trades at 
Dresden, Leipzig, Chemnitz, Plauen, and Zittau, all dating 
from over seventy years ago, and carried on for the most part 
during the winter months only ; three mining schools, one a 
State institution ; a series of weaving and embroidery schools 
(30 in number), some going back to 1830 and very few of modern 
origin ; Schools of Mining at Freiberg and Zwickau, the former 
a State institution and the latter carried on by the colliery 
companies ; seven State Schools of Navigation intended for 
the boatmen of the Elbe ; and finally an imposing array of 
133 Professional Schools (Fachschulen), distributed all over 
the State, devoted to special local industries, handicrafts, 
and trades, and over seventy industrial and industrial con- 
tinuational schools, the majority established and for the most 
part maintained by commercial associations and Trade Guilds, 
though a few by the local authorities. 

In this group of schools may also be included 16 schools 
of painting and drawing, intended for the special benefit of 
the toy industry, also the courses of instruction given by the 
factory inspectors to stokers and engine drivers in various 
centres, which change from year to year. 

(4) The schools of the fourth group, the Trade Schools, in 
number 71, owe their origin and success to the enterprise and 
liberality of the Commercial Corporations and Associations, 
and of the members of the merchant class individually, for 
communal action is here very rare. These schools are specially 
intended for apprentices — for the merchants of the future. 



110 THE EVOLUTION OF MODERN GERMANY 

There is no technical instruction in the common sense of the 
words, and manual teaching is altogether absent. Attention 
is rather centred on book-keeping, caligraphy (be it under- 
stood, in its etymological sense), commercial correspondence, 
commercial geography and history, stenography, modern 
languages, the rudiments of political economy, and such other 
subjects as are comprised in the convenient term " commercial 
science." There is at Dresden an old-established Royal College, 
dating from 1839, for the training of stenographers for public 
and private service. 

(5) There is, lastly, the group of agricultural and horti- 
cultural schools, 19 in number, viz. 11 of the former and 
five of the latter, including several of national and even of 
Continental fame, besides three schools for agricultural domestic 
economy, intended for girls. They have all been established 
by associations of farmers and gardeners respectively. 

At none of the schools to which reference has been made 
is attendance compulsory, yet in reality an indirect pressure 
is exerted. It happens in this wise. Since 1893 compulsory 
attendance at a continuation school has been legalized in 
Saxony, which was the second State in the German Empire 
to adopt this epoch-making act of coercion. For three years 
after leaving the primary school, that is, from the age of 14 
to 17, boys and girls must carry on their education in an 
advanced night-school. With a view to economy of time, 
however, they are given the option of passing these three 
compulsory years in a Technical School instead. Many go 
at once to Industrial or Trade Schools, while others pass their 
compulsory years in what are known as Industrial Continuation 
Schools, a type of school which the Education Law of 1873 
called into existence. 

So far is this law from being regarded as a hardship, that 
in general the students who come under it attend school most 
willingly, and often continue to do so after their legal duty 
has been fulfilled. Practically all the more intelligent and 
persevering students of the continuation schools pass on, 
without any pressure, into the Industrial Schools, which have 
as a consequence greatly increased in numbers and popularity 
since 1893. Compulsion, in fact, has been such a success in 
Saxony that it could probably now with perfect safety be 
dispensed with, and in practice the educational authorities 
do place far less reliance upon the rigours of the law than 
upon the fostering of a spontaneous desire to learn, know, 
and excel. 

In so far as figures are available, the amount expended 
by Saxony on technical education, as represented by the 



TECHNICAL EDUCATION 111 

institutions above enumerated, exceeded £370,000, but omissions 
would bring the total to at least £400,000, equal to about 17s. 
a head of the entire population of the kingdom. Of this 
amount the State bore about 55 per cent., though in the case 
of institutions other than those immediately carried on by the 
State the proportion was only about 27 per cent. Of the 
expenditure incurred on account of technical, industrial, and 
professional schools other than the higher institutions 
(colleges, academies, and the like) the State bore only 15 per 
cent., a fact which bears a high testimony to the enthu- 
siasm of local authorities and the industrial and commercial 
organizations in the cause of technical education. 

Such is the many-sided system of technical education which 
Saxony has in the course of years, and by a vast expenditure 
of wisely directed effort, brought to a degree of excellence 
which may well excite both the envy and the admiration of 
rival industrial countries. I heard much, when discussing the 
subject in Dresden at the Ministry of Education, of the means 
adopted by the Government for obtaining from the Technical 
Schools the best results. While the last word is always said 
by the Ministry, there is no wholesale treatment. Free- 
dom of movement, within wise limits, is studiously fostered. 
" We introduce less regimentation (reglementiren) in our schools 
than is the case in Prussia," I was told by the Director of this 
Department : ''as far as possible we let them alone, only 
taking care to spur them to emulation ; and that, with our 
intelligent Saxon folk, is quite enough." A feature of this 
plan of encouragement is the publication every five years of 
a complete register of the schools, recording what they have 
done or failed to do, and awarding praise without stint for 
the praiseworthy, while turning the fierce light of comparison 
upon the backward. The effect has been found to be eminently 
stimulative. 

The same practical spirit is shown in the selection of teachers. 
Stress is, of course, laid upon proved efficiency, and as far as 
possible attractive salaries are offered, with a view to securing 
the best available talent ; yet a very considerable degree of 
laxity is purposely allowed in the requirement of formal 
certificates of efficiency of the usual examination order, on 
the ground that in the lower technical schools it is practical 
ability rather than any encyclopaedic knowledge of theory 
that is needed. Nor is the system of Government inspection 
grievous. The local managing bodies are expected to exercise 
needful supervision, and supreme control is exerted through 
a single inspector, though lately several sub-inspectors have 
been appointed. Another means of promoting friendly rivalry 



112 THE EVOLUTION OF MODERN GERMANY 

is by the holding of periodical exhibitions of students' work. 
These exhibitions are not intended so much for the general 
public as for the schools themselves and their teachers. Hence 
all schools are encouraged, and are even expected, to take part, 
whether their proficiency be great or small. " There are no 
parade horses at our exhibitions," said the Director expres- 
sively. The object, in fact, is not to create a spectacle, but 
to produce solid results. 

It is worth notice also that while in theory, and to some 
extent in practice, the higher technical schools are open to 
all comers, the shrewd Saxon has of late years come to look 
with a certain suspicion, if not disapproval, on foreign pupils. 
" Formerly," I was informed, " all were welcome. ' Let 
everybody come,' we said : ' the world is wide, and we have 
plenty of room.' But we say that no longer." The fact is 
that every pupil is regarded as a possible commercial rival, 
and in Saxony there is no disposition to ride the hobby of 
free competition to the death. Hence a certain coldness on 
the part of the authorities toward the foreigner, who is no 
longer invited as of old to share at the board of knowledge 
on equal terms, but is invariably required to pay double or 
even treble fees. But even when he thus pays he would appear, 
judging by his numbers, to be well satisfied. 

Although Prussia and Saxony have been taken as illustra- 
tions of the importance attached in Germany to technical 
education, the same story of enlightened enterprise might be 
told of the other German States, each one of which works on 
its own lines in the same cause of national and industrial 
efficiency. Thus Bavaria has distinguished itself during late 
years by its system of industrial continuation schools, the 
number of which in 1911 was 371, one-third of the cost of 
maintenance being defrayed out of public (State, communal, 
district, and circle) funds. In addition there were 333 agri- 
cultural continuation schools and 42 agricultural winter schools, 
supported in even greater measure by public grants. 



CHAPTER VII 

CAPITAL AND LABOUR 

The relations between capital and labour — The legal status of labour and its 
organizations — The trade unions and their membership — The Socialist 
organizations — The Christian (Roman Catholic) and Hirsch-Dimcker 
organizations — Revenue and expenditure — The " free labour " \mions 
— Trade unions as fighting organizations — Strikes and their result — 
Progress of labour — Future of trade unionism — The Socialist Press — 
Loyalty of trade unionists to their leaders — An exception to the rule 
— Trade union contributions — Smallness of official salaries — The work- 
men's secretariates — The attitude of capital to labour — The industrial 
princes of Rhineland-Westphalia — Their hostility to trade imions — The 
Westphalian miners' strike in 1905 — Organizations of employers — The 
bitterness of the struggle — A better feeling in the South — Insurance 
against strikes and lock-outs — Present phases of the labour movement 
— The agitation for higher wages and shorter hours — The ten-hours 
day predominant — Attitude of the Imperial Government — Labour policy 
of the State and municipal authorities. 

NOT long ago there took place, between the special organ 
in the German Press of the employers of labour and 
the official organ of the Social Democratic party, an 
exchange of views which clearly brought out one of the greater 
sources of friction between capital and labour in Germany. 
The Arbeitgeber-Zeitung {Employers' Gazette) had published 
an article upon the agreements for the adjustment of disputes 
which exist in the British engineering and shipbuilding trades. 
It pointed out that by these agreements " the trade unions 
recommend their members not to refuse to work with non- 
unionists, and the employers' unions recommend their members 
not to refuse to employ workmen because they belong to 
unions. No workman shall be required to say whether he 
belongs to a union or not." " Is there," it added, " a German 
trade union which would subscribe to such an agreement, 
though it is not in all respects what German employers regard 
as desirable ? " To this challenge the leading Socialist labour 
journal, the Vorwdrts, replied : " Such an agreement as the 
one referred to would be signed by every German trade union 
without hesitation, since it prohibits the employer from 
penalizing workmen for belonging to organizations. At the 

8 "3 



114 THE EVOLUTION OF MODERN GERMANY 

moment of writing we receive news that ' The porcelain 

workers of have been locked out because they have not 

complied with a demand that they should withdraw from their 
union.' And that proceeding is typical of German conditions. 
Lock-outs for the same cause are of daily occurrence with us." 
Now, neither Germ^an employers nor German trade unions 
are as black as they are generally painted by each other. 
Nevertheless, the fact remains that the relationship between 
capital and labour has long been one of extreme tension, and 
in some industries of extreme bitterness. Organization on 
the one side has been answered by combination on the other, 
until it is literally true, as the Norddeutsche Allgemeine Zeitung 
asserted recently, that " The employers have been welded 
into a weapon-brotherhood, regardless of their competitive 
relationships," so that, in some of the large industries at least, 
they " present to-day a closed phalanx." 

For a long time to come no factor w^ill be so important in 
determining the conditions of labour as trade unionism, and 
its power and pretensions deserve study. 

It seems desirable to refer briefly, by way of introduction, 
to the legal status of labour and its organizations. In regard 
to the right to combine for the defence of economic interests 
a valuable safeguard is secured to the majority of wage-earners 
— ^not, however, to State employees, agricultural labourers, and 
domestic servants, who possess no right of the kind — by 
Section 152 of the Industrial Code, which declares that " All 
prohibitions and penal regulations against industrial employers, 
industrial assistants, journeymen, or factory operatives regarding 
agreements and combinations for the purpose of obtaining 
more favourable conditions of wages and of work, particularly 
by means of the suspension of work or the dismissal of work- 
people, are repealed." The provision constitutes a defence of 
strikes and lock-outs, though until recent years this unre- 
stricted right to combine for economic ends did not apply to 
political or even public affairs. Only by the passing of the 
Law of Association of April 19, 1908 (which has been liberal- 
ized by an amendment of June 16, 1916) was a fairly generous 
right of combination created for the entire Empire. 

But in judging the liberty which the working classes enjoy 
of furthering their interests by the method of the strike it is 
not sufficient to state the bare letter of the law. So much 
depends on the application of the law by courts and judges, 
and such a variety of interpretation and usage prevails, that 
it is only by the examination of judicial decisions that the 
actual state of the law can be learned. The method of exclusive 
dealing is largely resorted to by the working classes in the 



CAPITAL AND LABOUR 115 

assertion of their economic claims. There exists, indeed, no 
legal right to proclaim an embargo upon an industrial under- 
taking in which employer and workpeople are in conflict, yet 
it has been found that the same end can be attained by the 
employment of ingenuity in phrasing, and in practice the law 
has tacitly tolerated the unacknowledged yet no less effective 
" boycotting " (the word was long ago naturalized in the 
German vocabulary of labour) of employers and public places 
of assembly (like meeting-halls and licensed premises) obnoxious 
to the workers, though here, too, there are exceptions according 
to the practice of the various States and tribunals. For example, 
the mere threat of a strike or a " boycott," in the event of 
an employer not falling in with conditions proposed by his 
workpeople, has been punished as a misdemeanour under 
the provision of the Penal Code which forbids the use of force 
or menace with the object of " procuring illegal pecuniary 
advantage." In isolated cases courts of law have even inter- 
preted the summary demand of higher wages in this sense, 
and workpeople have frequently been convicted for having 
appealed to their colleagues in open meeting to cease work 
without giving notice. 

On the whole it may be said that the law of association 
has hitherto been more liberal than its interpretation by the 
courts and the police. Lately the working classes and their 
unions have gained a valuable concession by a law (May 22, 
1918) repealing Section 153 of the Industrial Code, which, 
owing to judicial interpretations, had operated prejudicially 
against labour combinations and some of their methods of 
warfare. This section provided that whoever by physical 
force, threats, insult, or defamation should persuade or 
endeavour to persuade another person to take a part in or 
give support to any agreement or combination for obtaining 
improved wages or conditions of work, or should by the same 
means endeavour to prevent another person from withdrawing 
from such an agreement or combination, was liable to a penalty 
of three months' imprisonment or such severer penalty as 
might be prescribed by the criminal law. 

The labour organizations fall into three principal groups — 
the " Free " or Social Democratic group, the Hirsch-Duncker 
or Radical group, and the Christian or (for the most part) 
Roman Catholic group. There are, however, a number of inde- 
pendent unions, professing special attachment to " patriotic " 
or " national " principles, as well as a group of " Yellow " 
organizations, which have been promoted and subsidized 
by the employers on "Free Labour" lines as understood in 
England. All these types of unionism will be dealt with 



116 THE EVOLUTION OF MODERN GERMANY 

in order. The unions in which the Poles combine do not call 
for detailed reference. They are purely national and are 
found for the most part in the colliery and iron districts of 
the Rhineland and Westphalia. Although Roman Catholics, 
the Poles have greater social affinity with the Social Democratic 
than the Christian organizations ; it has proved impossible, 
however, to induce them to join either in large numbers. On 
labour questions, as on all others, they prefer to remain apart 
and go their own way. Before the outbreak of the war in 
1914 the whole of their unions were understood to have a 
membership of a hundred thousand, but the tie is a loose one 
and is dictated as much by racial as by economic motive. 

The following figures show the growth in membership of 
the principal groups of trade unions during the twenty years 
1891 to 1912 :— 



Type ol Union. 


Membership. 


Increase. 


1891. 


1912. 


Absolute. 


Per Cent. 


Socialist (" Free ") . . 

Christian 

Hirsch -Dimcker 

Independent 

Pacific (" Yellow ") 


277,659 
65,588 


2,553,162 
344,687 
109,226 
814,745 
231,048 


2,275,503 
43,637 


820 
67 


Total 
Confessional (Protestant and 
Roman Catholic) . . 


343,247 


4,052,867 
765,089 


3.709,620 


1,080 




343,247 


4,817,956 


4,474,709 


1,300 



"The three principal groups of German Trade Union 
organizations," said a German writer recently, " represent 
together the most powerful, most numerous, best organized, 
most militant, if not the most wealthy, labour army of 
which we have any knowledge, though in political views these 
great organizations are diametrically opposed." Nevertheless, 
the German trade unions, though collectively stronger in 
numbers than the English unions, do not yet contain so large 
a proportion of the industrial workers as the latter, or indeed 
the unions of several other European countries, such as 
Denmark and Sweden. 

The Socialist or " Free " organizations naturally give the 
lead to the entire trade unionist movement. So strong have 
they become during recent years that they now embrace more 



CAPITAL AND LABOUR 117 

than half (53 per cent.) of the organized workers of the country. 
Their growi:h during the ten years preceding 1912 was strikingly 
rapid, as the following figures show : — 



Year. 


No, of Members. 


Increase. 


1900 
1905 
1910 
1911 
1912 


680,427 
1,344,803 
2,017,298 
2.339,785 
2,653,162 


664,376 
672,495 
322,487 
213,377 



The increase over the whole period was 1,872,735, or nearly 
fourfold. The largest unions are those in the building trades, 
mineral and metal industries, textile industry, commerce and 
transport, and the clothing, wood, food and drink, and 
printing and allied trades. The unions are grouped in large 
Federations, and in the large towns these Federations have 
central offices, combining union offices, inquiry agencies, labour 
registries, reading-rooms and libraricF, lodging-house, restaurant, 
etc. Two of the best of these central institutions are those at 
Berlin and Leipzig, the latter costing £50,000. 

The " Free " trade unions have also of late years made 
considerable progress with the organization of women, of 
whom large numbers are now enrolled in the unions of the 
textile workers, metal workers, tobacco workers, and general 
factory workers. 

The " Free " central unions had a revenue in 1912 of 
£4,019,000, and an expenditure of £3,062,000, and their 
accumulated funds were £4,042,000. In 1891 the revenue per 
member for all purposes was only 6s. 8d., in 1895 it was lis. 6d., 
but in 1912 it was 31s. 6d., while the accumulated funds had 
increased from 2s. 6d. to 31s. 8d. per head. 

These unions have throughout kept in close touch with 
the political side of Socialism, and the association has been 
of immense help in recruiting their members. Probably most 
of the members are convinced Socialists, so far as conviction 
can be said to go in an attachment which in many cases is 
based far more on feeling than reason, yet a considerable 
section identify themselves neither with the Socialist party 
nor with Socialist principles, and a far larger number, possibly 
the majority, remain outside the political organizations of 
Socialism. It is significant that when the members of the 
Socialist trade unions numbered nearly a million and three- 
quarters, the Socialist political party only numbered a little 
over half a million registered and subscribing members, including 



118 THE EVOLUTION OF MODERN GERMANY 

adherents other than manual workers, of whom there were 
many. Some time ago the SociaUst Trades Federation of 
Danzig inquired of its members how many were " poHtically 
organized," and of those who replied only 8 per cent, so 
described themselves. 

The explanation of this apparent inconsistency is that a 
large number of workmen are drawn to the Socialist trade 
unions because they are the most energetic, most vigilant, 
most resourceful, and at the same time most uncompromising, 
in promoting the interests of labour, and because their large 
funds and unequalled machinery enable them to offer to the 
working classes advantages which are not offered in anything 
like the same degree by the other organizations. Thus the 
Socialist Working-men's Secretariates or Advice Agencies which 
are found in most large German towns are altogether superior 
in usefulness to the rival agencies of the same kind which, 
in far smaller numbers, are carried on by the Hirsch-Duncker 
and Roman Catholic organizations. 

German trade unions classify themselves as " Gewerk- 
schaften " (the Socialist and Christian unions) and " Gewerk- 
vereine " (the Hirsch-Duncker unions). The first trade unions 
to be formed were of the latter kind and date from 1868. 
They owed their existence to Dr. Max Hirsch, an influential 
member of the " Fortschritt " or Progressive Parliamentary 
party of that day, who had found his model in England. They 
were originally politico-economic organizations and were formed 
of working men who were more or less in sympathy with what 
in England would be known as Liberalism. Even to-day they 
resemble the English trade unions most closely, though puzzled 
by the new movement which in England would appear to 
be rapidly diminishing the distance between trade unionism 
and Socialism. They are still closely associated, both in 
political views and in practical action, with the Liberals of 
one direction or another, yet on principle they repudiate formal 
association with any political party and leave their members 
free, in Frederick the Great's words, to be " saved every one 
in his own way." " We are a neutral organization for economic 
ends, and that we will remain." This standpoint was formally 
avowed by the last congress of the Hirsch-Duncker unions, 
and in general the principle of detachment is observed as far 
as is possible for a party which is not one of great numerical 
or intrinsic strength. These unions on the whole represent 
the ilite of the working classes, yet they are not pioneer 
organizations and they make little progress, their total number 
being only equal to one year's addition to the Social Democratic 
unions. Their largest national unions are those of the machine 



CAPITAL AND LABOUR 119 

builders and metal workers, and the factory and unskilled 
labourers. They are not exactly a peace-at-any-price party 
of labour, but they have no love of powder and firearms, and 
will negotiate long and patiently rather than expose their 
resources to the decimating influence of active disputes. 
Their revenue in 1912 was £139,300, their expenditure £117,300, 
and their accumulated funds £225,000. Two-thirds of their 
invested funds were ear-marked for sick benefit. 

" The Christian unions, which are strongest in the industrial 
and mining districts of Rhenish- Westphalia, where the Roman 
Catholic Church is paramount, have in the past been still 
less militant. They may best be described as a compromise 
between ecclesiastical and economic organizations. More than 
fifty years ago, when an outburst of social fervour passed 
through Roman Catholic circles in the Rhineland, under the 
influence of Lassalle's convert. Bishop Ketteler, many associa- 
tions of working men attached to that Church were formed. 
They were not aggressive or exclusively devoted to labour 
propagandism. Their founders and patrons were as a rule 
priests of popular sympathies, who were concerned lest the 
Roman Catholic working classes should be drawn into alien 
organizations. Gradually it was found necessary to broaden 
the basis of these societies, and more and more to conduct 
them on the usual trade union lines ; yet the tie between the 
Church and labour has never been sensibly weakened, and on 
the whole the Christian organizations are, even to-day, the 
most tractable of all the labour unions. 

Formally, and perhaps from conviction, these organizations 
repudiate the Socialist notion of an inevitable " class war,'* 
accept the existing political and social order as expedient, 
and, while endeavouring to assert for the working classes a 
larger share in determining the conditions of employment, 
discourage all attempts to set capital and labour by the ears. 
At the same time this official attitude does not prevent the 
Christian organizations from joining hands with the Socialist 
and other unions when there is a common battle to be fought. 
Thus in the great Westphalian colliery strike of 1905 the 
Christian unions, after first hesitating, threw in their lot entirely 
with the Socialist organizations, and with them carried the 
struggle to a satisfactory issue. Peace having been secured, 
however, the old inter-party bickerings were promptly resumed. 
Nevertheless, the leaders of the Socialist labour organizations in 
large industrial towns will tell you " in confidence " that 
not a few of their members are Roman Catholics, who have 
surreptitiously joined the Socialist unions as a form of 
reinsurance against capitalist exploitation. 



120 THE EVOLUTION OF MODERN GERMANY 

The Christian unions have at their disposal most of the 
machinery which the SociaHsts employ — advice bureaux, 
funds for all purposes, labour registries, and the like — though 
the vigour of their various propagandist agencies is greatly 
restrained owing to the fact that the moderating influence of 
the clergy is everywhere exerted. 

At the end of the year 1912 they had a membership of 
a third of a million. The largest unions are those of the 
miners, masons and masons' labourers, textile operatives, metal 
workers, the Bavarian railwaymen, transport labourers, and 
wood workers and ceramic workers. The aggregate income 
of the Christian unions in 1912 was £330,400, their expenditure 
£261,100, and their accumulated funds amounted to £428,800. 

The " Free Labour " unions, which, following French 
usage, are called " Yellow " — the Socialist unions are " Red " 
and the Christian unions " Black " — are local, and as a rule 
are subsidized, even when they have not been established, by 
a few large industrial firms, acting independently or collectively. 
Most of these firms belong to the engineering trade and are 
willing to pay liberally to the support of organizations which 
are pledged to keep the peace. For the principal condition 
of membership is that strikes must on no account be resorted 
to, and that the right of coalition shall pro tanto be surrendered. 
As a rule these unions are limited to special works. One of 
the largest, formed in connection with a Bavarian machine 
works, comprises three-quarters of the employees, and the 
firm contributes the greater part of its revenue. Essentially 
such contributions are a form of insurance against disputes, 
but the *' Yellow " union movement is too recent to enable 
one to judge whether it will stand the test of serious differences 
between employers and employed. If the monetary assistance 
of the former were withdrawn the unions would not exist a 
day. It is natural that the " Yellow " associations should 
not stand in good repute with other trade unionists of any 
class, and that their influence upon the labour movement 
should so far be quite negligible. 

Another and somewhat similar type of trade union, so 
called, was called into existence in 1905, with the name 
*' Patriotic " Working Men's Union. There is nothing dis- 
tinctive about the branches of this organization, except their 
feebleness, insignificance, and their assumption of special 
national virtues, which by implication are denied to the Hirsch- 
Duncker and Christian unions. Seeing that the " Patriotic " 
union did not think it necessary to come to the relief of the 
working classes until the old-established unions had a member- 
ship of nearly two millions, there is little disposition to treat 



CAPITAL AND LABOUR 



121 



it seriously, and neither a long nor a useful life is predicted 
for it. 

The following figures relating to 1912 are interesting as 
affording an index to the fighting strength of the principal 
groups of unions, and possibly also to the strength of their 
members' attachment to these unions : — 



Socialist (Free) Unions 
Christian Unions . . 
Hirsch-Duncker 
Independent 



Income 
Per Capita. 



s. d. 

31 6 

19 2 

25 6 

3 8 



Expenditure 
Per Capita. 



s. d. 

24 

15 2 

21 6 

2 11 



Accumulated 

Funds 
Per Capita. 



s. d. 

31 8 

24 11 

41 2 

4 



More and more the trade unions are becoming militant 
organizations, and even the Christian unionists are ceasing to 
look upon the labour movement with the old apathy. Strikes 
tend to increase rather than the reverse, as the unions learn 
their strength, and an increasing proportion of their revenue 
is expended in offensive warfare of this kind or resistance to 
the employers' common counter-stroke of the lock-out. The 
average yearly number of strikes during the period of 1909- 
1913 was 2,595, and the number of workpeople involved 
328,000. The average yearly number of strikes settled during 
the same period was 2,171, representing 7,998 undertakings, 
figures comparing with 2,243 and 11,783 for the years 1904- 
1908, and 1,242 and 5,972 for the years 1899-1903. 

An analysis of the results of all labour disputes occurring 
during the five years 1907-1913 shows that the workers had 
greater success when locked out than when striking. Of the 
strikes 88 per cent, were completely and 39*6 per cent, partially 
successful (together 48-4 per cent.) and 51*6 per cent, altogether 
unsuccessful, while as a result of the lock-outs the workers had 
complete success in 22 per cent, of the disputes and partial 
success in 75*5 per cent, (together 77'7 per cent.), being wholly 
unsuccessful in only 22*3 per cent, of the total. 

It is to be noted that the various classes of clerks, technical 
assistants, and other officers connoted by the French term 
employes are highly organized. Their many federations had 
in 1912 a membership of 907,000, the federations of commer- 
cial employees having more than two-thirds of this total. 
Owing to the solid front which they are able to present when 
their interests are affected by projected legislation these organ- 
izations have more than once proved themselves a power in 
political life. 



122 THE EVOLUTION OF MODERN GERMANY 

Certainly no small part of the progress made by the working 
classes during the past twenty years, alike in wages and the 
general conditions of labour, is due to the action of their 
unions. The entire status of labour has been raised, and by 
general consent industry has been well able to bear the largely 
increased expenditure entailed by higher wages and reduced 
hours, yet most of the ground won by labour has been severely 
contested, and without the aid of strong organization, led by 
determined men, it would not have been won at all. In 
Germany, as elsewhere, the weakest organization is found in 
the badly paid industries, and it is in these industries that 
the least disturbance occurs in the relationships of capital 
and labour. The chemical industry is an illustration of this 
general truth ; in this industry wages are low and strikes rare, 
and the gradual improvement in the workers' level of earnings 
is mainly dependent upon the extent to which the chemical 
industry is affected by the competition for labour. Only the 
general upward movement of wages levels up the standard 
in an industry like this, and it is the last to feel the benefit. 

In Germany there is a disposition to regard the recent 
growth of trade unionism as abnormal, and the prediction is 
sometimes made that as soon as the relationships between 
capital and labour become more composed the unions will 
lose their hold upon the working classes and decline. The 
answer to this is that there is no likelihood that the relation- 
ships between employers and employed will for a long time 
become more harmonious. The trade unions are only just 
learning their power, and far from the struggle between capital 
and labour being exhausted, it is merely beginning. Experience, 
it is true, shows that an important dispute invariably leads 
to a large addition of membeis to the organizations which do 
the fighting on the men's behalf, and that with peace a con- 
siderable proportion of these recruits fall away. There have 
been many such disputes during recent years, and the member- 
ship rolls of some of the unions affected show as a consequence 
startling fluctuations. For example, while in one year 10 J, 000 
new members joined the Socialist Metal Workers' Association, 
70,000 withdrew from it. So, too, the Christian Miners' 
Union had 43,400 members when the Westphalian strike of 
1905 began ; before the strike ended its membership had grown 
to 80,000, but the dispute had not long been settled before 
the number fell to 47,000. The significant thing is, however, 
that the growth of trade unionism has been steady and persistent 
in spite of violent oscillations in individual unions, and this 
will in all probabiHty be the case in future. Every circumstance 
of the workers' position and outlook encourages that view. 



CAPITAL AND LABOUR 123 

The growth of the syndicates, the organization of employers 
in defensive unions, the amalgamation of these unions in 
powerful federations covering large areas and commanding 
virtually unlimited funds, the effect of increasing taxation in 
restricting spending capacity, the desire for a higher and fuller 
life — all these things impel the working man to aim at the 
enlargement of his resources, and whatever may be the ultimate 
incidence of his growing wages demands, his immediate concern 
is with his employer. 

In its work of organization and agitation, trade unionism, 
especially of the Socialist type, is assisted by a singularly 
efficient Press. In sixty-eight towns the Socialist party has 
daily newspapers, and in three of these towns two or more 
such newspapers ; four newspapers appear once a week, and 
eighteen appear at longer intervals. In addition sixty-two 
trades and industries have special trade union newspapers 
(several with two or three), most of them appearing weekly, 
and there are at least twelve other journals and inagazines of 
various kinds conducted by the Socialist party or trade unions. 
In the interest of Polish and Italian workmen there are 
newspapers written in their languages. 

Many of the Socialist daily newspapers have large circu- 
lations, equalling or exceeding those of the burgher party 
newspapers published in the same towns. The most widely 
circulated of the trade unionist journals is that of the metal 
trades, which claims to be distributed to the number of 
200,000 each week. The daily Press is for the most part ably 
and energetically conducted. It does not pay much attention 
to the niceties of controversy and has no respect for confidential 
documents ; its tone is frankly anti-ecclesiastical and often 
aggressively atheistic, in spite of the much vaunted but hollow 
claim of the Socialist party that it regards religion as, in the 
words of its programme, " a private matter," yet it serves the 
purpose of agitation very effectively. Primarily the daily 
journals are political, and Socialist propagandism is their 
principal aim. They zealously watch the interests of labour, 
however, and in the event of an industrial dispute they are 
able to afford powerful help to the men. 

The editors of these journals are often men of considerable 
education and study, who have obtained their doctorates at 
the university by hard work, and their intimate acquaintance 
with economic questions gives to their articles — one-sided 
though they may often be — a note of intelligence and even of 
authority which is not always found in the more reputable 
departments of journalism. Moreover, they are careful and 
generally accurate — probably never wilfully inaccurate — in 



124 THE EVOLUTION OF MODERN GERMANY 

their facts, though often enough perverse and wrong-headed 
in their theories and as full of prejudices as of good intentions. 

Germany is on the whole behind England in the publication 
of cheap literature of a high class, but her labour Press is far 
above the corresponding Press of this country in wideness of 
interests and in literary ability. In many of the trade organs 
which have been referred to, dyed red with Socialism though 
they may be, appear articles which the most educated persons 
can read with interest and profit — articles on art, literature, 
the sciences, antiquities, theology (very rationalistic yet strictly 
critical), travel, etc. If newspapers give the public what the 
public demands, the readers of these cheap prints must belong 
to a higher order of intelligence than the average English 
labour journalist. Or is the tone given in both cases by the 
journalist himself ? Whatever be the explanation, the labour 
newspapers of the two countries offer interesting points of 
comparison. 

Nor is the Socialist Press conducted on philanthropic lines. 
Every journal is expected to pay its writers moderate — they 
are generally very moderate — salaries, and leave a surplus 
available for party purposes, and many of the organs in the 
large towns do, as a fact, yield large profits. To this end the 
rank and file of the party are urged as a matter of principle 
to support their own newspapers and no other, and on the 
whole the response to this appeal to loyalty is cordial. An 
inquiry made recently of the members of a strong trade union 
in Berlin brought to light the fact that over one-third per cent, 
of the households interrogated regularly subscribed to the 
official Socialist journal. 

The Hirsch-Duncker and still more the Christian unions 
have also their trade papers, though they do not compare in 
importance with those of the Socialist unions, and the con- 
stant and bitter controversial warfare between the three rival 
journalistic camps points to the existence of deep-seated 
divergences and antagonisms. 

In general the trade unionists are perfectly loyal to their 
organizations and leaders. When the movement was in its 
infancy it was often a matter of difficulty to persuade the men 
that, having become organized, they were bound to stand 
together and accept the verdict of the majority, and if needful 
the decisions of their leaders, when duly empowered to act 
on their behalf, even though acceptance at times involved 
disappointment and chagrin. With more knowledge of trade 
union principles, and with experience of the disaster which 
attended divisions, this chafing against authority tended to 
disappear. Here the educative influence of political life was 



CAPITAL AND LABOUR 125 

of great effect, though it is questionable whether the identi- 
fication of the trade union movement with poHtics has on the 
whole been of economic advantage to the German workman. 

Nevertheless, cases still occur from time to time in which 
the men get out of hand, and under the influence of the strike 
fever throw discretion and authority to the winds. An instance 
of the kind occurred in Berlin a few years ago. The masons 
there were by agreement in receipt of wages of 9d. an hour, 
with a day of nine hours in summer. They demanded lOjd. 
an hour and an eight-hour day at once. The hours of labour 
were to be reduced by 11 per cent, and the lost time was to 
be made up by a 13 per cent, increase of wages. The effect 
would have been to increase the weekly wages from 40s. 6d. 
to 41s. The dispute occurred in the middle of the busy season 
and the employers were at great disadvantage. They offered 
to concede a higher rate of wages, but declined to reduce the 
hours of work. The leaders of the men's organization accepted 
this offer as a fair compromise, but with reproaches and resent- 
ment the leaders were overthrown, and the men decided to 
strike. Even the party organ condemned the rebellion of the 
rank and file, who went so far as to refuse the conciliatory 
overtures of the Court of Conciliation. The struggle ended 
without definite result either way. Many of the employers 
settled on the basis of 9jd. an hour and 8J hours' work, but 
the majority let matters take their course and only resumed 
building when the men were tired of playing, which was too 
late to enable either side to recoup that year the losses which 
had been occasioned by a dispute forced on the employers in 
defiance of the rules and best traditions of trade unionism. 
Two incidental results of the strike may be named. On the 
one hand the wages agreement movement became discredited, 
for the employers argued that if the men would repudiate a 
bargain made on their behalf by their own leaders, they would 
be equally ready to repudiate a written contract made with 
them when it suited their purpose. Further, the employers 
learned during the dispute the value of piecework, and began 
to employ this method of remuneration — hateful to German 
trade unionists — far more extensively than before. 

It has been estimated that a trade unionist's contributions 
of all kinds to his union range between Is. and 2s. per week, 
according to a workman's trade and rank. The weekly con- 
tribution proper varies from 2jd. to Is. 5d., with an average 
of between 5d. and 6d., but to it come various other payments 
— local additions or supplements, special levies, as for the 
Secretariates, etc. — so that a total contribution of 5 per cent, 
of a man's income is probably below rather than above the 



126 THE EVOLUTION OF MODERN GERMANY 

mark. The proportion has been estimated to be as much as 
7 J per cent, in many cases. Certainly Httle of this money 
paid into the trade union funds goes to the able and devoted 
officials who work the machinery of organization. The salaries 
of these men are seldom higher than the wages of skilled 
mechanics, and the work expected of them is exacting and 
endless. They are at call morning, afternoon, and night, 
always for six days in the week and often on Sunday as well, 
and apart from their onerous tasks the amount of fighting they 
have to do, and the constant legal risks they have to run, are 
so harassing that only sheer love of their cause could keep them 
at their posts. Certainly the German trade unionist official 
does not " batten on the hard-earned wages of the working 
man." 

Almost invariably the headquarters of the federations of 
all three groups of trade unions are also the home of another 
institution which greatly aids the unions in their work of 
organization and agitation. This is the inquiry and advice 
agency, usually called Workmen's Secretariate, which is a 
friend-in-need to working people of both sexes, and often to 
the public generally, in many a difficult situation. So popular 
have these institutions become, and so important is the place 
they fill, that a number of towns have established public 
agencies on the same lines, at which legal advice is gratuitously 
given upon all matters of civil, penal, and industrial law. 
Many of the Secretariates only give help to organized 
workpeople or those incapable of organization (i.e. domestic 
servants, etc.), but the majority follow the policy of the 
" open door." 

In the year before the war there were known to be 1,143 
of these agencies of all kinds in Germany, 361 being carried 
on by the Socialist trade unions and federations of the same, 
163 by the Roman Catholic Church, exclusive of 83 carried on 
by the " Christian " trade unions, 144 being municipal or 
State agencies (chiefly the former), 60 carried on by the Hirsch- 
Duncker trade unions, and the remainder by miscellaneous 
societies and agencies. During that year advice was given 
in 1,982,000 cases, and in addition over half a million written 
reports were furnished. The number of information agencies 
and the volume of their work have decreased during the war, 
but there can be no doubt that the decline is but temporary. 

The German labour employment agencies, apart from those 
carried on by employers' and workpeople's associations and 
the Trade Guilds, are for the most part conducted or subsi- 
dized by the municipalities, and as a rule they admirably fulfil 
their purpose, though in Germany as elsewhere there is a 



CAPITAL AND LABOUR 127 

disposition on the part of the large employers and the skilled 
trades to fight shy of these agencies and to make their own 
arrangements. About a million positions are filled by the 
public labour registries in the course of a year, and the total 
for labour registries of all kinds is about twice that number. 
In some of the States an efficient system of co-ordination has 
been established. The local government authorities, and 
particularly the provincial and district councils, actively 
interest themselves in the maintenance of relief stations for 
the reception of itinerant work-seekers — agencies of great 
utility which stand between this hard-pressed section of the 
community and the poorhouse. 

It must not be supposed, however, that capital has passively 
looked on while labour has closed its ranks and united in an 
aggressive movement against industrial wealth. On the con- 
trary, the resistance of German employers to trade unionism 
was never so strong as at the present time, though this resist- 
ance is more determined in some parts of the country, and 
also in some industries, than in others. In no industries is 
it so vigorous as in the syndicated coal, iron, and steel industries 
of the West of Prussia. If trade unionism is nowhere so strong 
as there, anti-unionism is nowhere so uncompromising. 

" The decisive battles of German politics," said a German- 
journal recently, " will be fought neither on the Neckar (Baden) 
nor on the Isar (Bavaria), but in the district of the Elbe 
(Prussia). For in North Germany capitalism has attained 
the gigantic expansion which is characteristic of the world- 
market ; there classes oppose each other so nearly and so 
roughly that one disputant can look into the white of his 
enemy's eye ; there amiability long ago disappeared from 
politics." Of the relations between capital and labour this 
is emphatically true, and the truth has an explanation. The 
remark is often made by German employers, " Our workpeople 
are unpractical : they have no comprehension of industrial 
conditions." Translated into plainer language the complaint 
implies that the modern workman shows a keener sense of 
his rights than his fathers did, and is not very discriminating 
in his choice of means of advancing his position. This must 
be freely conceded. The workman is fighting, and fighting 
at best is a crude and brutal business. If he makes use of any 
weapons that lie to hand, and is not particular as to how he 
handles them, he only proves that the struggle between 
labour and capital in Germany is a little less refined than in 
some other countries. Yet capital has not been slow to 
retaliate. Rhinel and- Westphalia is its chosen battle-ground. 
Here all the conditions of economic warfare exist in a rare degree. 



128 THE EVOLUTION OF MODERN GERMANY 

It is a striking fact that a large part of the natural resources, 
industry, and wealth-production of that unresting workshop of 
Germany is under the control of a dozen men of commanding 
business genius — men of strong and masterful character, born 
rulers of the sternest mould, without sentiment, not insus- 
ceptible to justice yet never going beyond it, inflexible in 
decision, of inexhaustible will-power, and impervious to all 
modern notions of political liberalism. These men, who have 
so conspicuously helped to create modern industrial Prussia, 
and who are a greater real power in the land than Ministers 
and legislators put together, typify in modern industry the 
feudalism which is slowly dying upon the great estates of 
the East. Their attitude towards the unions in which their 
workmen are organized to the number of hundreds of thousands 
is frequently expressed in the maxim, '' We intend to be 
masters in our own house," and nothing is wanting in the 
vigour with which this maxim is applied. On the occasion 
of the annual conference of the Association for Social Policy 
held at Mannheim in September, 1905, Herr Kirdorf, prob- 
ably the best-known industrialist of Westphalia, and the head 
of the Coal and Steel Syndicates, was invited to give an 
employer's reply to an indictment of the syndicates to be 
made by Professor Gustav Schmoller, since dead. In the 
course of his statement occurred the following observations 
on the question of labour organization : — 

"It is regrettable that our workpeople are able to change 
their positions at any time. An undertaking can only prosper 
if it has a stationary band of workers. I do not ask that 
legislation should come to our help, but we must reserve to 
ourselves the right to take measures to check this frequent 
change of employment. The proposal has been made that all 
workpeople should be compelled to join organizations and 
that employers should be required to negotiate with these 
organizations. For myself I would remark that I refuse to 
negotiate with any organization whatever. I decline to negotiate 
either with the Social Democratic organizations or even with 
the so-called Christian organizations, for I regard the Christian 
tiade unions as far more dangerous than the Social Democratic. 
While the Social Democratic organizations at least say openly 
at what they are aiming, viz. the subversion of the present 
social order, the Christian unions fight under a false flag — they 
fight under the cloak of Christianity. They know well that 
the subversion desired by the Social Democrats cannot be 
brought about, so they seek to place capitalism under the 
domination of the clergy. I regret, too, that the State 
interferes at all in labour relationships." 



CAPITAL AND LABOUR 129 

This passage deserves to be quoted at length, since it 
frankly and correctly characterizes the attitude of the great 
industrialists. Moreover, Herr Kirdorf repeated the same 
sentiments a short time later in the presence of the Prussian 
Minister of Commerce, who took occasion to object to the 
" phrasing " of the speech, which had been made for his benefit, 
but wisely did not enter into argument. It is questionable, 
indeed, whether argument in such a matter is of any value, 
for views like these betray a frame of mind, a temperament 
insusceptible to any sort of reasoning : the man who thinks 
so does it because he is so. Just as the great landownei of 
the East contends that the agricultural labourer is his property 
and would refuse to him the right either to combine or to 
leave his native soil, so the great industrialist of the West 
ignores labour organizations and insists that the workman 
shall be prevented from selling his labour where and how he 
likes. Whatever may be thought of this attitude, it is held 
by some of the most powerful leaders of industry in North 
Germany, though it is not always avowed with the same 
candour. Only in the light of an utterance like the foregoing 
can the present position of trade unionism be understood. ^ 

These men are absolutely honest in their belief that labour 
organizations are pernicious and should be combated, not by 
legal prohibitions, for that is not necessary, not by State help, 
for they are stronger than the State, but by the most effective 
of all ways — by simply ignoring them. They do not squabble 
about insignificant demands for higher wages, so long as the 
demands are not put in the form of threats, but are willing 
to pay for labour a fair market price. Their great works 
are models of judicious management and often abound with 
institutions and contrivances for the welfare of their employees 
going far beyond the requirements of the law. What they 

^ It was a similar attack upon trade unionism, made in the Reichstag, which 
drew from Count Posadowsky, then Imperial Home Minister, the following 
rebuke (February 6, 1906) : — 

" It has been asserted that the Christian trade unions are worse than the 
Social Democratic. It appears, then, that there are people who cherish the 
hope that in spite of our great industrial development, the labour movement 
— I mean the endeavour of the workers to improve their position and to partici- 
pate to a greater extent than formerly in public affairs — can, or should be, 
entirely abolished. But whoever believes that falls into a great error, and 
supports his view on a somewhat narrow, interested standpoint. The view that 
the Christian labour movement is worse than the Social Democratic can only 
come from men who are unsympathetic to all labour demands, however justi- 
fiable. The attitude of many men towards the demands of labour reminds 
me of the attitude of many Ministers towards Parliament. WHien a Minister 
daily sees how his carefully prepared Bills are criticized, he longs for the happy 
times of absolutistic Ministers — Ministers like Richelieu, Mazarin, Kaunitz, and 
Metternich. But those times are passed and will never return ; of those 
divinities only the shadow remains," 

9 



180 THE EVOLUTION OF MODERN GERMANY 

will not do, however, is to negotiate with, or recognize, or 
tolerate the trade union. 

Public opinion naturally finds itself often in conflict with 
the Westphalian industrialists' attitude, which more than 
anything else was responsible for the solid gain won by the 
men in the great colliery strike of 1905. It was the same 
Herr Kirdorf who declared during that strike : " The move- 
ment can only end by the men recognizing that they can get 
nothing by a strike, and returning to the mines. We will 
negotiate with every man singly, but we will not concede 
workmen's committees." It was this inflexible attitude, 
persisted in too long, which turned first the public and then 
the Government against the colliery owners. By refusing 
to meet the colliers' " Committee of Seven " they created the 
impression that the men were wishful for peace but were unable 
to gain an ear for their overtures. In the end not only were 
workmen's committees granted by force of law, but the hours 
of labour were curtailed, fines were abolished, and other con- 
cessions were made which cost the colliery owners dearly, 
until the extra burden could be transferred to the public. It 
is estimated that fifteen of the largest colliery companies lost 
together during the year of the strike no less than half a million 
pounds. 

While thus the large employers look with disfavour upon 
labour organizations, they have closed their own ranks, and 
are found more than ever uniting in trade associations, and 
in federations of these associations covering entire industries 
within wide areas. The strongest of these unions is the Central 
Union of German Industrialists, which represents in the main 
the great colliery proprietors and ironmasters of the Rhineland 
and Westphalia, and whose influence is held to have both made 
and unmade more than one Minister of State ; though every 
important industrial district has a central organization whose 
work it is to concentrate the forces of capital in order the 
better to resist the pressure of trade unionism. " The military 
State of Germany," said the director of the principal Saxon 
union of employers at an annual meeting of that body, 
" owes the supremacy of its industry in the world-market to the 
discipline asserted in its factories. The authority of the em- 
ployer is a precious possession, to defend which is our most 
immediate duty. We shall never yield when it is a question 
of a test of power on the part of the workmen, where the 
authority of the employer might be menaced. For this authority 
is not merely the possession of the individual, it is a common 
good. Modern economic development has brought to the 
front the estate of the industrialists, who have superseded the 



CAPITAL AND LABOUR 181 

old feudal landed proprietors as employers. Upon the efficiency 
of the industrialists depend the nation's power and progress. 
It is the duty of the industrialists not merely to provide the 
increasing millions of the population with a livelihood, but 
it must primarily wage war against subversive endeavours 
in every form. Our battle against the trade unions is at the 
same time a battle against Social Democracy." Saxony has 
not been behind in this movement for the coalition of capital : 
the Union of Saxon Industrialists numbers no fewer than 
4,000 undertakings, employing 400,000 workpeople out of 
the estimated 700,000 industrial workpeople of that kingdom. 
The estimated membership of all the employers' associations 
in 1913 was 145,000, and the number of workpeople in their 
employment was said to be rather more than four and a half 
millions. 

In this struggle with trade unionism the industrialists no 
longer count on the active assistance of the State. Knowing 
that any systematic repression of labour combinations cannot 
be expected from the legislature, the weapon upon which they 
chiefly depend, and the one which combination naturally 
suggests, is that of exclusion, or, as it is called by the trade 
unionist — who is not slow to employ the same weapon when 
the opportunity offers — boycott. In many of the largest of 
the works in the coal, iron, steel, chemical, and other industries 
of the North- West known Socialists are refused employment. 
Some of these firms institute a thorough inquisition into the 
antecedents of every applicant for work, and so effectively 
and so secretly is the exchange of " black lists " carried on 
that a capable man, whose reputation as an ardent trade 
unionist, or, worse still, as a Socialist, has preceded him, may 
go round the workshops of an entire district and be refused 
at every door, though there is work to do and a need for hands. 
The following is an actual specimen of inquiries exchanged 
amongst such employers : — 

" X, born , has applied to us for work. He states 

that he has been employed by you from to . We 

beg to ask you if this statement is correct. We should also 
be glad if at the same time you would tell us something about 
the character of X, whether he belongs to a labour organization, 
and if so to which. While assuring you of perfect privacy, 
we shall be glad to do the same service for you in return," etc. 

The firm to which this letter relates is one of the largest in 
its special industry in Germany. No known Socialist is tolerated 
in its works, and suspicion of Socialist sympathies entails 
instant dismissal. There are some employers' unions whose 
members are bound not to employ, at least for a period of 



132 THE EVOLUTION OF MODERN GERMANY 

from three to six months, workmen who take their discharge 
for any cause whatever. Occasionally the operation of a 
" black list " comes to light, and more than one action for 
damages has been successfully brought by aggrieved workmen 
in consequence. In one recent case the Duisburg District 
Court found the practice of boycotting to be " against good 
morals," so contravening both the Industrial Code (Section 
153) and the Civil Code (Section 820), and awarded the plaintiff 
£7 as compensation for deprivation of employment. 

Struggles carried on in such circumstances are bound to 
be bitter and to lay the foundation for much future difficulty. 
The employers contend with some justification, however, that 
they have been driven into an attitude of aggression, and that 
they employ no weapon of which the Social Democratic trade 
unions have not first taught them the use. It was a conference 
of Protestant trade unionists of the kingdom of Saxony which 
formally declared : " Those who, like the Social Democrats, 
take their stand on materialism and preach the struggle of 
classes cannot complain if the employers combat inconvenient 
trade unions with all the means in their power." It is a signi- 
ficant fact that while the fewest strikes in proportion to the 
number of workpeople and also the smallest strikes (i.e. the 
strikes affecting on an average the smallest number of work- 
people) occur in Germany, that country has the largest number 
of lock-outs. 

One of the severest defeats which the Socialist trade unions 
have received is that over the " labour day " movement. The 
idea that the 1st of May should be observed as a labour 
festival originated at the International Labour Congress held 
in Paris in 1889, though it was not then contemplated that 
work should on that day be laid down universally. For 
some years the German Socialists tried to popularize the 
holiday, and in some large towns with partial success. They 
even succeeded in obtaining recognition for " labour day " 
in some of the wages agreements. The employers as a whole 
resisted the idea of a general cessation of work irrespective 
of temporal and local circumstances, and their opposition 
won a signal victory in 1907, when the powerful Metal Workers' 
Union formally declared against the observance of May Day, 
and the official organ of the Socialist party urged that the 
question should no longer be pressed. 

On the other hand, there is a far greater disposition in the 
South, in Bavaria and in Wiirtemberg, to negotiate with the 
unions. There both large and small employers often prefer 
to deal with the responsible trade unionist officials, who have 
behind them the authority of their members, than with 



CAPITAL AND LABOUR 188 

individual workmen or groups of workmen lacking the standing 
and the prudence which responsibility confeis and without 
power to bind their fellows. Further, as the WUrtemberg 
factory inspectors have repeatedly pointed out, the creation 
of strong organizations of employers and employed has en- 
couraged an accommodating spirit, and even where disputes 
have occurred the fact that they have been conducted by 
representative bodies, capable of taking a large view of the 
issues, has softened asperity and facilitated settlements on 
conditions which left neither side suffering from a sense of 
humiliation. 

But at retaliatory measures the employers do not stop, 
for they have taken a leaf out of the trade unionists' book 
and they answer the strike pay machinery of the unions by 
a system of insurance against strikes and lock-outs. This 
new movement has already taken root in a number of industrial 
districts, and it extends both to large and small trades. 
Contributions are paid proportionate to the yearly wages bill, 
and in the event of a stoppage caused by a dispute a certain 
daily compensation per head of the men employed is paid. 
The Union of Metal Manufacturers and the Union of Saxon 
Industrialists are among the employers' organizations which 
have established insurance agencies of this kind. 

A few words must be added as to the practical aims of 
the labour movement at the present time. The demands 
which trade unions of all types are agreed in advancing are 
those which are common to labour everywhere — higher wages 
and shorter hours of work. As to the former, constant progress 
is being made, and never so rapidly as during the past decade, 
though in the meantime the cost of living has also increased. 
" That the money wages of the proletariat increase Social 
Democrats have never once denied," said the official organ of 
the Socialist party recently ; " they only deny that they have 
kept pace with the increasing income and capital of the 
propertied classes." There is considerable difference in the 
remuneration of labour as between one part of the country 
and another. Industry for industry, the highest rates of 
wages are paid in Rhineland and Westphalia and in Berlin, 
the lowest in certain districts of Saxony and the South generally. 
In general the maximum rates are still as a rule well below 
those usual in the same trades in the United Kingdom, until 
the unskilled occupations are reached, when only a narrow- 
margin divides the two countries. ^ 

' An inquiry made by the German Imperial Statistical Department showed 
that the wages of industrial workers in September, 1917, were in general more 
than twice as high as in March, 1914, the rise in the case of male workers having 



184 THE EVOLUTION OF MODERN GERMANY 

Progress has also been made in restricting the hours of 
labour, though there is still great disparity as between different 
industries and different parts of the country. The coal miners 
of Prussia have secured a legal eight-hours day for under- 
ground work, but in industry generally the number of hours 
worked is ten daily, or from fifty-eight to sixty weekly, and 
these hours generally fall between six and six or seven and 
seven. In some industries, and especially the textile industries, 
from sixty-three to sixty-six hours per week are commonly 
worked by both sexes. It is the impossibility of arriving at 
a uniform reduction of hours on a moderate level which has 
led the Socialist party to carry this question into Parliament. 
In truth the " maximum work-day " movement is as old as 
the Reichstag itself. As early as 1869, when twelve hours 
a day were usual, the Conservatives and Clericals joined in 
a demand for a reduction, to be fixed by statute both in 
the case of males and females. Prince Bismarck then and 
later refused to interfere with what he obstinately persisted 
in regarding as the workman's " natural right " to work as 
long as he wished, and the Liberal parties of all shades being 
then under the influence of " Manchester " ideas, even to 
the extent of reprobating factory inspection, the proposal 
fell through. 

When the Socialists first took up the cry in the Imperial 
Diet in 1877, all they asked for was a " normal " day of ten 
hours. This maximum would have satisfied them until 1891, 
but in that year they advanced their demand to nine hours, 
and in 1896 an eight-hours day figured for the first time in their 
programme. In the meantime the law^ of 1890-1891 for the 
protection of labour had been passed as a result of the Berlin 
Labour Conference. A resolute attempt was made by the 
Clerical and other parties to carry a clause to limit the work 
day for men to eleven hours, but without success, and this 
restriction was only legalized in the case of women. True 
to its traditional sympathy with the aspirations of labour, 
the Clerical party still periodically brings forward a resolution 
calling on the Government to enact a maximum work day, 
which it now demands shall not exceed ten hours for adults 
of either sex employed in factories and workshops. 

In practice the ten-hours' day does already exist in most 
parts of the country, but where it is the rule there are often 

been 109 per cent, and in the case of female workers 113 per cent. The largest 
increase in the case of men had occurred in the electrical trades (142 per cent.), 
and the largest in the case of women in the metal trades (175 per cent.). The 
lowest increase in the case of men had been in the food, drink, and tobacco 
group of trades (32 per cent.), and in the case of women in the leather and 
rubber group (48 per cent.). 



CAPITAL AND LABOUR 183 

exceptions, and it is in the interest of uniformity that legislation 
is desired. The building trades long ago adopted a ten-hours 
day ; and over 90 per cent, of the wages agreements concluded 
in these trades stipulate a day not exceeding that duration, 
often with an hour less on Saturday. Further, over 60 per 
cent, of all the factories in Prussia worlc ten hours daily, the 
principal exceptions being the textile factories, and especially 
those engaged on low-class goods. In the engineering trade, 
while ten hours are the rule, as many as ten and a half, or 
sixty-three per week, are worked in the more backward districts, 
and as few as fifty-four per week in the more advanced indus- 
trial centres. The longest hours are worked in the smelting 
works and the rolling mills, where twelve per day, with merely 
nominal intervals, are common, added to which an extra shift 
is worked once a fortnight, bringing the week's work up to 
an average of eighty hours. 

The attitude of the Government has hitherto been a halting 
one. Its sympathies are probably with the workers, but it 
bears in mind the burdens placed upon industry by the 
insurance laws and the general factory regulations, and it has 
no desire to overload the camel's back. No one denies that 
the hours worked in some industries are excessive, and that 
their curtailment would be for the good of the present as 
well as the coming generation. It is objected, however, that 
any radical change would be likely to overburden capital 
and disable industry, and particularly to harass the export 
industries. 

Naturally that attitude is applauded by employers in general. 
Just as there was once a time when the textile industry of 
the Rhineland worked seventeen hours a day in order to 
facilitate competition with England's more highly developed 
factories and more skilled workers, so now a day of ten and 
eleven hours is maintained in the same industry purely out 
of fear of the foreigner. The pace of the Government's advance- 
may, therefore, for some time longer be regulated by the atti- 
tude of industry, and that attitude is for the present hostile 
to any further reduction. It found expression recently in 
the Reichstag in the words of a National Liberal deputy, who 
stated, " German industry can bear no more restrictions. 
If protective regulations are carried further employers will 
be ruined. For that reason I call upon the Government to 
' slow down.' " And the poHcy of " slowing down " is the 
policy which the Government has for some time adopted. 

The only limitation of hours introduced by the amendment 
to the Industrial Code which was passed in 1908 applied to 
female workers, and it merely fixed the rule of sixty hours, 



186 THE EVOLUTION OF MODERN GERMANY 

subject to many exceptions. An investigation which had been 
made by the Government into the hours worked by females 
employed in factories and workshops showed that of 813,560 
such workpeople, employed in 88,706 works, 86,191 (in 6,768 
works), or 10*6 per cent., worked nine hours or less, while 
347,814 (in 18,267 works), or 42*8 per cent., worked from 
nine to ten hours (inclusive), so that over half already enjoyed 
the protection which the new law was intended to afford. 
The Socialists at present demand a ten-hours day for both 
sexes, for the whole country and for all industries, but they 
regard this no longer as their final objective, but as a stage 
on the way towards the goal of an eight-hours day. 

One common objection to a legal reduction of the hours of 
labour, which is heard whenever the subject is debated in 
the Reichstag, is that the extra leisure given to the working 
classes would be unwisely used. (A Prussian factory inspector, 
in a recent report, gravely pointed to the fact that the reduc- 
tion of hours had been accompanied in his district by an 
increase of illegitimate births.) It is doubtful, however, 
whether on the whole the working classes of any country 
use their leisure less unwisely than those of Germany, and 
little apprehension is entertained on this score by those 
who remember the physical pressure entailed by the present 
system, which often keeps the workman thirteen hours from 
home six days in the week, and compels him to seek his only 
relaxation during a few hours of Sunday. Yet even Sunday 
rest, though enacted as a general principle for the Empire 
many years ago, is still far from being universal, for con- 
siderable administrative latitude is allowed ; in some States 
there is no difficulty in obtaining sanction to Sunday overtime 
or to " continuous working," which means for many men 
working seven full days a week. 

On the other hand, there is no conclusive reason to expect 
that the desired reduction in the hours of work will necessarily 
be accompanied by any general increase in productivity. That 
this result has often followed where voluntary reductions of 
hours have taken place, even to an eight-hours day, is true ; 
and were there no other motive save the desire for greater 
leisure behind the movement for shorter hours the same thing 
would possibly happen generally. There is, however, another 
motive, and it is the hope of widening the area of employment 
and so of diminishing the number of the workless. The 
" ca' -canny " movement is not without its adherents in 
Germany, who are actuated by no inclination to idleness or 
selfish desire to cheat their employers, but who see in restricted 
production an opportunity of reducing the surplus supplies 



CAPITAL AND LABOUR 187 

of the labour market, knowing that by doing this they will 
reduce competition and so benefit wages. 

A further demand of labour, and one in which it has much 
public sympathy, is the severer regulation of the home indus- 
tries by imperial legislation. Until 1911 the Industrial Code, in 
spite of all the many amendments which have been introduced 
during recent years, almost entirely ignored these industries, 
though proposals had been repeatedly pressed upon the Govern- 
ment for the enforcement of such measures as the registration 
of home workers by their employers, the placing of the domestic 
industries under factory inspection, the control of workrooms 
with a view to the enforcement of hygienic conditions, the 
extension to the home workers of the three insurance laws, 
the use of wages books or lists, the prohibition of night and 
Sunday work, the placing of the home industries under the 
Industrial Courts in the matter of disputes, and the prohibition, 
as in Switzerland, of the taking home of work by factory 
operatives. By the amendment of the Industrial Code of 
December 20, 1911, something was done to protect the home 
workers against undue exploitation, but though the British 
Trade Boards Act was before it at the time, the Govern- 
ment refused to imitate that humane measure by regulating 
the wages paid in the sweated trades. In the same year the 
home workers were brought more completely under the Social 
Insurance Laws. 

It is the misfortune of the German working classes that 
they have not in general the benefit of the strong lead in 
labour policy which the State and many municipal authorities 
give in this country. In Prussia the Sovereign has, indeed, 
endorsed the precept of more than one of his ancestors on the 
throne in his saying that *' State undertakings should be model 
institutions," but it was one of his Ministers of Commerce 
who, in replying to a demand that the standard of wages 
should be raised in some of the undertakings under his control, 
declared that " the State should not be in advance of private 
employers." In the matter of wages it certainly does not 
take the lead, though the policy of social welfare which the 
State voluntarily pursues for the benefit of its employees — 
in such matters, for example, as housing, pensions, holidays, 
etc. — may make good this shortcoming in other ways. It is 
however, a bitter drop in the cup of many workpeople in 
State employment in Prussia that combination in trade unions 
is prohibited and Socialist sympathies rule a man out of 
favour ; in most other States a more lenient policy is followed. 

Amongst municipal authorities there has of late been a 
freer use of what Prince Bismarck called " social oil," and the 



188 THE EVOLUTION OF MODERN GERMANY 

wheels of the civic system have undoubtedly moved more 
smoothly as a result. In part this is due to the larger direct 
influence which the working classes have obtained upon local 
government bodies. There are few Town Councils in large 
towns without a labour (which inevitably means a Socialist) 
party ; it is generally less strong in numbers than lungs, 
though at least two important towns have during late years 
passed entirely under the government of labour. On the 
whole the influence and the usefulness of these municipal 
labour groups consist more in critical than constructive work : 
they are quick to point out evils and defects, but slow to devise 
practical remedies. Nevertheless, with and without their 
assistance, many municipalities have during late years adopted 
well-considered schemes of social welfare securing to their 
employees cheap housing, pensions, holidays, etc. A large 
and increasing number of municipalities now regularly give 
their workpeople a summer holiday of from three to ten days 
without reduction of wages, and some even pay them a small 
sum extra towards the cost of going to the country or the 
seaside. Trade union and standard rates, fair wages clauses, 
and similar devices for levelling up wages have not as 
yet, however, received a patient hearing from municipal 
authorities, and in public contracts it is seldom that more is 
done than to make provision for the safety and health of the 
workpeople employed and for the due observance of the laws 
regarding insurance. 



CHAPTER VIII 

METHODS OF INDUSTRIAL CONCILIATION 

Statutory Workmen's Committees — The employers' objections to them — 
Functions of the Industrial Courts — Their limited action as boards of 
conciliation — Chambers of Labour — Proposed establishment of an 
Imperial Ministry of Labour — The wages agreements in the building 
and small trades — Their number and operation — Advantages and dis- < 
advantages from the workpeople's standpoint — Legal force of the wages 
agreements — Attitude of the Bavarian Government thereto — Attitude of 
the employers — Profit-sharing — " Social welfare " institutions — Factory 
colonies of dwellings — Antipathy of the working classes to employers' 
philanthropy — Industrial Co-operation. 

ALL that has hitherto been said about the relations between 
capital and labour might seem merely to have brought 
into relief the deep-rooted hostility that exists between 
the two. For the present that hostility must be accepted as 
a settled fact, and it is safe to predict that every attempt 
made either by legislation or any other outside influence to 
conciliate these two antagonists will fail until the struggle 
has continued long enough to enable each of them to take 
more conclusively the other's measure. Warfare of this kind 
is still comparatively new in Germany ; the strength of the 
rival forces is unknown, the conditions of the struggle are 
altogether novel. Both sides recognize that a great battle 
must be fought out before an understanding is possible, and 
for the sake of the issues at stake they are prepared to make 
any sacrifice. 

Nevertheless, palliatives of the prevailing disharmony are 
being tried in various directions. There have not yet been 
introduced in Germany the admirable boards of conciliation 
and arbitration which operate with such success in the leading 
industries in the United Kingdom, i though in the event of 
dispute arising the official machinery of the Industrial Courts 
is always at call, should the disputants be willing to use it. 

* At a meeting of the German Society for Social Reform, held in Berlin in 
December 1906, resohitions were adopted " affirming the meeting's conviction 
that industrial peace would best be promoted by the development of collective 
arrangements between employers and workpeople in the form of (I) wages 
agreements, (2) voluntary boards of conciliation and arbitration, and (3) work- 

180 



140 THE EVOLUTION OF MODERN GERMANY 

The law requires the formation of these Courts in all towns 
with over 20,000 inhabitants, but they may be formed else- 
where at the option of the Government of the State or on the 
joint requisition of a given number of employers and work- 
people, and they consist of equal numbers of both. That the 
519 Courts now in existence do not mediate oftener would 
appear to be less the fault of the workpeople than of the 
employers. During 1912 they acted as boards of conciliation 
on 315 occasions : on 145 in response to invitations from both 
sides, on 158 on the invitation of the workpeople alone, and 
on 12 only on the sole invitation of the employers. Only in 
140 cases was it possible to bring about an agreement. 

Something is done to ease the working of the industrial 
machine by the workpeople's committees, which have long 
existed in the better regulated works. These committees 
are elected by vote of the employees and are intended to 
serve as boards of reference and consultation on matters 
affecting the interests of the workers. Voluntary bodies of 
the kind can be traced back as far as 1891, and it is probable 
that some were formed still earlier. Where the committees 
were established in a spirit of conciliation and loyalty on both 
sides they showed a considerable capacity for usefulness. Many 
large employers, however, were unwilling to take advantage 
of this method of lessening the grievances of their workpeople, 
regarding it as an unnecessary interference with their rights, 
and a dangerous restriction of their authority, that workpeople 
should be able to state their views directly and collectively 
in so formal a way, instead of through the time-honoured 
mediation of the manager or foreman. 

It was only in 1908 that these committees received statutory 
recognition. An amendment of the Industrial Code of that 
year made it obligatory for all factories and works employing 
twenty or more workpeople to adopt a code of rules governing 
the conditions of employment. Before these rules could come 
into force the opinion thereon of the workers had to be taken, 
and where there were provisions affecting the conduct of 
workers in relation to the acceptance of any welfare institu- 
tions offered by the management or affecting the behaviour 
of minors outside the works such provisions were to be con- 
ditional upon the consent of the shop committees, if such 
existed. The Compulsory National Civilian Service Law of 
December 5, 1916, went a step farther, for it made the formation 

men's committees for individual works"; and it was urged that, "after the 
example of Great Britain, conciliation boards suited to the various industries 
should be generally formed, these to co-operate with higher tribunals and to call 
in on occasion the help of prominent public men as advisers and arbitrators." 



METHODS OF INDUSTRIAL CONCILIATION 141 

of these committees obligatory in all industrial works engaged 
in work of national importance and employing at least fifty 
workpeople. It is specifically stated that the purpose of such 
a committee is to be the promotion of good relations between 
the workers themselves and between them and the works 
management, and it is to be one of its duties to " bring to 
the knowledge of the management the proposals, wishes, and 
grievances of the workers relative to the conduct of the under- 
taking, the wages and other conditions of labour, and the 
general welfare of the concern, and to express its opinion 
thereon." The committees have to be elected by the adult 
workers from amongst themselves ; where an undertaking 
employs more than 5,000 workpeople the formation of works 
committees for special departments may be required, and 
where the salaried staff numbers at least fifty it must have 
a separate committee. From the standpoint of the workers 
the requirement that the chairman of a committee must be 
the head of the concern or his representative is regarded as 
objectionable, as tending to discourage free discussion. It 
is likely that the obligation to form these committees will be 
made general. 

Nevertheless, the workshop committees continue to be a 
private arrangement between individual employers and their 
workpeople, and in the opinion of the trade unions they do 
not give to the working classes the voice in the determination 
of labour conditions which they have a right to expect. 
Accordingly the Parliamentary labour party has for a long 
time agitated for the formation of Chambers of Labour 
analogous to the Chambers of Commerce and Agriculture — 
that is, bodies which shall solely represent labour, shall ex- 
clusively watch its interests, shall be consulted by the Govern- 
ments and public authorities on questions affecting the working 
classes, and shall even have power to regulate the relation- 
ships between capital and labour within defined limits. The 
Imperial Government is willing to give Chambers of Labour 
constituted on the basis of parity, i.e. elected half by the 
employers and half by the employed, and so long ago as 1890 
they were definitely promised in an Imperial Decree, which 
ran : — 

'' For the fostering of peace between employers and work- 
people legal regulations are contemplated regarding the forms 
in which the workpeople shall, through representatives who 
possess their confidence, participate in the regulation of matters 
of common concern and the protection of their interests in 
negotiations with employers and with the organs of my 
Government. By such institutions the workpeople are to be 



142 THE EVOLUTION OF MODERN GERMANY 

enabled to give free and peaceful expression to their wishes 
and complaints, and the State authorities are to be given the 
opportunity of continually acquainting themselves with the 
conditions of the workers and of cultivating contact with 
the latter." 

At the present time (1918) a Government bill for the estab- 
lishment of Chambers of Labour is before the country. Should 
these bodies come into existence on the basis proposed, they 
will at the outset be handicapped by prejudice and, what 
is even worse, indifference. For while the labour party claims 
that the Chambers should be composed entirely of working 
men, the employers have no desire for agencies of the kind, 
regarding any such joint authorities as the thin end of the 
wedge of trade union interference which they are so resolutely 
resisting. 

But at Chambers of Labour the Socialists do not stop, 
for it is their hope that these will pave the way for the 
creation of an independent Imperial Ministry of Labour. Not 
only the Socialists, however, but the social reform groups 
belonging to the burgher parties heartily favour the trans- 
ference of labour questions from their present ressorty the 
Ministry of the Interior, to a separate Department of State. 
The Government has hitherto discouraged the idea on the 
plea that labour questions are often involved in other questions, 
and that a specific Labour Ministry would inevitably conflict 
with existing Departments. It contends reasonably enough 
that it would often be difficult to draw the line between what 
is specially a concern of labour and what is not : such ques- 
tions as housing reform, factory and school hygiene, factory 
inspection, the insurance laws, and the regulation of co-operation, 
emigration, and immigration are all instances of questions which 
are capable of leading to conflict of jurisdiction. 

In the smaller trades, and particularly in the building 
trades, a method of preventing disputes, at least within fixed 
periods, has largely been applied of late years in the form of 
the wages agreement, known as wages " tariff." In the large 
towns the building trades are almost entirely regulated by 
these agreements, which not only fix the rates of wages and 
the hours of labour to be observed during the contract period, 
which is generally two years, but lay down other conditions of 
employment, as, for example, the circumstances under which 
overtime shall be allowed. Agreements of the kind also 
apply largely to the brewery, certain branches of the wood, 
small metal, and other trades, but in the main it is the handi- 
crafts, or the trades most nearly corresponding to them, which 
have embraced this method of averting disputes. The large 



# 



METHODS OF INDUSTRIAL CONCILIATION 148 

industries have hitherto stood aloof, and in the engineering 
trades especially the wages agreement can hardly be said to 
have made its appearance. 

In the year of the outbreak of war (1914) 10,840 of these 
agreements were known- to be in existence ; they applied to 
143,650 undertakings and to 1,396,000 workpeople. The 
great majority related to skilled workers ; two-thirds applied 
only to individual firms, and about a quarter to given towns 
or districts, only a few applying to the whole country. 

That the wages agreement is at best a palliative and no 
counsel of perfection is proved by the criticism aimed against 
it both by employers and workpeople, though by the latter 
its merits are held to outweigh its defects. From the stand- 
point of wages the advantage would appear to be with the 
men. The rate of wages usually fixed is a minimum ; it does 
not follow that more will not be paid, but less cannot, except, 
perhaps, in the case of old men and young journeymen just 
out of their time, and even in these cases there is generally 
an express stipulation to that effect. The employers complain, 
however, that the agreements, which were originally held out 
to them as a means of preventing disputes, have in effect 
become ladders by which labour climbs to higher wages. An 
agreement is as a rule only concluded for several years, at 
the end of which its terms need to be reconsidered ; the work- 
people naturally endeavour to insist, generally with success, 
that each revision shall denote an improvement in their position 
— a higher rate of pay, shorter hours of work, or both — so that 
the wages agreement, in effect, becomes an endless screw, 
which does its work all the more effectively because it moves 
slowly and sometimes imperceptibly ; for in the regulation 
of wages, thanks to the German decimal system of coinage, 
increases of a fraction of a penny the hour are by no means 
uncommon. 

At the same time the wages agreement is not an unmixed 
good from the standpoint of labour as a whole. Broadly 
speaking, it plays into the hands of workers of inferior ability, 
and to that extent there is truth in the common objection 
that it is a device for paying such men more than they could 
earn under normal competitive conditions of employment. 
On the other hand, it is a matter of common experience that 
these agreements, in so far as the fixing of wages is their sole 
or principal object, have no great attraction — because they 
are of no practical importance — for efiicient workmen. The 
minimum rate below which workmen qualified by years or 
apprenticeship are not under an agreement to be paid is 
naturally based on medium capacity or output, and takes no 



144 THE EVOLUTION OF MODERN GERMANY 

cognizance of the men of all-round ability, who would always 
be able to earn this minimum rate, whether it were guaranteed 
by agreement or not. Yet even inferior men are not always 
protected by agreements, for the employer always reserves, as 
a final weapon of defence, the right to discharge the inefficient 
and the undesirable. Thus it happened in a South German 
town not long ago that the trade union leaders pressed the 
employers in the printing trade to conclude a wages agreement. 
The head of the largest undertaking concerned expressed his 
own readiness to do so, since his rates were already above the 
minimum proposed, yet at the same time he pointed out that 
one effect would in all probability be that, whether explicitly 
or not, the masters in paying a minimum wage would expect 
a minimum output — a contingency not provided for by the 
draft agreement. The warning was disregarded, the agreement 
was concluded, and in due time it came into operation. One 
of the first results was the wholesale discharge of inefficient 
workmen who failed to earn the minimum wages. Conferences 
took place between the authors of the agreement and the 
employers who had thus protected themselves, and without 
any formal revocation of the minimum rates it was agreed 
that they should be disregarded, and masters and men be at 
liberty to make their own arrangements as in the past. The 
case mentioned was one in which the minimum wage was a 
time rate. Where an agreement fixes the rates for piecework 
the difficulty here illustrated does not occur. 

It will be understood that the legal force of these agree- 
ments is very limited. Inasmuch as they are concluded by 
non-corporate bodies they are, strictly speaking, only binding 
on the signatories, and neither employers nor workpeople 
outside the respective organizations can legally be required 
to fall in with their provisions. Several of the Industrial 
Courts and Boards of Conciliation have, however, adopted 
decisions which have greatly enlarged the importance of special 
agreements, but these decisions are, of course, only of local 
force. Thus the Essen Board of Conciliation and the Hanover 
Industrial Court have both decided in a building trade dispute 
that a wages agreement concluded between the employers' 
union and the workmen's organizations should apply to all 
workmen employed by a master belonging to the union, whether 
the workmen were organized or not. While, on the other 
hand, unorganized employers are not bound by these agree- 
ments, sooner or later they are in practice inevitably affected 
by them, since an agreement tends to become in course of 
time a standard both of wages and other conditions of 
employment for the locality concerned. 



METHODS OF INDUSTRIAL CONCILIATION 145 

A decision in this sense was enforced by the Dortmund 
Industrial Court, in which a workman who had been engaged 
without special agreement by an unorganized employer claimed 
to be paid the rates fixed for his trade in the local wages 
agreement, while the employer contended that not the local 
standard rate but the rate usual in his own workshop should 
be the basis of payment. The Court held that not only the 
rates of pay but all other conditions of employment set forth 
in the wages agreement concluded in that trade should apply. 
It has also been held that where workpeople are transferred 
from one employer to another, as in the case of a business 
changing hands, the old agreement holds good in the absence 
of a new one. 

It has often been complained that where wages agreements 
have been concluded the productivity of labour has diminished. 
" Convenient and conducive to equable calculation though 
the agreements may appear," writes the Chamber of Commerce 
for Upper Bavaria in a recent report, " it must on the other 
hand be affirmed that the output of the individual workman 
has decreased. The guarantee of a certain minimum wage is 
no stimulus to activity, but the contrary. A workman may, 
indeed, be discharged, but that often leads to a strike of all 
the rest, in spite of wages agreements. Further, the employ- 
ment of a non-union workman alongside of the unionists has 
been made impossible by the agreements." These objections 
may hold good in special cases, but it cannot be contended that 
they apply on any large scale, and they have not prevented 
the Bavarian Government from declaring emphatically in 
favour of agreements and instructing its factory inspectors 
to encourage their conclusion wherever possible. 

The attitude of employers varies in different industries. 
In the building trades agreements hold the field in the large 
towns, and while the masters have not invariably welcomed 
this mode of reducing the number of disputes, they regard it 
as inevitable and on the whole as an improvement upon the 
old order of things, under which the workman had to strike 
for an increase of pay, but as a rule got it all the same. There 
were, however, several reasons why this industry should lead 
the way in the adoption of agreements. In the first place it 
had suffered more than any other from labour disputes, the 
injury caused by which was increased by the short season 
within which active building operations are as a rule confined. 
Furthermore, the local character of the industry enables em- 
ployers to recoup higher costs of production more easily than 
is possible in most industries. Hence the invariable effect 
of building trade agreements, increasing the price of labour, 

10 



146 THE EVOLUTION OF MODERN GERMANY 

has been higher costs of production, with consequent higher 
rents, from which the working classes have been the first to 
suffer. Nevertheless, even in the building trades the agree- 
ments have not made equal progress in the small towns, where 
labour is but little organized. 

In many of the trades and occupations which partake of 
the handicraft character the wages agreement has also been 
introduced without difficulty, but again in large towns more 
than in small. In miscellaneous trades and industries it is 
still regarded as an innovation, while the heavy trades resolutely 
hold aloof, in spite of all the efforts made by the trade unions 
to obtain recognition for it. The Central Union of German 
Industrialists, which voices the opinions of all the great 
employers of labour, has formally declared " the conclusion 
of wages agreements between employers' organizations and 
the organizations of the workers to be altogether injurious 
to German industry and its prosperous development. The 
agreements not only deprive the individual employers of the 
liberty of deciding independently as to the employment of 
their workpeople and the fixing of wages, which is necessary 
to the proper carrying on of every undertaking, but they 
inevitably bring the workpeople under the domination of the 
labour organizations. The agreements are, according to the 
conviction of the Central Union, fully confirmed by the expe- 
rience of England and the United States, serious obstacles in 
the way of the progress of German industry in technical matters 
and in organization." That is the firm attitude of all the 
large industrialists, and from it they are not likely to deviate 
for a long time to come. 

The plan of profit-sharing would appear to be but little 
popular in Germany. The premium or bonus system is largely 
followed in the engineering trades in some parts of the country, 
and the practice of giving Christmas or New Year gratuities 
is common, but it is very unusual to offer workpeople a direct 
share in profits. On the other hand, what are known as 
" welfare " or " social welfare " institutions are a conspicuous 
feature of the larger industrial undertakings — institutions 
and efforts for the benefit of the workmen and their families 
which go beyond the requirements of the insurance and other 
laws for the protection of labour. These exist in one form or 
another in connection with most important works, and 
especially those in the coal, iron and steel, chemical, certain 
of the textile, and other manufacturing industries. In this 
respect Germany has a very creditable record, for hundreds 
of the more humane of her employers have for decades been 
engaged in this species of philanthropy. The most common 



METHODS OF INDUSTRIAL CONCILIATION 147 

efforts take the form of special pension and benefit funds which 
supplement the compulsory insurance funds, either extending 
the benefits obtainable under these funds or making provision 
for widows, orphans, and dependents under circumstances in 
which the legal provisions do not apply or are inadequate. 
Holiday funds for workpeople and their children, summer 
festivity funds, assisted savings banks, and the like are also 
common. Of more immediate benefit are the canteens, 
kitchens, milk depots, etc., which are attached to many large 
works, enabling workpeople to obtain wholesome food at low 
cost. 

The provision of workmen's dwellings is also common, 
and, encouraged by the Governments and the factory inspectors, 
an increasing amount of capital is being invested in this way, 
for the Pension Insurance Boards which interest themselves 
in the housing question — and nowadays most of them do — 
generally lend to employers on the same terms as to building 
societies. 

In many cases these workmen's colonies are built from 
purely business and prudential motives. This is particularly 
the case where works have been built outside a town, as is 
increasingly common, and the only hope of obtaining a constant 
supply of efficient workpeople was to house them on the spot. 
In the colliery districts, as in England, a large part of the 
miners live in dwellings built by the mine-owners. Many of 
the newer factory colonies to be found on the outskirts of 
large towns are in every way admirable. The dwellings are 
well built and commodious, the surroundings pleasant and 
healthy, and the rents below those charged for inferior 
dwellings in private ownership. Sometimes these colonies 
are composed of miniature villas, which in external appear- 
ance almost suggest the suburban residences of the middle 
classes. 

It must be confessed, however, that the general attitude 
of the workpeople towards these benefactions, direct and 
indirect, is unappreciative, if not absolutely thankless. Often, 
though not always, employers have themselves to blame for 
this, as when the benefits offered are hedged round with 
conditions and reservations which take away all grace from 
the gift and encourage the workman to believe that not 
good-will but self-interest is the motive force. Most unpopular 
of all are the special pension and other funds to which workmen 
are compelled to contribute whether they wish or not, though 
whether they will ever derive benefit in return or even get 
back their subscriptions in the event of removal depends 
almost entirely on the whim of the employer. The system 



148 THE EVOLUTION OF MODERN GERMANY 

of pension funds which the firm of Krupp carries on, and to 
which workmen are compelled to contribute, is based on this 
one-sided principle. For years the employees of this firm 
forfeited their contributions on leaving its service, until 
a short time ago it occurred to some one to contest in the 
Industrial Court the legality of their retention. Judgment 
was given for the plaintiff, and as no appeal is allowed against 
the findings of such a Court a wide prospect of litigation is 
offered unless the statutes of these compulsory funds are 
altered. Already the workman who sued Krupp for debt 
has had many successful imitators, though the law does not 
allow an action to lie in respect of claims going back more 
than two years. 

Still more open to objection are those benefits — such as 
pensions, premiums, and gratuities of all kinds — which are 
offered on such uncertain or exacting conditions that human 
nature would need to be well-nigh perfect in order to qualify 
for them. Here, again, it often rests with the arbitrary will 
of the benefactor to say whether a chance lapse from good 
conduct, as he or his representatives may claim to judge 
good conduct, shall cancel a long record of consistent service, 
for in the regulations which govern these voluntary charities 
it is customary to state that no right to them is recognized. 

In the case of the factory dwellings the obvious objection 
applies that they restrict a man's independence and make it 
difficult for him to negotiate on equal terms in the event of 
a conflict of opinion as to the relative rights of employer and 
employed, on which account the trade unions of all kinds are 
strongly opposed to them and do their best to deter their 
members from becoming tenants. Many of the contracts of 
tenancy are very stringent, not to say harsh. As a rule, a 
tenancy is ipso facto held to be determined with the cessation 
of the contract of labour ; in other words, where no notice 
is usual — and this is the case in many industrial districts — a 
tenant may in strict law be discharged from work one day 
and required to quit his home the next. Much adverse criti- 
cism has been passed by social and housing reformers upon 
the colliery and factory dwelling-house, held on so uncertain 
a tenure as this, and of all welfare institutions it might appear 
to be the one whose benefits are most questionable. 

It would be unjust, however, to generalize upon this subject. 
A large number of the voluntary benefits offered by large 
employers, and especially by old-established firms which are 
already in the third or fourth generation, are undoubtedly 
the outcome of genuine benevolence, wide-heartedness, and a 
desire to do more for the working classes than legislation 



METHODS OF INDUSTRIAL CONCILIATION 149 

requires or the strict law of the labour market would permit. 
A host of firms bearing names of wide renown, and still more 
of only provincial or local reputation, have established for 
themselves a tradition of philanthropy and patriarchalism 
which anticipated the modern insurance laws by many years, 
and it is a creditable fact that in not a few cases they have 
continued their own sickness and pension funds side by side 
with those created under legal obligation, so that their work- 
people, in times of illness, incapacity, and old age, enjoy not 
only the benefits which are due in part to their own compulsory 
providence, but also the provision made for the same emer- 
gencies by pious founders whose foresight was greater than 
that of the State. 

The Bavarian Government, than which no German Govern- 
ment takes a livelier interest in the welfare of the working 
classes, lately published a report on the various institutions 
and agencies maintained in the interest of their employees 
by the larger firms in trade and industry in that kingdom. 
It found proof of much genuine solicitude for the well-being 
of the workers, and was able to report that great progress had 
been made in this respect since the first inquiry of the kind 
in 1874. One significant change had, however, taken place 
in the meantime. While forty years ago strikes were virtually 
unknown in the factories whose workpeople had the benefit 
of these special forms of help and charity, " such an effect of 
social welfare institutions can no longer be affirmed." The 
employers who reported on the subject were loud in their 
complaints of the " ingratitude " of their workpeople, who 
no longer showed the old appreciation of sacrifices made for 
their good. 

The change of mind may be variously judged, for what to 
the benefactor often appears base ingratitude is defended by 
the labour leader as an assertion of independence and a healthy 
protest against patronage ; yet the fact is as stated, and the 
experience of Bavarian employers is that of employers in every 
other part of Germany. The workman contends that the old 
patriarchal relationship is an anachronism, out of keeping 
with the modern conditions of industrial life. He would 
prefer that the voluntary benefactions by which he is encour- 
aged to good behaviour should take the form of wages, which 
he would be free to spend in his own way ; and it is possible 
for disinterested outsiders to respect at once the high motives 
of the unappreciated philanthropist and the scruples of the 
independent and " ungrateful " workman. 

Only a few words need be devoted here to the subject of 
industrial co-operation, for while the number of co-operative 



150 THE EVOLUTION OF MODERN GERMANY 

undertakings established in industry is large, the great majority 
of these undertakings have no relation to the working class. 
Genuine productive enterprises have been established among 
the hand-weavers in several of the textile districts of rural 
Saxony ; co-operation is the basis of many prosperous bakeries 
in the large towns ; and workmen have formed productive 
partnerships here and there in other trades requiring little 
capital, but the working classes would not appear to have 
reached the degree of ^elf-reliance necessary to any extensive 
application of the principle of industrial co-operation. An 
interesting case occurred in Berlin not long ago of a co-operative 
workshop proving the solution of difficulties between employer 
and employed. Rather than give to his upholsterers the 
advance in wages which they demanded, the head of a large 
furniture manufactory offered to establish this section of his 
men in business, providing them with most of the necessary 
capital on loan, and agreeing to take all their output at fixed 
prices. The experiment succeeded ; the men, working for 
themselves, earned far larger wages than before, and the 
employer paid no more for his goods. 



CHAPTER IX 

THE WORKMAN 

The characteristics of the German workman — Comparison with the English 
workman — The difference mainly that between acquired and natural 
aptitudes — The neatness and smartness of the German workman — The 
influence of the school and the army — The factory bath and clothes 
locker — The workmen's long hours and few holidays — Sunday relaxations 
— Socialist festivities — Attractions of the lottery — The value of social 
legislation — The insurance laws and their popularity — SociaUst testi- 
mony in their praise — Expenditure in sickness and accident benefit and 
old-age pensions — The German workmen's thirst for knowledge — A 
visit to their educational workshops — Herr Bebel as a Mutual Improve- 
ment Society debater — Labour education societies — University Settlement 
work — Attitude of the authorities towards labour schools — Socialism 
and the theatre — The labour temperance movement, its origin and 
extent — Class awakening. 

A SHORT time before he ceased to be the Imperial Secre- 
tary of State for the Interior, and as such to have charge 
of the Empire's social policy, Count Posadowsky paid 
a warm tribute to the working classes of Germany when he 
said in the Reichstag : "If Germany has just experienced a 
vast industrial expansion equalled by no other country in the 
world during the same time, it is chiefly due to the efficiency 
of her workers." The compliment was no less generous than 
deserved. The German workman possesses qualities, both 
technical and personal, of a very high order. Of his capacity 
his work is the best evidence. The day has gone by when 
the products of German industry could be summarily charac- 
terized, as they were characterized by a German professor 
in 1876, as of the " cheap and bad order " : comparative 
cheapness may remain, but while plenty of inferior goods are 
still produced, the very highest standard of excellence is also 
attained. 

It is natural to compare the German with the English 
workman, and the first difference which such a comparison 
brings to light is the German's lack of independence. He 
both submits to an endless amount of direction and he needs 
it. Probably the trait is due to the fact that control and 
regulation at every turn are the lot of all Germans, at least 

151 



152 THE EVOLUTION OF MODERN GERMANY 

of all North Germans, from the cradle to the grave, with the 
result that initiative is crippled and men come to regard orders 
and instructions as a necessary part of life. Works managers 
who have under them workmen of both nationalities — whether 
Englishmen working with Germans or Germans working with 
Englishmen — will be found invariably to agree that the good 
qualities of the German workman seldom include self-reliance 
and trust in his own judgment. 

The broad difference between the German and the English 
workman is exactly the difference between acquired and 
natural aptitudes. Both learn their chief lessons in the school 
of experience, but what is added to their capacity and value 
from other sources results in the case of the German workman 
from technical instruction, in the case of the English workman 
from his practical mind and common sense, though in many 
cases inheritance also plays an important part. It is the old 
contrast between theory and practice : all the knowledge 
that theory can impart the German possesses, but he does 
not easily get outside his theories, and he is not even conscious 
of the limitations which they impose upon him. It would 
be better for the English workman if he attached greater 
importance to theoretical knowledge, yet considering how he 
has been taught to despise it — and most of all by the example 
of his employer — the wonder is that he has achieved so much 
and still so admirably holds his own. Given a wise conjunction 
of theoretical knowledge with the practical gifts which he 
already possesses in so marked a degree, and the English 
workman need fear no competitor. 

Yet if the German workman is dependent he is also indus- 
trious and plodding. He is not quick, yet no one can turn 
out better work, if the right tools, material, and time are given 
to him. If one were to judge him by the black pictures which 
are painted by reactionary politicians, whose imaginations 
are disturbed by the progress of Socialism and by its hold 
upon the masses of the people, it might be necessary to conclude 
that the German workman has lost moral equilibrium, that 
he lacks principle, and that his sole aim is the ruin of the indus- 
tries and manufactures by which he lives. Such an estimate 
is strangely belied by the economic development which has 
synchronized with the growth of Socialism. The fine examples 
of modern architecture which are to be seen in every large 
town, the museums of industrial art, the very shop windows 
of every street furnish evidence that the workman's skill and 
conscientiousness were never greater than now, and that, 
however bitter the relations between capital and labour may 
be, the industrial foundations of the country as laid during 



THE WORKMAN 153 

the last forty or fifty years have been laid well and truly, and 
that the fabric which is rising above them is worthy of the 
pioneer work that went before. 

No one can visit German industrial towns, and see the 
workman and workgirl in the streets and at their employment, 
without being impressed by a certain neatness in their appear- 
ance and a certain smartness in their bearing which, on reflection 
he somehow does not seem to recall as obvious and matter- 
of-course characteristics of the working classes at home. Co- 
ordinating his observations with a view to relating cause with 
effect, he is unable to conclude that this difference, so favourable 
to Germany, is the result of better wages or healthier homes. 
Is it a result of a more drastic school regime ? Is industrial 
Germany taught from its earliest years to cultivate a cleanly 
exterior, an alert presence, and a respectful demeanour ? 
All these virtues are no doubt fostered in a large degree in the 
schools of the people, though children of school age play on 
sand-heaps and run about barefooted in German towns as 
in others. 

It is certain that the German boy of the working class in 
general exhibits a respectfulness and self-restraint, the German 
girl a modesty and absence of ostentation, which are not equally 
characteristics of English youth belonging to the same rank, 
and for this the schools, which still cling tenaciously to the 
old-fashioned maxim that children should be seen and not 
heard, may unquestionably claim a large share of credit. But 
between youth and manhood there is time and opportunity 
for forgetting many of the healthy lessons of school life, and 
it is here that the German system of man-making differs from 
the English, in that it bridges over this critical interval between 
youth and puberty by two disciplines, each of which in its 
way effectively carries forward and strengthens the influences 
and impressions which have been created by the primary 
school. 

The first is the continuation school, and the second is the 
institution of military service. From the primary school the 
boy passes into the continuation school by a natural transition ; 
where the one leaves off the other begins, so that there is no 
break in the mental process, no perceptible slackening of 
authority, and no inevitable danger of sliding into loose ways. 
Where, as is the case in some towns, the municipal Labour 
Bureau takes upon itself the duty of finding employment for 
boys who are about to leave school, an additional guarantee 
exists that the habits of regularity which the school teaches 
will not at once be cast off. It is worthy of note that many 
of the large engineering works train their men from boyhood 



154 THE EVOLUTION OF MODERN GERMANY 

forward, taking the apprentice at fourteen years, directing his 
work at the continuation school — which is often a special 
school attached to the works — and so instilling into the young 
worker the traditions and spirit of the place, that by the time 
he is out of his time an intimate tie between employer and 
workman has been created, and if he has " made good " he is 
invited to stay on as a matter of course. 

Regular habits are further confirmed by the military training 
to which every young man of full physical and mental capacity 
is subjected, and which now extends in the case of " common 
soldiers " (Gemeinen) to two years in the infantry, yet three 
years in the cavalry. Whatever be the need and value of 
such service from the standpoint of national defence, the 
disciplinary and educative results are by universal testimony 
most beneficial, while the spirit of order and the habit of 
working together with others which he practises enable the 
discharged soldier to fit naturally into the highly organized 
mechanism of modern industrial undertakings. If a German 
manufacturer in close touch with his men — or, better still, 
the practical manager of his works — be interrogated on the 
point, he will invariably answer in words like these : " Military 
service makes men of the recruits, and they come back to us 
far more efficient as workers than when they left. For they 
learn obedience, discipline, regular habits ; they are more 
alert, quicker to understand, smarter in every way." " Ninety- 
nine per cent, of my men come back to me," said the manager 
of a large machine works in the Rhineland, " for I always keep 
their places open for them, and they are more valuable to me 
than before." It is interesting to be told that when on 
furlough the first thing a soldier does, after visiting his parents, 
is to go on to the factory to see his old foreman and comrades. 
While military training exerts this valuable moral and 
physical influence on the workmen, the baths and washing 
arrangements which are plentifully provided minister to bodily 
cleanliness in their own way. The German factory laws re- 
quire facilities for washing to be provided in most industrial 
establishments, but many employers go beyond this and add 
shower-baths, which may be used by the men at stated hours 
in turn. Sometimes a nominal charge of a halfpenny or a 
penny is made, but usually they are free, and some employers 
even give their men twenty minutes or half an hour once a 
week in which to use the bath, which is supplied with cold, 
tepid, or hot water at wish. The wash-bowls and troughs 
are largely used both at the noon interval and in the evening 
when work is over, for a German workman has a laudable aver- 
sion to being seen on the streets soiled with the dust and grime 



THE WORKMAN 155 

of the workshop. A changing room, with lockers for all the 
men, is a common feature of a factory or workshop, and here 
the out-of-door clothes are replaced by working attire. So 
much importanc eis attached to cleanliness and orderliness of 
appearance that apprentices are required on compulsion to do 
do what their elders do voluntarily. " My foremen have instruc- 
tions," said a large ironmaster to me once, " to send back to 
the wash-trough any lad who is seen leaving the yard dirty." 
To the influence of all these factors together — the training 
received in school, the discipline of the barracks and the 
drill-ground, the encouragement of a proper pride in dress 
and general appearance — must be attributed the fact that the 
average German workman walks well, works well, and looks 
well. The explanation of the tidiness, orderly bearing, and 
smartness of carriage to which allusion has been made proves, 
in fact, to have a moral rather than an economic origin ; these 
qualities are the result of training and not of social conditions. 
In his habits of order and frugality the workman is dutifully 
supported by his wife. It would be a mistake to suppose that 
every German woman of the working class is a domestic 
paragon. If, however, in Germany as elsewhere untidiness 
and neglect are often to be found in the houses of the workers, 
as a result not of poverty but of idleness, the reverse is usually 
the case, and the typical housewife of the people is an admir- 
able manager, who stretches her husband's earnings to the 
utmost, feeds him well on a small allowance, keeps his accounts, 
pays his rent and taxes, and in general makes an ideal chan- 
cellor of the domestic exchequer, to which she not infrequently 
contributes by her own toil. German proverbial philosophy 
is full of maxims enforcing the domestic virtues and lauding 
the amenities of home life, and in spite of the inroads which 
industrial life has made upon the family circle they are far 
from losing their old application. These maxims may often 
be read in scrolls upon the walls, or embroidered upon table- 
cloths and hangings, in working-class homes, and familiarity 
does not appear to weaken their force. 

It may not be flattering to English pride, though it should 
be wholesome, to read in the report upon a visit of investigation 
paid to a number of English industrial towns in 1906 by a 
deputation of German trade union officials the verdict, '' In 
modesty, sense of order, and self-respect, it appears to us, 
the English woman of the working class can learn much from 
the German. It is, of course, difficult to speak on such a 
subject without running the risk of falling into unsafe 
generalizations, and moreover many German working-class 
families are not conspicuous for these virtues. Nevertheless, 



156 THE EVOLUTION OF MODERN GERMANY 

in no German industrial district will women and children 
with clothes ragged and tattered be found in such number 
or in such condition as in the East of London, or in a working- 
class quarter of Manchester, though in Lancashire there are 
comparatively few married women in the textile industry, so 
that factory work cannot be blamed for this state of affairs, 
except that most of the women have been engaged in the 
factories before marriage and therefore have not learned house- 
keeping." I Of working-class family life in Berlin, particularly 
the Cross Gazette said recently : " In the course of many years' 
observation we have learned to value the family life of the 
Berlin working and burgher classes. Hard work and the 
constant fear of going under here weld the family more firmly 
together than in towns in which it is easier to earn a liveli- 
hood and to preserve external respectability. A single 
Sunday excursion in the surroundings of Berlin, or even a 
Sunday walk in the Lindens or the Thiergarten, presents 
to every unprejudiced observer .numerous pictures of family 
life which must warm his heart." 

The German workman takes his pleasures soberly, though 
by no means sadly. For six days out of the seven he works, 
as we have seen, nine., ten, and sometimes eleven hours a day, 
according to his industry, and excepting the Church festivals 
and (in some States) one day in the year which is set apart 
for national penitence and prayer — the Buss- und Bettag, which 
originated when Germany was in the throes of her struggle 
with Napoleon I — there are no regular holidays ; even the 
attempt to make May 1st into a labour festival has been 
attended by little success. Hence it comes about that Sunday 
is devoted entirely to recreation. On that day the working 
classes will not be found in the churches but in the public parks 
and woods if it be summer, and in the restaurants at other 
seasons of the year. All the large towns are in both respects 
well supplied. Like the middle classes, the workers take their 
picnics and pleasures en famille, and the spectacle of rough- 
handed toilers enjoying themselves on a Sunday afternoon in 
the parks in the company of their wives and children is a 
pleasing one and throws light upon the healthy solidarity which, 
in spite of all disintegrating modern influences, still in the 
main characterizes German family life. There is a certain 
negativeness about this form of enjoyment which a man of 
active temperament might not readily appreciate, for a German 
workman can patiently sit for hours together upon a bench 
or a patch of sward silently smoking his cigar and gazing into 
space. It would be unfair to say that such a condition of 

^ Gewerkschaftliche Studien in England, p. 33. 



THE WORKMAN 157 

mental inertia is necessarily unintelligent ; rather, it goes 
with the essential simplicity and naivete of the German nature, 
which is still on the whole frugal in its hedonism as in other 
things, requires no violent relaxations, can make a little pleasure 
go a long way, and can derive satisfaction from trifles. The 
Germans have coined a word to describe this mood of passive 
content : it is the untranslatable word " Behagen" 

There are periodical races in all the large towns, almost 
invariably run on Sunday afternoons, but the workman does 
not trouble much about them, and is content to watch the 
returning cavalcades when the sport is over. The younger 
men are much given to Sunday cycling, and there exist in 
the towns working-men's cycling clubs of different trades and 
occupations, all affiliated to a national federation covering 
the whole Empire. An outside pleasure in which work- 
people of all ages and both sexes share is that provided by 
the Sunday fetes and excursions periodically arranged during 
the summer months by the labour and political organizations ; 
but while relaxation and conviviality are the objects primarily 
pursued, it is customary to combine with pleasure a certain 
amount of propagandist work, in so far as this can be done 
without openly transgressing the restrictive laws of public 
meeting and drawing upon the festive comrades the attentions 
of the police. 

The fact that the German workman is not addicted to the 
racecourse protects him from one strong temptation to gamble, 
yet there is another way open to him of seeking luck adventi- 
tiously, and that is by the public lottery. Labour leaders, 
jealous for the reputation of their class, sometimes tell one 
that the " enlightened working classes " are superior to the 
seductions of the lottery, and ceased to gamble long ago, when 
trade organizations came into vogue. Inquiry of the lottery 
agent does not support that complimentary statement. The 
lottery agent will reply that a large part of his customers are 
working men or their wives ; that in the case of cheap drawings, 
for which the tickets cost a shilling or two shillings, 90 per 
cent, of the sales are to working people. Moreover, it is said 
that the women are more addicted to the lottery than the 
men, and that children of ten exchange shillings for tickets 
which they confidently expect will bring them the " great 
prize." In the case of the expensive State lotteries it is common 
for several workmen to buy a ticket between them and share 
in the prize if fortune favours them. It is significant that in 
the working-class districts of the towns small cigar dealers 
commonly act as lottery agents, also that the results of the 
State lottery drawings are regularly published in the Socialist 



158 THE EVOLUTION OF MODERN GERMANY 

newspapers most read by the working classes. In the winter 
months the opportunities of relaxation are more limited, for 
the German working classes have no outdoor games, and the 
choice is virtually confined to the restaurant, with beer and 
billiards, and the theatre. 

Speaking of the efficiency of Germany's workers in the 
speech to which reference has already been made, Count Posa- 
dowsky said : " This efficiency must inevitably have suffered 
had we not secured to our working classes, by the social legis- 
lation of recent years, a tolerable standard of life, and had we 
not, as far as was possible, guaranteed their physical health. 
Quite recently a representative of the chemical industry assured 
me of this in eloquent words." The effect of the triple system 
of insurance is to secure workpeople in times of sickness or 
accident complete medical treatment, either at home or in 
hospital, with such monetary benefits that the home can be 
maintained at the usual level of comfort without any serious 
depletion of family savings, where such exist, while pensions 
are granted in the event of premature invalidity and in old 
age. By this provision the weight of uncertainty and appre- 
hension, w^hich presses so heavily on the lives of working men 
concerned to meet their responsibilities as heads of families, 
is sensibly relieved, for, should the worst come, absolute want 
need not be feared. Of all the measures passed in the interest 
of the working classes during the past quarter of a century, 
the insurance laws are not merely the most beneficent : they 
are also unquestionably the most popular. They are still 
criticized freely, but only on points of detail and methods of 
administration : the workman would sacrifice any laws rather 
than these. Socialist criticism represents the worst that can 
be said against the Government and its achievements ; yet 
it was a well-known Socialist labour leader, Herr Edmund 
Fischer, who wrote a few years ago : " Let the Industrial 
Insurance legislation be depreciated as it may, it must never- 
theless be confessed that the old age and invalidity pensioners 
take quite another social position to that of the incapacitated 
grandfather of twenty-five j^ears ago, who was a load upon 
his children or was exposed to the scandal of being maintained 
by the parish. Every increase of the pensions is thus a piece 
of civilizing work. The social laws are, it is true, only foundation 
walls, but they are these at least, and for that reason they are 
the beginning of a great fabric of human solidarity.'* Taking 
a more practical view of the question, Herr Paul Kampfmeyer, 
the Socialist writer, said recently in the Sozialistische Monatshefte: 
'' The German industrial insurance legislation has had almost 
the same effect for labour as protective legislation. It means 



THE WORKMAN 159 

an actual economic gain of a millard and a half of marks " 
(£75,000,000). 

These laws are sometimes spoken of as though they were 
a benevolence to the working classes. The fact is that they 
cost the workers heavily, though the necessary contributions 
are willingly paid. The major part of the cost of accident 
insurance falls upon the employers ; of the cost of sickness in- 
surance, however, the workpeople bear two-thirds, the employer 
the remainder ; and towards the cost of invalidity and old age 
insurance the workpeople and employers contribute in equal 
proportions, while the Empire adds £2 10s. per annum to 
every pension granted. The burden which is imposed on 
capital by these three insurance laws is considerable, yet as 
industry has, so to speak, '* lived into " the system of insurance 
and accommodated itself to its obligations, the contributions 
have gradually passed into the costs of production as an item 
as inevitable as rent or interest. Not only so, but probably a 
majority of employers would be willing to acknowledge that 
the direct gain to themselves caused by the operation of the 
laws is worth more than the sacrifice which they entail, inasmuch 
as they make for the workers' physical welfare and as a conse- 
quence for their efficiency, and help to maintain their standard 
of life at a higher level than would be possible if they depended, 
in the eventuality of sickness, accident, and invalidity, upon 
their ow^n unaided resources. 

A few figures will show the magnitude of the industrial 
insurance system. The number of workpeople of all classes 
insured against sickness in 1913 was 14,556,000, the amount 
of the contributions paid by workpeople and employers (includ- 
ing entrance fees and fines) was £23,120,000, equal to 31s. 6d. 
per member for the year, and the amount paid to the members 
in benefits of all kinds was £21,569,000, of which £8,985,000 
represented sickness pay. The number of workpeople (including 
agricultural labourers) insured against accident in the same 
year was estimated at 25,800,000, the amount of the contri- 
butions paid by their employers (who alone pay contributions 
or premiums) was £9,734,000, and the value of the compensation 
(chiefly in the form of pensions) and benefits of all kinds awarded 
to the victims of accidents and their dependents was £7,990,000. 
Finally, the number of persons insured against invalidity and 
old age was 16,323,800, the amount of the contributions 
paid in moieties by the employers and the workpeople v/as 
£14,447,600, and the amount awarded in pensions (including 
pensions to survivors of deceased members) and other benefits 
was £10,417,000. The average amount of the pensions granted 
was for invalidity £9 15s. and for old age £8 7s., for widow^s 



160 THE EVOLUTION OF MODERN GERMANY 

and widowers £3 18s., and for orphans £4. In the case of the 
invalidity and old age pensions these amounts include a statutory 
contribution of £2 10s. made by the Imperial Treasury. At 
the beginning of 1915 nearly a million and a quarter pensions 
were being paid and the number granted in the preceding 
year was 193,900. 

Until 1916 the old age pension was claimable only at the 
age of 70. By a law of June 12th of that year the age was 
reduced to 65^ the change taking effect as from January 1, 1916. 
The consequence of this lowering of the age was that the number 
of such pensions granted during 1916 by the various Pension 
Boards increased from 11,276 in 1915 to 92,120, with the result 
that the joint contributions of the employers and workpeople 
had to be slightly increased ; these had hitherto ranged from 
2d. to 5|d. a week, but from the beginning of 1917 thev ranged 
from 2i^d. to 6d. 

Owing to the operation of the Insurance Laws an incidental 
ameliorative work of great though incalculable value is done 
for the working classes and other sections of the population 
akin to them in social status. The Pension Boards are em- 
powered to make loans out of their accumulated funds for 
purposes of "public utility," and particularly those directly 
conducive to the welfare of the insured classes, and by the end 
of 1916 more than £67,000,000 had been used in this way, 
exclusive of over four and a half million pounds expended on 
institutions carried on by the Boards themselves. The sum 
of £28.300,000 had been advanced — largely to Building Societies 
and local government authorities, though in part to employers 
and insured persons — for the building of working-class dwellings, 
including a number of hospices, Rowton Houses, homes for 
single men, and the like ; £6,700,000 for works for the benefit 
of agriculture and the agricultural population ; £7,600,000 for 
the erection of hospitals, sanatoria, convalescent homes, homes 
for permanent invalids, and the like ; £10,000,000 for the 
provision of people's baths, sewerage works, etc. ; £5,000,000 
for educational purposes, and £9,000,000 for other social 
welfare purposes of a miscellaneous character, e.g. gas and 
electricity works, tramways and light railways, reservoirs, 
river regulation, the purchase of land by municipal authorities 
for building and open spaces, co-operative undertakings (in- 
cluding co-operative bakeries), churches, parish halls, labour 
colonies, homes for parish nurses, teachers, industrial workers, 
and seamen, orphanages, creches, poorhouses, homes for travel- 
ling workmen, for the blind, deaf and dumb, refuges of 
various kinds, child welfare centres, etc. 

A well-known German essayist, Dr. Friedrich Dernburg, 



THE WORKIVIAN l6l 

wrote a short time ago that " The true ambition of the masses 
of the German nation is less ambition for economic amelioration 
and material advantages than for education." It is, of course, 
difficult to say how far education is followed for the sake of 
the material benefits which it is able to bestow, and therefore 
is an indirect object of pursuit ; yet every one who has followed 
working-class movements, and is acquainted with the intel- 
lectual life of the masses, will be ready to testify to the wide- 
spread popular desire for education, for knowledge, for a greater 
share in the spiritual treasures of the time. " The masses of 
the people," says the same writer, " see in education endless 
perspectives ; their thirst for knowledge, like their ambition, 
impels them to the one aim, to be educated. More or less, all 
acknowledge that this, more than anything else, determines 
a man's rank in modern society, that personality is won by 
force of education. All the means of extending and perfect- 
ing education are seized with zeal, and often with passion. 
The most social and certainly the most popular of Ministries 
would to-day be a Ministry of Popular Education in the 
most universal sense." 

That, too, is all true, and the nation of which it may be 
said is sure of a future. In order to understand this ambition 
for knowledge so characteristic of the working classes, it is 
necessary to enter their intellectual workshops and observe 
the tools which are there employed. " You do not know the 
workman's pride," said a Socialist deputy in the Reichstag 
on one occasion (March 3, 1908), addressing himself to the 
occupants of the benches on the Right ; "we support ourselves 
by the work of our hands, and have laboriously worked our- 
selves upwards. We have painfully educated ourselves in 
the evening and night hours, while to you education came 
without effort ; yet I would not exchange intellectual powers 
with you." The words may well form our starting-point. 

Let it be said at the outset that the agencies by which the 
working classes chiefly carry forward the education begun 
in the primary schools do not owe their existence to action 
from above, but are created and conducted by themselves. 
Half a century ago Workmen's Educational Associations 
(Bildungsvereine) were common in Prussia, and it was as a 
! lecturer at meetings of such an association in Berlin that the 
Socialist pioneer, Ferdinand Lassalle, first came to the front. 
Even so revolutionary a Social Democrat as August Rebel 
was originally a member of one of these strictly sedate and 
correct organizations, and literally imbibed the beginnings 
of his political thought at the innocent meetings of what was 
for practical purposes a Mutual Improvement Society at 

11 



162 THE EVOLUTION OF MODERN GERMANY 

Leipzig. Under the influence of Lassalle and other early leaders 
of Socialism the Workmen's Educational Associations developed 
first a strongly Radical and later a Republican agitation, and 
in the end they were merged in the wider international move- 
ment of the masses which became known as Social Democracy. 

Outside the ranks of Socialism these associations still exist 
under different names, but the modern Socialists have merged 
their functions in the general work of their political and trade 
organizations. The usual practice is for a special education 
committee to be formed in connection with the local Trades 
Council or Federation of Trade Unions, and to this committee 
is entrusted the duty of providing for the intellectual as well 
as the recreative needs of organized and unorganized workers 
of Social Democratic persuasion. To quote from the rules 
of such a committee : " The purpose of the committee is the 
intellectual elevation of the workers and their relatives by 
lectures upon themes selected from the domains of social science, 
history, ethics, pedagogics, and natural science, the last with 
the accompaniment as far as possible of lantern slides ; the 
holding of musical and literary evenings and dramatic perform- 
ances, and the formation of exhibitions for the dissemination 
of good literature, works suited to juveniles, illustrated books, 
etc. The committee seeks also to exert influence on the arrange- 
ment of labour association festivities by the provision of 
suitable music and other representations, in order that even 
these festivities may more and more be worthy of the culture- 
movement of the working classes. The committee is further 
charged with the supervision of the labour library." A certain 
sum is placed annually at the disposal of such an education 
committee, contributed in moieties or otherwise by the Trades 
Council and the Social Democratic Electoral Association of 
the town or district, and with this sum, supplemented by the 
proceeds of lectures, classes, concerts, and other gatherings, 
it is expected to meet all the necessary outlay. 

In Berlin the Socialists carry on a Workmen's Improvement 
School, which conducts evening classes throughout the winter 
months, in which instruction is given on subjects like political 
economy, sociology, German jurisprudence, the history of 
literature, history, and rhetoric, while special courses of lectures 
are held for advanced students. A whole course of lessons 
or lectures costs a shilling. The classes begin at 9 p.m. and 
last an hour and a half. " In accordance with its device, 
' Knowledge is power, and power is knowledge,' " says a 
recent report, " the Workmen's Improvement School endeavours 
in a certain sense to make good the wrong done to the workers 
by the dominant class, in that it confines the elementary school 



THE WORKMAN 168 

to the absolutely necessary subjects." That may or may not 
be a just criticism, yet the popularity of the school proves 
the workers' desire for a knowledge beyond that with which 
the primary school sends them out into the world. During 
a recent year over 1,700 persons attended the various classes, 
and of this number only 146 were below the age of 20 years, 
1,056 were between 20 and 30 years, 248 between 30 and 40, 
and 50 above 40 years. Most of the men were metal workers, 
wood workers, bricklayers, painters, and book printers, but 
other classes of workmen largely represented were shoemakers, 
carpenters, paperhangers, tailors, smiths, saddlers, carvers, 
bookbinders, lithographers, wheelwrights, turners, gardeners, 
bakers, with isolated representatives of another hundred 
manual occupations. 

In the same way the General Workmen's Educational 
Institute at Leipzig holds during the winter and spring months 
regular courses of instruction, lasting from one and a half to 
two years, in political economy, history, and social legislation. 
Most of the lectures are given on Sundays, and the others on 
week-day evenings. There is no charge for the classes, but 
it is required that the students shall belong to the political or 
labour organizations of the Social Democratic party. In 
addition public lectures on economic and social subjects are 
given during the winter, and labour libraries are accessible to 
working people in various parts of the town. A further branch 
of the Institute's work is the holding of high-class theatrical 
performances, concerts, and art and other exhibitions, for the 
special benefit of the working classes. 

Hamburg, Frankfort-on-Main, Diisseldorf, and Munich are 
other towns in which systematic efforts are made on the same 
lines to enlighten the working classes on science, philosophy, 
and questions of the day. For example, during one winter the 
Munich Working Men's Educational Association held twenty 
courses of lectures, varying from two to twelve in number, on 
such themes as " Introduction to political economy," '' Agrarian 
reform and policy," " Political and cultural history of the nine- 
teenth century," " Evolutionary periods in Bavarian history," 
" History of political parties in Germany," " Industrial in- 
surance," " International law," " The development of co-opera- 
tion in Germany," " Modern poets and thinkers," " Albrecht 
Dlirer," " The German language," and " Theories of criminal 
psychology." 

The lectures are given, for the most part, by well-known 
Socialist leaders, labour members of parliament, trade union 
leaders, editors and authors, schoolmasters, and other friends 
of the people. Most attractive of all are the classes and 



164 THE EVOLUTION OF MODERN GERMANY 

lectures which deal with economic subjects. The lectures 
held in Berlin are attended by crowded audiences of working 
men and women who, at the end of a long day's work, have 
barely time to eat supper and change clothes before they 
hurry off to the meeting-hall half an hour or more away. The 
lectures are entirely scientific in character — it is Socialistic 
economics, more controversial, more personal, more human, 
perhaps, than the economics of the chair, though never swerving 
from the text — yet they are followed with close and intelligent 
interest by hundreds of hard-headed and hard-handed trade 
unionists, whose genuine thirst for knowledge is one of the 
most striking and at the same time most pathetic facts in the 
intellectual life of Germany. 

As to the correctness of the economic theories expounded 
I say nothing. They are the theories of Socialism ; they do 
not pretend to objectivity, but are avowedly put forward- as 
weapons from the armoury of argument by which it is hoped 
that the existing order of society will one day be upheaved 
and replaced by one in which master and man will change 
places. And yet the reproach which is commonly levelled by 
superior persons against the Socialist leaders, that they are 
educating their followers on class lines, and wilfully encouraging 
narrow and partial views of the State and of political and social 
science, comes with a bad grace when it is remembered how 
lamentably little the educated classes of Germany, with their 
twenty-two universities and their unequalled system of higher 
schools, have done to meet the intellectual needs and longings 
of the masses, and to bring within their reach the know- 
ledge, the culture, the civilizing influences which wealth has 
at command yet so seldom appreciates. 

Something is being done to bridge the gulf between classes 
which inequality of educational opportunity far more than 
inequality in material condition has created, and it is a hopeful 
sign that it is the rising generation which is taking upon itself 
this work of conciliation. In not a few university towns 
educational work is carried on amongst the working classes 
by students and other educated men who recognize that one 
of Germany's greatest social evils is class alienation. In Berlin 
a band of students of the Charlottenburg Technical College 
led the way and the university of Berlin quickly followed ; 
since then the universities of Strassburg, Gottingen, Munich, 
and Freiburg have taken up the same work. The main idea 
is to offer instruction in elementary subjects to adult work- 
people who would be out of place in the ordinary continuation 
schools conducted by the municipal authorities for young 
people. In Berlin the number of such working-men scholars 



THE WORKMAN 165 

has in the course of five years increased from several hundreds 
to a thousand during each winter, the intelligent metal workers 
forming nearly a quarter of the whole. The university settle- 
ment of the English and American type has also won a way 
into Germany. 

It is interesting to know what the Social Democrats them- 
selves think of this conciliatory work. A contributor to the 
Neue Welt wrote some time ago : " The work of these students 
(they are only a small fraction of the whole, say 1 per cent.) 
is honestly meant and praiseworthy. An enlivening breath 
of warm and idealistic enthusiasm emanates from this social 
work. Those who, like the writer of these lines, have looked 
into the educational workshop cannot withhold the admission 
that the endeavour of these young men comes from the heart. 
The complete devotion to the work of popular education has 
also opened the eyes of many a student, and revealed to him a 
resource of popular power of which he never dreamed." Efforts 
so appreciated can hardly fail to contribute in some measure to 
the abatement of working-class distrust and antagonism. Class 
pride and aloofness on one side have hitherto been answered 
by the same unlovely attitude on the other, until the working 
classes have learned to look abroad for sympathy — to the inter- 
national brotherhood of labour which knows no ties of country 
or of race. 

Stripped of phrases, the problem of Socialism in Germany 
as elsewhere is in essence, the problem of social reconciliation, 
and while ameliorative legislation will help in its solution, 
aids of that kind may be found to be less effective than the 
natural influences that flow from the approachment of classes 
and the cultivation between them of a closer community of 
thought and life. 

The same interest in the efforts of labour to enlarge its 
knowledge is not always shown by the public authorities. Not 
long ago one of the best known popular educators of the Socialist 
party in Berlin undertook to give at Potsdam a course of 
lectures on jurisprudence, and an announcement to that effect 
appeared in the Press. Before the day appointed for the first 
lecture he received a notice from the Potsdam Provincial 
Government informing him that " in order to the giving of 
such instruction the sanction of the school supervisory authorities 
is necessary in accordance with a Cabinet Order of June 10, 
1834,'* and as that sanction had not been given the lectures 
might not be held. This ancient Cabinet Order preceded by 
seventeen years the issue of the Prussian constitution declaring 
that '' science and its teaching are free.'* Moreover, the Order 
referred unquestionably to the imparting of instruction to 



166 THE EVOLUTION OF MODERN GERMANY 

youth in ordinary schools, and was intended to check the 
estabhshment of unlicensed private schools. Nevertheless, 
there was no remedy against the arbitrary enforcement of an 
obsolete regulation, and the lectures were not given. In the 
same way a kindergarten established by the Socialists at Charlot- 
tenburg was closed by the police authority, and on appeal 
being made to the Government the act was justified by the 
provisions of a Ministerial Decree going back to 1839. Seldom 
do the short-sighted jacks-in-office who endeavour to combat 
Socialism with such absurd weapons as these reflect upon the 
outrage which they inflict upon the moral sense of the community 
at large. 

Even in the matter of amusements the working classes are 
more and more going their own way. They have their own 
theatres and concerts, and working-men's musical unions and 
athletic clubs exist in all towns. In Berlin the " Free People's 
Stage " (Freie Volksbilhne) provides for the workers at very 
small cost dramatic performances of a high order. Dramas 
belonging to Germany's classical period, as well as famous 
works by modern playwrights, both German and foreign, are 
chiefly presented ; political, historical, social, and problem 
plays are mostly favoured, however, and Schiller, Lessing, 
Ibsen, Hauptmann, and Sudermann constantly figure on the 
bills. The repertory for one winter included plays by Goethe 
(*' Faust " amongst them), Shakespeare, Calderon, and Ibsen, 
as well as modern comedies by German and English writers, 
and in addition the society arranged concerts and art exhibitions. 
The interests of children are not overlooked, for the Workmen's 
Athletic Associations of Berlin conduct games every Sunday 
during the summer months in various parts of the city and 
the suburbs. The children assemble at fixed centres, and are 
taken in bands to the playgrounds, and after play are returned 
to their guardians at the starting-places. In all these efforts 
party purposes are undoubtedly kept well in view, yet their 
educational and recreative value is not on that account 
diminished. 

One other endeavour which the working classes are making 
on class lines to advance their position individually and as a 
body should be named, and in many respects it is the most 
remarkable of all. This is the temperance movement which 
has sprung up in their ranks during the past twenty years, 
and which is bearing fruit in every part of the country. 

The question of temperance in the use of alcohol is a relative 
question, the meaning and importance of which are different 
in every country. It is impossible, for example, to apply iden- 
tical criteria and standards to two countries so unlike as 



THE WORKMAN 167 

England and Germany ; and even in Germany itself diversity 
of climate, cultivation, and race makes it necessary to exercise 
great discrimination in judging the drinking habits of the 
people. Broadly speaking, it may be said that beer still 
continues, as in the days of Tacitus, to be the national beverage 
of the German, and of this he drinks deeply because cheaply. 
In the far North and North-east spirit is largely drunk, partly 
because it is a staple product of the country, partly because 
the population contains a strong Slavic element. In the South, 
on the other hand, much cider and wine is drunk, the former 
in Wiirtemberg, the latter in Wiirtemberg, Baden, and Alsace, 
though of beer and spirit there is also a large consumption. 
Where, however, the German most differs from the Englishman 
is in regarding beer not as a luxury, but as an article of food, 
as which it often takes the place upon the table which in 
England is given to tea or coffee. The " poor man's beer " 
is, therefore, no hollow phrase in Germany, and it is the recog- 
nition of its important place in domestic life that has secured 
for it an immunity from taxation which to the Englishman 
appears incomprehensible. ^ 

While, on the whole, the Germans are a great beer-drinking 
people, they are at the same time a sober people. It is no 
uncommon thing for a Bavarian workman to spend five shillings 
per week on beer, and an expenditure of three shillings is 
common in any part of the beer-drinking zone.^ That, in 
spite of this, there is so little visible drunkenness must be 
attributed to several causes — the habit of piecemeal as dis- 
tinguished from prolonged drinking, the absence of treating, 
possibly, to some extent, the habit of drinking in public view, 
but above all the small alcoholic content of the beer, which, 
as a rule, is about 2 per cent, in Germany, comparing with 
5 per cent, in England. Nevertheless, there is much abuse of 
alcohol in Germany, and at the Roman Catholic Congress held 
at Wiirzburg in August, 1907, Father Neumann, of Trier, stated 

^ I cannot resist the temptation to relate an incident of thirty years ago 
which first brought to my knowledge — conclusively and once for all — this 
diversity of standpoint. It was in the seminary of a Berlin professor of 
economics, of which I was a member, and the subject under consideration was 
taxation. Beer was then about to be further taxed, and the project was not 
popular. The emphasis laid by the debaters upon the importance of beer as 
an article of food led the English student, greatly daring, to refer to the English 
principle of taxing beer as a luxury. The professor's " eye flashed fire," as 
he remarked, " Yes, that is your one-sided English point of view ! " To clench 
the matter, he subsequently brought the sitting to a close with the invitation, 
" Gentlemen, shall we now adjourn to the Kneipe ? " 

' The Imperial Board of Health {Oesundheitsamt) has estimated that the 
average expenditure on beer, spirits, and wine for every male over fifteen years 
is £7 yearly, and for the whole population £2 4s. per head. 



168 THE EVOLUTION OF MODERN GERMANY 

that " more than 80,000 persons fall victims to alcohol every 
year in Germany." 

Even where there is no absolute indulgence, the opinion 
has taken root in labour circles that the use of alcohol is detri- 
mental both to the individual and to the class, and that the 
workers' interests can best be served by a policy of strict 
moderation or entire abstention. Hence has arisen the labour 
temperance movement, which, originated by the Socialists, 
has gradually spread to other sections of the working class, 
until it now has active propagandists and a large body of 
adherents in all parts of the country. The most remarkable 
facts about the movement, indeed, are its spontaneity and 
its class character. For it no special society, and certainly 
no temperance workers of the type known in England, can 
claim the least credit. Its inception is due to no outside 
influence or stimulus whatever ; at the conferences and meetings 
of the labour temperance reformers no representatives of 
religion, no ethical teachers, no spokesmen belonging to the 
higher social circles are ever present ; the workman is appealed 
to exclusively by men of his own class. 

There is also no sentiment about the movement and no 
profession of high moral purpose; the more intelligent of the 
organized workers are simply persuading themselves that for 
physiological, economic, and social reasons the less use or even 
the entire disuse of alcohol is likely to prove advantageous to 
them, and in this purely egoistic sense they are welcoming 
temperance principles and with growing eagerness are taking 
advantage of the increasing facilities for practising those prin- 
ciples which come within their reach. 

It is true that in its temperance propagandism the Socialist 
labour party, true to its principles, seeks to wean the working 
classes from alcohol by appeals to class prejudice, and 
endeavours to convince them that it is a deep plot of the 
existing " capitalistic order of society " that the masses shall 
drink themselves into a condition of physical and moral 
degradation and economic slavery, and by reminding them 
that every glass of beer or spirit drunk is so much money 
transferred from the pocket of the hard-working labourer into 
that of the pampered agrarian. Yet this is but part of the 
well-understood mHier of Socialist controversy, and appeals 
of the kind would be entirely impotent if unsupported by 
tangible arguments. 

The effects of this movement are most obvious to those 
who knew Germany years ago, before beer had forfeited the 
almost sacrosanct reputation which has immemorially clung 
to it. Twenty years ago a teetotaller or a man who formally 



THE WORKMAN 169 

avowed what are understood in England as temperance principles 
was rare in Germany ; to-day he is to be met with everywhere, 
for he moves in every class of society, and it is no longer un- 
common to see temperance drinks served in licensed houses even 
to working men. Trade union conferences exclude alcohol from 
their meeting-rooms. Berlin masons, who a few years ago 
had the reputation of being the hardest spirit drinkers in 
Germany, may be seen carrying to their work harmless bottles 
of milk, just as a Lancashire factory operative carries his tin 
of tea. Temperance cafes exist in the towns for the sake of 
the working classes much on the same principle as the English 
coffee-taverns, though cleaner and more attractive ; and 
factory canteens by the hundred are conducted on non-alcoholic 
principles. It is significant that between the years 1899 and 
1912 there has been a reduction in the consumption of beer 
per head of the population from 27j to 22 gallons, while simul- 
taneously there had been a small decrease in the consumption 
of spirit. In Munich, the capital of the great beer-producing 
country of Germany, Bavaria, the consumption of beer has 
fallen still more. The consumption of beer in the United 
Kingdom in 1912 was 28 gallons per head of the population. 

The Governments and the heads of Government establish- 
ments — most of all in beer-brewing Bavaria — are encouraging 
temperance amongst the working classes in many ways. When 
large public works, like railways, docks, and canals, are con- 
structed, the authorities require the contractors to keep alcohol 
in the background in all their canteens and to give prominence 
to non-alcoholic drinks. The factory inspectors are instructed 
to keep the temperance question in mind in their intercourse 
with employers. In State workshops special provision is 
commonly made for the " Abstinent en," who are given the 
choice of coffee, tea, milk, and mineral waters, instead of beer, 
and in the Bavarian railway workshops this has been done to 
such an extent that an entire change is reported to have taken 
place in the drinking habits of large sections of working people, 
the use of beer having ceased altogether in one depot canteen. 
It is also significant that the Imperial Insurance Board has 
formally requested the Employers' Accident Insurance Associa- 
tion for the beer industry to take steps to discourage the far 
too common custom of allowing free beer almost ad libitum to 
brewery workpeople. Since then a large number of breweries 
have abolished this custom, though from two to six litres 
(and even eight litres in Bavaria and W^urtemberg) are still 
allowed to the principal workers in most breweries. 

Nevertheless, this movement has emphatically sprung, and 
derives its strength, from below, and all that benevolent 



170 THE EVOLUTION OF MODERN GERMANY 

Ministers of State and departmental officials have done to 
combat alcoholism would have been ineffectual but for the 
fact that the working classes have taken up the question as a 
purely class and economic question and herein have been 
zealously encouraged by their party and trade unionist Press. 

A few years ago it seemed impossible that the movement 
would be seriously taken up by the central Socialist organization. 
When it was first discussed at the Hanover congress of 1899 it 
was in a spirit of undisguised ridicule. Even Herr Rebel, 
while declaring himself to be a strong opponent ol excessive 
drinking, threw cold water upon the little band of temperance 
enthusiasts who appealed to the congress for a " mandate,'* 
and stated amid applause : "In my opinion we as a party 
are not called upon to debate the alcohol question ; we must 
not waste our energies on trivialities." The advocates of 
the new movement were not, however, discouraged ; at the 
Mayence congress of the following year they secured a more 
favourable hearing for their views, though still the party held 
to the maxim that for Socialists alcohol (like religion) was " a 
private matter." Rut agitation, the free use of literature and 
the Press, and conferences in season and out of season, did 
their work, and at last the sympathy of many of the most 
influential and most trusted leaders and spokesmen of the 
party was won to the side of the " water fanatics," as they 
were called. Hence it came about that when the great West- 
phalian miners' dispute broke out at the beginning of 1905, 
the first advice given by the men's famous " Committee of 
Seven " to the strikers w^as " Avoid alcohol." " And not 
least to this appeal to self-restraint (writes a Socialist journal) 
it was due that in spite of the enormous number of hetero- 
geneous and undisciplined strikers who took part in that struggle 
the whole movement was characterized by the most exemplary 
quietness." The final victory came at the Essen congress of 
1907, when a formal blessing was bestowed on the movement, 
which may now be regarded as bearing the official stamp of 
the Socialist party, and as being directly associated with the 
other measures by which that party hopes to achieve labour's 
ultimate " emancipation " from the thraldom of capital. 

Attention has been called to this movement at some length 
for two reasons. In the first place it is a singular example of 
the spirit in which the German working classes are endeavouring 
to strengthen the consciousness of class in their own ranks 
and to consolidate labour into an estate which shall be able 
to stand alone, independent of outside influences, relying on 
its own efforts, and working out its salvation by its own unaided 
devices. More important, however, is the economic aspect 



THE WORKMAN 171 

of the question. The conviction has taken hold of a large 
section of the workers that their industrial efficiency and their 
value as members of society will be increased by the practice 
of temperance. It is not from love of their employers or of 
labour in the abstract that they impose upon themselves this 
restraint ; egoism and class interest are avowedly their ruling 
motives. For Germany's mercantile rivals, however, it is 
the effect rather than the cause of this movement which really 
matters, and it remains to be seen how far the temperance 
crusade which labour is embracing, as part of a great class 
awakening, will lead to increased national efficiency. 



CHAPTER X 

THE SYNDICATES I 

The concentration of capital and industrial enterprise — The principal industries 
sjmdicated — The effect of Protection in encouraging the growth of 
syndicates — Protective duties not the cause but the occasion — German 
writers quoted on the point — The abolition of Protection would not 
abolish the sjnidicates — They are symptomatic of a movement towards 
the more efficient organization of industry — The principal forms of 
industrial combination now in vogue in Germany — Examples in different 
industries — The charges against the syndicates stated and considered 
— The price policy of the Coal Syndicate — Reference to the Spirit Syndi- 
cate — The practice of " dumping " — Injury done to the manufacturing 
industries — Instances given of underselling abroad — Testimony of 
German Chambers of Commerce on the subject — The complaints of the 
retail trader — The standpoints of capital and labour — The absorption 
of small by large undertakings — " Mixed " versus " pure works in the 
iron industry — Has the movement towards combination taken its final 
form ? — Trusts now openly advocated — A possible alternative is that 
the system of large combinations may break down for want of strong 
men — The attitude of the working classes — Certain trade unions favour- 
able to the syndicates — Proposed legislative measures for the control 
of the syndicates — Attitude of the Association for Social Reform — 
Professor G. Schmoller quoted — Nationalization of the coal mines widely 
advocated. 

" "T^XEVER before," wrote the Austrian Consul in Berlin to 
I^Wl his Government in 1906, "was economic Germany 
■^ ^ so entirely under the absolute rule of a group of men, 
barely fifty in number ; in no former period of industrial 
expansion was the old formula of ' the free-play of forces ' 
abandoned to such a degree as in 1906, when the momentous 
decisions as to the extent of production, sales abroad, prices, 
the granting of credit, the raising of new capital, and the fixing 
of wages and rates of interest lay in the hands of a few persons 
found at the head of the large banks, mammoth industrial 
undertakings, and great cartells. The lion's share of the 

^ Dr. W. Morgenroth, author of the monograph Die ExportpoUtik der Kartelle 
(1907), has kindly read the proof-sheets of this chapter. He writes : " I recog- 
nize therefrom that in fundamental ideas we to a large extent agree. From 
my standpoint your statement of the question is altogether correct." Perhaps 
Dr. Morgenroth on the whole, in the work cited, takes a more serious view of 
the influence of the cartells than, imder present circumstances, seems to mo 
justifiable. 

172 



THE SYNDICATES 178 

industrial boom has fallen to these great combinations of 
I interests, whose gains have been the larger the more their 
! industries were ruled by syndicates." 

These words, which hold good even more to-day than 

I when they were written, deserve to be reproduced as evidence 

of the growing importance of the German cartell and trust 

movement. Originating in industrial circles, the movement 

has extended, as this writer says, to the domain of finance. 

More and more the provincial banks have been absorbed by 

the large corporations which have their seats in Berlin. These 

corporations have also combined amongst themselves, until 

to-day hardly more than half a dozen institutions seriously 

i count in the financial world. Three of these banks work with 

\ a capital of over ten million pounds each, and the capital of 

j ten of the largest German banks now exceeds eighty million 

I pounds. All these banks play an important part in most of 

j the great financial operations by which German industry and 

trade are promoted in transoceanic countries, as well as in the 

combinations which are so rapidly completing the concentration 

of industrial enterprise at home. 

Industrial combinations are by no means of recent origin 
in Germany. A historian of inquiring mind has discovered 
that a syndicate existed as early as 1836.^ Even the cartells 
of the modern kind began to appear early in the 'sixties, 
and associations of producers were formed in the pig-iron 
industry in 1873, when protective duties still continued, under 
cover of which higher prices were charged to home than to 
foreign buyers. The cartells did not, however, make much 
progress until the close of the Free Trade era. Since then they 
have increased to such an extent that it is no exaggeration to 
say that almost the whole of Germany's exporting industries 
are at the present time altogether or partially syndicated ; 
certainly no single important branch of production has kept 
aloof from the triumphant movement towards concentration. 
At the close of the year 1905, just after the revision of the 
Customs Tariff by Prince Billow's Government, over 400 
cartells were known to exist, of which 19 were in the colliery 
industry, 24 in the stone and earth industries, 64 in the iron 
industry, 11 in the industries connected with metals other 
than iron, 10 in the glass industry, 46 in the chemical industry, 
33 in the textile industries, 4 in the earthenware industry, 6 
jin the leather and rubber industries, 7 in the paper industry, 

I ^ Following German usage, the terms " cartell " and " syndicate " are here 
employed indiscriminately. Nevertheless, they are not, strictly speaking, 
synonymous. The syndicate denotes a higher form of organization than the 
cartell, inasmuch as it generally acts as a sale agency for the affiliated firms. 
The purpose of the cartell proper is the fixing of prices and conditions of sale. 



174 THE EVOLUTION OF MODERN GERMANY 

5 in the wood industries, 16 in the industries connected with 
foodstuffs and luxuries, 2 in the electrical industries, 132 in 
the brick industries, and 7 in other industries. No reliable 
enumeration of later date exists, but it is safe to say that the 
number has since increased. The foregoing list disregards 
amalgamated firms, though in more than one industry these 
take a virtually monopolist position. Many cartells in the 
mineral industry are so closely related, however, that the 
number of independent organizations in industry is smaller 
than the above figures might indicate. Thus the Siegerland 
Pig-iron Syndicate and the Rolled Wire, Gas-pipe, Boiler Tube, 
and Plate Syndicates are all more or less dependent upon the 
great Steel Syndicate, whose breath can unmake as its breath 
has made them. Further, the mere recital of the number of 
cartells conveys no exact idea as to the extent to which industry 
is concentrated. Where the production of an industry is 
overwhelmingly controlled by one of these combinations — 
and there are many examples of the kind — the practical effect 
is that of the trust in a modified form. 

It is a question still warmly debated in Germany how far 
the cartells and syndicates are a result of protective legislation. 
Long before syndicates existed Friedrich List, father of modern 
Protection in Germany, wrote : "If protective duties for a 
time make home manufactured goods dearer, they will ensure 
lower prices in future owing to home competition." But in 
some industries the syndicates have to a large extent destroyed 
competition, so that prices are regulated by a double form of 
protection — against underselling from without and underselling 
from within. 

The fact that syndicates existed before the protective 
legislation of 1879 is proof that customs duties were not 
absolutely essential to their formation. Independently of Pro- 
tection, there are other conditions which favour the successful 
syndicating of industries — e.g. (a) the existence of a virtual 
monopoly, caused by the comparative rarity of raw material, 
or its concentration in few hands ; (b) monopolistic control of 
half-manufactured or finished products ; (c) favourable circum- 
stances as to quality, production, transport, etc., may create 
partial or local monopolies in marketable articles, facilitating 
the formation of syndicates ; and other illustrations might 
be added. All these conditions have operated in the case of 
one or other of the industries which are now ruled by syndicates. 

Nevertheless, a certain significance must be assigned to 
the fact that the era of the syndicates has in general syn- 
chronized with the operation of the protective tariffs introduced 
from 1879 forward, and on the whole it is impossible to resist 



THE SYNDICATES 175 

the conclusion that while Protection may not be the primary 
cause of the syndicates, it has greatly favoured their formation, 
and that without it they would not have reached their present 
dominating position. This view would appear to be increas- 
ingly held by German writers on the syndicate movement. 
One of the latest of these. Dr. W. Morgenroth, in an able 
criticism of the cartells from the special standpoint of the 
export trade, I writes : — 

" Since nearly all cartells, syndicates, or trusts aim at con- 
trolling the market and restricting competition between their 
members within their sphere of influence as far as possible, 
it must be immensely to their interest that foreign competition 
should be kept out of the market which they seek to monopolize, 
so that the outsiders may not disturb their policy there. For 
that reason protective duties are with most cartells the most 
important presupposition of really successful equipment and 
operation. Protective duties can only be dispensed with, 
without disadvantage, where their place is taken by natural 
advantages or monopolies. . . . Where there is a market open 
to international competition protective duties are the principal 
support (and. at the same time the foster-parent) of the 
' national ' cartells as we know them to-day. These duties 
form a wall round the territory syndicated, keeping out the 
flood of foreign and cheaper foods, and if this wall were to be 
torn down most of the cartells would be swept away by the 
inrush of competition." 

Again : " Protective duties and cartells stand in reciprocal 
relationship. The cartells for the most part need for their 
existence protective duties, and protective duties, in order that 
they may be thoroughly effective, require cartells. It is there- 
fore no accident that the real era of the syndicate in Germany 
began shortly after the change of fiscal policy which took 
place in 1879 " (p. 9). 

Even a discriminating defender of the cartells, Dr. R. 
Liefmann,^ is compelled to acknowledge the significance of 
the fact that '' In Free Trade England the tendency to monopo- 
listic combinations has been very slight, much slighter, indeed, 
than might have been expected in the oldest industrial country 
in the world." Dr. Liefmann, in a fair and temperate survey 
of the whole question, comes to the conclusion that while 
protective duties are " neither the cause nor the necessary 
presupposition of cartells," they distinctly " facilitate the 
formation of cartells." He writes : — 

"It is incorrect to say that Protection was the cause of 

^ Die Exportpolitik der Kartelle, Leipzig, 1907. 
« Schutzzoll und Kartelle, p. 6, 1903. 



176 THE EVOLUTION OF MODERN GERMANY 

the cartell movement, and that the entrepreneurs only formed 
cartells in order to exploit Protection to the best advantage. 
They are rather a product of causes lying far deeper — of the 
entire modern development of industry, with its increasing 
competition, the increasing risks of capital, and the falling 
profit. Entrepreneurs did not abolish competition and form 
unions for the purpose of exploiting the duties, but in order 
to put an end to the severe competitive war ; they strove for 
Protection as well as for combination, the first in order to get 
rid of foreign competition, the latter in order to prevent pur- 
poseless rivalry among themselves, recognizing that protective 
duties brought them little advantage so long as the competitive 
war continued at home.'* 

The close relation between Protection and the syndicates 
is not denied by this writer, and, indeed, it is proved by the 
fact that the syndicating of industry has been carried farthest 
where the greatest protection exists against foreign competition. 
Dr. Liefmann concedes the relationship when he says : " The 
greater the export and the more difficult it becomes owing to 
the competition of other countries, the greater will be the need 
for cartells at home." 

Granting, however, that Protection has been, if not the 
direct cause, at least the occasion of the majority of the syndi- 
cates, it is nevertheless unlikely that the relaxation of the 
protective duties would diminish the tendency towards combina- 
tion. Some of the cartells are already virtually independent 
of foreign competition — that is, they could operate successfully 
either with or without import duties : notably the Potash 
Syndicate and, in a less degree, the Coal Syndicate, the one 
enjoying a natural monopoly and the other, within a large 
part of its sale area, a geographical monopoly. The real 
significance of these organizations is to be seen in the general 
tendency towards the aggregation of capital and the con- 
centration of industry which they illustrate ; and the chief 
explanation of this tendency must be sought, not necessarily 
in '' capitalist greed," as Socialist writers are fond of saying, 
but in the natural endeavour after more efficient forms and 
methods of industrial organization. 

At the same time it is objected by many persons not un- 
favourable to syndicates on principle, that the undue protection 
afforded to them has expedited the *' industrialization " of 
Germany more rapidly than has been good for the country, 
and especially for the interests of agriculture, the small trades, 
and the handicrafts. The existence of a chronic scarcity of 
rural labour is a standing witness to the precipitation of 
economic changes to which the agrarian classes have been 
unable to accommodate themselves. 



THE SYNDICATES 177 

The industrial combinations found in Germany at the 
present day are of various kinds. 

(a) The loosest form of combination is a union of producers 
created for the purpose of fixing the conditions upon which 
their goods shall be supplied either to the retailers or the public 
direct, including terms of credit, payment, discount, etc. Where 
the number of members of such a union is small, this plan 
of combination can be followed with success ; the greatest 
difficulty arises when a multiplicity of undertakings has to 
be dealt with. In practice the wide latitude which is reserved 
by the affiliated works greatly restricts the efficacy of this 
form of combination, which has nothing in common with the 
highly-developed syndicate. 

(b) A second step in the organization of industry is the 
combination formed for the purpose of concluding and enforcing 
price conventions, and at present a majority of the German 
cartells are of this kind. These price agreements may be 
concluded between the producers or between dealers who 
control a sufficiently large market. As a rule they fix the 
minimum prices at which definite goods and qualities of goods 
can be sold. 

It is the purpose of neither of these forms of organization 
directly to regulate production. The combined firms continue 
to be rivals, though their rivalry is carried on under conditions 
which create a fairer field and secure to all a better prospect 
of remunerative trading. They no longer compete as to price 
at each other's cost but at the cost of the consumer, who may 
or may not be better served owing to the less inducement to 
sacrifice quality to cheapness. 

(c) More restrictive in their purpose and operation are the 
sale conventions. In syndicates formed on this basis the pro- 
ducers subordinate themselves to a central organization which 
acts in the interests of all equally, in return for their surrender 
of individual rights. This central organization sells the whole 
marketable output of the affiliated firms, allots to each its 
share of such sale, and fixes prices. There may still be over- 
production, but at the risk of the firms which resort to it. 
Virtually the members of such a syndicate are reduced to the 
position of manufacturers working on commission. 

(d) A further development is the syndicate whose purpose 
is to regulate the production of a particular industry and fix 
each producer's share in the aggregate output. Here the 
individual producer absolutely surrenders his independence 
and limits his profit-earning capacity. He cannot produce 
more goods than the cartell allots to him, and his proportion is 
determined according to invariable rules. 

12 



178 THE EVOLUTION OF MODERN GERMANY 

It is obvious that but one further step — union of capital 
— is needed to arrive at the logical development of the cartell, 
the trust. 

The highest degree of combination so far has been reached 
in the productive syndicates of the coal and iron mining and 
the iron and steel industries. The coal-mining industry leads 
the way ; for though the syndicates in this industry are few 
in number they are of large extent, and cover almost the whole 
market. The largest is the Rhenish-Westphalian Syndicate, 
originally formed in 1893, with its headquarters at Essen. 
The Syndicate was the result of various attempts, dating so 
far back as 1878, to regulate the production and price of coal 
by agreements between competing collieries. Several loose 
and limited organizations were formed between that year and 
1891, but in no case was a permanent form of combination 
found feasible. There are also syndicates for Upper and 
Lower Silesia, working from Kattowitz and Waldenburg 
respectively, and the chief Saxon collieries are similarly com- 
bined. In addition there are eleven syndicates of various 
kinds in the lignite or brown coal industry, the principal being 
those for the Rhenish-Westphalian, Lusatian, Saxon, and 
Magdeburg mining fields. 

The productive syndicates in the coal-mining industry are 
supplemented by sale syndicates, working under the control 
of or in close connection with the main combinations, in such 
a way that the latter determine the entire conditions of the 
retail trade. The arrangements enforced by the Rhenish- 
Westphalian Coal Syndicate upon the retailers are so stringent 
that the latter have practically become mere agents subject 
to the will of a dictatorial principal. 

In the iron and steel industries the syndicates regulate the 
output from the primary processes to the marketing of the 
half -finished article. The principal syndicate in the ore-mining 
industry is the Association for the Sale of Siegerland Ironstone. 
The production of pig-iron is completely syndicated in all the 
important districts, and the unions work in close communica- 
tion. Of the five great syndicates the most powerful are the 
Pig-iron Syndicate of Diisseldorf, to which some twenty smelt- 
ing works belong, and the Siegerland Syndicate, comprising 
in 1903 sixteen works, while the Upper Silesian works and 
the Lorraine and Luxemburg works are separately combined. 
The largest combination in the steel industry is the Steel Works 
Union (Stdhlwerhsverhand), commonly known as the Steel 
Syndicate, which virtually controls the production, sale, and 
price of all half-manufactured goods produced in Rhineland 
and Westphalia. In this combination 31 undertakings are 



THE SYNDICATES 179 

united, while within the syndicate there are special agreements 
relating to various products. 

In the half-manufactured steel industry there are between 
thirty and forty syndicates of all kinds, most of them being 
sale syndicates, though some regulate prices, and a few regulate 
production. The chief are those in the plate and plate goods, 
wire and wire goods, and pipe industries. There are also two 
associations of iron foundries, one established at Cologne and 
the other comprising a number of works in East Prussia and 
Saxony. 

In the engineering industry proper there are few syndicates, 
and these are of very limited influence. The reason for this is 
less the unwillingness than the inability of this industry to 
combine on the usual cartell principles. 

In the small iron industry and the miscellaneous metal- 
working industry generally the syndicate movement has also 
been but little successful, though a number of price conventions 
have been concluded in Westphalia, relating, for example, to 
agricultural forks, locks, flat-irons, knife-grinding, and pins, 
while syndicates have also been introduced in certain branches 
of the copper, lead, and zinc industries. 

In the chemical industry the largest combination is that 
formed in potash mining, which has existed since 1884. 
Powerful and wealthy though it is, however, the Potash Syndi- 
cate has not had matters its own way, for the industry is still 
young, a large number of new potash mines have of late years 
been opened, and while the success of the syndicate depends 
upon the establishment of a monopoly, to do this is increasingly 
difficult. It is said that at the present time at least two 
hundred companies of all kinds are engaged in the profitabl-e 
business of potash mining. No general syndicate has been 
concluded in the chemical manufacturing trade, but several 
combinations of powerful firms operating on competitive or 
complementary lines have been formed. 

Other industries which have to a large extent been syndicated 
are the glass, wallpaper, cement, earthenware, spirit, powder, 
paper, artificial manure, sugar, leather, and certain branches 
of the textile and rubber industries. 

The Spirit Syndicate is particularly interesting as repre- 
senting an alliance of industry with agriculture. Before the 
Government Commission which has for several years been 
inquiring into the working of the cartells one of the principal 
witnesses for this syndicate defended its monopoly by the 
argument that agriculture was by its instrumentality supported, 
and agriculture was in its turn the support of the State. " Break 
down this pillar with thoughtless hand," he gravely said, " and 



180 THE EVOLUTION OF MODERN GERMANY 

from the ruins nothing will emerge but the red flame of 
revolution." 

In the beer-brewing industry the efforts to establish strong 
combinations have not been attended by success. The prin- 
cipal reasons for this are doubtless the enormous extent of 
the industry and the difficulty of uniting rival breweries in a 
country in which beer production is so highly specialized. A 
further obstacle is the great development of the tied-house 
system, especially in Bavaria, where " free " houses are the 
exception, and where the independence of the licensed victuallers 
has been absolutely destroyed. A short time ago a congress of 
Bavarian licensed vicffiallers appealed to the Government to 
release them from their intolerable position of subordination 
" owing to cartells, agreements, and leases," which made 
them " the mere employees of the breweries." 

There are four main counts in the case made out against 
the large syndicates which not only control production but 
regulate prices. 

(a) In the first place it is asserted that the syndicates, 
not satisfied with curtailing the costs of production and distribu- 
tion, and with checking the undercutting that formerly resulted 
from competition, use their power to raise prices unduly. 

(b) They are also charged with enforcing higher prices for 
raw and half-manufactured material sold at home than they 
charge to foreign buyers, to the prejudice not merely of home 
undertakings engaged in the final processes of manufacture, 
but of the entire body of consumers. 

(c) Further, it is alleged in some cases that far from being 
able to cover the entire home needs, they have, protected by 
import duties, deliberately kept the production below national 
requirements in the interest of higher prices. 

(d) The dealers or middlemen complain that their liberty 
and independence have been taken from them, that their 
trading opportunities are injuriously restricted, and that their 
extinction is the ultimate aim of these syndicates. 

So far as the facts themselves are concerned, there is ample 
evidence to prove that all the injuries and disadvantages com- 
plained of by independent industries and individual traders 
have actually been experienced during the operation of the 
cartells. The difficulty is to apportion in every case the exact 
degree of blame or responsibility which attaches to the cartells. 
Prices have certainly increased during the operation of the 
Rhenish-Westphalian Coal Syndicate, and by general consent 
owing to the Syndicate's policy. Dr. Morgenroth writes : 
" While Germany used to have the cheapest coal in the world, 
and even up to the end of the 'eighties had lower prices than 



THE SYNDICATES 181 

England, the opposite is now the case. In consequence of the 
Syndicate's policy the German prices are now, in times of normal 
trade, higher than the English." One of the severest attacks 
made upon the Coal Syndicate occurred in 1907, and was 
conducted simultaneously in the Reichstag and the Prussian 
Diet, as well as in the Chambers of Commerce and the Press. 
Throughout North Germany the price of coal reached during 
that year a height hardly ever known before ; industry suffered 
as much as private consumers, and a demand for the national- 
ization of the collieries was heard on all sides. Yet even when 
the turn of the industrial tide came towards the close of the 
year the Syndicate advanced prices further. 

The Socialist economist, Herr Calwer, writing as a well- 
wisher of the cartel Is, argues that the Westphalian Coal 
Syndicate cannot dictate prices, since it does not control the 
entire market, the competition of lignite always exerts a pressure 
in times of tension, and water transport facilitates the import 
of foreign coal. It should not be overlooked, however, that 
within a very wide area this Syndicate is almost absolutely 
supreme. Against 64,769,000 metric tons of coal which the 
syndicated collieries of the Ruhr coal-field were entitled to 
sell in a given year, an amount considerably below their actual 
output, since it did «not include their own consumption, the 
fiscal mines of Prussia had an output of only 1,014,000 tons, 
and the other non-syndicated mines an output of 610,000 tons. 
Further, lignite is so far non-competitive that at any price it 
is a poor substitute for coal for industrial use, and it likewise 
is to a large extent syndicated. As to the competition of 
foreign coal, the Syndicate is careful to adjust its prices to 
geographical necessities, with the result that towns far distant 
from the seaboard yet enjoying the advantage of river transport, 
and thus having access to foreign supplies, are able to buy 
Westphalian coal at a cheaper rate than inland towns near to 
the coal-fields, and the same preference is shown to towns 
which can choose whether they will buy Westphalian, Saar, 
or Silesian coal. Thus it came out in evidence during the 
Cartell Inquiry that while the gasworks of the town of Essen, 
in the very centre of the Ruhr coal-field, were paying 12s. 9d. 
per ton, the town of Dessau, 800 miles to the east, was paying 
lis. 7id., and that Hanover paid more than Mannheim for 
Westphalian coal, though nearer by a hundred miles to the 
source of supply, because Mannheim has the option of purchasing 
Saar coal and of importing from England by waterway. 

The basis of the price policy of the cartells is, in fact, 
differentiation according to circumstances. Shortly expressed, 
the policy is that of selling at all hazards at the best possible 



182 THE EVOLUTION OF MODERN GERMANY 

prices. The highest prices are charged for goods intended 
for home consumption. Here the cartell, if it controls the 
market, is able to dictate its own terms, so long as it takes 
care to keep below the competition line. A reduction is made 
upon these home prices, either direct or taking the form of a 
bounty, if goods supplied to German customers are intended 
for export. The reduction is supposed to cover the costs of 
transport to port of shipment plus a preference to enable the 
exporter to undersell his competitors in the foreign market. 
The lowest prices are charged for goods exported by the cartell 
direct, and here the cartell would appear to protect itself 
very carefully against those of its customers who have the 
benefit of export rates. 

Before the Cartell Commission the Spirit Syndicate admitted 
that prices had increased as follows for first quality spirit ; — 



Year. 


Maximum Price. 


Minimum Price. 




Marks. 


Marks. 


1889-1900 


62.70 


47.50 


1900-1901 


61.70 


46.50 


1901-1902 


45.0 


38.70 


1902-1903 


49.40 


46.10 


1903-1904 


68.40 


51.0 


1904-1905 


72.20 


65.60 



In this case the outside firms likewise benefited to the full 
by the higher prices imposed by the spirit ring ; as one witness 
said : " The free spirit manufactories have filled their pockets 
owing to the high prices." During the years 1899-1905 some 
of the large Prussian spirit companies increased their dividends 
by from 20 to 50 per cent. These high prices were obtained 
by the simple device of destroying or overriding competition 
at home and selling surplus goods cheaply abroad. The 
representative of a celluloid factory stated in evidence that 
spirit which cost 20s. 4d. in 1895, before the spirit ring was 
formed, cost in 1899 32s. 9d., and in 1905 48s. Id. A varnish 
manufacturer stated that spirit which cost his firm 23s. in 1900 
cost 45s. in 1905, though the same article could be had for 
25s. in Austria. 

Instances of this kind could be multiphed. That prices 
have in many cases been deliberately forced up to unreasonable 
levels by the action of powerful syndicates cannot be gainsaid. 
On the other hand, the effect has in other cases been less 
fluctuation and greater equilibrium ; the old alternation of 



THE SYNDICATES 188 

excessively high and abnormally low prices has given way to 
a higher mean, which has certainly paid the producer better, 
and probably has often in the long run been better for industrial 
consumers. This is the claim advanced for the cartells by Herr 
Kirdorf, the Director-General of the two most powerful com- 
binations, the Westphalian Coal and Steel Syndicates : *' The 
former excessive fluctuation of prices has given place to a more 
restricted movement on a medium level '* ; and though there 
may be doubt as to whether either the coal or the steel industry 
is a convincing illustration of the wholesome influence of the 
syndicates, there can be no doubt that even in these cases 
prices have on the whole kept within a narrower range than 
formerly. This favourable view is taken by Herr Calwer in 
the work already cited : — 

" Excesses have occurred in the price policy of the cartells 
and will occur in the future, especially where a syndicated 
article enjoys a protected market and inland competition is as 
good as prevented. But in general the effect of the syndicates 
on price policy is not to be sought in the absolute increase of 
prices, but in the maintenance of more stable and equal prices. 
The pre-cartell era was distinguished by very frequent varia- 
tions of prices, according to the state of trade and the force 
of competition. In times of increasing demand prices rushed 
up spontaneously and suddenly, and then after a short time, 
when excessive supply and over-production had set in, they 
rapidly dropped to a level that was disastrous not only for the 
capitalist, but for the workpeople employed. Such a ruinous 
movement of prices is impossible where powerful productive 
cartells exist. Prices may rise in times of good trade, but 
gradually and with a certain deliberation ; they will fall in 
times of industrial reaction, but here, too, the decline will be 
gradual. A price policy which takes this form leads us out 
of the anarchical conditions of things which existed in the 
pre-cartell era into a period marked by regulation of production, 
in which the existence of industrial undertakings is no longer 
threatened by the free play of wild competition. The cartell- 
ized concerns, alike in their profits and losses, are no longer, 
as was formerly the case, subjected to the powerful vicissitudes 
of trade." 

The objection that higher prices are charged to home than 
to foreign buyers is the standing grievance of the manufacturing 
iron and steel works against the Coal and Steel Syndicates. 
The evidence placed before the Cartell Commission showed 
conclusively that this policy of selling cheaply abroad and 
dearly at home has been systematically followed by the Coal, 
Pig-iron, Steel, Wire, Plate, Girder, Wire Tack, Paper, Spirit, 



184 THE EVOLUTION OF MODERN GERMANY 

Sugar, and other Syndicates. ' According to returns placed 
before the Commission the average price of the coal sold at 
home by the Rhenish- Westphalian Coal Syndicate in 1900 was 
10s. 8jd. per metric ton and of that sold abroad 9s. lOd., a 
difference of 8-2 per cent, against the home buyers ; in 1901 
the prices were lis. and lis. 2jd., respectively, or 1*9 per cent, 
in favour of the home market ; and in 1902 10s. 5jd. and 9s. lOd., 
or 5*8 per cent, against. Similarly the average price of coke 
sold by the Coke Cartell in 1900 was 17s. per ton for home 
consumption and 16s. Ijd. for coke sent abroad, in 1907 
17s. and 16s. lOjd., and in 1902 15s. and 13s. Ijd. respectively. 

These figures, however, deal with the sale as a whole, and 
ignore the far greater preference given to the foreign market 
in individual cases. Abundant evidence of this comes from 
the industries which have specially suffered. When the inquiry 
began the representatives of the iron industry praised the 
Coal Syndicate and the representatives of the Coal Syndicate 
praised the Iron and Steel Syndicates in return ; each con- 
tending that the whole operation of the combinations was not 
merely harmless, but for the benefit of the community as well 
as of the industries affected. It seemed as if the investigation 
was superfluous and its issue a chose jugie. They had, however, 
forgotten the buyers of manufactured iron and steel, who 
advanced a strong indictment against the masterful ways of 
the producing syndicates. It was shown that the Pig-iron 
Syndicate sold at home 21s. and 22s. above the international 
price, and that the Wire Syndicate had in 1900 three prices, 
one for goods sold for home consumption, viz. £9 5s. per ton ; 
one for goods intended for export, £8 10s. per ton ; and one 
for direct sale abroad, £5 15s. per ton. The same preference 
to foreign buyers has marked the price policy of the Rail 
Syndicate, which exported rails to Belgium at £4 10s. (f.o.b. 
Antwerp), while the Prussian Railway Administration was 
paying £6. 

A witness giving evidence as to the price policy of the 
Wire and Wire Tack Syndicate said : " The managers of the 
great syndicates should really reflect before giving a large 
portion of their entire production to foreign countries in order 
to support and strengthen there industries which afterwards 

* In its report on German foreign trade for 1902 the Imperial Statistical 
Office expressly refers to this practice of " dumping." It says : " Special 
mention should be made of the great increase in the export of iron and iron 
goods, these amounting to £1,500,000. . . . This large increase in the export 
of iron and iron goods, and especially of half-manufactured products like pig- 
iron, angle iron, malleable iron in bars, etc., is to be attributed to the unsatis- 
factory condition of the German iron industry, which, with a view to the 
continued employment of the works, relieved the home markets by selling large 
quantities abroad, and especially to Great Britain." 



THE SYNDICATES 186 

return to us the finished article and paralyse our industry in 
finished and refined manufactures. For instance, when the 
Syndicate sells wire tacks to the foreigner at 14s., and we at 
home have to pay 25s. for them — that is, a difference of lis. 
■»^it is certainly worth while to ponder whether one should 
not limit a great part of the foreign sales, which amount to 
over 45 per cent, of the entire production of the Syndicate, 
and in return raise certain industries at home by disposing 
of raw material at a cheaper rate. During the second half 
of 1900 alone the syndicate lost £43,900 on its foreign sales, 
but cleared a profit of £58,500 on its home sales." The same 
witness added that but for the action of the syndicates, helped 
by the tariff, building operations might be carried on in Germany 
at from 25 to 30 per cent, less cost, for nearly all building 
materials, except wood, were syndicated. " We do not wish," 
he said, in conclusion, "to go the way of the American trusts, 
for they destroy not only all self-dependence, but likewise all 
technical progress. And a second thing that I have very 
much at heart is that through this drifting towards trusts the 
connection with the banks will become such that it can and 
must work to the detriment of our industry, which is for us 
of vital moment." 

Illustrations might be multiplied from other branches of 
the iron and steel and metal industries, the paper trade, etc. 
The evidence given before the Cartell Commission is full of 
illuminating facts bearing upon this phase of the syndicate 
question, and the same policy of foreign preference continues 
to the present time. The Cologne Gazette not long ago related 
the following illustration of how German manufacturers of 
finished steel goods have been injured by the cheap export 
of raw material by syndicated works. Some of these manu- 
facturers had been in the habit of selling to Holland 10,000 
tons of wire nails and the material from which Dutch works 
manufactured 4,000 tons more. Owing to the establishment 
of new rolled wire works, encouraged by the prosperity of the 
syndicated works, there began a serious over-production of 
raw material, so that the home market was glutted and the 
excess had to be sold at any price to Holland. Hence arose 
several new wire works in that country, with the result that 
not only were manufactured goods no longer imported but 
goods made from German raw material were now exported to 
Germany and sold 25 per cent, below the home market price. 

The Duisburg Chamber of Commerce reported in 1905 : 
" Less satisfactory during the year was the position of the 
manufacturing iron industry in so far as it is not united in 
cartells. Raw material was systematically sold abroad by the 



n 



186 THE EVOLUTION OF MODERN GERMANY 

syndicates more cheaply than to local industry, with the result 
that export was made impossible or was at least attended by 
sacrifice." Dr. Morgenroth also writes : " For years the 
reports of almost all Chambers of Commerce have been full of 
complaints on the subject. Various industries have, owing 
to this policy of the cartells, been developed abroad. The 
Rhine shipbuilding industry has in part, owing to this reason, 
been transferred from Germany to Holland, where in a customs - 
free market (in which Germany, Belgium, and England naturally 
underbid each other) the yards can buy their plates and sheets 
much cheaper than the German cartell sells them to the German 
yards. So, too, the iron construction works in Holland have 
become marvellously efficient, principally owing to cheap 
German steel, and in Belgium the drawn -wire industry is said 
to have been built up by cheap German material." ^ 

On the other hand, Dr. Lief man ^ contends that " The 
cheap export of raw and half-manufactured material, as 
furthered to a certain extent by the cartells, maintains and 
increases the economic power of Germany abroad. The 
ability of the finishing industries to compete with foreign rivals 
is not weakened by this export, but by the high prices which 
the producers of raw material are able to obtain at home owing 
to the cartells." It is, however, obvious that these high 
prices inflict injury upon home manufacturers in a double 
way — they make production dearer, and by so doing they 
encourage foreign competition. This writer proceeds to admit 
that " If such effects should ever be of protracted duration 
measures should be adopted against the cartells concerned, 
as indeed against all excessive price-movements, so soon as 
natural correctives prove futile " — a characteristic example 
of the German faith that when every other comfort fails the 
State can always be relied on to act the part of the deu^ ex 
machind. 

The cartells acknowledge that they injure the finishing 
industries by the preference shown to foreign buyers, since 
they pay these works export bounties in the form of a rebate 
of a portion of the price of raw material used in exported 
products. 3 The Rhenish-Westphalian and Siegerland Pig- 

1 Die Exportpolitik der Kartelle, p. 46. ' Schutzzoll und Kartelle, p. 30. 

* It is interesting to have on record the theory of foreign bounties, which 
was expounded to the Association for Social Policy at its congress at Mannheim 
in September, 1905, by Herr Kirdorf, one of the iron and steel kings of West- 
phalia and the head of the Steel Sjnidicate : " The words export bounties have 
a somewhat evil taste. At bottom, however, export bounties are in the interest 
of the commimity, for in the measure that we are in a position to sell manu- 
factured goods cheaper to foreign countries do we receive raw materials and 
half -manufactured goods at cheap prices." Yet the policy of the Stool Syn- 
dicate is avowedly directed towards keeping half -manufactured iron goods out 
of the ooxmtry. 



THE SYNDICATES 187 

iron Cartells began to do this in 1882 in the case of raw iron 
supphed to rolling mills, and the Rolled Wire Syndicate followed 
suit in 1888 in relation to the wire-drawing works. These 
export bounties were at first a temporary expedient, but since 
1892 and 1893 they have become a recognized feature of 
syndicate policy. The Steel Syndicate lately increased the 
export rebate from 5s. to 15s. per ton on half-manufactured 
iron intended for export, and applied this reduction to all 
works, whether belonging to unions or not. The Coal Syndicate 
has also extended the export rebate, which had hitherto only 
been allowed to rolled iron works, to all consumers in the iron 
industry ; this rebate is now fixed at Is. 6d. per ton of coal 
used. But, as Dr. Morgenroth writes : " The cartell bounty 
is a mere compensation for the injuries caused to the German 
export industry by the fact that, owing to the operation of the 
cartells, they have to reckon with dearer raw materials than 
foreign competitors, and in most cases the compensation does 
not cover the higher cost of these materials. Bounties are 
only given to any appreciable degree in times of declining trade. 
At other times they almost entirely disappear. ^ 

A measure aimed at " dumping " was proposed by the 
Social Democratic party during the discussion of the present 
Customs Tariff by the Reichstag in November, 1902. It was 
the prompt suspension of all duties beneficial to any industry 
whose products were proved to be exported at lower prices 
than were charged at home. The fatal objection to so 
summary a measure was that it would punish the innocent 
and guilty alike, and the resolution was rejected. 

As to the third objection to the syndicates, there can be 
no doubt that the syndicated industries on the whole have 
asserted a far firmer hold upon the home market than they 
held before. This is proved by the diminished imports of 
many of the goods which the syndicates produce, though it 
is a question how far this result is due to the combination of 
works, how far to the protection they enjoy in the form of 
import duties. Yet even here there are notable exceptions, 
and one such exception came to light in the course of the evidence 
given before the Cartell Commission. It was the case of the 
Tin Plate Syndicate, whose defenders admitted that though 
it was able, helped by a duty of £2 10s. per metric ton, to 
advance prices 38 per cent, between the years 1898 and 1900 
— the increase being from £14 9s. to £19 18s. per ton — it was 
never able to cover the home demand. The United Kingdom 
is Germany's only serious rival in this industry, and SO per 
cent, of the tin-plate required for home use had to be obtained 

* Die ExportpolUik der Kartelle, p. 33. 



188 THE EVOLUTION OF MODERN GERMANY 

from this country, whose manufactures benefited by the higher 
prices enforced by the German works owing to the restriction 
of competition by the Syndicate. Professor Adolph Wagner 
summed up the evidence in this case in the following words : 
"Far from having adapted the supply to the demand, you 
have only met the demand by raising prices 50 per cent, higher 
than those charged by England, and even at these higher prices 
you have not nearly supplied as much as was needed." 

The contention that the retail trader has received no more 
consideration than the consumer was amply supported before 
the same Commission by evidence from various quarters, and 
new illustrations are of constant occurrence. Referring to 
the rigid regulation exercised by the Rhenish- Westphalian 
Coal Syndicate and the affiliated Coal Trade Syndicate, the 
report of the Mannheim Chamber of Commerce for 1906 stated : 
" The wholesale coal trade is now almost entirely in the hands 
of the Rhenish Coal Trade and Shipping Company. The 
dependent retail trade finds itself restricted to the utmost 
by the measures taken by the Company. It was not able to 
derive any advantage from the extraordinarily large demand 
for coal, for its dependence on the Company prohibits it from 
buying English coal and prescribes for it a limited market. 
On the other hand, the year was favourable for dealers in 
non-syndicated coal." How stringently the " tied-house ** 
principle is applied may be illustrated by the following notifica- 
tion, by which the customers of the Westphalian Coal Trade 
Company learned that their right to buy from a rival source 
was cancelled : " We beg to inform you that from April, 1907, 
we shall be in a position to supply you with a good briquette 
of Rhenish coal. From that date, therefore, we can no longer 
allow you to obtain your supplies of this product elsewhere." 
So far has the Steel Syndicate carried its policy of trade 
regulation that it now apportions to the dealers their separate 
spheres of influence, beyond which they are not allowed to 
go, and with a view to exercising complete control it requires 
registers of their customers, so that there is nothing to pre- 
vent it from eliminating the middleman altogether and selling 
direct to the manufacturers. 

The coal and iron industries, however, are not singular in 
this respect. Not long ago a Berlin firm of silk dealers wrote 
to a leading journal of that city : " The dictation of the cartell 
of silk-stuff manufacturers, with its arbitrary and rigorous 
measures, cries to heaven. The cordial agreement which had 
existed for years between producers and buyers has been 
changed into open hostility, and the Berlin firms are to-day 
only the vassals of the manufacturers." 



THE SYNDICATES 189 

There is, indeed, wide and bitter complaint that the old 
tie between manufacturer and consumer has disappeared since 
the syndicates stepped in and converted the affiliated works 
into mere agencies. In a recent report the Duisburg Chamber 
of Commerce noted this change with regret. " The works 
united in syndicates," it said, " take but the smallest interest 
in their customers, since they hardly need to make any effort 
to obtain and retain a fixed book of customers. All commissions 
have to be notified to the syndicates, and the affiliated works 
are simply allotted their share." 

It is a significant circumstance that under the auspices of 
the Central Association of German Industrialists (Central- 
verband Deutscher Industrieller) a conference of represen- 
tatives of leading syndicates and wholesale consumers of 
syndicated goods, particularly in the ironware trade, has been 
held for the purpose of considering a proposal to form organiza- 
tions to secure the advantages of personal relationships between 
producer and purchaser, as they existed under the system of 
free competition. 

Viewing the question further from the interested standpoints 
of capital and labour, it must be conceded that (1) the syndi- 
cates have been attended by distinct advantages to industry, 
while at the same time (2) they have not yet proved so injurious 
to the working classes as was predicted and seemed likely 
during the earlier stages of the movement. The capitalist 
theory of combination is straightforward and not unattractive. 
Either the producers may compete with each other on the 
principle of every man for himself, which means war all round 
without quarter, or they may call a truce to competition, join 
forces, and divide the spoils of a bloodless victory according 
to a fixed plan. Obviously commerce conducted on such 
peaceful principles denotes an advance upon the unrestricted 
rivalry of unequal forces. 

Not only does it convert trading, from being a game of 
chance in which the rewards are uncertain, into one of science 
in which there are prizes for all and blanks for none, but it 
leads to economy of effort and prevention of wastage in many 
directions, with the result that capital receives a higher and 
possibly on the whole a more equal return. 

It is on this ground that the cartells and syndicates and 
unadmitted trusts of Germany are chiefly defended by their 
originators among themselves, and from this standpoint the 
success achieved has been very notable. 

For a time, indeed, the cartells may have protected 
inefficient undertakings against the extinction which, sooner 
or later, befalls the unfit, yet on the other hand many such 



190 THE EVOLUTION OF MODERN GERMANY 

undertakings have disappeared by the process of amalgama- 
tion. Nevertheless, there is as before a considerable difference 
between individual concerns even though they are now joined 
in the same combination. Syndicate or no syndicate, modern 
machinery, improved methods, skilled and well-paid labour, 
efficient organization and co-ordination of effort, and careful 
management mean lower costs of production, so that works 
which have these advantages at command — the price of 
syndicated goods being the same all round — are able to show 
the best returns. The fact that sales are to a certain extent 
guaranteed releases effort in the direction of distribution and 
allov/s of its concentration upon more efficient production. 
Obviously, too, the syndicating of industries facilitates special- 
ization, to the advantage at once of quality and economy of 
production. It is Herr Calwer's opinion that " While amongst 
the many cartells which exist there may be some which, owing 
to special circumstances, afford no incentive to progress, it 
must be accepted as a general rule that cartellization has helped 
to increase the productivity of industrial labour." Another 
effect is that a syndicated industry is kept in closer touch with 
the market. There is less working in the dark, less chance, 
more adaptation, greater equalization of supply to demand. 
Yet if production has been developed upon more regular and 
more healthy lines, over-production has by no means been 
prevented, in proof of which assertion it is only necessary to 
point again to the *' dumping " abroad at low prices of goods 
which cannot be sold at home. 

One direct result of the syndicating of the leading industries 
has been the strengthening of the large undertakings at the 
expense of the small ones, and this result is variously judged. 
One of the principal arguments by which the formation of 
the Coal Syndicate in 1893 was justified was that it would 
discourage concentration, and by the method of annual appor- 
tionment would give a chance to the small collieries, provided 
only these were willing to join the combination. Such has 
not been the effect of the Syndicate, for the large collieries at 
once steadily increased their workings in order to secure an 
increased share of the output, while the share that fell to the 
struggling small companies hardly increased at all. 

In order to carry out the original idea more faithfully the 
plan of annual allotments was changed on the renewal of the 
Syndicate in 1903, and the participatory shares were fixed 
until 1915, with the proviso that larger shares might only be 
claimed in proportion to the increased aggregate sale. But 
this restriction did not suit the large colliery companies, which 
began to buy up the smaller ones, encouraged by the rule 



THE SYNDICATES 191 

allowing any company which absorbs another to claim the 
latter's share in the output, whether the absorbed workings 
should be closed or not. Then began a period of closing down 
which, though it did not last long in an acute form, created a 
great displacement of labour and much distress to the miners 
and their families concerned, for in some districts whole 
villages were deserted. So far did the closing of collieries go, 
that in 1905 an urgent Government Bill was introduced in 
the Prussian Diet to require colliery owners before they aban- 
doned any of their works to show proof that they were no 
longer profitable. As a price for the passage of a twin measure, 
amending the conditions of employment in coal mines and 
particularly curtailing the hours of labour to eight per shift, 
and abolishing excessive fines, the Bill was dropped. 

The immediate effect of this new development, however, 
was to help on the very concentration which the Coal Syndicate 
was to have checked. Ten Westphalian colliery companies 
disappeared between 1904 and 1906, having been absorbed 
by larger ones, and of an aggregate output sanctioned for 
1905 of 75,584,133 metric tons 12 of the largest companies 
shared to the extent of 38,074,190 tons, or 50 per cent. 

Side by side with the formation of syndicates there has 
also sprung up another form of combination no less important 
in its way, viz. the " mixed " works in the iron industry, i.e. 
coal and smelting works combined, or smelting and rolling 
works combined, which are rapidly and inexorably crushing 
out of existence the " pure " works, engaged in a single branch 
of the productive process. ^ 

The tendency is no new one : what is new is its extent, 
and the growing difficulty of the " pure " iron works holding 
their own against the large syndicated works which rest on a 
double basis. For the formation of cartells places the associated 
undertakings in a specially advantageous position, since all 
the required raw material can be obtained inside the " ring," 
and the choice before the still unsyndicated works is either to 
throw in their lot with the majority or be driven into insol- 
vency. The " mixed " works, no doubt, represent a higher 
stage of industrial efficiency, yet the transition involves great 
hardship not only to those capitalists who have to adapt them- 
selves to the new conditions, but to their workpeople as well, 
and the cartells are specially responsible for the change that 
is being painfully worked out. 

The question is often asked in Germany, Has the movement 
towards combination taken its final form ? Few observers 
who have given attention to the subject w^ould be prepared 
1 See Chapter V., pp. 90-92. 



192 THE EVOLUTION OF MODERN GERMANY 

to answer that question affirmatively. When the syndicates 
were only feeling their feet, and were moving forward in the 
face of much public distrust, an attempt was made to win 
confidence by the assurance that the formation of syndicates 
would keep out the more dangerous combinations of the 
American pattern. " Never the American trust," said the 
authors of the early cartells ; " this is the final form.'* No one 
says nowadays that the cartells represent the last word on 
industrial organization, for the simple reason that they have 
long ago departed from their original form and scope. Very 
early in the movement the larger syndicated works experienced 
the disadvantage of being joined to works lacking their power 
of expansion. They found their enterprise checked, their 
ambitions curbed, and that in the interest of smaller under- 
takings of limited financial resources. The only remedy was 
a policy of absorption, and that policy they adopted. It is 
not impossible that the next step will be an extension of that 
policy, or a combination of absorption and amalgamation, 
and such a step will carry German industries — the coal and 
iron industries are specially referred to — a long way forward 
on the path that leads to the American trust. 

It is significant that a responsible body like the Essen 
Chamber of Commerce should be found advising the amalga- 
mation of the two most powerful syndicates in Germany. " It 
is a question worth considering by the Coal Syndicate," it says, 
" whether the time has not come for amalgamating with its 
powerful colleague the Steelworks Union, in order to maintain 
its position against the too powerful undertakings of the united 
collieries and smelting works. The united Steel and Coal 
Syndicate would represent a ' trust of trusts,' and with the 
American Steel Trust would rule the world." So, too, the 
Cologne Gazette, which has always been regarded as the official 
mouthpiece of the large syndicates in the Press, wrote recently, 
apropos of the amalgamation of several wealthy Westphalian 
collieries and smelting works : " The more rapidly these 
amalgamations are effected, the more rapidly we shall reach 
the trusts, though they may not for years take a clearly defined 
form. The cartells and syndicates have proved to be not 
permanent but merely transition forms, and with the progress 
of the amalgamations their basis disappears and their interest 
for the allied works decreases. The trust, therefore, is not 
the invention of a ' smart ' American brain, but is a necessary 
and logical economic development. Hence the amalgamations 
which are paving the way for the trust are not, as the (Prus- 
sian) Minister of Commerce said, something diseased and 
unhealthy ; they rather denote progress ; by the concentra- 



THE SYNDICATES 198 

tion which they imply they increase economic efficiency and 
are indispensable to competition with the powerful industries 
of foreign countries. From this standpoint no objection can 
be taken to the increasing tendency to concentration." 

There is another alternative so obvious that it would appear 
to be disregarded. All the great syndicates are the workman- 
ship of powerful men, the expression of their strength, the 
embodiment of their large ideas, and by them are alone kept 
in operation. No sudden edict of extinction seems likely to 
threaten the line of virile and masterful personalities which, 
after winning for Germany a recognized place in the markets 
of the world, turned to the organization of industry at home 
and sought new conquests there. Yet the bigger the under- 
taking the bigger must be the man at the head is a rule attested 
both by the successes and the failures incidental to private 
enterprise everywhere, and there seems reason to believe that 
the permanence of the enormous combinations which have 
become common in the form of syndicate and cartell will be 
dependent upon the continuation of the race of industrial 
giants which originated them. Should the race become 
enfeebled, the very magnitude of the syndicates will prove their 
weakness. From this standpoint, too, it would appear unsafe 
to speak of finality in relation to existing forms of industrial 
organization. 

As yet the attitude of the working classes towards this new 
form of industrial organization can hardly be said to have 
been clearly defined. Amongst themselves the labour leaders 
alternate between vituperation and a guarded criticism hardly 
to be distinguished from approval. Perhaps these contradictory 
voices can best be explained by saying that they represent the 
political and economic camps respectively in which German 
Socialists range themselves upon most great social questions, 
the combatants of the one camp working for immediate party 
interests and those of the other keeping in view the necessity 
of watching closely every form of industrial evolution which 
seems to foreshadow the ultimate embodiment of the Socialistic 
idea. 

On the whole the position taken is that of a waiting 
opportunism. On principle Socialists do not object to industrial 
combinations, however powerful, but rather regard them as a 
step towards the eventual combination of all the nation's 
productive resources in one corporate union — the State of the 
future which is to own all capital, all property, all natural 
wealth, all the means of production, exchange, and communi- 
cation. Hence the significance of the resolution adopted by 
the International Socialist Party at the Amsterdam congress 

13 



194 THE EVOLUTION OF MODERN GERMANY 

of 1904 calling upon all Socialists parties to hold aloof from 
legislative measures for preventing the establishment or growth 
of employers* combinations. 

For the present the interest of labour in the syndicate 
question centres in the two questions of wages and prices, 
and it is generally admitted that in so far as the syndicates 
are responsible for creating higher prices, they have at least 
exempted the workmen from injury by sharing with them the 
tribute levied upon the general body of consumers. 

" The view is quite fallacious," writes Herr Calwer, " that 
the cartells use their combined power in order to regulate the 
conditions of labour. The regulation of the relationships 
between employers and workpeople is at present an internal 
affair of the individual undertakings, and so we find that in 
general the individual works pay their workpeople variously, 
some treating them better than others in the same organization. 
This freedom of the individual undertakings regarding their 
workpeople does not make it impossible that the latter's position 
may gradually become considerably altered, and this change is 
a consequence of the price policy of the syndicates, causing 
greater equilibrium than existed formerly. When in the pre- 
cartell period the prices of a commodity suddenly fell consider- 
ably, many undertakings were compelled to restrict production 
or to stand. The result was that the workpeople of such 
undertakings partially or altogether lost their employment 
or large reductions of wages took place. When, however, the 
prices of commodities rose greatly, production increased, 
thousands of additional workpeople were suddenly employed 
and wages increased proportionately. On the one hand the 
workman had the chance of securing more employment and 
higher pay, but on the other hand he was exposed to the risk 
of being suddenly thrown on the street or of submitting to a 
considerable reduction of his income. The cartells, with their 
more stable prices, avert both extremes. The fluctuations of 
production are no longer so great or so fortuitous, and the 
result is that neither employment nor the wages level varies 
so much as formerly." 

Coming from an avowed friend of the cartells, who also 
differs from the vast majority of his colleagues upon other 
questions, like agrarian policy and protective duties, these 
views of Herr Calwer cannot be regarded as representative of 
working-class sentiment generally. It is, however, significant 
that just as in the United States the labour organizations 
systematically co-operate with the trusts in keeping up prices 
— even to the extent of share-holding — on the understanding 
that a portion of the extra profits shall be returned to the 



i 



THE SYNDICATES 195 

workers in higher wages, so the Christian (i.e. predominantly 
Roman Catholic) trade unions in Germany show a disposition 
to support the syndicates on the same ground of self-interest. 
The report for 1906 of the largest of these unions, that of the 
miners, stated : " The favourable and moderating influence 
of the Coal Syndicate was again felt during the year. In earlier 
times, before the Syndicate was formed, the prices of coal 
rapidly advanced in years of good trade, and fell just as quickly 
on a trade relapse. But the Syndicate since its establishm.ent 
has followed a policy of stable prices, preventing a too great 
fall in times of crisis and a sudden excessive rise in the years 
of commercial expansion. The business world and almost 
the entire middle class, even in the industrial districts, have 
complained of the high prices of coal. It is too easily forgotten 
that nearly the entire population of the industrial districts 
has an interest in the adequate remuneration of the workers, 
and this is only possible permanently if industry works at a 
corresponding profit." So, too, the leading spokesman of the 
Christian organizations, Herr Giesbert, said in the Reichstag 
recently : "If the Syndicate gets good prices for its coal and 
thus creates the possibility of paying good wages to its work- 
people, the interests of the workpeople coincide with those of 
the Syndicate." Even the organ of the powerful Socialist 
Metal Workers' Union, the most influential in Germany, has 
welcomed the syndicates as representing " a higher form of 
industrial organization." 

Nevertheless, the working classes as a whole more or less 
vaguely fear the power of the cart ells. If the cartells can 
increase prices by eliminating competition between producers 
(so they argue), why should they not seek to reduce wages by 
eliminating competition between employers ? The argument is 
theoretically sound, except that it does not make sufficient 
allowance for other factors which go to fixing the price of 
labour, nor does it take at its full value the weapon of counter- 
combination which is within the power of labour. In effect 
the fear of lower wages is not yet justified by the past history 
of the cartells. 

More reasonable and more justified is the suspicion of the 
working classes which is based on the hostile attitude of some 
of the best known syndicate leaders towards trade unionism. 
In proof of this it is only necessary to refer the reader back to 
the chapter in which the relations between capital and labour 
are discussed, and particularly to the sentiments avowed by 
the director of the Westphalian Coal and Iron Syndicates, 
with his ultimatum : "It has been proposed that all work- 
people should be compelled to form organizations and the 



196 THE EVOLUTION OF MODERN GERMANY 

employers be compelled to negotiate with these organiza- 
tions. Let me remark for myself that I decline to negotiate 
with a labour organization of any kind whatsoever." ^ Words 
like these, coming from one of the greatest autocrats in the 
German industrial world, have naturally given rise to the 
apprehension that the large cartells would not be indisposed 
to challenge the working man's most fundamental rights, 
viz. his right to combine and his right to sell his labour where, 
how, and to whom he will, should a favourable opportunity 
arise. The late Professor Adolph Wagner said at the meeting 
of the Evangelical Social Congress in May, 1907, that in spite 
of the improvement in the condition of the working classes, 
their " dependence upon the enormous capital concentrations 
was to-day greater than ever." It is the uncertainty as to 
where this dependence may in the end lead that creates most 
suspicion and distrust of the syndicates in the minds of the 
workers. 

It remains only to refer to the public attitude towards the 
cartells, and to the legislative and other measures which have 
been proposed for the checking of such excesses as have come 
to light. 

When the cartell movement began there were not a few 
writers in the circle of economic liberalism who welcomed these 
organizations as a legitimate means of regulating production, 
of equalizing prices, and of organizing -industry on more 
efficient lines. The State Socialistic critics of " unlimited 
competition," with its correlative, price undercutting, at the 
expense of quality on the one hand and of wages on the other, 
saw their wisdom justified when a blow seemed to be thus 
struck at their special aversion. There was all the greater 
readiness to receive the syndicates with confidence since they 
were held to be a certain means of equipping the German iron 
industry in particular for further conquests in the world- 
markets. The home trade, it was said, would by their operation 
be more completely preserved for home labour, the export 
trade would expand, small and large undertakings would 
have an equal chance, the working classes would have higher 
and more stable wages, and all this would be done at no one's 
expense, for cheaper production and distribution would permit 
of the syndicated goods being sold at the same average prices 
as before. 

Some of these predictions and expectations have been 

partially realized, but not all. The syndicated industries 

have made giant strides ; assisted by the higher protective 

duties which have been imposed in the meantime, the home 

» See Chapter VII, pp. 128-30. 



THE SYNDICATES 197 

market has been kept to a larger extent than before as a national 
preserve ; the export trade has also increased, and the wages 
of labour have risen. Yet all industries have not benefited 
equally ; the smaller undertakings in the industries syndicated 
have as a rule suffered ; where the syndicated works have 
gained by the larger export trade the unsyndicated works have 
often lost ; and finally the increased gains of industry and 
(nominally) of labour have unquestionably been at the expense 
of the general consumer, who has been effectually squeezed 
by manufacturer, labourer, and trader equally. 

It is instructive to read in early literature on the syndicate 
movement of the high expectations which were entertained by 
some of the liberal economists. Professor Lujo Brentano, 
regarding the syndicates as an eventual substitute for Protec- 
tion, saw in them a means of rejuvenating the existing industrial 
system ; blind, unregulated production, leading to ruinous 
over-production, was to cease, and all the evils that follow in 
its train were to be abated. " While theorists of different 
schools," he wrote in 1890, " have exhausted themselves over 
unprofitable projects, the needs of practical men have called 
into existence a new organization, whose purpose it is to remove 
the glut of the market — viz. the cartells. A market will be 
secured to home industry sufficient to provide ample and regular 
employment to labour at remunerative prices." So, too, 
Professor Kleinwachter regarded the cartells as the salvation 
of the working classes, and called upon the State to '' require 
the syndicated industries to assure to their employees life 
occupation, with wages regularly increasing with the years 
of service, as well as old age, widows' and orphans' pensions," 
thus creating universal industrial content and cutting from 
under the Socialist party the basis of its agitation. In those 
days the syndicates had at best critics and not opponents, 
and on the whole the criticism was too little discriminating to 
be helpful. 

Since then a change has come over the spirit of the pro- 
fessors' dream ; many illusions have been dispelled, and few 
of the first hopes have been altogether realized. This change 
found for the first time vigorous expression at the Mannheim 
congress of the Association for Social Politics in September, 
1905, which Herr Kirdorf, director of the Westphalian Steel and 
Coal Syndicates, had been invited to attend in order to hear 
the opinion of the theorists regarding his doings and to reply 
for himself. 

The late Professor Gustav Schmoller led the attack in a 
speech which showed that he had entirely forsaken his early 
attitude of benevolent neutrality. 



198 THE EVOLUTION OF MODERN GERMANY 

" Only a short time ago," he said, " the speeches of Ministers 
flowed over with praises of the cartells. Since then these 
Ministers have changed their views, although matters have not 
gone so far with us as in America. The gentlemen of the 
cartells say, ' Do leave us alone and do not disturb our circle.' 
We should be glad enough to do that if only the cartells and 
syndicates would leave us alone. The syndicates have, however, 
enormously increased the price of coal, and colliery shares 
have as a result increased from 40 or 50 to 300 and 400 per 
cent. Formerly legislation placed in the foreground the 
principle, ' All economic development depends on free compe- 
tition,' and now suddenly the contrary holds good, for the 
cartells destroy all competition and set up monopolies in its 
place. The formation of cartells leads logically to the repeal 
of industrial freedom. Formally this freedom can and will 
continue to exist, but it has in practice lost significance, and if 
matters continue as now it will lose it more and more. This 
fundamental transformation undoubtedly explains the fact 
that the cry for nationalization was never so loud as now. 
The nationalization of the collieries has become especially 
popular. I am no friend of nationalization, but I have no 
doubt that if we had a Minister of the strength and decision 
of Prince Bismarck the collieries in the Ruhr district at least 
would have been nationalized. In any event it is necessary 
that the State should acquire an influence on the syndicates. 
A mere veto on an increase of prices, however, is not enough ; 
the State must use its influence to secure a reduction of prices. 
It is desirable that there should be an agreement between 
buyers and sellers, perhaps negotiated by an Imperial Board. 
In this way a movement of prices suited to varying conditions 
might be secured. In a country in which the private rail- 
ways have passed into the State's hands and in which fiscal 
mining ' has been begun on a large scale, there is certainly 
nothing extraordinary in setting limits to the formation^ of 
trusts." 

Professor Schmoller proceeded to advocate the giving to 
the State of a voice on the directorates of the larger syndicates 
by the nomination of one-fourth of their members, with a 
view to preventing abuses by which the interests of the public 
might suffer, and he also suggested that one -half of their profits 
beyond a certain amount (a 10 per cent, dividend was men- 
tioned) should go to the State, proposals which led Herr Kirdorf 
to say on behalf of the Coal Syndicate that he would prefer 
out-and-out nationalization. 

It seems clear, however, that the cartells so far have kept 
strictly within the law. When a case against them was stated 



THE SYNDICATES 199 

before the Imperial Supreme Court, which was asked to declare 
these organizations to be contrary to the principle of free 
competition, the Court turned the tables on the prosecution 
by stating that measures for preventing free competition might 
under certain circumstances be in the interests of the com- 
munity. Nor has success attended similar attempts by legal 
process to prove close unions of employers opposed to the 
principle of '' freedom of occupation " affirmed by the Industrial 
Code. For the law only assures to every citizen the right to 
follow the calling of his choice ; it does not undertake to 
protect him against difficulties caused by the presence of other 
competitors in the same field or guarantee him the least measure 
of success. Nevertheless, the feeling prevails very widely 
that the cartells have gone as far in the concentration of eco- 
nomic power and its employment for private advantage as is 
just to the interests of society as a whole, and that the time 
is quickly coming for restrictive measures. This many of the 
syndicates recognize. It was doubtless a desire to conciliate 
public opinion which led the directorate of the Coal Syndicate 
to invite the Prussian Government some time ago to join that 
body and so exercise a voice in its proceedings, an offer which, 
wisely or not, was declined as " untimely." 

At present no legislative powers exist which would enable 
either the Imperial or the State Governments to interfere with 
the action of the syndicates, and such measures as they have 
taken have been of an indirect kind. In Prussia the State, 
though a large colliery proprietor, has but slight influence on 
the coal industry in general. It controls some 25 per cent, 
of the coal output in Upper Silesia, and dominates the Saar- 
brlicken coal-fields, but the Westphahan district is the real 
heart of the coal industry and the scene of the struggle between 
private monopoly and the public, and in spite of the Hibernia 
colliery share purchases in 1904 the State is there helpless. 
The determining motive in the Hibernia transaction, to which 
the natural desire of the Government to secure constant and 
economical supplies of fuel for the State railways and other 
undertakings was admitted to be quite secondary, was to 
exercise an effective check upon excessive prices in the interest 
of the great industries whose prosperity depends on cheap 
coal supplies. The Government obtained possession of a con- 
siderable share in the property before it became known that 
the agents who were known to be buying up the market were 
acting on its behalf, but the avowal of the project stirred up 
opposition among the Hibernia Company's shareholders, and 
in spite of persistent efforts and appeals to law the State was 
beaten back. 



200 THE EVOLUTION OF MODERN GERMANY 

As to the possibility of direct intervention the Prussian 
Minister of Commerce, Dr. Delbriick, said in the Diet on 
November 26, 1907 : " The question has been asked whether 
we can oppose obstacles to the (Coal) Syndicate's arbitrary 
action in fixing prices. I pass over the question to what extent 
the Syndicate has transgressed reasonable limits in fixing 
prices. The test whether the Syndicate fixes its prices according 
to economically right principles can only be applied when we 
know how it will act in the event of a further decline in 
industry.! Por the present we are certainly not in a position 
to exert influence on the Syndicate in the matter of price fixing, 
and such an influence will only be possible on the strength 
of general syndicate legislation, as to which the necessary 
investigations are not yet complete." 

The only legislative measure which has yet been aimed at 
the Coal Syndicate in Prussia was of an indirect character, 
and it was adopted in the special interest of the miners, viz. 
the Mining Law of 1905. In defending that law, which was 
intended to ameliorate the conditions of work, to reduce the 
hours of labour, to abolish abuses in fines and penalties, and 
establish workmen's committees, the Prussian Minister of 
Commerce of that day (Herr Moller) said in the Upper House 
of the Diet on June 28, 1905 : — 

The present reform of the mining legislation is a consequence 
of capital concentration in the coal-mining industry. I have 
repeatedly acknowledged the necessity of such concentration 
and have opposed anti-cartell laws. But the Government 
must show the cartells that it cannot in the public interest 
allow them to transgress certain limits, and such a transgression 
of permissible limits has occurred on the part of the Coal Syndi- 
cate. The members of the Syndicate have taken up a too 
masterful standpoint, or they would long ago have satisfied 
the justifiable demands of the workpeople. As that was not 
done it was necessary for legislation to intervene." 

Although, as has already been explained, the Government 
in its reprisals did not go to the full lengths originally intended, 
which included a State veto on the closure of mines, the law 
as passed materially improved the position of all underground 
workers. 

The Imperial Government has so far adopted a waiting and 
watching attitude, merely appointing a Commission to inquire 
into the past working of the more important cartells in the 
principal industries. This inquiry has already continued for 
several years and a vast amount of more or less disjointed 

1 Although an industrial relapse occurred towards the end of 1907, the Coal 
Syndicate raised its prices for the succeeding year. 



THE SYNDICATES 201 

evidence has been accumulated, not all to the advantage of 
the cartells, though they have made out the best possible case 
for themselves. The Government has, however, made it clear 
that should legislation be necessary to check cartell excesses 
it will without hesitation be proposed, and in the present 
temper of the Imperial Diet there can be no doubt that any 
measures in this sense submitted to it would be passed not only 
promptly, but in a more drastic form than might be acceptable 
to the Executive ; for though the many parties in the Reichstag 
differ upon most questions, they are absolutely united in 
acknowledging that some of the cartells both possess excessive 
power and have made excessive use of it. It is in the ranks of 
the National Liberal party alone that the syndicates specially 
look for sympathy and support, yet during one of many recent 
debates on this question in the Reichstag a National Liberal 
deputy stated, " The head of the Coal Syndicate possesses 
to-day far greater political power than the Minister of Commerce. 
We foresaw that, and that was why we proposed in 1900 that 
there should be Imperial control of the syndicates and cartells. 
We are no opponents of the cartells in principle, but we call 
for the regulation of their powers somewhat on the lines of the 
resolution of the Jurists' Conference (Juristentag) of 1904." 
The resolution here referred to affirmed the opinion that *' State 
intervention is indispensable for the purpose of checking exces- 
sive increases of price and of conferring upon the working 
classes an equal right of coalition and an equal legal status 
to those enjoyed by the organizations of employers." 

The counter measures most commonly advocated may now 
be briefly summarized. It will not have escaped attention 
that most of the criticism directed against the syndicates really 
relates only to the policy pursued by one of their number, the 
Westphalian Coal Syndicate, which affects th-e public as con- 
sumers most immediately, and the remedial measures proposed 
nearly all proceed from this standpoint. 

(1) The first demand is that the fullest light of publicity 
shall be thrown upon the operations of the syndicates, for it 
is held that only on that presumption will public opinion 
be brought to bear upon them effectively and the State be 
able to adopt timely action should the syndicates abuse their 
power when circumstances are favourable. It is accordingly 
proposed that the syndicates shall henceforth be required to 
work in the full light of day ; that all their statutes, regulations, 
and conventions, and all resolutions modifying them, shall 
be published, together with yearly accounts of revenue and 
expenditure, prepared in greater detail than is the case with 
ordinary public companies. The statutes of all syndicates 



202 THE EVOLUTION OF MODERN GERMANY 

are first to be submitted to the Imperial Government for 
approval. It is significant that in a recent issue of the Deutsche 
Wirtschaftszeitung, Dr. H. Voelker, who, as a former member 
of the directorate of the Steelworks Union, is able to judge 
of the syndicates from within, urged that these combina- 
tions should be brought under the systematic control of the 
State, yet with a distinct voice in their own regulation. It 
is not very encouraging to find Dr. Voelker adding the admo- 
nition that the Cartell Commission should be made permanent, 
since only by that means will the Government be able to culti- 
vate the close touch with the syndicates and their conductors 
which he regards as desirable in the public interest. 

(2) All the critics of the syndicates agree in the demand 
that where these bodies are known to be manipulating the 
market or improperly exploiting a condition of scarcity, the 
Government should suspend the import duties and also the 
preferential railway tariffs, in the case of the incriminated 
industry ; further, that in the event of public convenience 
seriously suffering, as by a dearth of coal, it should encourage 
imports by reducing the railway charges. The suspension of 
import duties under such circumstances is, of course, a part 
of the Canadian protective legislation of 1897, and it has been 
enforced in the Dominion more than once. In Germany, 
where the Federal Council reserves to itself great powers in 
regard to the execution of the customs tariff, there would be 
no administrative difficulty : the only serious objection is 
that syndicated and unsyndicated works would be hit indis- 
criminately by such a retaliatory measure. 

As regards the offer or withdrawal of preferential railway 
tariffs, a matter which falls within the exclusive province of 
the individual States — the Empire only having railways under 
its control in Alsace-Lorraine — the various Governments do 
already possess full power to differentiate both on exported 
and imported goods. This power is constantly exercised in 
relation to heavy exports, but more rarely in relation to imports, 
though in 1900 the Prussian Government in a time of scarcity 
temporarily facilitated the entrance of coal by reducing the 
charges upon its railways. 

(3) As regards private action, defensive organizations of 
dealers and consumers on the one hand and of working people 
on the other are advised. It is obvious, however, that 
organizations amongst dealers would offer no protection to 
consumers, while efficient combinations of consumers are almost 
inconceivable. Moreover, it is a fair argument that if the 
community is only able to protect itself against injurious 
combinations of private interests by counter-combination, 



THE SYNDICATES 203 

the time has clearly come for it to act as one body, i.e. for 
the State to interfere and apply the ultima ratio of legislative 
restriction. 

The case of the working classes would seem to call for 
special consideration. They are most immediately affected 
by the syndicates, and while so far there is no proof that they 
have suffered, still, in the face of capital combinations of 
unequalled magnitude, they must always keep en vedette. 
Vague yet ominous threats, like that uttered by Herr Kirdorf 
at the Evangelical Congress at Mannheim, already referred to, 
must inevitably produce in labour circles a feeling of uneasiness. 
As the success of the cartells depends upon the closest and 
strongest possible union of the entrepreneurs concerned, it is 
contended that the workpeople in their employ may fairly 
claim in its fullest form the right to combine and also to resort 
to all action which logically proceeds from that right, and may 
under circumstances be needful in order to make it effective. 
It is significant that Herr Richard Calwer, the Socialist well- 
wisher of the syndicates, allows that combinations of dealers 
and consumers and working-class coalitions will, in all prob- 
ability, be insufficient to hold the syndicates in check, and 
that he, too, looks to State action. 

(4) The enormous power of the syndicates in the coal and 
coke trade has unquestionably weakened the objections to the 
nationalization of the collieries, not because the syndicates are 
regarded as a natural step towards collective ownership, but 
because they have stifled competition, handicapped dependent 
industries, and placed the mass of consumers at the mercy of 
a few great companies. The action of the Westphalian Coal 
Syndicate, in particular, has greatly stimulated public opinion 
in Prussia in favour of a general scheme of nationalization, 
and in the event of another conflict between national and 
syndicate interests such as occurred during the later period of 
the recent industrial boom, it is not unlikely that this move- 
ment would carry the Government with it. The nationalization 
of the coal mines has been advocated by leading economists like 
Wagner and Schmoller, and all parties save one in the Diet 
would favour the immediate adoption of such a measure. The 
colliery proprietors are not indifferent to the imminency of 
this danger, and when the Hibernia share purchase was made 
a union of nine Chambers of Commerce of Rhineland and 
Westphalia promptly petitioned the two Houses of the Prussian 
Diet to annul the contract on the ground that *' the projected 
acquisition of the Hibernia colliery would be followed by the 
nationalization of other collieries, and the nationalization of 
even a majority of the collieries must be resolutely opposed for 



204 THE EVOLUTION OF MODERN GERMANY 

political, economic, and social reasons." In Prussia, however, 
where State enterprise extends in so many directions, no objec- 
tion on grounds of principle would be allowed to stand in the 
way ; and while for the present there is no reason to believe 
that the Government desires to undertake new responsibilities 
of such magnitude, a large scheme of nationalization must be 
regarded as at least falling within the range of practical policy. 

Many experts who object to the nationalization of the 
collieries did not oppose the application of this measure to 
the potash mines. In the early years of the Potash Syndi- 
cate's career the Prussian State was represented by 27 per 
cent, of its entire production. The opening up of new mines 
and their inclusion in the Syndicate led to a reduction of this 
share to 7 per cent, in 1906, and with that reduction the State's 
influence disappeared proportionately, so that the tendency 
to force prices upwards to the prejudice of agriculture, the 
Syndicate's largest customer, was fast getting beyond control. 
The purchase of the Hercynia mine, at a cost of one and a half 
million pounds, brought the State's share in the Syndicate's 
production back to 11 per cent. Answering the objection made 
in the Diet that the Government had paid too high a price 
for the mine. Minister von Delbriick said (April 3, 1906) : — 

" The question has been asked repeatedly whether the 
State could not have attained its ends more economically by 
waiting for a more favourable time to purchase. Yes, a business 
man, who wished to make a big profit, might argue so, but 
the State is buying for reasons of the public welfare and the 
public interest. The object of this purchase is to make it 
strong enough to serve the public interest, even without the 
Syndicate if necessary." 

It is generally admitted that the syndicating of the potash 
industry, subject to statutory control, has been beneficial both 
to the industry and the workpeople employed. The industry 
is severely regulated by special laws, which not merely lay 
down the conditions of exploitation, but fix minimum rates of 
wages and make other provision for the welfare of the workers 
engaged in the syndicated mines. 

It is not without significance that in 1907 the Prussian 
Government succeeded in passing a bill which gave — or, 
rather, restored — to the State the entire right to explore for 
coal, rock salt, potash, magnesia, etc. In former times mining 
was, in Prussia, a right of the Crown. A Mining Law was 
passed in 1865, however, with the object of attracting private 
capital to mining undertakings, and it succeeded only too well, 
since it developed a large amount of unhealthy speculation. 
The new measure is intended to check the growth of monopo- 



THE SYNDICATES 205 

lies and to prevent mining enterprise from falling into the 
hands of mere company promoters. It transfers to the State 
the sole right to open new mines in most parts of the kingdom 
— the provinces of Brandenburg, Schleswig-Holstein, East 
Prussia, and Pomerania were excluded from the bill by the 
dominant political party — thus making private enterprise 
dependent upon State assent, which is granted subject to such 
conditions as the Department of Mines from time to time 
imposes. 



CHAPTER XI 

STATE ENTERPRISE— RAILWAYS AND CANALS 

Grerman ideas as to the sphere of public and private enterprise — The extent 
of State initiative — The revenues from State undertakings — The State 
as owner of lands and forests — State insurance for agriculture in Bavaria 
— The State railway system — Prince Bismarck's ideal of Imperial rail- 
ways, frustrated — The railway revenues and taxation — The profits of 
the Prussian railways — The extent of the national water-ways and 
canals — The Kiel Canal — Recent canal schemes — Freedom of river 
navigation. 

IT has been of untold advantage to Germany that when 
the serious development of her economic resources began 
progress was not hampered by any hard-and-fast adhesion 
to a definite line of policy in regard to the limits of public as 
compared with private enterprise. The Germans are supposed 
to be a nation of theorists, the English to be a nation of 
practical men, yet the doctrinarianism which made a fetish of 
individualism originated in the land of practical men ; the 
nation of theorists accepted both individualism and socialization 
just for what they were intrinsically worth, without prejudice 
for or against, and made an idol of neither. If Germany has, 
on the whole, gone as far in the direction of encouraging public 
enterprise as England went, up to a generation ago, in crippling 
it, the explanation may be found in the fact which has already 
been incidentally referred to, that State initiative, originating 
in the time of patriarchalism and absolutist rule, is the tradi- 
tion of German government ; hence it was easy and natural 
for the Germans to apply the principle of public enterprise 
and effort to modern conditions. 

The adoption of this principle has assisted the nation in a 
pre-eminent degree to make the most of its opportunities. 
For by taking upon themselves a large share of economic 
functions the State and the municipal authorities to that extent 
released a vast amount of private effort and capital ; while 
they were looking after matters of common interest, the indi- 
vidual citizens were left free to concentrate attention in 
directions which offered a more natural scope for personal 

206 "" 



STATE ENTERPRISE— RAILWAYS AND CANALS 207 

enterprise. It is a striking fact that at the present time over 
35,000 miles of railways (either railways belonging to the 
State or private lines managed by the State, though over- 
whelmingly the former), representing over nine hundred million 
pounds of invested capital, are working with perfect smoothness 
and success without the aid of boards of directors and meetings 
of shareholders, who as a consequence are able to employ 
their activities in other and more advantageous ways. 

Not only so, but a large part of the revenues of the various 
States is derived from their remunerative enterprises, a fact 
which has an important bearing upon taxation, and which 
explains the comparative lightness of the direct taxes per 
head of the population in some of the States. Among the under- 
takings from which the Empire derives revenue are, besides 
the post and telegraphs, the railways in Alsace-Lorraine, the 
Imperial Printing Works, and the Imperial Bank (in which 
the Empire holds shares), while the principal undertakings 
carried on for profit by the States are the railways, the post 
and telegraphs (in Bavaria and Wiirtemberg, which retain 
their " particularist " rights in regard to these services), forests 
and domains, coal, iron, potash, and other mines, and iron 
smelting works, though revenue is derived in some States from 
tobacco and porcelain manufactories, banks, lotteries, medic- 
inal baths and springs, amber works, breweries, and newspapers. 
Of industrial undertakings alone the Prussian State carries on 
some forty coal, iron, and potash mines, twelve smelting works, 
five salt works, also stone quarries, and amber works. The 
State is, in fact, the largest individual owner of mines and 
minerals in the kingdom. 

In Bavaria the State is responsible for the maintenance 
of 4,200 miles of public roads, costing £200,000 a year ; it 
makes grants to the extent of £100,000 towards the mainten- 
ance of district roads ; and its total expenditure upon roads, 
bridges, and public streams amounts to about a million pounds 
a year. 

The State has alFo taken under its survey and care the 
general question of public water supply for the monarchy, 
and with the co-operation of the State Water Board and by 
the aid of State subsidies ranging up to a third of the cost — 
though the average is 21 per cent, in the case of works carried 
out by the Board and only 5 per cent, in the case of works 
in whose execution it has only co-operated — over 800 small 
townships were supplied with water during the four years 
1909-1912. 

Of old the fiscal lands were the main source of public revenue 
in all States, and they so continue in some of the smaller States 



208 THE EVOLUTION OF MODERN GERMANY 

even to-day. In the larger States, however, railways have 
taken the place of public lands as a source of revenue, though 
it is only in Prussia that the profits from the railways meet 
any large proportion of the national expenditure. In 1913 
the net proceeds of the Empire's various profit -yielding under- 
takings were estimated at about nine and one-third million 
pounds, but those of the Federal States at fifty-three and a 
half million pounds. The revenue from the State railways 
alone was represented in these totals by £1,570,000 for the 
Empire (yielded by the railways in Alsace-Lorraine), and 
£39,100,000 for the Federal States, before deduction of interest 
on loans. 

The average yearly gross and net yields of the fiscal 
enterprises of Prussia during the period 1907-1911 were as 
follows : — 





QrojB. 


Nett. 


Domains 

Forests 

Mines, Smelting works. Salt works. 

Amber, etc. . . 

Railways 

Lottery 

Prussian Bank {Seehandlung) 
Mint and Assaying Office 
Bathing establishments . . 

Porcelain Manufactory 

Other undertakings 


£ 
1,503,500 
6,781,500 

13,919,500 

102,019,000 

6,472,000 

310,500 

44,000 

169,500 

815,000 

685,000 


£ 
638,500 
3,211,500 

716,000 

22,590,000 

516,500 

261,500 

19,000 

50,200 

4,000 

8,500 


Totals 


£132,720,500 


£27,915,700 



Prussia in 1913 budgeted for a net revenue from remunera- 
tive undertakings of £34,840,000, of which £28,039,000 was 
from railways, £3,936,000 from forests, £773,000 from lands, 
and £1,177,000 from mines, smelting works, etc. 

The Saxon State, besides owning or working 2,100 miles 
of railways, both owns and works eleven small ore mines, a 
colliery producing more than a quarter of a million tons of 
coal yearly, in addition to coke and briquettes, a lignite mine 
producing over 20,000 tons of lignite, besides lignite bricks 
and briquettes, smelting works, cobalt works, lime works, and 
the famous Meissen Porcelain Manufactory. The estimated 
surpluses of these various undertakings for the financial year 
1911-1912 were £1,364,000, £543,000 being from the railways, 
£468,000 from forests and lands, £23,000 from colheries, and 
£12,500 from the Meissen Porcelain Manufactory. 



STATE ENTERPRISE— RAILWAYS AND CANALS 20d 

This policy of State enterprise is likely to be developed still 
further in the future. The possibility of the nationalization of 
the collieries in Prussia on a large scale has been referred to, and 
in the meantime the Government of that State is energetically 
adding to its existing holding in mining property and increasing 
its pits. In 1908 it obtained from the Diet a vote of nearly 
three million pounds for the purpose of sinking new shafts. 
Since then the Saxon Government has likewise bought coal 
mines at large cost, as part of a great electric power scheme. 

The confidence in State enterprise which is felt in Prussia 
received singular confirmation during the consideration of the 
Rhine-Weser canal project by the Diet in 1907. The Govern- 
ment asked for a grant of a million pounds, wherewith to 
purchase land on both sides of the new waterway, so that 
the community might benefit by the increased value which 
this land would acquire. The Diet promptly voted two 
millions. 

State enterprise has been shown on an ambitious scale in 
Bavaria in projects for developing water power for the electri- 
fication of the railways and for industrial purposes generally. 
The Government of that State already owned the right to use 
the rivers and streams of the country in this way, and a large 
and costly scheme for the generation and distribution of electric 
power has been prepared. The Saxon Government endeavoured 
to obtain a law which would have asserted a similar fiscal 
right to the rivers and streams, and have placed them for all 
future time in the direct power of the State. It is estimated 
that from the larger rivers of Saxony alone a force of at least 
873,000 horse-power can be obtained, though as yet only a 
small fraction of this potential energy has been harnessed for 
the use of industry. The Government's proposal, however, was 
not well received. The cry of " Water Socialism " created 
great prejudice against it, and the Diet insisted on restricting 
the bill to one for the regulation of the streams. 

Reference has been made to the revenue derived by most 
of the States from forests and other lands. It is greatly to 
the public advantage that owing to the great extent of its 
landed possessions the State has an important direct stake in 
agriculture, and incidentally can in some degree preserve the 
balance between the large and small proprietors. It used to 
be a favourite theory of Prince Bismarck's that the salary of a 
Prussian Minister of State should be paid only partly in money 
and that for the rest he should be allotted an estate which he 
should be required to manage on his own account. In that 
way, he argued, the Government would be in continual and 
close contact with the first of national industries, and would 

14 



210 THE EVOLUTION OF MODERN GERMANY 

be in a position to frame its agricultural policies and measures 
on the basis of immediate experience. It may be contended 
that the same end is attained by the fact that a large part of 
the area of each State is in fiscal hands, and that this area tends • 
to increase. The area of fiscal land (forests excluded) in Prussia 
increased from 869,000 acres in 1903 to 1,077,000 acres in 1913, 
chiefly owing to additions made in the Eastern provinces. 
The largest domains are in the provinces of West Prussia, 
162,000 acres ; East Prussia, 166,000 acres ; Pomerania, 
158,000 acres ; and Brandenburg, 125,000 acres. 

The State farms, which are as a rule let on eighteen years' 
leases, serve as a useful barometer by which the Government 
can test the condition of agriculture at any given time, without 
relying on the conflicting opinions of parties. When, for example, 
in the middle of the 'nineties the rents of all fiscal farms fell 
to the extent of 25 and 30 per cent., the Government had no 
need of a commission of inquiry to convince it that something 
was radically wrong with agriculture. The Department of 
Agriculture devotes great attention to experimental farming, 
to the great benefit of the smaller cultivators, and as a high 
standard of cultivation is expected of its tenants the fiscal 
holdings generally serve as object lessons in progressive agri- 
culture to the surrounding farmers. At the same time the 
public domains are a source of considerable revenue. The 
income derived from all the fiscal lands, exclusive of forests, 
in 1913 was £851,000. For the State does not conduct its 
estate on philanthropic principles ; no better bargainers exist 
than the controllers of its manors, farms, and forests. In 1913 
twenty-seven leases, representing 11,408 hectares of land, fell 
in upon the State domains, and the new leases brought the 
State an increase of £8,200 in rentals, roughly 6s. more per 
acre. The increased rentals secured during the eight years 
1906-1913 owing to the renewal of leases amounted to 
£33,750 a year. 

Moreover, the State takes good care to dispose of its land 
when prices are high and to buy largely when the market is 
depressed, while all the money realized by sales is put again 
into the business. In 1911 it bought 427 hectares for £34,180 
(£80 per hectare), and sold 2,664 hectares for £354,500 (£133 
per hectare). As land is sold in the neighbourhood of towns 
it is bought in the open country, with the result that the 
foundations of great future wealth are industriously being laid. 
The Prussian State also owned forests to the extent of 
7,479,000 acres in 1913, and this estate is steadily increasing. 
In that year it purchased 25,500 acres of forest, but sold only 
7,500 acres. The State forests are spread all over the kingdom, 



STATE ENTERPRISE— RAILWAYS AND CANALS 211 

though one half are found in the provinces of East and West 
Prussia, Brandenburg and Pomerania. The only western pro- 
vinces with an exceptionally large area of State forests are 
Hanover and Hesse-Cassel. That the State forests of Prussia are 
forests indeed will be understood from the fact that in 1911 there 
were killed in them 29,000 deer of all kinds, besides 91,900 
hares and 13,100 winged game. The State sold 7,500 acres of 
forest for £1,932,000 in that year, and bought 26,000 acres for 
£355,600. The whole of these forests are managed by the 
State on its own account by a skilled service of foresters, 
trained in special schools of forestry, and from the revenues 
half the cost of the King's Civil List is defrayed. 

This is not the only form of State agricultural enterprise 
common in Germany. The Bavarian Government insures 
farmers against fire, hail, and loss of farm stock. Nearly a 
hundred years ago King Maximilian I of that country laid down 
the principle of national insurance, and such have been its 
developments that to-day the State insures property to the 
value of nearly four hundred million pounds against fire ; it 
insures farmers against loss by hailstorms to the extent of 
eleven and a half million pounds ; and over 2,000 farmers' 
societies are affiliated to its horse, cattle, and goat insurance 
funds. 

It is in the domain of railway ownership and administration, 
however, that the State has achieved its greatest success. In 
this, as in most innovations involving the strengthening of 
the State's influence, Prussia has led the way, though only in 
comparatively recent times. The earlier German railways 
were built by private capital, for the State Governments 
for some time resolutely abstained from embarking upon so 
uncertain an enterprise. The first line to be built was that 
from Nuremberg to Fiirth in Bavaria, and it was opened in 
December 1835, but in this undertaking the Bavarian Govern- 
ment only interested itself to the extent of taking two shares 
of 100 florins. The lines from Berlin to Potsdam (opened in 
October 1838) and from Leipzig to Dresden (opened in April 
1839) were similarly constructed as private enterprises, though 
in 1838 a small railway Avas built by the State in Brunswick. 
Official prejudice, together with the example of England, deter- 
mined the German Governments of that day to leave the new 
method of transport to private initiative. When the would-be 
builders of the Nuremberg-Fiirth line sought the necessary 
concession the highest medical authority in Bavaria gravely 
warned the Government that the working of such an enterprise 
by steam would assuredly be attended with serious cerebral 
injury both to the travellers and the public, and in the interest 



212 THE EVOLUTION OF MODERN GERMANY 

of the latter, as innocent victims of the modern craze, it urged 
that the hne should be protected from view by high wooden 
barriers. When the line from Berlin to Potsdam was planned 
the old-fashioned Prussian Postmaster-General of the day- 
ridiculed it as a waste of enterprise and money. " Here am 
I," he said, " sending several diligences to Potsdam every day, 
and nobody uses them, yet they are going to build a railway 
in addition ! It is a stupid business ! " 

Thus it was that the Prussian Railway Law of 1838 followed 
English precedent in leaving the construction of railw^ays to 
private enterprise, though it reserved to the State wide powers 
of control, and stipulated for the right to purchase a line after 
thirty years' working on condition of taking over its debt and 
paying the shareholders twenty-five years' purchase, calculated 
on the average dividend of the preceding five years. Before 
long, however, the Governments began to recognize that in 
leaving the construction and working of the railways to private 
capitalists they had made a serious mistake, for the innovation 
had come to stay and its possibilities were now seen to be 
boundless. From the beginning of the 'forties the prejudice 
against State enterprise in railway building began to die down 
in the secondary States, though it continued for some time 
longer in Prussia. 

Early in the 'sixties the Prussian Government might have 
acquired several private railways, the concessions for which 
had expired, but the opportunity was not used. At that time, 
however, the Government and the Lower House of the Diet 
were in conflict, and since 1862 Bismarck had carried on the 
business of the country without a budget. When, therefore, 
the Danish War broke out in 1864 and the Diet refused funds 
for waging it, Bismarck prolonged the concession for one line 
— ^the Cologne-Minden line — in consideration of the payment 
of thirteen million thalers, and while he acquired two other 
lines — the Ruhrort-Crefeld-Gladbach and the Aachen-Dussel- 
dorf lines — at the price of their shares, he at once sold them at 
a profit to the Bergisch-Markische Railway Company in order to 
replenish the State coffers. A proposal to raise forty million 
thalers by selling to the latter Company the Westphalian State 
railway was frustrated by the Diet in 1865. A' year later the 
annexations which followed the war with Austria brought to 
the Prussian State the railways of Hanover and Nassau and 
the Frankfort portion of the Main-Neckar line, and these it 
kept. 

The policy of nationalization was followed earlier and 
more vigorously by the other important States, Bavaria, 
Wiirtemberg, and Baden, yet as late as 1875 one half of the 



STATE ENTERPRISE— RAILWAYS AND CANALS 218 

German railways were still in private ownership. In that year 
the Bavarian Government acquired a large system of lines, 
and in the year following Saxony went over to the State 
railway system by the purchase of the Leipzig-Dresden line. 
Now for more than a generation the principle of nationalization 
has been taken for granted so entirely that the question whether 
State or private management is better cannot be said to have 
even an academic interest in Germany. When Alsace-Lorraine 
was annexed in 1871 the Imperial Government bought the 
lines therein of the French Eastern Railway Company for thirteen 
million pounds, and they were henceforth worked as an imperial 
undertaking as a matter of course. 

Bismarck's ideal was nationalization in the widest sense. 
Just as before 1871 — indeed, as early as 1847, when he was 
still a private deputy in the incipient Diet of Prussia — his 
motto was " The railways for the State," so after the establish- 
ment of Imperial unity his motto was " The railways for the 
Empire." Hence in the constitution of that year he asserted 
for the Empire wide powers of control over the railways, 
secured the possibility, at least, of uniform management, and 
paved the way for the appropriation by the Imperial Govern- 
ment of the entire railway system. In 1875, holding that it 
was Prussia's duty to show the way, he went so far as to ask 
her Diet to pass a bill for " the transference of the State's 
property and other rights in railways to the German Empire " ; 
and although the Radical individualists bitterly contested the 
proposal he carried it by a large majority, meeting the argu- 
ment that while nationalization was good imperialization was 
dangerous with the rejoinder that he was quite sure that 
German liberty and unity would " not travel away with 
the first Imperial locomotive." 

The " first Imperial locomotive " in Bismarck's sense (though 
the Alsace-Lorraine railways belong to the Empire, Prussia 
manages them) has not yet made its appearance, however, for 
while Prussia was ready to merge her railways in the common 
stock, and passed a law to that effect (June 4, 1876), the other 
States, jealous of their rights and fearing aggression by the 
northern kingdom, held back, and the project came to nought. 
The result was that Prussia entered upon a large scheme of 
nationalization on her own accoimt. From that time railway 
after railway was bought by the State, until — the new lines 
constructed in the meantime having been retained as fiscal 
property — private enterprise was virtually superseded. For 
the lines which the State did not buy it acquired the right to 
work, with the consequence that only a small length of railway, 
mostly of narrow gauge, to-day continues either in private 



214 THE EVOLUTION OF MODERN GERMANY 

ownership or private management. Simultaneously great 
improvements in administration were introduced in all direc- 
tions, and in this way the Prussian lines became patterns which 
the rest of the States were obliged to imitate. 

On the question of railway policy the minor States have 
to the present time adhered to their particularist standpoint, 
and the prospect of an imperial railway system is as far off 
as ever. 

During the last few years a serious beginning has been 
made with the local electrification of the railways in large centres 
of population. The Prussian, Saxon, and Bavarian State 
railway administrations have all carried out schemes of the 
kind, and others are planned. With a view to the generation 
of electric current at a low cost the Bavarian Government is 
building large power stations to be worked by water taken 
from the rivers, while the Saxon Government has acquired 
lignite mines at a cost of three million pounds in order to 
have at command an unlimited amount of fuel. 

At the end of the fiscal year 1912 there were in the whole 
Empire 37,580 miles of main and secondary normal-gauge ' 
railway, 35,330 miles being State railways or private railways 
carried on by the State, and 2,250 miles being private railwa^^s, 
the greater part of the latter being secondary lines. There 
were 180 miles per 100 square miles, and 56-8 miles to every 
100,000 inhabitants, ratios exceeded only by Belgium, Holland, 
and Great Britain, though exceeded by France, Denmark, 
Norway, Sweden, and Switzerland as regards ratio to 
population. 

The railways carried in that year 1,744 million passengers 
of all kinds (representing an aggregate of 24,700 million 
passenger-miles), and goods to the amount of 667,707 million 
tons (representing 40,999 million ton-miles). The amount of 
capital invested in all the normal gauge lines at the end of 
that year was £922,850,000, equal to about £24,500 per mile. 
In round figures the revenue in that year was £173,850,000, 
and the expenditure £117,300,000, giving a surplus of £56,550,000, 
equal to £6 2s. per cent, on the capital. These railways em- 
ployed an army of 740,200 servants of all ranks. The foregoing 
data ignore the unimportant narrow-gauge lines, the aggregate 
length of which at the same date was 1,374 miles. 

Upon the railways of the Prussian system there are four 
classes of passengers, but in the South there were only three 
until a few years ago, when Wurtemberg for the first time 
introduced a fourth. Nowhere is there less snobbishness in 

* The normal German railway track has a width of 1435 metres, or 4 feet 
7 inches ; the narrow gauge track may be a metre (3 ft. 3 in.) or even less. 



STATE ENTERPRISE—RAILWAYS AND CANALS 215 

railway travelling than in Germany, whose people have not 
lost their traditional reputation for frugality, and few people 
are willing to pay two shillings where one will serve. Nearly 
90 per cent, of the passengers carried on the Prussian railways 
travel third class and fourth class in almost equal proportions, 
while in Bavaria over 90 per cent, travel third class. Similarly 
in a recent year 72 per cent, of the passenger receipts on the 
Prussian lines were from third and fourth class passengers, 
and the same percentage held good for third-class passengers 
in Bavaria. In Germany as a whole not one passenger in a 
hundred travels first class, while in Prussia one in ten and in 
Bavaria only one in twenty travels second class. The tendency 
to use the lower classes has largely increased since the intro- 
duction of the railway ticket tax. 

In the absence of an imperial railway system, with complete 
uniformity of policy and management, various attempts have 
been made to diminish to the utmost the resulting disadvan- 
tages. The constitution of 1871 conferred upon the Imperial 
Government far-going powers with a view to the railways of 
the Empire being organized and worked on a common plan. 
It reserved to it the right to exercise supervision over all 
railways and to legislate regarding them in the twofold interest 
of national defence and general traffic facilities, and provision 
was made for the maintenance of through traffic and the inter- 
change of rolling stock. The Empire itself was given power 
to construct as well as work railways, and the regulation of 
rates was made an imperial concern. Nevertheless, these and 
other powers conferred upon the Imperial Government proved 
either difficult to exercise or futile where employed. In 1873 
an Imperial Railway Board was created, but in face of the 
jealousy of the State Governments its usefulness was very 
limited. 

The recognition of the inconvenience and wastefulness of 
an arrangement under which half a dozen State railway adminis- 
trations went their own way, regardless of the advantage of 
co-operation in such matters as the exchange of rolling stock 
and the regulation of traffic, timetables, and tariffs, led at 
last to a series of conferences, dating from 1904 forward, which 
resulted in the adoption of many rational reforms. Passenger 
rates were made uniform for the whole country, and goods 
rates approximately so ; reduced fares for double journeys 
were abolished, while there was a corresponding reduction in 
the cost of single tickets ; the practice of charging higher rates 
for express trains was curtailed ; the privilege of free luggage, 
which had been the rule in North Germany but not in the 
South, was also repealed, but the rates henceforth charged 



216 THE EVOLUTION OF MODERN GERMANY 

were fixed very low and based on the zone principle ; and 
slightly higher rates were introduced for circular tickets, but 
these rates were made uniform for all trains, instead of being 
subject to supplementary charges. A further reform, which 
came into force in 1909, was an arrangement for the reciprocal 
use of goods wagons (not of passenger carriages) throughout 
the Empire. It is estimated that before this agreement was 
concluded empty wagons were carried to the extent of 200 
million axle-kilometres every year. 

To say merely that the State railway system has justified 
itself would be to retail a stale truism. Alike from the commer- 
cial, financial, and, not least, the military standpoint, it has 
proved an unqualified success, and it is unthinkable that it 
will ever be abandoned. Viewed solely as a money transaction, 
Prussia's purchase of the railways has been described by a 
German authority as "a brilliant stroke of business . . . the 
most brilliant ever transacted by a modern State," and the 
tribute is hardly exaggerated. There may be difference of 
opinion as to whether on the whole the German State railways 
are better in themselves and are better managed than good 
English railways in private ownership, yet any comparison 
between two countries with different systems, or even with 
the same S5^stem, would obviously be futile. It is probable 
that most of the incidents of German railway administration 
and usage which unfavourably impress people unaccustomed 
to the methodical and calculated movements of German 
officialism are not inherent in the State railway system at 
all, but have their explanation in German characteristics, 
and would have no chance of being translated to this country 
were the principle of nationalization introduced here. The 
only practicable comparison must be confined to Germany 
itself, and there exists there absolute agreement that the great 
improvement which has taken place since the railways were 
nationalized is attributable more to the efficient and uniform 
management exercised by State officials than to any other 
cause. 

Perhaps the most serious objection to railway nationalization 
is one that applies more or less to all State undertakings of 
all kinds partaking of the nature of monopolies, and it is the 
danger of unduly emphasizing the revenue standpoint. This 
is an aspect of the question which has come to the front in 
Prussia especially of late years, for there the railways are one 
of the main sources of fiscal revenue, and the Government is 
slow to cripple so useful a profit-yielding enterprise by incurring 
expenditure or making concessions which would have the 
effect of seriously diminishing the available surpluses. The 



STATE ENTERPRISE—RAILWAYS AND CANALS 217 

trading world is alive to the temptations which beset even the 
most conscientious of railway administrators, though otherwise 
thoroughly satisfied with the railway system and its management. 

" The fact is," wrote the Essen Chamber of Commerce, in 
explaining to its members the difficulty of obtaining a conces- 
sion for industry which would have meant financial sacrifice 
on the part of the railway administration, " that the prosperity 
of our entire State finances is largely dependent upon the 
prosperity of our railway finances. For a long time to come 
we shall have to reckon with the fact that the receipts (i.e. 
net profits) from the railways will form the principal source 
of the Prussian State's revenues. It cannot be denied, however, 
that the increasing dependence of our State finances on the 
finances of the railways is attended by grave disadvantages. 
When it is remembered that the sum which the railway adminis- 
tration has handed over to the State Treasury, after payment 
of all expenditure incurred on behalf of the railways, increased 
from about £2,150,000 in the year 1890-91 to over £10,000,000 
in the year 1900, and that in later years the sum contributed 
by the railways towards the expenditure of the State has 
steadily increased to £14,250,000 in 1905 [and to £28,000,000 
in 1913, according to the estimates], it is easy to understand 
why the further appropriation of railway revenues to the general 
purposes of the State should in the IDiet be regarded on all 
hands as undesirable, and that the fear should be entertained 
that such a course would be injurious to the commercial interests 
of the country and check the prosperous development of our 
economic life. In truth, the dependence of the general State 
finances on the yield of the railways involves the great danger 
that in the arrangement of tariffs economic considerations 
may tend to be made subservient to financial, that necessary 
economic reforms may not be introduced out of regard for the 
State finances, and that the tariff system may become absolutely 
stationary." 

This danger has been accentuated during the late years 
of revenue scarcity, and it has led to the railway estimates 
being scrutinized and railway policy criticized with a jealousy 
unknown before. The Prussian Diet in 1906 went so far as 
to lay down principles for the guidance of the Railway Depart- 
ment in the form of a resolution affirming its opinion that 
" within the limits imposed by due regard for the financial 
position of the State and the conditions of competition, measures 
may be taken more systematically than heretofore, for the 
reduction of goods tariffs, especially for goods which, as means 
of production or products of home manufactures, are of great 
importance for the success of agriculture and industry," This, 



218 THE EVOLUTION OF MODERN GERMANY 

however, is but a pious opinion, and it is unlikely that the 
Government will depart from its traditional policy, the effect 
of which is that nearly one-fifth of the State's needs are supplied 
by the profits on railway traffic. During the twenty years 
1887 to 1906 the clear surpluses which were handed over to 
the Minister of Finance by the Railway Minister for national 
purposes amounted to no less a sum than £293,000,000. The 
fact should not be ignored, however, that the nation has been 
spared taxation to this large amount, and that without it much 
of the most beneficial expenditure of the State — as, for example, 
in the promotion of education and the general purposes of 
culture — might have been impossible. 

The progressive increase shown by the gross surpluses yielded 
during recent years by the State railways of Prussia and 
Hesse, as worked together, will be seen from the following 
table, the Prussian surpluses being shown separately; — 



1895 . 

1896 . 

1897 . 

1898 . 

1899 . 

1900 . 

1901 . 

1902 . 

1903 . 

1904 . 

1905 . 

1906 . 

1907 . 

1908 . 

1909 . 

1910 . 

1911 . 



Prussian-Hessian Railways, 
Maries. 
457,200,000 
490,400,000 
616,500,000 
519,500,000 
644,500,000 
642,800,000 
493,300,000 
614,400,000 
681,700,000 
699,900,000 
645,500,000 
660,100,000 
592,400,000 
484,800,000 
629,300,000 
710,700,000 
816,300,000. 



Prussian Railways. 
Mark?. 
450,200,000 
489,400,000 
600,400,000 
604,000,000 
627,600,000 
627,900,000 
479,300,000 
499,700,000 
670,200,000 
681,900,000 
626,000,000 
640,500,000 
677,700,000 
472.400,000 
613,600,000 
692,600,000 
798,300,000 



These surpluses are reckoned before deductions for interest 
on and redemption of loans. The gross returns for the combined 
railways represented in 1908 4-78, per cent, of the capital em- 
ployed, in 1909 5-94 per cent., in 1910 6-48 per cent., and in 
1911 7-20 per cent. 

Even more than in the case of the railways the State has 
regarded the question of inland navigation as one falling to 
its special domain. In Prussia canal construction, like so 
much other enterprise, received its first impetus from the rulers. 
Between the years 1662 and 1668 the Great Elector built a 
waterway from the Upper Oder to the Lower Elbe, and the 
waterway from the Elbe to the Lower Oder was constructed 
by Frederick the Great between 1740 and 1746. Down to 
the beginning of last century, however, little was done to adapt 



STATE ENTERPRISE—RAILWAYS ABD CANALS 219 

any of the rivers of Germany to systematic navigation, and 
natural obstacles were supplemented by artificial ones. At 
that time goods carried on the Elbe from Hamburg to Magde- 
burg had to pay duty fourteen times, and goods carried on 
the Rhine were similarly taxed thirty-three times between 
Bamberg and Mayence. Even so, in the absence of competition 
by railways these imposts did not prove prohibitive in 
view of the far slower and more costly method of transport 
by road. 

The great development of the waterways, both rivers and 
canals, has synchronized with the era of railway enterprise, 
and particularly with the nationalization movement. The 
remarkable extent to which Germany uses her natural water- 
ways, and has constructed artificial ones, for commercial 
purposes is a suggestive reminder that the railway has never 
been regarded in that country as the last word on the problem 
of internal communication. In 1903 (the latest year for which 
statistics exist) her navigable rivers and canals and other inland 
waterways had a length of 8,750 miles, of which 5,040 miles 
were main streams — the principal ones being the Rhine, Elbe, 
Oder, Weser, Danube, Ems, and Vistula ; 880 miles were 
channelled rivers, 1,370 miles were navigable canals, and 1,440 
miles were canals and other connecting waterways between 
lakes, estuaries, etc. Of the total length 524 miles had 
a navigable depth at the mean water-level of over 16 feet 
3 inches, 350 miles had a depth of between 13 feet and 
16 feet 3 inches, 520 miles one between 9 feet 9 inches and 
13 feet, 355 miles one between 8 feet Ij inches and 9 feet 9 
inches, 1,788 miles one between 6 feet 6 inches and 8 feet Ij 
inches, 2,573 miles one between 4 feet 10 J inches and 6 feet 
6 inches, 1,834 miles one between 3 feet 3 inches and 4 feet 
lOj inches, and 574 miles one of 3 feet 3 inches or less. The 
various waterways were classified geographically as on p. 220. 

The vessels of all kinds of ten tons and upwards engaged 
in internal navigation in 1912 numbered 29,533, of which 29,523 
were certified to have an aggregate tonnage of 7,395,000, com- 
paring with 18,242 such vessels with a tonnage of 1,658,266 
in 1882. Of these vessels 25,042 were without motive power 
(i.e. were towed or propelled by man power), while 4,491 were 
so equipped. The aggregate amount of merchandise carried 
upon inland waterways in that year (exclusive of the transit 
trade) was 53,475,000 tons in the home trade and 40,006,000 
tons in the foreign trade, together 93,481,000 tons. Of this 
large total 76,014,000 tons fell to the Rhine district, 25,733,000 
tons to the Elbe district, 18,545,000 tons to the Mark of Bran- 
denburg waterways, 11,048,000 to the Oder district, 9,543,000 



220 THE EVOLUTION OF MODERN GERMANY 

tons to the Weser-Ems-Jahde district, 5,847,000 tons to the 
waterways of the East, and 727,000 tons to the Danube district. 



LENGTH OF NAVIGABLE WATERWAYS IN MILES. 











Canals 


Districts. 


Natural 
Streams. 


Channelled 
Streams, 


Navigable 
Canals. 


connecting 

Lalces and 

Haflfs.' 


Rhine . . 


1,053 


278 


237 


68 


Elbe 




694 


219 


90 


39 


Weser 




613 


66 


1 


28 


Danube 




429 


21 





35 


Oder 




994 


98 


50 


221 


Vistula 




257 


20 


41 


66 


Eras 




291 


63 


268 


31 


Memel 




156 


— 


19 


63 


Pregel . . 




136 


— 


— 


— 


Masurian waterways . 




3 


— 


9 


108 


Frisches Haff . . 













65 


Mark of Brandenburg 


323 


84 


264 


196 


Baltic Sea waters west of the 










Oder 


20 





— 


188 


Coast waters north of the Elbe 










(including the North and 










Baltic Sea Canal) . . ... 


134 


41 


66 


170 


Coast waters between the Ems 










and Weser . . 


21 





9 


79 


Danube and Main Canal 


— 


— 


89 


— 


Haute-Ems Canal 


— 


— 


— 


— 


Other canals 


— 


1 


109 


— 



Seven harbours on the Rhine and its tributaries (Duisburg- 
Ruhrort, Mannheim, Alsum-Schlwelgern, Ludwigshafen, Strass- 
burg, Frankfort, and Walsum) had each a trade of over two 
miUion tons, and eight others (Karlsruhe, Rheinau, Gustavs- 
burg, Mayence, Cologne with Deutz, Diisseldorf, Rheinhausen, 
and Homberg) had a trade of over one million tons, while four 
harbours on the other rivers (Hamburg, Berlin, Kosel, and 
Emden) had a trade of over two million tons, and five (Konigs- 
berg, Breslau, Charlottenburg, Harburg, and Dortmund) a 
trade of over a million tons. 

Early in the history of mercantile transport the States 
recognized that canals were an absolute necessity for Germany, 
for with one exception the large rivers all flow from south to 
north, and so are of little use for the trade passing from west 
to east ; even the Danube, flowing due east from Ulm to 
Vienna, only serves a small portion of South Germany. Hence 



^ Freshwater lagoons off the eastern coast of _ the Baltic, connected by narrow 
channels with the sea. 



STATE ENTERPRISE— RAILWAYS AND CANALS 221 

many of the canals are of old date, though they have as a rule 
been thoroughly adapted to modern needs. The principal 
ones connect with the rivers Rhine, Elbe, Ems, Oder, and 
Vistula, with their tributaries. 

Perhaps the best idea of the inland waterways facilities 
enjoyed by the German trader can be obtained by taking 
almost any important town as a starting-point and following 
the directions in which regular navigation is carried on. Thus 
the Rhine can be used for heavy traffic as far as Mannheim 
and for light craft -as far as Strassburg, though the deepening 
of the river to Basle is only a question of time. In the neigh- 
bourhood of Duisburg a canal runs west towards the Scheldt, 
the Dortmund-Rhine canal runs east and the Dortmund-Ems 
canal runs north to Emden with a branch to the Weser ; while 
higher up the Rhine its tributary the Main has been made 
navigable as far as Frankfort, and has been deepened as far 
as Aschaffenburg, whence canals are contemplated which at 
Bamberg and Nuremberg will join the Ludwig canal, running 
north from the Danube. Finally there runs from Strassburg 
in French territory the Rhine-Marne canal and further south 
Miilhausen has canal communication with the Rhone. In the 
same way the Elbe above Dresden is connected by canals with 
the Danube, while below Magdeburg waterwaj^s establish 
communication east with the towns on the Spree, Havel, and 
Oder. The uncompleted Midland (Mittelland) canal runs 
east from the Dortmund-Ems canal, passing Minden, Hanover, 
Magdeburg, Potsdam, and then, leaving Berlin slightly to the 
north, will meet the Oder above Frankfort. 

When several canal links have been made in the South 
there will be uninterrupted water communication between the 
North and Baltic Seas and Vienna and the rest of the towns 
on the Danube. What the canal system means for the large 
German towns may be judged from the fact that since the 
construction of the Teltow canal towed boats can traffic from 
Ratibor, over a hundred miles south of Breslau, in Silesia, to 
Berlin, and thence either to Stettin or Hamburg. 

It has been estimated that the expenditure incurred and 
authorized in Prussia on canal construction and improvement 
since 1880 exceeds thirty million pounds. 

In recent years there have been great developments in the 
widening and deepening of the canals, and the construction of 
larger locks, basins, and bridges, while towing by horse and 
man power has more and more given place on the larger 
waterways to steam and electrical traction and haulage. The 
consequence is a steady increase in the size and carrying 
capacity of the vessels using the canals. While up to the middle 



222 THE EVOLUTION OF MODERN GERMANY 

of last century, a tonnage capacity of from 150 downwards 
was the rule, vessels of 600 tons and over are now common. 
On the larger rivers vessels up to 1,000 tons are now usual, 
and the modern " merchantmen " of the Rhine have a carrying 
capacity equal to that of 300 goods wagons of ten tons. 

The largest canal enterprise in Germany is, of course, the 
Kiel or Kaiser Wilhelm canal, connecting the North and 
Baltic Seas between Brunsbiittel, in the Elbe, and Holtenau, 
half an hour's steaming from the port of Kiel. It was in 
anticipation of the construction of this canal, which had 
long been projected, that Bismarck both in 1884 and 1885 
sounded Lord Granville, the British Foreign Secretary, as to 
the cession of Heligoland. The cession was made by Lord 
Salisbury in 1890 as part of the African Convention of July 1st 
of that year, and the German Emperor took formal possession 
of the island on August 10th following, declaring that it was 
destined to be " a bulwark at sea, a succour for German fisher- 
men, a point d'^appui for my ships of war, and a shield and 
protection for the German Ocean against every enemy who 
should venture to show himself thereon." By this time the 
construction of the canal was well advanced. In view of the 
fact that it was primarily intended to serve the interests of 
national defence, the scheme was carried out as an imperial 
enterprise. The bill on the subject was approved by the 
Imperial Diet on February 18, 1886 ; on June 3, 1887, the 
foundation stone was laid by Emperor William I, "in honour 
of United Germany, for its progressive welfare, and in sign 
of its power and might " ; and the canal was opened by the 
third Emperor on June 20, 1895. The cost of the project 
is stated to have been £7,800,000, a sum almost identical with 
the maximum expenditure which was contemplated so long 
before as 1873. The canal is 61 miles long, and runs entirely 
through Holstein. The measurements of the waterway as 
completed in 1895 were as follows : — Depth below mean water 
level, 29 J feet ; average width at bottom, 72 feet ; width on 
bottom in curves, 124| feet; width at surface, 197 feet ; passing 
stations- width, on bottom, 197 feet ; length, 1,500 feet. Two 
large locks were built, one at Holtenau, generally open, the 
other at Brunsbiittel, open three to four hours each tide ; while 
at Rendsburg, half way along the canal, is the lock to the 
Eider river. As originally planned and executed, the canal 
allowed of the passage of vessels with a length of 443 feet, a 
breadth of 65| feet, and a depth of 26^ feet, with height of mast 
131 feet. Larger vessels can now use the waterway. The in- 
stallation of the electric light on both banks enables vessels 
to use the canal at night. The entire passage occupies from 



STATE ENTERPRISE— RAILWAYS AND CANALS 228 

eight to ten hours. From the naval standpoint the canal 
proved of immediate advantage in reducing the distance 
between the naval port of Wilhelmshaven and Kiel from 500 
to 80 nautical miles. 

For a time the canal was not used to the extent expected. 
A tariff of dues which the leading shipowners held to be excessive 
was introduced, and this discouraged traffic so greatly that 
during the first complete year of working the receipts only 
about half-covered the costs of administration. The dues 
were in consequence reduced, and as a result the traffic at 
once increased. The number of mercantile vessels which 
passed through the canal during 1896 was 20,068, with a total 
tonnage of 1,751,065, but in 1898 the number was 25,224, 
with a tonnage of 3,009,011, and in 1899 26,524, with a tonnage 
of 3,451,273. In 1905, when the canal had been in existence 
for ten years, the number of mercantile vessels in transit was 
only 20,322, but their tonnage was 5,035,243, figures which 
indicated a growing tendency to send large vessels through 
the canal instead of round the Scaw. 

By this time the increase in traffic and the need for accommo- 
dating a larger type of vessel necessitated important extensions 
and improvements, the principal being the deepening of the 
waterway to about 39 feet, with provision for a further 
deepening if needed, the doubling of its width, and the addition 
of two locks. Accordingly the Diet in 1907 passed a bill 
authorizing these and other works and providing the necessary 
funds. The works included new locks at Brunsbiittel and 
Holtenau, 1,072 feet long, 146 feet broad, and 45 J feet deep at 
the average level of the canal, or 40 J feet at the low water mark 
of the river Elbe, the increase of the passing places to eleven; 
two islands have also been formed along the new route, one 
serving as a coaling station. The canal has now a navigable 
channel of 45j feet throughout, and a width at the bottom of 
144| feet, with curves having a minimum radius of 5,900 feet. 

The execution of the new works occupied seven years, and the 
enlarged canal was reopened on June 25, 1914, the cost having 
been some eleven million pounds. The mercantile traffic 
carried by the canal during the five years 1909 to 1913 increased 
from a total of 35,326 vessels with a registered tonnage of 
6,269,000 to one of 54,628 vessels with a registered tonnage 
of 10,292,000, while the canal dues increased from 2,847,000 
marks to 4,455,000 marks, and the towing dues from 167,000 
marks to 207,000 marks. Of the mercantile vessels which 
passed through the canal in 1913 82-6 per cent, were German, 
while of the total tonnage represented 571 per cent, was German. 
British vessels in a recent year formed only 2 per cent, of the 



224 THE EVOLUTION OF MODERN GERMANY 

total, and represented between 6 and 7 per cent, of the tonnage. 
Rather less than one half of the vessels using the canal are 
steamships. 

At the present time Prussia is showing special enterprise 
in developing its canal system. The Canal Law of 1905 
authorized the execution of a great project, which will greatly 
improve the transport facilities of the Rhine-Weser and Oder 
areas. The Rhine-Weser part of the scheme comprises the 
construction of a ship canal from Ruhrort to the Dortmund- 
Ems canal at Heme, with a branch canal from Datteln to 
Hamm ; a ship canal from the Dortmund-Ems canal at 
Bevergern to the Weser (near Biickeburg), with branch canals 
to Osnabriick and Minden ; the canal from the Weser at 
Biickeburg to Hanover, with a branch canal to Linden ; the 
enlargement of the Dortmund-Ems canal ; the canalization 
of the river Lippe from the Weser to Datteln, and from 
Hamm to Lippstadt, together with improvements of many 
existing waterways and a large amount of land reclamation. 
The cost of these works is estimated at twelve and a half million 
pounds. The Oder project, which is estimated to cost four 
and a quarter million pounds, includes the construction of a 
ship canal from Berlin to Stettin, improvements to the water- 
ways between the Oder and the Vistula, and to the Warthe 
from the mouth of the Netze to Posen, the canalization of the 
Oder from the Neisse at Glatz to Breslau, and other works. 
The Government's original idea was to construct a canal the 
whole way from the Rhine to the Elbe, but the agrarian party, 
with characteristic disregard of the welfare of the community, 
refused assent. 

Three notable features of the scheme are the far-going 
powers of expropriation acquired by the Government, the 
reservation of the towing service on the Rhine-Weser canal 
and its branches as a Government monopoly, and the large 
grant made to the Government (two million pounds) for the 
purchase of land on the banks of that canal with a view to 
preventing private speculation and reserving to the community 
the increased values created by public expenditure. 

Quite recently the inland navigation trade escaped a menace 
which would have thrown serious obstacles in the way of its 
future expansion, for the freedom of the natural waterways 
was challenged by the Prussian Government in the interest 
of the agrarians. Hitherto the rivers had all been free, and 
in some of the ports on the Rhine, like Mannheim and Ludwigs- 
hafen, even harbour dues had not been charged. Now Prussia 
proposed to levy duties on all the rivers of the Empire, and 
overtures to that effect were made to the Federal States in 



STATE ENTERPRISE— RAILWAYS AND CANALS 225 

1911. The proposal was part of a bargain made by Prince 
BUlow with the Conservative party in the Prussian Diet when 
in 1905 it withdrew its opposition to the Government's canal 
schemes and accepted them on terms. Forced at last to agree 
to the construction of the canals, the agrarians extracted from 
the Government an undertaking that it would use its influence 
to secure the introduction of duties on the rivers " regulated 
in the interest of navigation," and the pledge was duly 
embodied in the Canal Act as passed, section 19 providing : 

" Dues (Abgaben) shall be levied on rivers regulated in the 
interest of navigation. The dues shall be of such amount 
that the proceeds shall cover a reasonable (angemessen) interest 
and repayment of the expenditure made by the State for the 
improvement or deepening of each of these rivers beyond the 
natural limit in the interest of navigation. The raising of 
these dues shall begin at the latest with the coming into use 
of the Rhine- Weser canal or a portion of the same." 

It is remarkable that the Prussian Government should 
have committed itself to so far-going a decision as this, affecting 
the rights of other States, both German and non-German, 
without first feeling its way ; yet the pledge having been 
given, the agrarians were not disposed to tolerate its infrac- 
tion. There was never any concealment of the fact that the 
dues were intended to make more diiBcult the conveyance of 
foreign corn to inland Germany by waterway. Not only did 
the Parliamentary Committee on the Canal Bill state in its 
report that *' the large streams are prejudicial to home agri- 
culture, since they serve as entrance doors for foreign products, 
with the result that our protective policy is checkmated," 
but when challenged to state why he wished for these dues 
the leader of the agrarians in the Upper House said, " I declare 
quite openly that I hope that the import of corn will be 
checked by the dues, and that by the differentiation of tariffs 
a means will be found of making it possible for us [the East 
Prussian] corn-growers to compete on the Rhine." It is also 
a fair assumption that Prussia wished to see freedom of naviga- 
tion curtailed on the rivers in the interest of her railways, 
with which the rivers seriously compete. How important 
the waterways are for the conveyance of food supplies is 
illustrated by the fact that between the years 1875-6 and 1896-8 
the amount of com delivered in Berlin by ship increased 
from 27*6 per cent, to 66-7 per cent, of the total supplies, 
while the amount received by rail fell from 72*5 per cent, to 
83-3 per cent. 

The proposal at once encountered serious opposition, for 
Prussia had not only to meet the natural reluctance of the 

15 



226 THE EVOLUTION OF MODERN GERMANY 

other German States concerned — Baden, Bavaria, Wiirtemberg, 
Hesse, Anhalt, Oldenburg, and Hamburg — to part with imme- 
morial rights, but it had also to satisfy neighbouring States 
like France, Holland, and Austria-Hungary. For the Rhine 
Navigation Act of October 17, 1868, was signed, not only by 
Prussia, Baden, Bavaria, and Hesse, but by France and 
Holland, while to the Elbe Navigation Act, securing complete 
freedom of navigation upon that river, Austria was a party. 
Alterations of the imperial constitution were also involved. 

Two articles of the constitution deal with the inland water- 
ways and their regulation. Article 4 reserves to the Empire 
the " oversight " of (amongst other matters) " the carrying 
on of rafting and navigation on the waterways common to 
the several States and the condition of such waterways, as 
well as the river and other water dues " (navigation marks, 
such as lights, buoys, etc., being added by an amendment 
in 1873). As for the dues contemplated, article 54 expressly 
states : — 

" On all natural waterways dues shall only be levied for 
the use of special works [the word is " Anstalten "] which are 
intended to facilitate traffic. These dues, as well as the dues 
for the navigation, of such artificial waterways as are State 
property, shall not exceed the costs necessary to the maintenance 
and usual renewal of the plants and works. These provisions 
shall only apply to rafting in so far as it is carried on upon 
navigable waterways." 

There is in the same article a guarantee against preferential 
treatment in the provision which states : "In the seaports and 
on all natural and artificial waterways of the federated States 
the merchant ships of all those States shall be admitted and 
treated on equal terms. The dues which are levied in the 
seaports from sea-going ships or their cargoes for the use of 
shipping works may not exceed the costs necessary for the 
maintenance and usual renewal of these works." 

Thus the dues legalized and permitted on the rivers were 
constructively the harbour and similar dues which are charged 
in seaports ; of navigation dues in the ordinary sense there 
is no suggestion. The intentions of the framers of the consti- 
tution are clear from a Federal Council declaration of 1870 
stating : " The idea is no other than that the waterways pro- 
vided by nature shall be thrown open to common use without 
restriction or charge." Further, that the rivers were intended 
to be free is evident from the fact that the dues which had 
been levied on the Elbe were repealed in 1870, by treaty between 
the North German Confederation and Austria, and those on 
waterways in Alsace-Lorraine were repealed by a law of 1873. 



STATE ENTERPRISE- RAILWAYS AND CANALS 227 

The fact did not pass unnoticed that the Prussian Govern- 
ment was taking up an entirely new attitude on this question. 
Down to 1896 it frankly and without any reservation held the 
view that the levying of river dues was impossible, since the 
free navigation of the rivers was secured by the constitution 
and by international law. In 1902 the desire to introduce 
such dues was avowed for the first time, but they were still 
declared to be impracticable for the reason just given. In 
1904 the wish became a resolve, and Prussia now for the first 
time disputed the interpretation of article 54 of the Imperial 
constitution in the sense universally received ; in other words, 
it contended that free navigation w^as not intended to be 
unlimited, and that subject to the constitution as it stood 
dues might legally be levied. Following this decision came 
in 1905 the Canal Law with the provision quoted above, com- 
mitting the Prussian Government, without any prior arrange- 
ment with the other States, to distinct antagonism to the 
traditional freedom of the rivers and to a denial of the interpre- 
tation of the constitution which had been accepted for forty 
years. 

The question whether the introduction of river dues was 
contrary to the constitution hinged upon the meaning of the 
words " besondere Anstalten," and around it a long and bitter 
controversy raged. Seeing that the acutest legal minds differed 
as to the exact definition of these words, it would be rash to 
bind oneself to a too literal translation, though the sense is 
given by the words already used, viz., " special works." The 
point upon which the official Prussian jurisconsults professed 
to differ from all other authorities was whether these " special 
works," justifying dues, included works of a general character 
executed for the deepening or widening of the channel, or 
merely special works like docks, bridges, warehouses, roads, 
cranes, etc. The official view was that works of the former 
kind are " special," and that the users of the rivers might 
legally be required to contribute to their cost — a view con- 
flicting with the entire policy of the States and the Empire 
since the creation of the North German Confederation. It was 
recalled that even when dues were introduced on the Lower 
Weser because of heavy expenditure on improvements, it 
required a special law because of the admitted constitutional 
difficulty. 

The Prussian official advocates of river dues, however, had 
a further argument, which was that even if the deepening 
and widening of a river might not be regarded as " special 
works," a river so altered was no longer a " natural waterway," 
and became an " artificial waterway," hence was subject to 



228 THE EVOLUTION OF MODERN GERMANY 

navigation dues. That argument, however, ignored the fact 
that even " artificial waterways " were not subject to dues 
according to the constitution unless they were State property, 
a reservation which obviously excluded all rivers. 

The conclusion come to by Dr. Netler, in a monograph 
on the question prepared at the time for the Berlin Corporation 
of Merchant Elders, was that as to the law of the question 
there could be no room for doubt. Both the history and the 
implicit meaning of the constitutional provisions on the subject 
*' make it clear that dues may not be levied for navigation, 
nor yet for the improvement of the channels of natural streams 
and the erection of buildings serving this purpose, and that 
dues may only be levied for the use of such buildings as do 
not belong to the nature of the stream but are independent 
of it." " If," adds Dr. Netler, " this state of the law has 
lately been called in question, the reasons are not to be found 
in the legal domain. It is not really a question of law at all, 
but a political question, which was made acute by section 19 
of the Prussian Canal Law and the influence of the Conserva- 
tive [i.e., agrarian] majority of the Prussian Lower House on 
the attitude of the Prussian Government, and further owing 
to the. traffic policy of that Government, which seeks to 
counteract any loss in railway revenue by the development 
of inland navigation." 

Finding that the other federal States immediately concerned 
were not to be convinced by argument, Prussia sought to 
win them over by bribery, but only partially succeeded. For 
while Wiirtemberg agreed to withdraw opposition in considera- 
tion of liberal financial assistance in the deepening of the 
Neckar, Saxony, Hesse, and Baden remained firm, the Saxon 
Minister of Finance declaring : " The Ministry of State now 
as before decidedly declines to adopt the proposed duties. 
The prosperity of the industry of Saxony is in part due to the 
advantage of a cheap waterway, the Elbe, and the Government 
cannot undertake the responsibility of imposing a burden 
upon shipping, much though it regrets its inability to go hand 
in hand in this matter with the Prussian Government, with 
which it is otherwise on such' friendly terms." 

Unable to get all it wanted, the Prussian Government 
had in the end to be satisfied with a compromise which left 
the rivers practically as free from navigation dues as before. 



CHAPTER XII 

AGRICULTURE AND INDUSTRY 

The difficulty of preserving the right balance between agriculture and industry 
— The prevalence of one-sided views — Importance of agriculture in 
Germany — Agriculture and military efficiency — The rural movement 
— Number of agricultural o^vners — Cultivation of the land — The national 
production of grain — Com -growing in Prussia — Other ground crops — 
Vineyards, orchards, hop-growing, spirit distillation, tobacco -growing, 
the beet-sugar industry — Agriculture and fiscal policy — Effect of industry 
on com imports — The agricultural State — Conflict between agriculture 
and industry — Prince Bismarck on agrarian policy — Imports and exports 
of wheat and rye in recent years — Demand of the corn-growers — The 
present conditions of agriculture favourable — Higher prices and increased 
value of land — The Prussian Minister of Agriculture quoted — The encum- 
berment of the land — All parties agreed that Protection cannot be 
summarily abandoned — The argument of the " National Granary " 
— Count von Caprivi quoted — Attitude of the Protectionists of 
the Chair — Prince Billow's claim to be an " agrarian Chancellor " — 
Agrarian and industrial duties inseparable — Demands of the Agrarian 
League. 

ONE of the most difficult of all Germany's domestic 
questions is undoubtedly the relationship of agriculture 
to industry, and one of the Imperial Government's 
most delicate domestic tasks is the preservation of the right 
balance between these two interests. For the growth of indus- 
try must inevitably be at the expense of agriculture, and the 
protection of agriculture by one-sided legislative measures 
must as certainly involve the handicapping of industry. 
Viewing the problem each from its own exclusive standpoint, 
it is unavoidable that neither agriculture nor industry should 
be able to see the problem " truly and to see it whole," yet 
only when it is thus seen and treated can the interests of the 
nation as a whole receive due consideration. 

There may be a difference of opinion as to how far the 
Government has hitherto succeeded in holding the scales 
evenly between the rival forces which are competing for the 
economic future of Germany, yet no one questions the wisdom 
and necessity of its endeavour to maintain agriculture in a 

229 



280 THE EVOLUTION OF MODERN GERMANY 

prosperous condition and to protect it as far as possible against 
rapid changes to which it could not accommodate' itself. For 
Germany has never neglected the vital interests of the soil, 
and its peasantry can still make the proud boast that it is one 
of the soundest bulwarks of the national prosperity and 
stability. While in the United Kingdom the number of persons 
ensaged in aofriculture declined between 1881 and 1901 from 
711 to 495 per 10,000 of the total population, the decline in 
Germany between 1882 and 1895 was only from 1,783 to 1,554 
per 10,000 ; the decline in the first case was 30 per cent., 
in the second it w^as 13 per cent. The German occupation 
census of 1907 showed that over seventeen million persons, 
out of a total estimated population of sixty-two millions, 
were directly dependent upon agriculture and horticulture, 
and if forestry be included over half a million more may be 
added. 

Perhaps the German agrarian party is itself to blame for 
the fact that much sympathy has been withdrawn from it 
during recent years, for if industry has not been slow in making 
known its needs and claims, the representatives of agriculture, 
both in the Imperial and State Parliaments, have failed to make 
due allowance for the economic revolution which has come 
over the country during the past half-century, and they demand 
as persistently to-day as ever that domestic policy shall un- 
erringly follow the lines laid down by Prince Bismarck when 
the modern industrial era had hardly opened. 

It is only when the facts of Germany's peculiar position 
are clearly understood that it becomes possible to do justice 
to both parties to the present struggle for predominance. In 
spite of the steady displacement of the rural population which 
has been going on for many years, no greater mistake could 
be made than to suppose that in endeavouring to uphold 
agriculture the German Governments are defending a mori- 
bund industry. Notwithstanding the perpetual cry of the 
large landowners that their calling and existence are threatened, 
there is still money in progressive farming even in the great 
corn-growing districts of the North and East, while the smaller 
cultivators in general are holding their own in every part 
of the country. 

Many of the platonic friends of agriculture, who hang on 
to the skirts of the agrarian party, though having nothing in 
common with that party's interests or ideals, support their 
solicitude for the farmer and his calling by the plea that the 
country is the best antidote to the town, a healthy and robust 
peasantry the best bulwark against the feverish, enervating 



AGRICULTURE AND INDUSTRY 231 

influence of overcrowded centres of population. There is, 
indeed, in the German nature a strong and irradicable country 
instinct : it is significant that in the one German Hterary 
classic in which trade is glorified, Gustav Freytag's novel, 
Soil und Hahen, the writer suddenly stops short in the midst 
of his story of a business-man's hustling career in order to 
recite, in eloquent and enthusiastic words, the praises of rural 
life. 

" Happy the man," he writes, " who treads wide tracts 
of his own land; happy he who knows how to subject the 
powers of burgeoning nature to an intelligent will. Everything 
that makes men strong, healthy, and good falls to the lot of 
the agriculturist. His life is an endless struggle, but an endless 
victory. The pure air of heaven strengthens the muscles of 
- his body ; the primeval order of nature forces his thoughts 
into an orderly course. He is a priest whose duty it is 
to preserve steadfastness, discipline, and morals — the first 
virtues of a people. While other useful employments age, 
his remains as eternal as the life of nature ; while other 
pursuits imprison men within narrow walls, in the depths of 
the earth, or between the boards of a ship, his gaze has but 
two limits — the blue heaven above and the firm earth at his 
feet. His is the highest joy of creation ; for whatever he 
demands from Nature — plant or animal — springs up under 
his hand to a glad existence," etc.' 

There is truth in the words of a recent German economic 
writer : — 

" The agricultural population preserves its strength and 
vigour by its free life with nature, and bj^ giving to the towns 
the surplus of its increase of population its influence upon the 
latter is recuperative. The effect of the entire conditions of 
rural life is that the population on the land holds fast to good 
old customs, is not easily detached from all the movements in 
national life, preserves its fidelity and attachment to religion, 
and attributes importance to good morals. All these qualities 
exert their influence on the State and industry, and give us 
in the rural population a powerful support for our entire 
national life, as has been only too often shown in critical 
times." * 

It is impossible to quarrel with sentiments of this kind 
or to criticize in an unfriendly spirit the measures in which 
they are often embodied. At the same time, it is only just to 
bear in mind that the towns are not as bad as they have been 

* Soil und Haben, vol. i, book 3. 

• C. Herold, Die wichtigsten Agrarfragen, p. 4. 



232 THE EVOLUTION OF MODERN GERMANY 

painted, and that the urban degeneration which social reformers, 
with more earnestness than regard for facts, often deplore has 
not yet shown itself in Germany. For a long time the un- 
proved assertion of a well-known agrarian advocate, Professor 
Sering, to the effect that the industrial towns did not supply 
one-third as many efficient men to the army as did the purely 
agricultural districts in proportion to their population, passed 
unchallenged, even where it was not formally endorsed and 
exploited as agrarian capital. There had hitherto, however, 
been no conclusive figures from which to draw any inference 
either favourable or unfavourable to this contention. Such 
a basis for judgment was for the first time provided by the 
Bavarian Government, which in 1895 classified according to 
occupations the whole of the recruits called up for service with 
the colours. The result was to upset entirely the agrarian 
theory that the rural districts were a special source of efficient 
soldiers. It was found that although about one-half of the 
population of Bavaria followed agricultural occupations agri- 
culture supplied to the army not three times more men than 
industry, but not even as many, viz. 26*4 per cent, against 
28 4 per cent., while trade and commerce supplied 22 8 per 
cent., and other occupations and classes the rest. According 
to Professor Lujo Brentano, " Not quite a third of the men in 
the entire German army belong nowadays to agriculture," 
though, as has been pointed out, more than half of the entire 
population depends on agricultural occupations. In 1902 the 
proportion was 29*4 per cent., in 1903 it was 31*3 per cent., 
and in 1904 30*9 per cent. In 1912 the largest number of 
defectives fell to agricultural Schleswig-Holstein and Mecklen- 
burg and the Hanse Towns, viz. 8 4 per cent., then followed 
Hesse with 8*2 per cent., and the First Army Corps district 
of Bavaria with 7*6 per cent. The smallest proportion of 
defectives fell to Lorraine, viz. 4*6 per cent. The largest 
proportion of full-efficients came from Wurtemberg and Alsace- 
Lorraine, viz. 69-9 per cent., East Prussia 64*7 per cent., and 
West Prussia 63 per cent. — the first two semi-industrial and the 
last two agricultural districts. 

The argument of military efficiency apart, however, there 
is every reason why Germany should make a determined effort, 
even at great sacrifice, to preserve agriculture in a successful 
condition, and above all to protect its still large independent 
peasantry and to encourage the multiplication of the small 
holders. For the cry of " Back to the land ! " which is heard 
there, as elsewhere, has a different and a happier meaning than 
underlies it in this country. In Germany the rural movement 



AGRICULTURE AND INDUSTRY 283 

is not an endeavour to put upon the land industrial workers 
for whom the towns have no employment and no homes ; it 
denotes an effort to attract back to agricultural pursuits labourers 
who left the land but yesterday and who have not yet fallen 
hopelessly into the whirlpool of urban life, yet for whom there 
are abundant opportunities of work in the country if only the 
conditions there can be made sufficiently attractive. Granting 
that radical changes will need to be made in the systems both 
of tenure and cultivation — a question to which it will be neces- 
sary to return later — before agriculture will be placed on a 
healthy basis, enabling it to do its best for those engaged in 
it and for the nation, the fact remains that the lack of efficient 
labour is the most pressing of all needs. It is estimated that 
every summer about four hundred thousand foreign labourers 
cross into Germany from the eastern frontiers in order to gather 
the crops in place of the native hands which are now finding 
more profitable or more congenial employment in the industrial 
districts. 

A few figures may be selected, from inexhaustible data of 
the same kind, in illustration of the important and progressive 
place which agriculture in its various forms takes in the 
national economy. 

The total area used agriculturally in 1907 was 31,834,874 
hectares (of 2-47 acres), divided into 5,736,082 holdings, figures 
comparing with 32,517,941 hectares and 5,558,317 holdings 
in 1895. Of this area 24,432,354 hectares were arable land, 
6,805,436 hectares meadow and rich pasture land, 481,716 
hectares garden land (exclusive of ornamental gardens), and 
115,368 hectares vineyards. In addition 7,679,754 hectares 
were cultivated as forest, and of the remaining surface of the 
country (3,591,858 hectares) a large part consisted of land of 
inferior quality and waste land. 

The purposes to which the entire surface of the land was 
put changed as is shown in the table on p. 234 during the 
thirty years 1883 to 1913. 

In 1883 48*5 per cent, of the entire surface was used as 
arable and garden land and in 1913 48*1 per cent. ; 172 per 
cent, was used as meadow and pasture in 1883 and 15*9 per 
cent, in 1913 ; 25 -7 per cent, was used as forest and plantation 
in 1883 and 263 per cent, in 1913. On the other hand, 9*4 
per cent, of the surface fell to buildings, farmyards, waste 
land, roads, etc., in 1913 as against 8*3 per cent, in 1883. It 
is worthy of note that of the nearly fourteen million hectares 
of forest in 1900 4,460,000 hectares were in State hands, 
2,258,000 hectares belonged to communes, 517,000 hectares 



234 THE EVOLUTION OF MODERN GERMANY 

belonged to foundations and corporations of all kinds, 257,000 
hectares were Crown lands, and 6,503,000 hectares were in 
private hands, an allocation which explains the high degree of 
excellence to which the trade as well as the science of forestry 









" 


Increase or 




1883. 


1893. 


1913. 


Decrease In 
30 years. 




Hectares. 


Hectares. 


Hectares. 


Hectares., 


Arable and garden land 


26,177,350 


26,243,210 


26,101,000 


- 76,350 


Vineyards 


134,620 


132,580 


118,600 


- 16.020 


Meadow land . . 


5,903,440 


5,915,770 


6,991,700 


+ 88,260 


Pastures and enclosures 


3,425,110 


2,873,030 


2,592,500 


-832,610 


Forests and plantations 


13,908,400 


13,956,830 


14,223,200 


+ 314,800 


Houses and farmyards, waste 










land, roads, water, etc. . . 


5,013,600 


4,927,200 


6,072,800 


+ 58,300 



has been brought in Germany. Of these forests no less than 
2,380,000 hectares had been planted within the twenty years 
preceding 1900. 

Germany no longer feeds herself, and with a rapidly growing 
population and a rising standard of life her imports of wheat 
especially have greatly increased during recent years, yet the 
production of the two staple food corns increased from an 
average of 9,958,000 metric tons yearly during the five years 
1904 to 1908 to an average of 11,309,000 metric tons yearly 
during the following five years 1909 to 1913 in the case of rye, 
and from an average of 3,738,000 tons to one of 4,140,000 
tons in the case of wheat. The heaviest harvest both of rye 
and wheat fell to 1913, viz. 12,222,000 and 4,656,000 metric 
tons respectively. 

According to the official " Statistics of the German 
Empire " the harvest of the land was as follows in the 
year 1913 : — 





Metric Tons. 


Per Hectare in Metric Toas. 




1913. 


1913. 


1903-1912. 


Rye 

Wheat 

Winter spelt 

Summer barley . . 

Oats 

Potatoes 

Hay 


12,222,394 

4,655,956 

438,469 

3,673,254 

9,713,965 

64,121,146 

29,184,994 


1-91 
2-36 
1-61 
2-22 
2-19 
15-86 
4-93 


1-70 
203 
1-46 
1-95 
1-86 
13-24 
4-25 



AGRICULTURE AND INDUSTRY 



235 



The following were the yields per hectare in the three 
largest States in 1912 (in metric tons) : — 





Prussia. 


Saxony. 


Bavaria. 


wheati^:^::^ :: 


2-43 


2-88 


1-71 


2-46 


2-09 


1-46 


«y« l^u^^^L :: 


1-85 


2-05 


1-67 


1-27 


119 


1-19 


'^"■eHruS^^r :: 


— 


— 


— 


2-33 


215 


1-85 


Oats 


203 


2-01 


1-47 


Potatoes 


15-45 


11-29 


12-7 



There has been a progressive increase in the produc- 
tivity of the soil. The yield of rye per hectare throughout 
the whole country increased from 28 2 cwts. on the average 
of the years 1893 to 1899 to 30-6 cwts. for the years 1900 to 
1905, and 38*2 cwts. in 1913, while the yield of wheat increased 
from 34*2 to 47*2 cwts. 

Taking the whole country together, there has been a 
steady if slow encroachment of arable upon grazing and pasture 
land, but even more important than the increase of the 
area devoted to corn-growing is the increase of production 
w^hich has resulted from the partial abandonment of the 
three-field system of cultivation, the consequence of which 
was that a third of the surface was perpetually fallow. In 
1878 in all Germany 2,308,474 hectares, or 889 per cent., of 
the arable and garden land were fallow ; in 1888 1,846,800 
hectares, or 7*05 per cent. ; in 1893 1,550,201 hectares, or 
5-91 per cent., and in 1900 only 1,230,626 hectares, or 4*69 
per cent. In Prussia the proportions at the same dates were 
8*91, 6*76, 5*56, and 4*25 per cent, respectively. In general 
the decline in the amount of fallow land since 1878 has been 
about 50 per cent., though in some parts of the country, like 
Saxony and Hesse, fallow land has almost entirely disappeared. 
The old system of cultivation is nowadays most followed in 
Mecklenburg, where some 10 per cent, of the land is still 
allowed to lie fallow. 

Referring particularly to Prussia, it is computed that 
during the past century the extent of its arable land nearly 
doubled, the area so employed being 17,407,000 hectares or 
more than one-half of the cultivable surface in 1900. Many 
of the large cultivators have still much to learn in science and 
enterprise, yet improved labour-saving machinery is gradually 



286 THE EVOLUTION OF MODERN GERMANY 

being introduced, owing, no doubt, in a large degree to the 
necessity which the corn-growers are under of finding a substi- 
tute for the human labour which they are unable to attract 
to the land. In 1913 there were in use in the monarchy 706 
steam ploughs, nearly all worked by two engines, and each 
capable, on an average, of deep ploughing 12 J acres of land 
per day. The use of potash for agricultural purposes has 
increased sevenfold in Germany since 1890 ; in that year 
77 kilog. were used to every 100 hectares of agricultural land, 
but in 1905 the amount was 576 kilog., though in Prussia it 
was no less than 700 kilog. per 100 hectares, and in the province 
of Brandenburg 1,026 kilog. Equally favourable figures cannot 
be recorded for live stock. Here there has been a large increase 
in numbers since 1873, except in sheep, but a decrease propor- 
tionately to population, except in pigs. The number of cattle 
per 100 inhabitants decreased from 38-4 in 1873 to 29*5 in 1912, 
the number of sheep decreased from 60*9 to 10*2 per 100 
inhabitants, and the number of horses from 8*2 to 8, but the 
number of pigs increased from 17*4 to 38*5. An enumeration 
of domestic animals in the Empire made in 1915 showed the 
following totals : — Horses, 3,342,000 ; cattle, 20,317,000 ; sheep 
5,073,000 ; pigs, 17,287,000 ; goats, 3,438,000. 

Here, however, the catalogue of Germany's agrarian enter- 
prises is not exhausted. In 1913 there were 261,000 acres of 
land under vines. In Alsace-Lorraine there were 66,200 acres, 
in Bavaria 49,100 acres, in Prussia 42,500 acres, in Baden 
35,600 acres, and in Wiirtemberg 34,900 acres. 

An enumeration of the fruit trees in the Empire made in 
that year showed the following totals: — Apple trees 74 J million 
(against 52 J million in 1900), 30 1 million pear trees (against 
20 millions), 64j million plum trees (against 69j million), 
21^ million cherry trees (no change), 2 million peach trees, 
I million apricot trees, and 2i million walnut trees. 

The hops, upon which the beer-brewing industry depends, 
are grown chiefly in the South, in Alsace-Lorraine, Bavaria, and 
Wiirtemberg, and to a smaller extent in Prussia and Baden. 
For many years there has been a progressive decrease in the 
area so cultivated, and its extent is now a third less than ten 
years ago. The area cultivated in 1913 was 66,800 acres, of 
which 10,300 acres fell to Alsace-Lorraine, 43,100 acres to 
Bavaria, 8,200 acres to Wiirtemberg, 2,590 acres to Prussia, 
and 2,480 acres to Baden. The produce in that year was 
465,000 cwts., and the average for the years 1910-1913 was 
842,000 cwts. The yield per acre in 1913 was 6-8 cwts., and 
the mean for the years 1910-1913 was 5*1 cwts., comparing 



AGRICULTURE AND INDUSTRY 287 

with an average yield of 8-8 ewts. per acre in the United Kingdom 
during the years 1898-1907. In 1873 the breweries of the 
country produced 857,000,000 gallons of beer, equal to 21 
gallons per head of the population. In 1913 the breweries 
produced 1,522,400,000 gallons of beer, equal to 22 f gallons 
per head, the rate for Bavaria being 59 gallons, for Wurtemberg 
36 gallons, and for Baden 33 gallons, while for the North 
German taxation area it was only 17 gallons. 

Again, in 1912-13 Germany had 62,900 distilleries of all 
kinds, large and small, 5,970 being agricultural and 20 indus- 
trial distilleries producing potato brandy, and 7,682 agricultural 
and 700 industrial distilleries producing corn brandy. The 
year's production of alcohol was 82,571,830 gallons, an average 
figure, of which 66,159,300 gallons were distilled from 
potatoes, and 12,663,900 gallons from corn. There is also an 
important trade in the manufacture of potato starch, over 
three hundred factories being so employed. More than half 
of the raw materials employed are of home production. 

The manufacture of sugar from beet also employs an 
increasing number of workpeople. The principal seats are 
Prussian Saxony, Hanover, Brunswick, Anhalt, and Mecklen- 
burg, and the beet is grown for the most part in the neighbour- 
hood of the factories. In the year 1912-13 342 factories were 
engaged in the manufacture of sugar. The area devoted to 
beet was 1,352,000 acres, and the quantity of beets used was 
16,642,200 metric tons, a larger amount than for twenty years. 
The production was 2,632,300 tons of raw sugar and 380,900 
tons of molasses. 

The area under tobacco varies greatly with the seasons, a 
good season giving so satisfactory a return that a larger area 
is at once put under cultivation, but the general tendency 
during the past twenty years has been a declining one. The 
average area under cultivation during the five years 1886-1890 
was 48,400 acres, during the years 1891-1895 43,600 acres, 
during the years 1896-1900 45,300 acres, and during the years 
1908-1912 it was 38,960 acres, the area in the year 1912 being 
38,900 acres. During the same period the number of tobacco 
planters has fallen from an average of 173,561 per annum for 
the years 1886-1890 to 96,100 for the years 1908-1912, the 
number in 1912 being 95,520. The greatest falling off has been 
in the small planters with farms of 2| acres and under, who 
have decreased to barely one-third the number twenty years 
ago. The production of dried tobacco leaves has fallen from 
an average of 37,400 metric tons annually for the years 1886- 
1890 to 31,900 tons for the years 1908-1912. 



238 THE EVOLUTION OF MODERN GERMANY 

Figures like these show the extent and variety of agrarian 
enterprise, and give some indication of the immense influence 
which is nowadays behind the demand for the retention of 
protective duties. 

It is only since the later 'seventies of last century, however, 
that German agriculture has been the special object of fiscal 
policy. Down to the middle of the century it was so far pros- 
perous that the corn-growers had only nominal protection, 
and desired none at all, insomuch that in 1865 the duties were 
allowed to lapse. Herr von Bismarck (afterwards Imperial 
Chancellor and author of the Customs Tariff of 1879) wrote 
in 1848 : " With regard to indirect taxation we hear far more 
of the protective system which favours our home manufactures 
than of the free trade necessary to the agricultural population." 
At that time the German corn -grower did not trouble much 
about a home monopoly, for he could sell his produce elsewhere, 
if necessary, on advantageous terms. A large amount of wheat 
and rye was regularly exported to England, even when there 
was a deficient crop at home, for higher prices could be ob- 
tained there than the consumers of his own towns were able 
to pay, and in times of scarcity the poorer people had to be 
contented with maize. During the decade preceding 1860 
the average wholesale price of wheat in the markets of Prussia 
was 44s. 6d. per Imperial quarter, in Bavaria 45s. lid., and in 
Wurtemberg (1852-1859) 49s. 8d. ; the average wholesale 
price of rye during the same period was 8s. Id. per cwt. in 
Prussia, 8s. 4jd. in Bavaria, and 8s. 8jd. in Wurtemberg. 
During the succeeding ten years the average price of wheat 
fell in Prussia to 44s. 7jd., in Bavaria to 43s. 5d., and in Wiir- 
temberg to 46s. 3 id. per Imperial quarter ; and the average 
price of rye to 7s. lOd. per cwt. in Prussia, 7s. 4d. in Bavaria, 
and 8s. 4d. in Wiirtemberg ; but there was a recovery during 
the earlier part of the following decade, 1870-1879, when the 
average prices were 48s. 3|d., 53s. Ijd., and 51s. per quarter 
respectively in the three kingdoms in the case of wheat, and 
in the case of rye 8s. 7d., 9s. Id., and 9s. 8d. per cwt. 
respectively. 

It may be asked, did not agriculture, like industry, share 
in the greater prosperity which came to the country after the 
close of the French war ? For a time it did share — so long, 
in fact, as corn prices continued high. The short run of good 
prices led, however, to the excessive capitalization of estates, 
and for a time farms on re-sale and re-lease changed hands at 
prices which proved an impossible load upon their new holders 
directly the brief spell of prosperity passed away. Land values 
fell again, and with the fall disappeared much, and often the 



AGRICULTURE AND INDUSTRY 239 

whole, of the capital of men who had bought by the aid of 
credit in times of inflated values, while many large proprietors 
found it impossible to adjust themselves to the altered condi- 
tion of things, and the state of agriculture was made worse 
by the higher cost of labour, caused on the one hand by the 
migration from the rural districts to the industrial towns, 
and on the other hand by the higher cost of living and the 
unrest of the awakened agricultural labourer even when he 
remained on his native soil. Worse still for the corn-grower 
was the competition, no longer of Russia only but of America 
and Argentina, which now began to take threatening dimensions, 
depressing the price of the principal foodstuff, rye, to a price 
at which it could not be profitably produced at home. Hence 
the demand for Protection which began to be heard in the 
middle of the 'seventies, a demand to which Prince Bismarck 
for a time hesitated to listen, yet to which he entirely capitu- 
lated in 1879, when the first duty of sixpence per cwt. was 
imposed on wheat and rye. 

At this time the home corn-growers were still able, on the 
whole, to cover the nation's food requirements, and sometimes 
they had a surplus for export. The scale turned after the 
industrial expansion which began early in the 'seventies had 
taken settled form and had become a great national movement. 
The growth of industry enormously increased the labouring 
population in the towns, creating a class of consumers with 
higher needs and ampler means for satisfying those needs. A 
wholesale movement from the rural districts began, with the 
result that even in the stagnant country districts labour began 
to have a competitive value. 

Germany had hitherto had a large surplus population, and 
this population it had sent across the seas — to the United 
States, to Brazil, to Australia, to South Africa. Now it had 
no men to spare ; the mines, factories, and workshops called 
for hands and would not be satisfied. From the early 'eighties 
the emigration movement was checked, and though there have 
been fluctuations since, the general movement has been down- 
ward, until to-day the outward flow of population is insignificant. 
In 1871 the emigrants from the German Empire who sailed 
by home ports and Antwerp numbered 75,912, in 1872 the 
number was 125,650, in 1873 it was 103,638 ; then there was 
a fall to 45,112 in 1874, to 30,773 in 1875, to 28,368 in 1876, 
to 21,964 in 1877, and in 1878 the number was 24,217. During 
the succeeding twelve years there was a great increase, rising 
from 117,097 in 1880 to 220,092 in 1881, then falling, after 
fluctuations, to 116,339 in 1892, since when the decline has 
been continuous. To-day the absolute emigration is only 



240 THE EVOLUTION OF MODERN GERMANY 

one-fourth what it was thirty years ago, and relatively to 
population it is far less. 



GERMAN EMIGRANTS LEAVING FROM ALL PORTS, HOME AND 

FOREIGN. 







Per J, 000 






Per 1,000 






of the 






of the 




Number. 


Population. 




Number. 


Population. 


1876 .. 


. 29,644 


0-69 


1895 .. 


. . 37,498 


0-72 


1877 .. 


. 22,898 


0-63 


1896 .. ^ 


. . 33,824 


0-64 


1878 .. 


. 25,627 


0-58 


1897 .. 


.. 24,631 


0-46 


1879 .. 


. 36,888 


0-80 


1898 .. 


. . 22,221 


0-41 


1880 .. 


. 117,097 


2-60 


1899 .. 


. . 24,323 


0-44 


1881 .. 


. 220,902 


4-86 


1900 .. 


. . 22,309 


0-40 


1882 .. 


. 203,585 


4-45 


1901 .. 


. 22,073 


0-39 


1883 .. 


. 173,616 


3-77 


1902 .. 


. 32,098 


0-56 


1884 .. 


. 149,065 


3-22 


1903 .. 


. 36,310 


0-62 


1885 .. 


. 110,119 


2-36 


1904 .. 


. 27,984 


0-47 


1886 .. 


. 83,225 


1-77 


1905 .. 


. 28,075 


0-47 


1887 .. 


. 104,787 


2-20 


1906 .. 


. 31,074 


0-50 


1888 .. 


. 103,951 


2-16 


1907 .. 


. 31,698 


0-51 


1889 .. 


. 96,070 


1-97 


1908 .. 


. 19,883 


0-32 


1890 .. 


. 97,103 


1-97 


1909 .. 


. 24,921 


0-39 


1891 .. 


. 120,089 


2-41 


1910 .. 


. 25,531 


0-39 


1892 .. 


. 116,339 


2-31 


1911 .. 


. 22,690 


0-35 


1893 .. 


. 87,677 


1-73 


1912 .. 


. 18,545 


0-28 


1894 .. 


. 40,964 


0-80 t 


1913 .. 


. 25,843 


0-39 



During the early years of the Protectionist era there was 
no sign of the acute conflict which was eventually to break 
out between agriculture and industry. The first moderate 
duties did not appreciably affect the price of food, and the 
manufacturing classes were able to obtain, as before, an unlimited 
amount of labour at wages which, though increasing, seem 
incredibly low when compared with those to which the working 
classes have in recent years become accustomed. There was no 
change in the general principles of national policy in other 
directions, for this policy was still based on the assumption 
that Germany was, and was destined to continue, essentially 
an agricultural State, that corn-growing was the chief of 
national industries, and that the first duty of Ministers and 
Parliaments was to safeguard the prosperity of the great land- 
owners and the large peasants. The occupation census of 1882 
showed, indeed, that agriculture no longer gave work and 
livelihood to as large a proportion of the population as of old, 
yet there had been no actual diminution of the pastoral class, 
and this fact was held to prove that the position of agriculture 
as the basis of national economy was not assailed. Yet the 
tide of industry was in full flux, and unfavourable influences 
were pressing with growing force on the agrarian from two 
sides. On the one hand, the shortening of his labour supplies, 
owing to the competition of the factory towns, was increasing 



AGRICULTURE AND INDUSTRY 241 

his costs of production, while, on the other hand, the prices 
of his products were still falling. The heaviest fall occurred 
in the decade 1880-1889, when the average price of the quarter 
of wheat was in Prussia 40s. 2d., in Bavaria 45s. 9jd., and in 
Wurtemberg 42s. lOd., the lowest prices being reached in 1886 
in Prussia, viz., 34s. 2d. ; in 1885 in Bavaria, 40s. 7d. ; and in 
1884 in WUrtemberg, 38s. Id. ; while the average price of 
rye per cwt. was 7s. lOd. in Prussia, 8s. 5d. in Bavaria, and 
8s. 9d. in Wiirtemberg, the lowest figures being 6s. 4d. in 
Prussia (1887), 7s. 2d. in Bavaria (1887), and 7s. 6d. in 
Wurtemberg (1886). 

Worse still, the corn-grower saw that the countries to 
which Germany was beginning to export manufactured goods 
on a scale never experienced before were sending back corn 
and other farm produce in return, so that a growing portion 
of the nation's food supply was coming from abroad. Added 
to this, an entire change in the spirit of legislation came about 
when Prince Bismarck was succeeded as Imperial Chancellor 
by Count von Caprivi. Bismarck's domestic policy had 
been consistently agrarian, though the word had not yet 
passed into currency in the modern sinister sense. He 
was profoundly convinced that any measure passed for the 
benefit of agriculture was bound to promote the well-being of 
the entire nation concurrently, and he must not be accused 
of insincerity when he uttered words like the following : 
" Whenever I have come forward on behalf of landed property 
it has not been in the interest of the proprietors of my own 
class, but because I see in the decline of agriculture one of 
the greatest dangers to our permanence as a State." 

Count von Caprivi had not long been in office before he 
recognized that Germany could no longer be regarded, and 
legislated for, as an exclusively agricultural State, but that new 
economic forces had arisen in whose development and free play 
the national prosperity was equally bound up. From the moment 
the policy of the State was directed from this new standpoint 
agriculture and industry inevitably stood in open antagonism. 

It is not possible to follow in these pages the history of 
the protective tariffs and other controversial measures which 
have been adopted for the benefit of agriculture, or do more 
than indicate in broad outline the economic transition through 
which Germany is passing, and any detailed account of what 
is known as the agrarian movement would be out of place here. 
Some answer must, however, be attempted to the questions 
— two in form though one in substance — is Germany able to 
feed her own people, and to what extent is existing legislation 
able to promote this end ? 

16 



242 THE EVOLUTION OF MODERN GERMANY 



According to the German Government's estimate, prepared 
when the Customs Tariff now in force was under parHamentary 
consideration, the corn-growers of the country were only able, 
on the average of the years 1895 to 1900, to supply 92*6 per 
cent, of the nation's needs in rye and 73-7 per cent, in wheat 
and spelt. During those years there was on the average an 
excess of imports over exports of 591,760 metric tons of rye 
and 1,263,240 tons of wheat and spelt. During more recent 
years Germany has had to import, on the average, over two 
million tons of wheat, while she has been able to send abroad 
a surplus of 400,000 tons of rye : — 



Year, 


Imports in 
Metric Tons. 


Exports in 
Metric Tons. 


Excess of Imports or 
Exports in Metric Tons. 


Wheat. 








1910 
1911 
1912 
1913 


2,343,742 
2,488,333 
2,297,422 
2,545,959 


281,389 
309,999 
322,590 
638,349 


I 2,026,353 
12,178,334 
I 1,974,830 
I 2,007,610 


Wheaten Flour. 








1910 
1911 
1912 
1913 


14,834 
15,295 
15,871 
17,868 


190,015 
161,828 
171,031 
194,756 


E 175,181 
E 146,533 
E 155,160 
E 176,888 


Rye. 








1910 
1911 
1912 
1913 


389,508 
614,115 
315,724 
352,542 


820,007 
768,527 
797,317 
934,463 


E 430,499 
E 154,412 
E 481,593 
E 681,921 


Rye Floub. 








1910 
1911 
1912 
1913 


975 
1,142 
1,067 
1,000 


166,310 
145,714 • 
168,851 
225,102 


E 165,335 
E 145,572 
E 167,784 
E 224,102 



On the whole Germany has of late years become rather 
more dependent upon foreign food supplies than before. 

Notwithstanding this, there has been a considerable increase 
in the production of both food-corns. While the production 
of wheat during the seven years 1893-1899 averaged 3,436,000 
tons, and during the succeeding seven years 3,606,000 tons, 
it was 3,993,000 tons on the average for the years 1907-1913, 
an increase of 557,000 tons as compared with the earlier of the 
preceding periods. The production of rye averaged during 
the years 1893-1899 8,489,000 tons, during 1900-1906 it was 
9,344,000 tons, and during 1907-1913 11,006,000 tons, showing 



AGRICULTURE AND INDUSTRY 243 

a yearly increase of 2,517,000 tons as compared with the earlier 
of the preceding periods. The increase for both of these food- 
corns was 3,064,000 tons, or 26 per cent., comparing with an 
increase of population between 1893 and 1913 of 32 per cent. 
It is clear that at present the home corn-growers, while they 
are not going back, are not meeting the larger demand caused 
by the increase of population and an improving standard of 
life. 

Perhaps the most significant fact about the home production 
of food-corn is one which has not hitherto received the recog- 
nition which it deserves. The principal deficit is in wheat, 
the consumption of which is steadily increasing as social 
conditions improve. It will be a surprise to many persons 
who only know the Germans as a rye-bread-eating people to 
be told that over 30 per cent, of the grain consumed is wheat. 
The explanation lies, of course, in the fact that a large amount 
of pure wheat bread is eaten in the form of rolls, and that 
throughout the country the so-called rye-loaf generally has 
an admixture from one-fifth to one-third of wheaten flour. 
Hitherto it has been assumed that the soil of the great corn- 
growing districts of the East is more suited to rye than to wheat, 
and in the tariff of 1902 the duty on wheat was fixed higher 
than that on rye for the deliberate purpose of giving additional 
encouragement to its cultivation. 

It will be interesting to see how far the corn-growers of 
Prussia are able and willing to adjust production to demands 
which are changing qualitatively as well as quantitatively. 
Their constant rejoinder to the critics of protective policy 
has been that production is merely a question of price, and 
that, given a remunerative return on capital, the national 
granary can supply the national need. It is obvious, however, 
that in a country with such diversity of soil, climate, and 
transport conditions as Germany, no estimate of costs of produc- 
tion could be suggested which would be generally acceptable. 
Professor Dreschler, calculating the cost in Hanover in 1888, 
came to the conclusion that wheat could not be produced for 
less than £8 10s. 7d. per ton and rye for less than £7 lis. 9d. on 
the average, the maximum rates being £9 12s. for wheat and 
£9 lis. 9d. for rye grown on poor land, and the minimum rates 
£6 10s. 7d. for wheat and £5 5s. 5d. for rye grown on good land. 
A more recent estimate made by Herr Evert ^ is £7 10s. for 
rye and £10 for wheat, while another agricultural writer, Herr 
C. Herold, places the cost of producing rye remuneratively 
at £8 and that of wheat £10, a surplus of ios. per ton being 
left in each case.^ The logical agrarian protectionist refuses 

^ Der deutsche Osten, p. 18. " Die wichtigsten Aararfragen, p. 16. 



244 THE EVOLUTION OF MODERN GERMANY 

to be bound by data of this kind, however, and states his 
demands in the simple formula, " The German market for the 
German corn -grower." He insists that the duties must be 
retained at such a height as will eventually make Germany 
independent of the rest of the world for its food supplies, 
ignoring the fact that every new pair of hands that goes to 
swell the industrial army adds to the difficulty of preserving 
her as an " agricultural State." 

For a long time, owing to a combination of auspicious 
influences, the conditions of agriculture have been exceptionally 
favourable. The agrarians have had matters their own way, 
and not without reason did one of their most authoritative 
representatives, Baron von Goler, say (February 1908) : 
" German agriculture was in a better position than for many 
decades. He had for years complained of agricultural distress, 
but he must now confess that agriculture had revived and was 
more profitable than before. It might seem hazardous for 
an agrarian to talk thus, but out of the abundance of the 
heart the mouth speaks." He added that the agriculturists 
owed this state of things in great measure to the new customs 
tariff. 

Every sign points to the accuracy of this estimate. It 
was stated in the Reichstag on March 2, 1907, on the authority 
of the German Agricultural Society (LandwirtschaftsgeselU 
schaft) that the protective duties had during the year 1906 
increased the value of German real estate by no less a sum 
than £68,250,000. One has only to consult the records of 
sales of agricultural estates to find evidence of the enormously 
increased capital value which has been created by the higher 
prices obtained owing to the last revision of the duties, assisted, 
no doubt, by a shortage of corn, and by the exceptional run 
of prosperity which industry has enjoyed, leading to an in- 
creased national spending power. ^ Speaking for a typical 

* The following instances, referring to the spring of 1907, of Prussian estates 
changing hands at larger figures, have been taken at random : — 

1. The estate of Staldssen, 280 morgen, bought for £10,800, sold for 
£11,500, increase 65 per cent. 

2. Estate at Wolsko sold for £5,250, bought a year before for £4,700, increase 
11* 7 per cent. 

3. The Wenskowethen estate, sold for £6,000, bought ten years before for 
£3,750, increase 60 per cent. 

4. The estate of Georgenau, near Rosengarten, sold for £6,500, bought a 
year before for £5,400, increase 20* 3 per cent. 

6. The estate Ernstfelde, near Insterburg, sold for £17,600, bought six years 
before for £14,500, increase 20* 7 per cent. 

6. The manor Friedrichshof, near Bublitz, sold for £9,750, bought two 
years earlier for £5,000, increase 95 per cent. ; and changed hands six years 
before that for £2,700, increase to date 261 per cent. 

7. Estate in the circle of Wehlau, of 1,400 morgen, sold for £26,150, though 
bought three years before for £12,500, increase 622 per cent. 



AGRICULTURE AND INDUSTRY 245 

corn-growing district, the Chamber of Agriculture of the 
province of West Prussia published the following com- 
parative return of prices per hectare (2j acres) of arable land : 
1901, £17 3s. ; 1902, £21 5s. ; 1903, £29 4s. 1904, £30 3s. ; 
and 1905, £54 3s., showing an increase of over 200 per cent, 
in four years. In 1911 the additions made by the Prussian 
State to its domains in that province cost on the average 
£80 14s. a hectare. 

The actual cultivators have benefited by the higher prices 
of corn and farm stock which have prevailed for some time, 
but a reaction is certain. For the increased capital value 
of land has advanced rents, while at the same time labour, 
material, and other costs of production have become dearer, 
leaving a smaller margin of profit. " According to my observa- 
tion and experience," writes Herr Herold, " leasehold xents are 
in general too high for present conditions. Many leaseholders 
are becoming bankrupt, others manage by great exertion and 
by living in restricted circumstances to drag out a necessitous 
existence. The experience of better circumstances in agri- 
culture in former days and the keen competition called forth 
by the endeavour of many young people to create an independent 
position for themselves drive up leasehold rents to an unhealthy 
height." 

It would appear that this see-saw movement in the fortunes 
of agriculture is inseparable from Protection, and that the 
hope of steadying prices and ensuring to the corn-grower 
certain and constant profits on a moderate level has so far proved 
unrealizable. Judging by the past, it is impossible to resist 
the conclusion that the improvement in the condition of 
agriculture which has unquestionably taken place, though it 
is now shared more or less by all sections of the agricultural 
class, owners and tenants equally, will eventually prove in 
the main advantageous to the owners. As in earlier times of 
prosperity, higher prices will create unhealthy land values, 
and at the end of a brief period of relief the actual cultivators 
of the soil will find themselves once more crippled in resources 
and paying advanced rents in face of falling returns. 

It should also be borne in mind that even among the corn- 
growers themselves the benefits of Protection are shared very 
unequally. The Handbook of the Conservative Party says 
frankly that " The protection of home agriculture means 
essentially the protection of corn-growing." No one has 
doubted this ; but it follows as a corollary that the protection 
of corn-growing means the protection of a numerically small 
section of the agricultural class and positive disadvantage to 
a far larger section, which only grows corn for its own consump- 



246 THE EVOLUTION OF MODERN GERMANY 

tion, and is, as a consequence, but little affected by the fluctua- 
tions of the market. According to an estimate used by Count 
von Caprivi, when defending his commercial treaties against 
attack in 1892, and later by Prince Hohenlohe, only corn- 
growing farms of at least 12 J acres have any direct interest 
in the price of corn, which means that only from one-fourth 
to three-tenths of the entire agricultural class is affected one 
way or the other. 

While the Imperial Government affords agriculture effective 
protection by means of a many-sided tariff, the various federal 
Governments give ready assistance in a variety of ways, as 
by large expenditure on technical instruction, the maintenance 
of experimental farms, and subsidies for the improvement of 
live stock and agricultural methods, for the improvement of 
fruit culture, for the establishment and working of co-operative 
dairies, and towards the work of the Chambers of Agriculture. 
The Prussian Government in 1912 made grants to the amount 
of over half a million pounds in support of agricultural colleges, 
schools, and other educational agencies of many kinds, and 
grants of more than a quarter of a million towards the 
improvement of live stock. There was also large expenditure 
on behalf of land reclamation and general works of amelioration. 
In Bavaria the State helps agriculture on the same and other 
lines. It even insures the farmer's live stock through district 
associations (93,000 horses and 292,000 head of ''cattle were 
insured in 1912) and his crops against hailstorms. 

Reference has already been made incidentally to the serious 
question of agrarian indebtedness. In the opinion of all writers 
on the subject the encumberment of the land is one of the 
greatest obstacles in the way of the permanently healthy 
condition of agriculture. It is probably under the mark to 
say that on the whole over half the sale value of the agricultural 
land of Prussia is covered by mortgage, and here again the 
East of the kingdom is in a far worse plight than the West. 
It has been estimated that for every £100 of capital invested 
in land by independent proprietors following agriculture as 
their principal occupation in Prussia, there is a debt of £188 10s. 
The position of those who only follow agriculture as a secondary 
occupation, either for business or pleasure, is more favourable, 
for here the indebtedness is only equal to one-half the capital 
invested. 

It is not without significance that the greatest encumberment 
falls to the region of large estates, and a comparatively light 
indebtedness to that in which peasant properties are specially 
numerous. The Berlin Post wrote recently : " There are 
estates, far from the larger towns, with good communications, 



AGRICULTURE AND INDUSTRY 247 

which, conducted on the old economic methods, give Httle 
return, which are burdened with mortgages and other debts, 
and are unable to adequately support the numerous members 
of their old families. And these are families whose names 
appear often in the Prussian officers' list, are engraved in golden 
letters in the rolls of honour of Frederick the Great, and their 
preservation is a profound interest of the State, in that the 
military spirit of the best ages lives in them as a tradition, 
that imponderable quantity which cannot be attained or imi- 
tated at a moment's notice by others. How can these families, 
how can the landed proprietors in the East especially, be 
helped ? " The same question was raised by the President of 
the Agrarian League at a meeting of the Prussian Economic 
Collegium in MaTch 1907. " How is a landed proprietor to 
be kept permanently in a sound condition ? " he asked. 
" First, naturally, by making his property sufficiently remuner- 
ative by resort to the utmost possible technical development, 
but also by being disencumbered of debt, a relief which must 
be permanent." 

Of the rural holdings and estates sold under distraint in 
Prussia in 1911 9 per cent, in number, but 64 per cent, in area, 
were of 150 acres and upwards, and 2 and 31 per cent, respec- 
tively were of 500 acres and upwards. Nearly all these larger 
estates were in the eastern provinces. On the other hand, 
an investigation made by the Statistical Office of Baden, a 
State with a comparatively small amount of corn-growing and 
with many little proprietors, showed no excessive proportion 
of indebtedness, and also brought to light the fact that a 
considerable part of the mortgages held on land was in the 
hands of farmers. 

The Government has on several occasions seriously con- 
sidered what measures might be feasible with a view to relieving 
the present burden of debt, which paralyses so many large 
landowners and checks enterprise, and at the same time to 
preventing excessive encumbrance in the future. No plan, 
however, would appear to have yet been devised which would 
not greatly restrict the free action of the owners, and to that 
extent decrease the selling value of their estates. 

Nor is that .the only difficulty. It is recognized that the 
first condition of any State regulation of agrarian debts must 
be the fixture of a maximum limit of mortgage, beyond which 
an impecunious landowner would have to rely on personal 
credit. It is, however, at least arguable that the effect of 
this restriction might be to make improvident men more unwise 
than ever in their monetary arrangements, for a debtor in 
difficulties will borrow anyhow, and if rational ways are closed 



248 THE EVOLUTION OF MODERN GERMANY 

to him he will resort to irrational. Further, any attempt to 
lay down general limits of debt would in practice be impossible, 
for the conditions of agriculture are so different that every 
class of property and form of cultivation would require special 
consideration. Upon one point the Government would appear 
to be determined : it shows no inclination to take upon itself 
any direct guarantee for the payment of either capital or 
interest under any scheme for the regulation of debts which 
may be found practicable. 

To sum up, it may be taken for granted that for a long 
time to come the preservation of agriculture in a prosperous 
condition will be one of the first objects of domestic policy in 
Germany. There is difference of opinion as to the measures 
best suited to attain the end in view, and as to the extent to 
which the aid of the State should be sought — a difference 
showing itself by such extremes as, on the one hand, the 
proposal of the ultra-agrarians that the State should set up a 
corn monopoly, and, on the other hand, the Radical demand 
that the large estates should all be summarily parcelled up 
into a multitude of small holdings — but no serious politicians 
suggest that a mere policy of laissez faire can ever again be 
followed in regard to a,n industry so closely related to the feeding 
of the people. Even some of the more responsible Socialist 
leaders repudiate the idea that Protection could be summarily 
abandoned, and avow their readiness to make any reasonable 
sacrifice for the sake of the genuine cultivators of the soil. 
Hence, in their attitude towards agrarian remedies parties 
are no longer divided on the question of principle, but on that 
of measure and degree. From the political standpoint alone 
it is held that Germany's dependence upon foreign food supplies 
is a danger which no responsible statesman ought to contemplate. 
However lamentable it may be that agriculture has been 
allowed to decay in the United Kingdom, our nation's food is 
at any rate secured by the existence of a navy powerful enough 
to keep clear the trade routes of the seas. Germany possesses 
no such security, and in its absence the maintenance of the 
national granary, the corn lands of the North and East, in as 
abundant and efficient a condition as possible must be a primary 
object of domestic polic5^ Of this Count von Capri v4 himself, 
though the first responsible statesman to recognize the advent 
of the industrial era and the urgent need of cheaper food for 
the labouring class, was no less sensible than the extremest 
Protectionist. 

" The existence of the State is at stake," he said in the 
Reichstag on December 10, 1891, " when it is not in a position 
to depend on its o^ti sources of supply. It is my conviction 



AGRICULTURE AND INDUSTRY 249 

that we cannot afford to dispense with such a production of 
corn as would be sufficient in an emergency to feed our increasing 
population, even if under restrictions, in the event of war. 
The very existence of the State would be at stake if it were 
not able to live upon its own resources. I regard it as the 
better policy that Germany should rely upon its own agricul- 
ture than that it should trust to the uncertain calculation of 
help from a third party in the event of war. It is my unshak- 
able conviction that in a future war the feeding of the army 
and the country may play an absolutely decisive part." 

It is this aspect of tJhe question which specially appeals 
to many Protectionists of the Chair, who view with misgiving 
the multiplication of industry without a corresponding increase 
in the home supply of food, and cherish the ideal of the self- 
contained State. Goods are not exchanged for money but for 
other goods, and in the case of Germany a great part of these 
other goods necessarily takes the form of raw materials and 
food. So long as an exchange on that basis can be contracted, 
and the ocean remains open to the traffic of all nations — that 
is, during times of peace — Germany may feel safe, but only 
so long. Arguing thus, the academic Protectionist lays stress 
upon the preservation of the home market for home industry, 
combined with such an increase in the production of corn as 
may enable Germany to become an exporting instead of an 
importing country, and disparages the export trade save in 
so far as it is required by the necessities of international 
exchange. 

The same idea was held by that industrial pioneer George 
von Siemens, who used to contend that the future of German 
industry depended more upon the development of the home 
markets than upon foreign trade. " German industry," he 
once said, " will achieve more for itself by introducing a curtain 
into every cottage window and a carpet into every cottage 
parlour than by pushing the German export business, and 
making German industry dependent upon the purchasing 
power and the good-will of foreigners." 

In his book, Deutschland als Industriestaat, Professor 
Oldenburg puts this argument in the following words : — 

" The national economy has been compared to a building 
arranged in stories. The strong ground-floor is agriculture, 
and it bears the industrial superstructure, the upper story, 
upon its shoulders. So long as uncultivated land remains at 
disposal the basement may be extended to the frontier of the 
country, and this extended basement can bear a correspondingly 
extended industrial story. But the industrial story cannot 
be extended further than the agricultural foundation extends 



250 THE EVOLUTION OF MODERN GERMANY 

unless its population live on foreign food and its manufactures 
be exchanged for this foreign food — in other words, unless an 
export industry be created which works for foreign countries 
and lives by them. The industrial story grows in that case 
laterally in the air and across the national frontier above foreign 
soil, artificially supported on the pillars of foreign trade, which 
rest on that foreign soil. But these pillars will only remain 
on foreign soil so long as the owner of the soil allows them. 
If one day he wishes to use the land himself the overhanging 
story, with the pillars beneath it, will collapse. In like manner 
if we establish an export industry employing five million men 
who live on z\merica's surplus of corn, these five million men 
with their future existence are dependent on that American 
surplus continuing permanently and being specially set apart 
for exchange for their manufactures." 

The attractive argument of the national granary is not, 
however, the argument upon which the agrarian rests his claim 
to special protection.^ However patriotic he may be, the East 
Elbe corn-grower is too honest to pretend that he cultivates 
his fields for the purpose of making Germany independent of 
foreign food supplies in time of war, nor is there any reason to 
suppose that, either in good seasons or bad, he will ever sell 
his produce more cheaply than his foreign rival. When several 
years ago the harvest was so abundant that there seemed a 
fear that prices would be forced down to an unremunerative 
level, an agrarian orator deliberately advocated the burning 
of a portion of the crop so that an artificial condition of 
scarcity might be produced. In ordinary times also the corn- 
growers make no systematic attempt to provide the needs of 
the home market first, but like good business men sell at home 
or abroad just as advantage dictates. During the years 1906 
and 1907, when corn prices everywhere rose to an unparalleled 
height, the home producer made a specially good business by 
sending large quantities of rye out of the country, thus 
keeping the home market sufficiently short to prevent any 
relapse in prices. No one dreamed of putting into force the 

1 It is a favourite idea with the Conservative party that a year's supply 
of com from abroad should be kept stored in towers after the fashion of the 
Julius Tower in which the Imperial War Chest of six million pounds is preserved 
at Spandau. Such a supply would be over two million tons of wheat and 
rye, with a value varying from seven and a half to fifteen million pounds, with- 
out counting the enormous accompanying costs. Frederick the Great stored 
com in the same way, but for the purpose of equalizing prices in case of scarcity, 
on the principle laid down by him in 1768 : " In the matter of prices it is the 
Prince's duty to hold the balance evenly between the interests of the nobleman, 
the domain tenant, and the peasant on the one hand, and the interests of the 
soldiers [who then bought their own bread] and the factory workers on the 
other." 



AGRICULTURE AND INDUSTRY 251 

attractive theory of " German corn for German mouths." 
The best prices were taken wherever they were offered, and 
the satisfaction of the home demand w^as entirely left to the 
accidents of the market. In thus acting the corn-growlers 
merely did what any other interest would have done under 
similar circumstances, and the reproaches levelled against 
them were irrational : they nevertheless furnished conclusive 
proof that attempts to apply the theory of the terra clausa 
in the matter of feeding a great nation are apt to fail in the 
critical moment. 

The attitude of the Government has not been changed 
since it was expounded and justified as follows by Prince 
von Billow in an address to the Prussian Agricultural Council 
in Berlin on March 14, 1907 : 

" A grave and difficult political struggle," he said (referring 
to the late elections to the Reichstag), " is behind us, which 
has called forth great excitement, but has also brought to the 
front again the sound commonsense and patriotic sentiment 
of the German nation, for struggle is the parent of all things. 
In this struggle one tie has happily not been weakened, but 
rather, as I hope, strengthened — the confidence between the 
German Chancellor and German agriculture. This confidence 
will also experience no change in the future — of that I am sure 
— when I prepare to fulfil wishes which have for a long time 
been cherished by the parties of the Left. . . . Some years 
ago a Liberal professor said to me : ' How can you, Herr Chan- 
cellor, as an educated man, carry on agrarian policy ? ' As 
if one could not be educated and still a thorough agrarian ! 
When, however, I contemplate the reforms referred to, the 
economic programme which I have for seven years represented 
and carried out remains unimpaired — protection for national 
labour, protection for our production, and particularly protec- 
tion and care for agriculture. I once told you that I regarded 
the name of agrarian as a title of honour, as a dignified dis- 
tinction, and when the time comes for me to retire from public 
life all I would ask to be written on my political gravestone 
is, ' He was an agrarian Chancellor.' " 

It is none the less inevitable that industrial and agricultural 
protection will stand or fall together. There are, undoubtedly, 
industries which could to-day do without Protection so long as 
imports were free all round, i.e., so long as the food duties, 
which constitute so large a charge upon the consumers, and, 
incidentally, upon the cost of labour, were abolished. It is 
admitted, however, that free trade in corn would, under existing 
circumstances, be a hazardous experiment, and there is no 
disposition to try it. 



252 THE EVOLUTION OF MODERN GERMANY 

At the same time it is a standing grievance of industry 
that the agrarians in general refuse to show an accommo- 
dating spirit and to act on the principle of " Live and let 
live." Their claim still is that the lion's share of the benefits 
which the State is able to confer upon the country by legis- 
lative and administrative measures shall fall to agriculture, 
and that the other interests of the nation shall be satisfied 
with the crumbs that remain. This claim was recently 
advanced by Dr. Oertel, in the name of the Agrarian League 
in the following candid fashion : " Their first principle, even 
to-day, when the Liberal bourgeoisie had again been taken 
into political favour, must be, No sacrifice of agriculture, 
the first-born child. So must it remain till the year 2000 
and the year 3000 ! German agriculture will never again allow 
itself to be crushed, not even buried under rose-leaves. It 
intends to live." It has even been suggested seriously that 
means should be adopted for preventing the further expansion 
of industry. The President of the Agrarian League said, in 
March 1907 : " German industry is now in the midst of so 
brilliant an era, and its resources and finance are so fully 
employed in all branches, that any further artificial expansion 
could only be disastrous. It is a question whether from the 
economic standpoint halt should not be called, in order to 
prevent an artificial over-production which would lead to a 
great catastrophe." Probably the author of these words would 
hesitate, even if he were able, to put into definite and under- 
standable terms the measures of restraint which, " from the 
economic standpoint," he would like to see applied to industry 
and trade, yet the underlying aim is plain — the transition of 
Germany from an agricultural to an industrial State is to be 
obstructed at every possible turn and by every possible device. 

In its defensive agitation the agrarian party receives powerful 
help from the Agrarian League, which has acquired such a 
position of strength in political life that it is able to exert a 
direct influence on Government policy and even to contribute 
towards the rise and fall of Ministers of State. It is the 
achievement of the Agrarian League that it has created a solid 
phalanx of agricultural opinion and influence — a powerful 
country party which voices the undivided sentiment of the 
larger owners and peasants. Before its formation the agri- 
culturists voted with the Conservatives, and the great majority 
were Conservatives, as they still are to-day ; yet while the 
domestic policy of that party has consistently been an agricul- 
tural policy, and in direct conflict with the special interests 
of industry and the towns, it had not in the past behind it 
the powerful support and impetus provided by a large and 



AGRICULTURE AND INDUSTRY 253 

concentrated rural party, united by a single aim. Since 1892 
the Agrarian League may be said to have swallowed up Con- 
servatism, though nominally it constitutes a political group 
apart. For while the members of the League in the Prussian 
Diet and the Reichstag differ in their attitude upon the details 
of the general Conservative programme, and may not always 
vote at the bidding of the official Conservative leaders on 
purely political questions, whenever an issue is brought to the 
front by the agrarians themselves, the whole body of Conserva- 
tive members usually join hands with the League. This is 
partly owing to fear lest the League should entirely drift away 
from the recognized political moorings of Conservatism, partly 
because the League is led by men who, whether wise and 
practical or not in their demands, certainly know what they 
want and go straight for their set goal, but chiefly because, 
in the main, the Conservative party continues still to be an 
agricultural party, in spite of the accession of a certain non- 
propertied element, which has never felt quite at home in its 
midst. 

So thoroughly have the League and its adherents become 
a class organization that there have been occasions when 
members of the League threatened to work with any party 
whatsoever, whether Radical or Socialist, in the event of the 
Government's refusal to satisfy their demands. When, on 
the other hand, they have supported the Government in critical 
situations, as on military or naval schemes, the agrarians have 
taken care to remind the Chancellor of the maxim of one of his 
predecessors, "Do et des,''^ and to secure a fair equivalent. 
Next to the party of Social Democracy no political organization 
in Germany is more energetic and consistent in the pursuit 
of class interests. 



CHAPTER XIII 

* THE SMALL HOLDINGS MOVEMENT 

Present extent of small holdings in Germany — Opinion of the East Prussian 
Land Commission — The creation of small holdings can only be at the 
expense of the great estates — The law of entail — The Prussian system 
of rent-fee farms — " Inner colonization " by land companies — The crea- 
tion of labourers' holdings — The Prussian Minister of Agriculture's 
proposals on the subject. 

TIERE is in circles interested in the rehabilitation of rural 
life, and in the welfare of the dependent people who 
live on the land, a strong body of opinion favourable 
to the creation on an extensive scale of small peasants' and 
labourers' holdings and properties, as a means at once of checking 
the flow of population to the towns, of diminishing the labour 
difficulty, and incidentally of counteracting the paralysing 
effect of the great estates. 

Hitherto it has been tacitly assumed that any weakening 
of the system of great estates in the North and East of Prussia 
would deprive the small farmers of the invaluable moral influ- 
ence which is supposed to be exerted by their powerful manorial 
neighbours, would bring agriculture to a standstill, and would 
make local government impossible, and of all this the large 
landowners themselves are even more convinced than the 
Government. Of late, however, the view has gained ground 
that a predominant system of large estates, absorbing economic 
and political influence and power, is not an unmixed good for 
the country, and this view has been supported by the proved 
ability of the small holders to withstand periods of agricultural 
depression which have severely tried the corn-growing industry. 
The Government honestly desires to multiply these small 
holders, by way of equipoise ; its difficulty is how to create 
new estates even of the smallest size without unduly interfering 
with the old and over-grown large ones. Many of the large 
proprietors are themselves beginning to recognize that only 
by the creation of some system of small holdings will the acute 
labour problem be alleviated. 

Yet in taking up this question of small holdings, as it is 

254 



THE SMALL HOLDINGS MOVEMENT 255 

doing in a serious spirit to-day, Germany is not by any means 
turning over a new leaf in her agricultural history. 

Happily for the nation, it already possesses a large race of 
small peasants who are able to keep abreast of the times, and 
to make a tolerable if not an affluent competency. The 
traditional home of the small peasantry is to be found in West 
and Central Germany, in Bavaria, and in the districts bordering 
on the North Sea. These peasants depend far more upon 
grazing than corn-growing, and for the most part they work 
their lands with the help of wife and children, and employ no 
labourers. 

Not only so, but the small holdings are steadily increasing 
in number and in aggregate area. Between 1882 and 1907 the 
agricultural holdings under 2 hectares (about 5 acres) in extent 
increased from 3,061,831, equal to 58 per cent, of the whole, 
to 3,378,509, equal to 59 per cent., while the number of holdings 
from 2 to 5 hectares in extent increased during the same period 
from 981,407 to 1,006,277, though here the percentage of the 
total showed a slight decrease. The holdings of from 5 to 20 
hectares increased from 926,605 to 1,065,539 ; while those 
from 20 to 100 hectares decreased from 281,510 to 262,191, 
those of 100 hectares and over decreased from 24,991 to 
23,566. The total number of agricultural holdings increased 
from 5,276,344 in 1882 to 5,558,317 in 1895, and 5,736,082 in 
1907, while the aggregate area under agriculture decreased 
between 1895 and 1907 from 32,517,941 to 31,834,874 hectares. 
These holdings comprised arable land, meadow and rich pasture 
land, garden land, and vineyards. 

In the opinion of many high authorities upon the agrarian 
question the future prosperity of German agriculture will 
largely depend upon the extent to which small farming is 
encouraged. It is a well-known fact that the most poignant 
cries of distress have invariably come from those parts of 
Prussia which are given up to large manorial estates, and that 
the districts identified with small farming, and especially those 
which do not depend exclusively on corn-growing, are still 
in a prosperous condition. This applies in a high degree to 
the Western provinces of that kingdom, like Rhineland and 
Westphalia, where the number of small proprietors and small 
leasehold farmers is exceptionally large. In some districts 
of the Rhineland it is estimated that at least a third of the 
entire area is held by leasehold tenants, who are willing and 
able to pay high rents, particularly in the neighbourhood of 
towns, where market gardening can be combined with grazing. 
In the adjoining province of Westphalia are found all fornris 
of tenure and cultivation — large estates, similar to those in 



256 THE EVOLUTION OF MODERN GERMANY 

the East, though few in number, peasant holdings of various 
size, and a host of small " parcels " — and in spite of the inroads 
made by industry town and country still develop satisfactorily 
side by side. 

The Land Commission which has for thirty years worked 
the State colonization scheme in the Polish districts of Eastern 
Prussia stated in a recent report : — 

*' The future of the great estates is threatened by the 
uncertainty of the supply of labour. Hence the assured form 
of agriculture to-day is that of the small and medium peasant 
with a property of from 25 to 50 acres. Dearth of labour 
does not affect him, and the sinking of corn prices does not 
affect him so directly or so severely, since he needs the greater 
part of his corn for his cattle. The basis of his economy is 
cattle breeding, and this becomes more than ever the case as 
the realization of animal products becomes more remunerative ; 
here he has a great advantage over the large proprietor, owing 
to the better care and control which he is able to exercise. 
He has appropriated the technical improvements introduced 
on the great estates, his machinery is in no way inferior to 
theirs, nor is his manuring, thanks to his increased stock of 
cattle ; while co-operative organizations have supplied him 
with easier credit and facilitated both the sale of his products 
and the purchase of his farm needs. Hence he is able to pay 
a higher price for his land than the large proprietor." 

The creation on any large scale of small holdings, however, 
can only take place at the expense of the great estates, and 
here, again, the whole weight of prejudice is against change. 
The large proprietors of the East of Prussia plead perpetual 
poverty, yet the last thing they are Willing to admit is that 
their interests and the interests of the community would be 
served by the disintegration of overgrown, unmanageable, and 
impoverished estates. Instead of making it easier to split up 
such estates the agrarians wish to make it still more difficult. 
Outlining the policy of the Agrarian League, the president of 
that organization. Baron von Wangenheim, said : — 

" What is especially necessary is the absolute prohibition 
of the private division of estates without State control — in 
other words, every alteration of possession must receive the 
sanction of a local or provincial court and a State Board of 
Cultivation under the Minister of Agriculture. We do not 
wish to inflict losses on the State, but we hold it to be in the 
national interest that the State should expend a big handful 
of millions in the cause of agriculture." 

Already the large proprietors are protected by a severe 
entail law, though the great majority of the entailed estates 



THE SMALL HOLDINGS MOVEMENT 257 

are of comparatively recent date. The Prussian constitution 
of 1850 expressly prohibited the creation of family entails, 
but a law of 1852 restored the old right. The right was also 
extended about the same time to other parts of Germany in 
which it had been repealed during the application of the Code 
Napoleon, though it is still unpermissible in Oldenburg and 
Alsace-Lorraine. 

It is in Prussia, the home of agricultural distress and the 
agrarian movement, that the system of entail prevails to the 
greatest extent. At the end of 1912 there were in that State 
alone 1,276 entailed estates with an aggregate area of 6,046,500 
acres, equal to 7 per cent, of the entire surface, against 6*1 
per cent, in 1895. Of this area 2,816,100 acres consisted of 
forest. The largest percentages of land entailed are in the 
provinces of Silesia and Pomerania, while the smallest per- 
centages fall to the provinces of East and West Prussia, 
Hanover, and Rhineland. In several Government Districts 
of the monarchy the proportion is as high as 18 and 21 
per cent. 

For the most part the entailed estates are of great size. 
In Prussia, for example, it is required that in order to be 
entailed a property must have a minimum rent of £375. The 
result is that only the large proprietors make use of the law. 
A return published a few years ago showed that 88*8 per cent, 
of the entailed land consisted of estates exceeding 2,500 acres 
in extent, and over 29 per cent, fell to estates exceeding 25,000 
acres. The 937 proprietors of these entailed estates owned 
some five and a half million acres of land and forest, or a million 
acres more than all the three and a quarter million small pro- 
prietors with holdings of five acres or less. Many persons 
would like to see a system of peasant entail to counteract the 
effect of the large entailed estates of the manorial proprietors, 
Bavaria has had a law on the subject since 1855, but it has 
been little used. 

In one respect, at least, the law of entail has been a blessing 
to the country, in that it has helped to preserve the forests 
which form so valuable a part of Germany's natural resources. 
In 1912 nearly one-seventh of all the forest land in Prussia 
was entailed, and nearly one-half of the entailed land in that 
State consisted of forest. 

Already something has been done in Prussia to multiply 
the number of small holdings by the laws of 1890 and 1891 for 
the creation by means of State credit of rent-fee farms (Renten- 
giitcr), a method suggested by the experience, rather than the 
success, gained by the colonization of the Polish provinces 
with German farmers. By these laws the State may acquire 

17 



258 THE EVOLUTION OF MODERN GERMANY 

land for division into small peasant properties, which are trans- 
ferred in return for an annual rent-charge, fixed either in 
money or in corn yet payable in money ; part of the rent-charge 
is irredeemable, so that the State retains an interest in the 
property. Such a property cannot be subdivided or in any 
way encumbered so that its economic independence is destroyed. 
The State acts through General Commissions and Rent Banks, 
advancing to the owners loans for the building of houses, etc., 
and the redeemable portion of the rent-charge is released by 
paj^ments spread over 5Q^ years. The holder is thus indebted 
to the State, and can count on more generous treatment than 
a private mortgagor generally allows. There are banks for 
the provinces of (1) East and West Prussia, (2) Brandenburg, 
(3) Pomerania and Schleswig-Holstein, (4) Posen, (5) Silesia, 
(6) Saxony and Hanover, (7) and Westphalia, Hesse Nassau, 
and Rhineland. 

Between 1893 and the end of 1912 the State had acquired 
in the various provinces of the monarchy 6,367 estates, and an 
area of 530,000 acres had been parcelled out into 19,010 properties 
of different size. In 1912 the number of properties so created 
was 1,216, of which 372 were under 2| acres, 221 from 2| to 
6J acres, 91 from 6j to 12j acres, 125 from 12| to 25 acres, 
314 from 25 to 62| acres, and 93 over 62j acres. More than 
half the land had been acquired and parcelled out in the 
two provinces of West Prussia and Pomerania. The condi- 
tions which apply to these properties carefully guard against 
alienation, with a view to the checking of speculation and the 
fulfilment of the objects of the law. Thus without the consent 
of the General Commission no property can be even partially 
sold or disposed of to a relative, even though the widow of 
the owner. 

The doctrinaire Radicals object to the rent-fee farms as 
an infraction of the sacred principle of freedom of trade, because 
the owner is not permitted to dispose as he will of a property 
which is not his until he has paid for it outright and which 
he voluntarily acquires with a full knowledge of the restric- 
tions. Certainly it has proved a disadvantage here, as in the 
case of the colonization of the Polish provinces, that public 
money when invested in land does not seem to go so far as 
private money, for the State both buys and sells worse than 
private individuals would either care or dare to do. The 
knowledge that the State is in the market has a wonderfully 
stimulating effect upon land values, and often estates which 
have long been a care to their owners acquire values never 
before suspected directly the Land Commission makes overtures 
as a possible purchaser. 



THE SMALL HOLDINGS MOVEMENT 259 

A scheme of home colonization on the Hnes of the settlement 
of East and West Prussia is also being carried on by land 
companies in the first of these two provinces and in Pomerania. 
The main purpose is to settle small farmers and labourers on land 
hitherto in German hands with a view to strengthening Ger- 
manism and keeping out Polish influence. Though the State 
does not direct this work, it advances money at low interest 
to settlement companies, not working for a profit, which buy 
eligible land and parcel it out into holdings of convenient size. 

The agrarians are not unwilling, subject to guarantees, to 
see the number of small farmers increased, but they are not 
enthusiastic about the idea of providing labourers with holdings. 
In the interest of the former they would like the State to extend 
to the monarchy generally the systeni of colonization partially 
applied in the Polish provinces. Some years ago they went 
so far as to introduce a bill authorizing the Government to set 
apart £600,000 as a first fund out of which to buy land with 
a view to creating farms of moderate size. The scheme was 
to have been worked separately in all the provinces by boards 
formed of Government officials and representatives of the 
Chambers of Agriculture. It was assumed that the price of 
the land would average £20 per acre, and that the fund would 
circulate seven times in twenty-one years, so that during that 
time some 210,000 acres of land would have been bought and 
divided into small properties. The Government did not 
favourably receive the proposal and it fell through. There 
were not wanting critics who, rightly or wrongly, saw in the 
scheme only an endeavour to create convenient facilities for 
enabling encumbered landowners to dispose of their estates 
to a generous buyer. 

Nevertheless, the settlement of the labourer on the land 
is a question which seriously exercises the Prussian Govern- 
ment. " The State," said the Minister of Agriculture on 
February 7, 1907, " has a high interest in having as large a 
number of sound holdings as possible. By that I do not mean 
to say that the large estates are not necessary in many districts. 
Any one who knows Prussian history and the part which the 
great proprietors have played in the past, and who knows 
that communal self-government is impossible without the 
large landowners, who form the bulwark of agricultural progress, 
and that high technical development in agriculture is almost 
solely due to them, will be in no doubt on that point. It is, 
however, indubitable that while in some districts there are 
too few large estates, in others there are too many." 

" The agriculturists," he proceeded, " must take up this 
question with all energy, though hitherto I have unfortunately 



260 THE EVOLUTION OF MODERN GERMANY 

seen little inclination on their part. It is feared that the 
settlers would go to the neighbouring towns to work, and, 
eventually, would simply fall on the Poor Law funds. That 
might be the ease in certain circumstances, but not in all. I 
therefore regard it as short-sighted not to make use of this 
means — whose systematic application would be more effective 
than any other — of relieving the scarcity of labour. The foreign 
supplies of labour, upon which we have hitherto drawn, are no 
longer in a position to cover our needs, and they will still be 
less able in the future, while they may fail us at any moment. 
Let us, therefore, prepare betimes before it is too late." 

The main lines upon which the Government proposes to 
deal with this question have been laid down in an Order issued 
by the Ministers of Agriculture and Finance with the intention 
of facilitating the application of the law regarding rent-fee 
farms to agricultural and industrial labourers. This Order 
sanctioned the reduction of the minimum area of a small holding 
under the Rent-fee Farm Law of 1891 to about 12J ares, 
or a third of an acre. Such labourers' holdings are not to be 
created in colonies, and so far as industrial labourers are con- 
cerned there must be proof that where holdings are desired 
there exists a prospect of permanent work, so that there may 
be no fear of the holdings having to change hands. In order 
that a labourer may have a definite interest in his holding he 
is to be required either to leave an annual rent or mortgage 
charge on his land, irredeemable for at least ten years, or to 
provide surety for the payment of the rent- charge for from 
ten to fifteen years. Moreover, it is expected that a small 
holder will pay down from one-tenth to one-eighth of the 
purchase money. 

In general, small holdings can only be created under this 
scheme through the Land Banks, by communal unions, by 
co-operative societies, or by public utility associations, though 
employers desirous of providing their workpeople with holdings 
of their own, and other private persons subject to suitable 
conditions, are allowed to take advantage of the law. As to 
the dwellings to be built upon these small holdings, it is pro- 
vided that at least from 85 to 90 per cent, of the land may not 
be built upon, and that only one-family houses of two stories 
at the most, together with the necessary farm buildings, may 
be erected. For the protection of Germanism it is required 
that in " the nationally-threatened districts " of the East and 
West of the kingdom (i.e. the districts in which Poles and Danes 
predominate) the owners of holdings shall bind themselves 
to ensure the retention of the land in German hands, and in 
certain circumstances the State is to be able to exercise a right 



THE SMALL HOLDINGS MOVEMENT 261 

of re-purchase at a price which is never to exceed 90 per cent, 
of the market vahie of the holding. For the carrying out of 
this scheme it has been proposed to set apart a portion of fiscal 
land in every administrative " Government district " for the 
creation of labourers' holdings — from fifteen to twenty in each 
district — the purchase price being £275, viz. £75 for land and 
£200 for buildings, payable in instalments spread over sixty 
years. 

The great objection to the creation of holdings of this 
character is that they cannot by any possibility do more than 
keep a family in vegetables and goats' milk, and must be 
regarded as allotments to be cultivated in spare time, and it 
is the constant complaint of the agricultural labourer that 
his endless duties leave him none of this commodity at his 
disposal. Hence the work on his patch of a third of an acre 
of land will either mean over-exertion, or it will have to fall 
on his wife and children, and in any case he will need to earn 
his livelihood as before by farm work. 



CHAPTER XIV 

THE RURAL LABOUR PROBLEM 

Extent of rural migration — The " land-flight " of the labourer and its causes 
— the effect of machinery in increasing seasonal labour — Conditions 
of rural life — Housing and wages of the agricultural labourer — Rural 
migration and poverty : a statistical comparison — Methods of remunera- 
tion — Payment in kind, and examples of wages agreements — The spirit 
of feudalism still perpetuated in North and East Prussia — Baron vom 
Stein's laws against serfdom — How the effect of the Edict of Emanci- 
pation was weakened — The " Servants' Ordinances " — Inability of the 
agricultural labourer to combine or strike — Breach of contract by agri- 
cultural labourers — Modem social legislation has ignored the rural 
labourer — A Prussian landowner's opinion of lost opportunities — The 
system of semi -bound labour doomed — Proposed remedies for the 
" land-flight " — The importation of foreign labour — Absence of organ- 
ization in rural districts — The unpopularity of Socialism amongst 
agricultural labourers. 

IN the whole Empire there were in December 1910, 1,259,873 
foreigners in a population of 64,926,000, representing a 
proportion of 1-94 per cent., while at the census of 1890 
there were 433,254 foreigners in a population of 49,428,000, 
representing the proportion of only 0-87 per cent. It has been 
estimated that at least 400,000 migratory foreigners are em- 
ployed in summer as labourers in the agricultural districts of 
the country. Prussia alone had in December 1910, 688,839 
resident foreigners, equal to 1-7 per cent, of the total population 
(40,165,219), and 413,000 of these foreigners came from Austria, 
Hungary, and Russia, about 60 per cent, of them being males. 
Yet in 1895 Prussia had only 205,818 foreigners and in 1885 
156,970. The number has increased during twenty-five years 
from 5-5 to 17-1 per 1,000 of the population. 

These striking figures point to one of the most serious prob- 
lems by which agriculture, and particularly the agriculture of 
Prussia, is confronted, viz. the persistent dearth of native 
labour, and, in recent years, labour of any kind. One of the 
phrases most commonly on the lips of agricultural writers, and 
most constantly recurring in the agricultural debates which 
occupy so large a part of the attention of the Prussian Diet, 
is '* the land -flight (Landflucht) of the labourer.*^ Any explana- 

262 



THE RURAL LABOUR PROBLEM 263 

tion of the reasons of the remarkable migration from the rural 
districts which has occurred during the past twenty years 
brings us face to face with some of the underlying conditions 
of Prussian agriculture which are at once the misfortune of 
the country and the despair of the true agricultural reformer. 
'' We understand by the term ' Movement from the country,' 
or, as it is also called, ' land-flight,' " writes Sohnrey, " not 
merely the natural movement of population which bears the 
superfluous surplus of rural strength to the towns, but the 
unnatural precipitation of that movement, which more and 
more depopulates the country and overpopulates the towns." 
But the movement can only be regarded as an " unnatural " 
one because the causes which have produced it are also, in 
part, " unnatural." What we see, in fact, is the wholesale 
withdrawal from the rural districts of those who have imme- 
morially been the mainstay of agriculture. The townward 
movement is specially strong in the Polish provinces and the 
backward North of Prussia, where it amounts to an absolute 
calamity both for the large proprietors and the farmers who 
need one or two hands for the most part of the year. 

How great is the migration from the Polish provinces in 
particular will appear from proofs easy to apply. It is 
required that workmen insured against old age and invalidity 
shall return their receipt cards to the places where they were 
first issued, wherever they may be at the time. There is thus 
a constant exchange of cards between the Central Boards of 
the Empire. In 1907 the returns of the Board for Posen showed 
that 65,003 persons more had left the district than had arrived, 
and in 1906 the excess was 74,101, making 139,104 for two 
years. In 1906 15,642 more persons went to Berlin than came 
thence ; the excess of removals to the Rhine Province was 
9,339, and the excess of removals to Westphalia was 8,405. 
The majority of the migrated Poles had been engaged in agri- 
culture, but had turned to industry ; only a small minority 
had been domestic servants ; of those who returned to the 
province of Posen a large part were elderly persons. 

Statistics prepared by the Government of the province of 
East Prussia, with the aid of the elementary school teachers, 
showed that during the year 1905-6 over 2,400 families left 
that province, most of them going to the West of the kingdom, 
and few going abroad. It was found that almost half the 
recruits called up from the rural districts did not return to 
their former agricultural employment. ^ The migratory spirit 
would appear to infect girls hardly less than young men. Dr. 
Binderwald, who investigated the movement of population 

1 Debate in the Reichstag, February 12, 1907. 



264 THE EVOLUTION OF MODERN GERMANY 

from the Saal district, found that of 4,575 girls who were born 
in that district between the years 1884 and 1888 no less than 
3,006, or 66 per cent., had in 1904 left agriculture and migrated 
to the towns, there taking work as factory operatives, domestic 
servants, sempstresses, laundry workers, saleswomen, etc.^ 

Further, if the statistics of oversea emigration are examined 
it is found that a far larger ratio to population falls to the agri- 
cultural States and the agricultural provinces of other States 
than to the industrial States and districts. Thus the emigrants 
of German nationality who left Prussia in 1913 numbered 31 
per 100,000 of the population, but the proportion ranged from 
12 and 19 per 100,000 in the industrial provinces of Silesia and 
the Rhineland to 49 and 60 in the agricultural provinces of 
West Prussia and Schleswig-Holstein. Of the secondary States 
industrial Saxony had the lowest rate, viz. 20 per 100,000, 
while the rate for Wiirtemberg and Baden was 27 and that for 
agricultural Bavaria 31. The figures for years of high emigra- 
tion are still more striking. 

All sorts of reasons have been advanced by the agricultural 
party and its spokesmen in the Press for the depopulation 
of the country districts, on the one hand by unreasoning advo- 
cates who see in the restlessness of the labourer only a proof 
of perversity, and on the other by serious men who recognize 
that if there is a landowner's side to the question there is as 
surely a labourer's side as well. As an illustration of the 
superficial method of explaining the land -flight of the labourer, 
the following passage may be quoted from an agrarian 
organ : — 

" An evil spirit stalks through the land, taking the form of 
disobedience, of resistance, of the emancipation of all the lower 
instincts. Our youth is specially possessed by this spirit, which 
is like a devastating pestilence. The symptoms of the malady 
which has seized hold of our youth point clearly to the proper 
remedy. We are suffering from a pestilence of education, and 
it is inoculated in the school, and through the school it poisons 
the juvenile mind and body. The consequences are seen in 
the flight from the country, in the fear of physical work, in 
effeminacy, and in superficiality." 

The same frame of mind was reflected by a large Silesian 
landed proprietor who said at a recent congress of agrarians : 
" The children learn too much to-day, and the result is that 
we can no longer get labourers." To many persons it will seem 
that sentiments like these may go far towards explaining the 
evil of which their authors complain, yet while a certain signifi- 

^ Sesahaftigkeit und Abwanderung der weiblichen Jugend vom Lande (Berlin, 
1906). 



THE RURAL LABOUR PROBLEM 265 

cance cannot be withheld from them they fail to do justice to 
the landowners' difficulty. 

One of the most important factors in the case is the large 
extent to which the permanent labourer, engaged all the year 
round, has been replaced on the large corn-growing estates 
by the seasonal labourer, owing to the increasing use of 
machinery of various kinds — in ploughing, sowing, and reaping — 
so that work which formerly occupied weeks can now, when the 
season comes round, be done in an equal number of days. The 
result is that a far smaller number of men is needed during 
the greater part of the year, and the farmer naturally restricts 
his supply to the indispensable number required in winter, 
trusting for the rest to such occasional assistance as he can 
procure. The displaced settled labourer tried the lot of the 
seasonal worker for a time, picking up odds and ends of a 
penurious livelihood in the ofl-seasons as best he might, until 
the life became too precarious and he tired of it. The more 
the use of machinery has increased, in fact, the stronger has 
become the movement to the towns. Hence it is the largest 
estates, best able to employ mechanical appliances advanta- 
geously, which in the busy seasons of the year suffer most from 
the dearth of settled labour. 

Herr Evert, writing from the landowners' standpoint, and 
speaking specially of the East of Prussia, says : — 

" In consequence of the unfavourable climate it is impossible 
to distribute the necessary operations of agriculture in the 
East so equally throughout the year as in the West. In the 
short summer, when so much has to be done, the agriculturist 
requires a comparatively large number of labourers, horses, 
and other stock, in the short winter fewer. As to his draught 
horses, he can to some extent remedy matters by the reduction 
of the forage rations, but he cannot do this in the case of labour. 
What can he do ? Of every undertaker, whether he be a 
farmer or a manufacturer, it is primarily to be expected that 
he shall work economically, otherwise he is not in his right 
place. But the farmer who permanently keeps more labourers 
than he can employ does not so work. So long as the power- 
worked thrasher was unknown, weaving for home use and 
the thrashing-floor afforded the farm labourer ample employ- 
ment in winter. But in this domain, as in others, technical 
progress has created social evils. An employer cannot be 
expected to renounce the advantages of the machine-thrasher 
in order to keep his labourers in regular employment. Certainly 
he acts more according to economic principles if he keeps per- 
manently, in yearly contract, only so many labourers as he 
can fairly employ in winter, and for the rest trusts in summer 



266 THE EVOLUTION OF MODERN GERMANY 

to seasonal labour. Hence the much-lamented land-flight in 
the East is by no means due alone to the farm labourer's hope 
of attaining better or pleasanter conditions of life by migrating 
to the town ; it is also due to a certain extent to the revolution 
in the conditions of production which compels the farmer to 
reduce the number of his permanent labourers, in so far as 
they cannot be employed in winter in forest work, road- 
making, and other improvements, etc. However disagreeable 
rural seasonal work may be from the social standpoint, from 
the economic standpoint it is for the individual farmer to 
some extent a necessary evil." ' 

But here the question is not exhausted. The modernizing 
of the methods of cultivation explains why the large estates 
cannot employ so much labour all the year round as formerly, 
and it also gives a good reason why those labourers who are 
only offered seasonal employment do not choose to remain 
on the land, but it does not explain why there is a dearth of 
labour at all times of the year. And the causes which have 
produced this larger problem, which is far more serious than 
that of seasonal scarcity — which has hitherto been remedied 
to a large extent by the importation of labour from Russia, 
Austria, and Galicia — may well be summarized in one, viz. 
the unhappy conditions imder which the agricultural labourers 
are still compelled to live in most parts of the rural North 
and East. Low wages, poor dwellings, social ostracism, an 
almost feudal relationship towards his employer, the depriva- 
tion of civil rights which have been conferred upon the urban 
working classes — in these tokens of his inferiority as a man 
and a citizen lies the principal explanation of the agricultural 
labourer's unwillingness to remain in the country and of his 
migration to the industrial districts of the West in increasing 
numbers, insomuch that in the Westphalian coal-mines there 
are to be found tens of thousands of Poles who have during 
the past few years abandoned their native provinces in the 
East. Of 387,000 mineirs employed in the Diisseldorf, Miinster, 
and Arnsberg Government districts alone 135,000 were found 
to have come from the eastern provinces of Prussia, and to be 
overwhelmingly of Polish race. In some districts 50 and 60 
per cent, of the mining population are either of Polish or foreign 
extraction. It is not too much to say that without the Poles 
who have migrated from the East of Prussia and the aliens 
from Western, Eastern, and Southern Europe, many of the 
collieries of Westphalia would have to be closed. To use a 
catch-phrase which has latterly become current, and which 
fairly describes the problem, " the need of labourers is attribu- 
1 Der deutsche Osten, pp. 7, 8. 



THE RURAL LABOUR PROBLEM 267 

table to the labourers' need." Everything that makes life 
worth living, that adds dignity to labour, that gives men self- 
respect and hope, is withheld from the great mass of the 
labourers who work the large estates of the East Elbe proprietors. 

There is no need to accumulate evidence as to the inferiority 
of housing conditions in rural districts. A prominent agrarian. 
Baron von Manteuffel, on a recent occasion sought to induce 
the Government to make the right of agricultural labourers 
to migrate to the towns dependent on proof that they had 
healthy homes to go to there. The argument proceeded from 
the assumption that rural houses are better than urban, which 
is far from being the case, so far as the large towns are con- 
cerned, though the rents of urban dwellings are, of course, very 
much higher. The publications of the public health department 
of the Prussian Ministry of Education and Public Worship 
speak of unhealthy rural dwellings in most parts of the monarchy 
— of insufficient space, dilapidated buildings, of darkness, 
damp, and decay, of unwholesome drainage and water supply, 
and living-rooms and pigstyes in immediate conjunction. 
One of the most potent reasons for this state of things is un- 
doubtedly the fact that the dwelling is so frequently part of 
the labourer's wages. 

That it is largely poverty which drives the labourers from 
the country to the towns is a fact which has never been seriously 
contested, and a study of the Prussian Government's returns 
of internal migration in conjunction with those of incomes of 
persons liable to State income tax points to conclusions the 
significance of which cannot be gainsaid. It is true that only 
incomes exceeding £45 per annum are included in the latter 
returns (since incomes below that figure are exempted from 
taxation), so that the proportion of the entire population 
covered is little more than a third, but as these incomes are 
family incomes and include not only money wages, but all 
payments in kind — house, land, wheat, seed, potatoes, flax, 
etc. — it follows that a very considerable number of agricultural 
labourers will be scheduled. The broad result of such a com- 
parison between wealth and movement of population is that 
districts with the highest proportion of taxable incomes have 
the largest amount of immigration, and conversely that where 
the taxable portion of the population is smallest there is most 
migration, so that in some of the poorer districts rapid depletion 
is taking place. 

The difference between West and East is very striking. 
On the average of the years 1899 to 1903 163 per thousand of 
the population of the Dusseldorf Government District were 
assessed to State income tax as having incomes exceeding £45, 



268 THE EVOLUTION OF MODERN GERMANY 



and during the years 1895 to 1900 the excess of immigration 
over migration outwards was 8 per cent. On the other 
hand, all the 24 Government Districts (out of a total of 37) 
with less than 100 inhabitants per 1,000 of the population 
liable to income tax showed an excess of migration over immi- 
gration, and nearly all these were districts in the East or 
North-East of the kingdom. Of the latter the most notable 
instances were the following : — 



Government District. 


Number of Inhabitants 

per 1,000 liable to 

Income Tax, 


Decrease of Population 

owing to Migration, 

1895-1900. 


AUenstein 

Marienwerder 

Posen 

Gumbinnen 

Bromberg 

K5slin 

Aurich 


36-8 
43-5 
44-4 
45-3 
49-2 
49-3 
84-6 


Per cent. 
11-4 
7-3 
7-9 
6-9 
6-4 
6-4 
3-2 



The correspondence is so general as to establish the rule that 
relative poverty implies a relatively high rate of migration. 

The same result is arrived at when we compare the migration 
of the population in relation to the official standard rate of 
day wages, i.e., the " customary day wages of the locality," 
as fixed under the Insurance Laws by the higher administrative 
authorities in conjunction with the communal authorities. 
These rates are as a rule somewhat below the wages actually 
paid, yet they afford a valuable standard of comparison between 
the different parts of a country or a province. Here, again, it 
is found that where the rate of day wages is highest there is 
as a rule more immigration than migration and vice versa. 

The Jahrbiicher fur Nationalokonomie und Statistik published 
an analysis of returns of agricultural wages (money only, 
without payment in kind) collected in 1905 by administrative 
authorities in all parts of the Empire. The wages were found 
to fall into five groups : — 



1st Group 


£15 to £21 per annum 


2nd Group 


£21 to £27 „ 


3rd Group 


£27 to £33 „ 


4th Group 


£33 to £39 „ 


6th Group 


£39 to £46 „ 



It was found that wages of the first class were paid in 81-13 
per cent, of the area covered by the returns, wages of the second 
class in 41*81 per cent., wages of the third class in 24*43 per 
cent., wages of the fourth class in 2-49 per cent., and wages 



THE RURAL LABOUR PROBLEM 



269 



of the fifth class in 14 per cent. ; so that wages of between 
£15 and £27 (roughly from 6s. to 10s. per week) were paid in 
nearly three-quarters of the entire area covered by the returns. 
The lowest rates fell to the agricultural provinces of Prussia 
and Bavaria, and especially to East and West Prussia, Posen, 
Lower Silesia, Upper Palatinate, and Upper and Middle Franconia. 
The lowest rates of wages were not paid at all in the Prussian 
provinces of Saxony, Hesse-Nassau, Schleswig-Holstein, and 
Rhineland, where there is either industry or progressive agri- 
culture, nor yet in the Kingdoms of Saxony and Wiirtemberg. 

The highest rates were paid in certain districts of Branden- 
burg, Schleswig-Holstein, Hanover, Westphalia, Rhineland 
(Prussia), in Upper Bavaria, the Kingdom of Saxony, Wiirtem- 
berg, and Hesse. It was also found that the wages were 
higher in districts in which estates of medium size predominated 
than in those in which large and small estates predominated. 

As between the various parts of Prussia there is considerable 
difference in the level of wages. While the highest rates are 
paid in the West, in the neighbourhood of the industrial 
districts and in the home of small farming, wages are lowest 
in the North and East, between which there is little to choose, 
although the labourers are of different race, those of the East 
being for the most part Poles, while those in the North are of 
the patient, stolid, much-enduring Low German stock. 

The Reformblait fur Arheitenwrsicherung published in 1907 
the following analysis of money wages paid to adult agricultural 
and forest labourers in various administrative circles of the 
province of East Prussia, perquisites being here disregarded : — 



Males. 


Females. 


Number of 


Yearly Money- 


Number of 


Yearly Money 


Circles. 


Wages. 


Circles. 


Wages. 




£ S. d. 




£ 8. d. 


14 


18 


1 


10 


1 


18 15 


11 


10 10 


6 


19 10 


1 


11 5 


5 


20 


10 


12 


1 


20 10 


2 


12 10 


1 


21 


1 


13 


1 


22 


4 


13 10 


4 


22 10 


4 


15 


2 


25 


1 


16 


1 


22 10 




^ 



In all the cases given above payment in kind was supple- 
mentary to the money wages, and the labourers' actual position 



270 THE EVOLUTION OF MODERN GERMANY 

can only be understood when the full terms of his contract of 
services are considered. Generally a small cottage, worth at 
the local value Is. or Is. 6d. per week, is part of the wages, 
and frequently a plot of land for potat9es, a certain quantity 
of food corn, bread, or vegetables, with wood or turf for fuel, 
and sometimes pasturage for a goat, a sheep, or even a cow 
are added. 

The value of these various payments in kind (known as 
" Naturalien "), differs in every individual case. The Deutsche 
Zcitung (the organ of the Agrarian League) recently published 
the following as the wages and perquisites of the average 
Pomeranian labourer : Money wages, £11 10s. per annum with 
a bonus (conditionally) of £1 10s. ; a dwelling-house, 28 cwts. 
of corn, 50 cwts. of potatoes, about 3 quarts of skimmed milk 
daily, and 40 cwts. of briquettes. The total remuneration 
would in normal times be as follows : Money, £13 ; rent (at 
Is. 6d. weekly), £3 18s. ; corn (at 7s. per cwt. wholesale), 
£9 16s. ; potatoes (at 2s. per cwt. wholesale), £5 ; milk (1,095 
quarts at Id.), £4 lis. 3d. ; briquettes (at Is. per cwt.), £2 ; 
total, £38 5s. 3d. ; equal to 14s. 8d. per week. This must be 
regarded as an outside estimate, however, and cannot be 
taken as representative of Prussian estates generally. 

A glance at specimen contracts of service customary in 
the East will give the best idea of the sort of life the rural 
labourer leads, though the rates of wages and the value of the 
perquisites may no longer apply. The basis of the organisation 
of agricultural labour which still continues in that part of 
Germany is the Instmann, who is a sort of master labourer. 
He engages himself by the year to the lord of the manor, and 
is paid partly in money and partly in kind. As a rule his wife 
and children render service either regularly or at special seasons, 
and frequently he has labourers under him. These men he 
engages on his own terms, and for their board and lodging he 
is responsible, while the landlord pays him for their labour 
according to a fixed rate which forms part of his own contract 
of service. 

A wages contract relating to the province of East Prussia, 
and concluded in 1906, runs as follows : — 

" The labourer receives free dwelling, 6 cubic metres of 
wood for fuel, half an (English) acre of land for potatoes, 
forage for two or three goats, and straw. He receives per day 
from October 1 to April 1, 1 mark (Is.), and from April 1 
until mowing time, 1 mark 25 pfennige (Is. 3d.), and from then 
to October 1, 1 mark 50 pfennige (Is. 6d.). His wife receives 
50 pfennige (6d.) per day all the year round. For thrashing 
with the flail the labourer receives the 14th bushel." 



1 


2i 


1 


n 


1 





1 








H 



THE RURAL LABOUR PROBLEM 271 

The wages, both in money and kind, of this labourer, who 
had six children, might probably be estimated at that time at 
£24 per annum ; the money wages alone (306 days — 152 at 
Is., 75 at Is. 3d., and 79 at Is. 6d.) working out to 7s. per 
week. 

The following is another contract relating likewise to 
East Prussia (the money converted into the nearest English 
equivalents) : — 

" The working day is 14 hours, with intervals of 3 hours 
fixed by the factor. 

" (1) Except at harvest time the daily rates of wages are : — 

s. d. 
Men who can mow, from April 1 to the 

end of the potato harvest 
Ditto, after the potato harvest 
Young men over 18 years who can manage 

horses and oxen . . 
Women and girls over 18 years . . 
Young men and girls under 18 years 

" (3) During the corn harvest (4 to 6 weeks) — 

Men . . . . . . . . . . ..16 

Women and young men and girls over 18 

years 1 2J 

Young men and girls under 18 years . . 10 

" (3) For overtime men receive Ifd. per hour, and all other 
labourers Ijd. 

" (4) Payments in kind additional — Dwelling-house consist- 
ing of bedroom with straw sack and cover, and a common 
kitchen, and for every labourer weekly 3J litres (3 quarts) of 
skimmed milk, 22 lb. of potatoes, 8| lb. of bread, 1 lb. 11 ounces 
of flour, 17 ounces of peas, 17 ounces of rice, 17 ounces of meat 
(or 7|d.), 17 ounces of fat (or 6d.), and 9 ounces of salt." 

The aggregate money value of all remuneration would here 
be about £31 10s. 

In the following contract, which relates to the province of 
West Prussia, the Instmann is specially mentioned : — 

" The Instmann is required to work from April 1 to Octo- 
ber 1 from sunrise to sunset, and during the rest of the year 
from light to dark. His wife is required to work from April 1 
to the end of the harvest every afternoon for 3d. per day, and 
must be ready at any other time to engage in house work from 
early morning at 6d. per day. 

" During harvest the labourer is expected to work on 
Sundays and holidays when required. 



272 THE EVOLUTION OF MODERN GERMANY 

" The wages of the Instmann are : — 

" Free house, 90 square rods of garden land, and 185 
square roods of potato land in the field. 

" Food for every 30 work days as follows : 88 lb. rye, 
24 lb. peas, and 19 lb. barley. 

" Five cords of turf or 35 cwts. of coal, and 2 cubic metres 
of wood for fuel, subject to a payment of Is. 6d. per 5 cords 
of turf or 7 cwts. of coal for getting the same. 

" In money wages — From Martinmas until April 1, 3|d. 
per day ; from April 1 to June 1, 4|d. ; from June 1 to Sep- 
tember 1, 6d. ; and September 1 to Martinmas, 3jd. 

" The ploughman receives from Martinmas to April, 3jd. ; 
from April 1 to September 1, 4|d. ; and from September 1 
to Martinmas, 3^d." 

In this case the Instmann had to pay 3s. for pasturage for 
a cow. Is. for a pig, and 6d. each fo^ young pigs, also 6 young 
pullets yearly by way of heriot. His money wages were about 
£6 per annum, but so small a payment is exceptional. 

Some wages contracts provide for the labourer living in his 
own dwelling and finding his own food. The following is an 
example (the values are converted) : — 

" The employer or his agent determines which work shall 
be performed at piece or time rates. The rates of pay are as 
follows : — (1) Day wages with full board and lodging — For 
the husband. Is. Ijd., and at harvest Is. 3jd. ; for the wife 
lOd, and Is. respectively. Day wages, without board and 
lodging — For the man Is. 7jd. and for the wife Is. Ijd. In 
addition 25 lb. of potatoes are given per head weekly and 
If pints of skimmed milk daily. The employer fixes the 
time for beginning and ending work. In every case 35s. shall 
be deducted from the wages and shall only be returned on 
the determination of service. In the event of discharge 
owing to unpunctuality, insubordination, drunkenness, or other 
irregular conduct this money shall be withheld." 

The following contract was communicated by a Pomeranian 
landowner to a Berlin newspaper in January 1907 in refuta- 
tion of certain criticisms which had been passed upon labour 
conditions on his estate : — 

" Money wages for the labourer of £11 10s. per annum, 
also 6d. for every cartload of corn led to town. 

" Wages of two children, 14 and 16 years respectively, 6d. 
and 7jd. per day, and of an older youth Is. 

" Free dwelling, consisting of one living room, one bedroom, 
and a small kitchen, a loft and a garden. 

" Stabling for two pigs, two goats, and ten hens. 

'' One Magdeburg acre or 60 square rods of potatoes. 



THE RURAL LABOUR PROBLEM 273 

"28 cwts. of wheat, rye, etc., and grazing and hay for two 
goats. 

" 5J pints of milk per day. 

" Free cartage of fuel, and 40 cwts. of briquettes. 

" Free medical attendance and medicine for the labourer 
and his family. 

" Work begins at 4 a.m. with the feeding of the horses." 

It will be safe to place the money value of the wages and 
allowances of the man alone at £36 per annum, or 14s. 
weekly. 

Finally an agreement relating to the Kingdom of Saxony 
and concluded in 1906 may be quoted : — 

" Hours of work, 5 a.m. till 7 p.m. Half an hour allowed 
for breakfast and afternoon vesper and an hour at noon. 

" The wages are as follows — Men, 10|d. per day when not 
on piecework ; women and youths, 9jd. per day when not on 
piecework ; overtime, 2d. and Ijd. respectively per hour. 

*' Rations — For men, 11 lb. of bread per week, women 
and youths, 8*8 lb., with 8 quarts of skimmed milk, 1*10 lb. 
of fat, 1*10 lb. of meat or 6d., 27 J lb. potatoes, 1*10 lb. rice or 
lentils, 1*10 lb. peas, 1*10 lb. barley, J lb. flour, J lb. salt. 
These rations may not be sold or given away, and anything 
left over belongs to the employer ; every infraction of this 
condition is punishable with a fine of 2s. On demand the 
labourers must at all times work by piece, and then they must 
pay 4|d, per day for food. 

" The following time is allowed to women for preparing 
meals — Forenoon from 10 to 12 and afternoon from 6 to 7. 

" The labourers further have free lodging, with a straw 
pallet and a coverlet for each person, and free fuel. The 
dormitories are divided for the sexes. Every labourer has to 
deposit 30s. as security, this being deducted from his wages 
at the rate of 3s. or 4s. weekly. 

" Sickness premiums and taxes must be altogether paid by 
the labourers and are deducted from their wages. Whenever 
necessary the labourer must work on Sundays." 

On the larger manorial estates it is usual to stipulate in 
the labourers' wages agreement for the services of his wife as 
required, and also of all children of working age, for the whole 
family is expected to be at the call of the employer at any 
time. On these estates it is no uncommon thing for the schools 
to be closed at given seasons, so that all children over ten 
years may be turned into the woods to plant trees or destroy 
insects, into the fields to weed, glean, or pull beets, or to dc 
other land work. When the task is over the school reassembles 
and all goes on comfortably as before. The teachers do not 

18 



274. THE EVOLUTION OF MODERN GERMANY 

like these uncertain interruptions, nor yet do the school 
inspectors, but they are helpless. 

It would be possible to multiply illustrations of agricultural 
labour contracts indefinitely, but those quoted are represen- 
tative. On the whole a fair estimate of a labourer's pay will 
be from £25 to £40 in money and in kind.^ 

Since the time to which these figures relate there has been 
a steady increase in rural wages, but it is not believed to have 
kept pace with the higher cost of living, and it is quite certain 
that it has not sensibly improved the labourer's material 
position or broadened his social outlook. The predominant 
rates of wages paid in summer to men for day labour by the 
administration of the Prussian State forests in 1911 were from 
2s. to 3s., and those paid to women and young people Is. to Is. 4d., 
in each case for a day of ten hours ; the winter rates were in 
all cases about 10 per cent, lower, with a day of 8 hours. The 
rates paid to men for piece work ranged from 2s. 6d. to 4s. 
in summer and from 2s. to 3s. lOd. in winter. Returns, covering 
the whole kingdom, published by the Bavarian Government show 
that in 1 91 3 the predominant rates of wages of agricultural labourers 
were from £27 10s. to £37 10s. per annum for men and from £20 
to £30 for women, and for young people (16 to 21 years) from 
£22 10s. to £32 10s. for males and from £17 10s. to £27 10s. for 
females. In addition there are the usual perquisites. 

Yet even low wages would not always have driven the labourer 
from the land had not his legal position been such as to make 
it difficult, and often impossible, to assert any claim to improved 
conditions of life. With the domestic servant the agricultural 
labourer in most parts of Germany is in the unique position 
of being legally disqualified from combining for economic 
ends. The law of Prussia will serve as an illustration of this 
disability. In order to understand the position of the agri- 
cultural labourer in Prussia it is necessary to go back to the 
emancipation of the serfs at the beginning of the nineteenth 
century. Convinced by his Ministers Baron vom Stein, von 
Schon, and others of the necessity of abolishing feudalism, 
King Frederick William III, on October 9, 1807, issued his 
famous Edict which, in addition to decreeing freedom of 
occupation both for burghers and peasants, and permitting both 
to acquire and hold property without condition, released the 

1 A Clerical deputy said in the Reichstag on February 8, 1907 : " The 
wages of agricultural labourers in Upper Silesia are high enough. A labourer 
with £30 10s. (under 14s. per week) in Upper Silesia is as well off as a Berlin 
workman with £60 or £70." A Conservative landowner from Pomerania 
added : " The agricultural labourer earns with us from 2s. to 3s. a day in 
summer, and has a piece of land and a good healthy dwelling." Taking the 
whole year together, however, it is questionable whether the daily rate would 
exceed Is. 6d., equal to £22 10s. per annum for three hundred days' work. 



THE RURAL LABOUR PROBLEM 275 

cultivators of the soil in particular from their dependent 
position by the following clauses (10-12) : — 

" After the date of this Edict no subject-relationship shall 
exist further, whether by birth or marriage, by the assumption 
of a subject position, or by contract. . . . With Martinmas 
Day of 1810 all serfage in our States ceases. After that day 
there shall exist only free men." 

But the large manorial proprietors viewed with apprehension 
the prospect of their labourers being free to £o and do as they 
wished, and they besought the King to sanction the issue of 
a code of regulations for servants, or " Servants' Ordinance " 
{Gesindeordnung), by which the liberty of the labourer would 
be restricted and he would still, for practical purposes, be bound 
to the soil. In spite of the opposition of Minister vom Stein, 
the King agreed, and several days before the emancipatory 
edict of 1807 came into operation in November 1810 the 
" Servants' Ordinance for all the provinces of the Prussian 
Monarchy of November 8, 1810," was promulgated. The 
object of this " Ordinance " was said to be the removal of 
uncertainty on the subject of rights and duties as between 
employers and servants, and it superseded most of the existing 
provincial '' Ordinances " of the kind. But it did more. The 
old " Ordinances " were intended to apply to domestic servants. 
The new and uniform " Ordinance/' by the mere introduction 
of a phrase, drew into its net the entire class of agricultural 
servants living with their masters. Other " Ordinances " 
have been issued since for provinces and districts of the 
monarchy, but the " Ordinance " of 1810 still applies to the 
provinces of the East and portions of the North and West. 
The oldest of the '' Ordinances " still operative in Prussia 
is one dating from 1732 and applying to the Duchy of 
Lauenburg. 

The Prussian " Servants' Ordinance " of 1810 applies, 
therefore, not only to domestic servants but in general to all 
labourers who do not come under the general law of association 
— like the industrial workpeople — provided their relation to 
their employers is a permanent one and that they live in some 
way in the latter's households. Its effect is that such labourers 
are bound to render obedience to a degree which differs but 
little from unrestricted compulsion ; the right to cancel a 
contract of service is limited to such an extent that it can 
hardly be said to exist at all ; in addition they are expressly 
forbidden by law of April 24, 1854, to strike collectively in 
any circumstances whatever on pain of imprisonment ; so 
that, in effect, though the name of serfage is no longer used, 
this condition exists in spirit and to some extent in fact. 



276 THE EVOLUTION OF MODERN GERMANY 

Although reference is made to Prussia particularly, most of 
the German States have their " Servants' Ordinances," and 
on the score of humane and equal treatment there is little to 
choose between them, save where, as in the case of Saxony, ^ 
their antiquated provisions have been amended. Not without 
justification has Professor Lohmar said that " subject to this 
partial and paralysing law the agricultural labourer lives under 
a system of unrelieved absolutism." 

The Prussian " Servants' Ordinance " has a fit complement 
in a law of 1854, applying only to agricultural labourers and 
domestic servants, punishing breach of contract. Section 1 
of this law says : — 

" Servants (Gesinde) who are guilty of obstinate disobedience 
or contumacy against the orders of their employers or persons 
having oversight of them, or who without legal ground refuse 
or leave service are, on the application of the employers, yet 
without prejudice to their right to dismiss or retain them, 
liable to a fine not exceeding 5 thalers (15s.) or imprisonment 
up to three days." 

Such a provision is foreign to the general spirit of German 
penal legislation. No other class of citizens is exposed to 
such penalties for breach of contract ; the only rearess is a 
claim for injury sustained. This is, for example, the only 
satisfaction at the command of an industrial employer whose 
workpeople leave work without notice, as often happens in the 
case of a strike, and the trouble and expense involved are so 
serious and the result so uncertain and so unsatisfactory that 
the law is seldom set in motion. Very diflerent is the position 
of workers in agricultural and domestic service. Here the law 
is not merely stringent in itself, but it is often arbitrarily and 
harshly enforced. 

In a recent report upon breach of contract amongst agricul- 
tural labourers in Mecklenburg Professor Ehrenberg states 
that amongst the reasons for this form of illegality are the 
isolated position of the large estates and excessive work, but 
he adds : " finally the farmers themselves often provide, 
directly and indirectly, the occasion of breach of contract." 
There is, no doubt, breach of contract on both sides, but on 
the whole the labourer has the worst of it. An employer is 
able to get rid of inconvenient labourers with the biiefest 
possible notice, or none at all, and when told to go a labourer 

1 A modernized Servants' Ordinance was promulgated for the Kingdom of 
Saxony in 1892, and it was amended in 1898. It is noteworthy that wnen the 
Imperial Civil Code was issued it expressly stipulated that all existing " Ser- 
vants Ordinances *' were unati'ected, and particularly " the liability to com- 
pensation of persons who induced servants to leave service illegally or who 
engaged servants knowing that they were already in service." 



THE RURAL LABOUR PROBLEM 277 

often has to quit his dwelling in a day or two, to leave his crop 
of potatoes standing, to forfeit rations due, and probably to 
lose the " caution money " which the landlord may have 
retained from his wages, and which may amount to a fortnight's 
or even a month's pay. Theoretically, servants who abruptly 
leave their employers' service may no longer be taken back 
by force, but the practice is nevertheless resorted to. 

While, however, the employer can dismiss his servants on 
a multitude of pretexts, the servant has only a few grounds 
of objection against his employer, and he is rarely successful 
in finding a court which will pronounce any of them sufficient 
to justify the breaking of his contract, for the local courts of 
jurymen naturally take the side of the landowners. Thus the 
newspapers recently reported the following case : " A labourer 
engaged on an estate in an East Prussian village was employed 
on a contract which freed him from Sundry work. Being 
required to perform such work he declined and was dismissed 
on the spot, was ordered to quit his dwelling, and, rn the ini'ia- 
tive of the landowner, was called on by the local judge of first 
instance to pay a fine of 3s. for ' disobedience.' Before paying 
this fine he called for the decision of the court, and the court 
of jurymen now fined him 10s., with the costs of proceedings. 
On appeal to a higher court he obtained the reversal of the 
previous judgments." Again, a young labourer of nineteen 
years left his employment because the farmer had violently 
beaten him. He returned to his home, which was not far 
distant, and the following day received from the local magis- 
trate a summons to return to work, failing which he would 
be fined 10s. or be imprisoned for three days, " according to 
Section 1 of the law of April 24, 1854." As he could not pay 
and would not return to work he was at once arrested. All 
this was done without any judicial investigation of the merits 
of the case. 

Equally disastrous in its effect upon the rural labour 
question is the fact that for the better part of a century amelio- 
rative legislation has virtually disregarded the agricultural 
worker. There is profound truth in the words of H. Sohnrey : 
" When the new commercial treaties were about to be con- 
cluded the farmer said, ' Let us only have corn duties high 
enough and we shall be able to pay our labourers higher wages 
and so to compete with the wages of industry.' That would 
be pertinent if the rural labour question were merely a question 
of wages. But it is as little a wages question exclusively as 
it is a housing question exclusively. That is proved by the 
fact that the complaints of a scarcity of agricultural labour 
were never louder than now, when the corn-growers ha^fe more 



278 THE EVOLUTION OF MODERN GERMANY 

favourable duties and wages have correspondingly increased. 
Nor is there in general any question of a lack of dwellings, 
though it is the popular idea that this is the cause of the ' land- 
flight.' Both the wages and housing questions are only elements 
of the great labour question, which is nothing less than a 
national question of civilization, whose roots go back more 
than a century — a question in which a multitude of the most 
various problems of our time, economic, intellectual, and more 
especially military, meet." 

The ameliorative laws which freed the peasantry from 
serfage at the beginning of the nineteenth century gave a new 
stimulus to agriculture, but with those laws — nullified, as we 
have seen, in the case of the labourer — solicitude for the rural 
population seems to have been exhausted. For a time all 
went well. It is a fact, indeed, th^^t for a full half-century 
the population of the rural districts increased more rapidly 
than that of the urban districts, and it was still possible to 
speak of Germany as an agricultural State. 

Then came the rise of industry, the growth of the towns, 
and the organization on a great scale of urban labour, which 
daringly began to talk of rights and to make its demands heard 
in the legislatures of the land. It is a fact, too often strangely 
ignored by those who profess surprise at the magnitude of 
Germany's rural question, that until a few years ago nearly 
all the social legislation of the past half-century was legislation 
on behalf of the industrial classes. 

The Industrial Code of 1869 and the amendments passed 
since do not mention the agricultural labourer. The factory 
and workshop inspection regulations do not touch him. Only 
since 1911 have the industrial insurance laws fully recognized 
the claim of the rural workers to the beneficent provision against 
sickness, accident, and invalidity which the town workers 
had enjoyed for over thirty years, and until then these 
workers had only the Poor Law or the uncertain hand of 
charity to fall back upon in time of need. 

Not only so, but, as we have seen, the right of combination, 
which the industrial workpeople have in limited form enjoyed 
throughout the Empire for half a century, is absolutely with- 
held from the agricultural labourer. In 1866 a bill was intro- 
duced in the Prussian Diet which was intended to give the 
right of coalition to agricultural labourers. The expose des 
motifs said, " If the prohibitions of coalition relating to industrial 
workpeople are repealed these relating to agricultural labourers 
must be repealed likewise, and that not from general reasons 
of expediency but for legal reasons." The answer was a non 
sequitur, and that answer has not yet been reversed. The only 



THE RURAL LABOUR PROBLEM 279 

weapon of defence which the rural labourer possesses in common 
with workpeople generally is the right of free migration, secured 
for the first time under the constitution of the North German 
Confederation. If, resenting the State's disregard of him, he 
decided to use this right and wandered off to the towns, there 
to join the ranks of the urban workers, for whom the State 
did care, and to claim the benefit of the remedial measures 
passed in their behalf, who could blame him ? 

" To the labourers of the village," writes Sohnrey, " nothing 
remains of the land to-day but the bare road ; can it be won- 
dered at that they should use this road, made so wide and 
commodious by the enclosure of common lands, in order to 
get away from the country as quickly as possible ? " 

Not long ago a far-seeing Prussian landowner wrote : "If 
twenty-five years ago we had given our agricultural labourers 
half the increase of wages which we are giving them now, we 
should to-day have had better and cheaper labour in abun- 
dance." That may be true or not : it is certainly probable 
that if the ameliorative legislation which is now slowly becoming 
recognized as the right of the agricultural labourer, and as 
the simple duty of society towards him, had been passed when 
the State awakened to the necessity of legislating for the new 
conditions of industry in 1881, the rural problem, while it 
might not have been entirely staved off, would not have taken 
its present acute form. The great mistake of the large land- 
owner and the small farmer alike has been in their neglect to 
attach to themselves a faithful race of labourers while they 
had the chance, before the tradition of attachment had been 
destroyed and the old ties became strained to breaking point. 

Infinite mischief has also been done by the wholesale en- 
closure of common lands and by the abolition in many districts 
of the old custom of paying the labourer partly in money and 
partly in kind — in corn and fuel, in land for potatoes, fiax, and 
linseed, in pasture and forage for cattle, sheep, and goats. 
The custom had its disadvantages, yet it was a human tie 
between the two, and where a reasonable spirit was shown on 
the employer's side and the money payment was not too 
grudgingly curtailed it produced a good relationship, giving 
to the labourer a direct interest in the estate and that subtle 
feeling of independence and dignity which a man's cultivation 
of the soil for his own sake seems always and everywhere to 
create. 

It would be wrong, however, to group all landowners and 
farmers together indiscriminately. Very many are deeply 
concerned for the welfare of their labourers, and such men 
have their reward in a loyalty and attachment which descend 



280 THE EVOLUTION OF MODERN GERMANY 

from father to son. Even where conditions of life are found 
at their worst it is in general less a question of deliberate want 
of consideration than of obsolete views of the relationship 
between master and servant, views which are the direct result 
of the old feudal system, which lives in spirit where the letter 
has been killed. It is significant of a new spirit abroad that 
the Chamber of Agriculture of the Province of Silesia should 
have stated in a recent report on the subject : " The ultimate 
reason of the wholesale migration from the East must be sought 
in the psychical and ethical factors which have created the 
modern social question. A longing for greater independence 
is passing through the masses — an endeavour after higher 
social position and respect for their personality. The ideals 
of liberty and human worth which were formerly confined to 
the middle classes have during the century penetrated to the 
lowest strata of the population. The one great means of 
remedying the present need lies in the hands of the rural 
employers themselves — an improvement in the personal treat- 
ment of the labourers and in the material conditions of their 
work." 

In the same sense a Saxon writer on the question said 
recently : — " Secure to the rural labourer — as you may by 
sincere and by no means exhausting efforts for his welfare — 
the hope of better times ; give him a home worthy of human 
beings ; help him and his family more in sickness : afford him 
more thorough protection to life and health while at work ; 
and above all things free him from the oppressing conscious- 
ness that he is only a second-rate workman without the 
rights of the industrial workman. The need of labourers will 
disappear in the measure that employers show appreciation 
for the labourers' needs — not merely their material needs, 
but the social needs which press them down perhaps even 
more heavily." ^ 

In many districts serious attempts are being made to make 
the rural labourer feel more at home on the land, and a large 
amount of genuine philanthropy has been called forth by this 
new awakening to his needs and aspirations. ^ Thus the 
German Association for Rural Welfare and Home Culture is 
endeavouring to check migration by improving the conditions 
of rural life and making the country a more tolerable abode 
than it is for the labourer and his family. 

It is, after all, individual effort which alone will solve the 
rural question in so far as its difficulties are the result of 

^ Hermann Kfthler, Landwirthschajt und Sozialdemokratie. 

2 One reads with admiration of the East Prussian lady of the manor who 
began the experiment of taking the labourers on her estate periodically to the 
theatre and other amusements in the nearest town. 



THE RURAL LABOUR PROBLEM 281 

unfavourable conditions of life and incompatible relationships 
between master and man ; yet while there are many con- 
spicuous exceptions the country party as a whole refuse to 
read the signs of the times and persist in clinging to the outlived 
theories of social subjection which are responsible for their 
present troubles. Instead of endeavouring to induce the 
labourer to remain on the land voluntarily, by making his 
service more tolerable, he is to be forcibly prevented, by all 
sorts of checks and hindrances, from migrating to districts 
where wages are higher and work more attractive. The 
argument by which this policy is implicitly, and at times 
avowedly, justified is that the labourer belongs to the landlord, 
as much now as in the days of serfage, for the money by which 
he is fed and brought up to manhood has come out of the same 
pocket which fed and brought up the bound serf of old. Count 
Kanitz candidly admitted this standpoint when charging 
the industrialists, in the course of a speech in the Prussian 
Diet, with robbing the land of its rightful cultivators. " Every 
adult labourer," he said, " represents a considerable capital 
which we have laid out, yet when these people are grown up 
they offer their labour to industry, which thus reaps where 
it has not sown." " Quite true ! " was the cry which in 
chorus greeted this typical example of agrarian reasoning 
from the adjacent benches. 

A few years ago a complete programme of restrictive 
measures in the interest of agriculture was introduced in the 
Prussian Diet and commended to the Government by the 
combined votes of the Conservative fractions. One of these 
measures was the regulation of employment agencies with a 
view to curtailing their activity in rural districts. Not only 
were employment agents to be required to obtain a " conces- 
sion " from a public authority before beginning business, but 
the grant of permission was to be made dependent upon the 
proved existence of a need for such agents. In practice, the 
employment agent was to be forbidden to offer work to agri- 
cultural labourers, whether they desired a change of employer 
or employment or not. Another measure was the sharpening 
of the law regarding breach of contract, so as to make it more 
difficult for discontented agricultural labourers and servants 
to leave their employment even under the special circum- 
stances which legally justify an immediate dissolution of the 
contract of service. The teaching in rural schools was every- 
where to be adapted, as to subjects and seasons, to the local 
needs of agriculture. State undertakings were to be required 
to free as many workpeople as possible at harvest-time, so that 
the corn and beet grower and the general body of farmers 



282 THE EVOLUTION OF MODERN GERMANY 

might have a greater reserve of temporary labour to draw upon 
at need. The prisoners in houses of correction were to be 
made available to a far larger extent than hitherto for improve- 
ment works in the country. Where rural offenders of certain 
classes were liable to imprisonment, their detention was to 
take place when agriculture could best dispense with their 
labour. Further, the issue of workmen's tickets on the State 
and private railways was to be restricted, with a view to 
diminishing the agricultural labourer's choice of occupation. 
Young people under eighteen years of age were to be forbidden 
to leave home for other districts without the express permission 
of their parents or guardians. ^ Another demand was that in 
harvest-time soldiers should be placed at the disposal of 
landowners and farmers. Finally, recruits and reservists 
were to be called up at slack seasons of the year, and time- 
served men who had been taken from rural districts were to 
be given railway tickets to their former homes and nowhere 
else. 

The sponsors of this remarkable programme secured its 
adoption by the Diet by a large majority. Some of the remedies 
proposed have since been applied by the Government, though 
most of them still afford the Junkers material for periodical 
debates in the Prussian Houses of Parliament. Thus the Indus- 
trial Code has been amended so as to make the vocation of 
employment agents subject to " concession," while various 
conditions are imposed as to how they shall carry on their 
business. Further, the use of soldiers who are sent from the 
garrisons in the agricultural provinces to perform farm work 
at harvest-time increases every year. The practice began 
with the large landowners who had friends at court ; but now 
the peasant farmers press for help and receive it. The same 
thing prevails in the South. 

There are even found agrarians who contend that the period 
of military service should be reduced from two years to one 
year, with a view to releasing labour for rural use. Necessity, 
indeed, suggests to the perplexed agriculturists many ingenious 
devices. The Westphalian and West Prussian Chambers of 
Agriculture have formally petitioned the Government to permit 
the importation of Chinese labourers, the organ of the Agrarian 
League has defended the proposal, and a prominent Conservative 

1 How attractive appears to be the idea of repealing or restricting the right 
of migration may be judged by the fact that at the Evangelical Social Congress 
held at Hanover in May 1907 Professor Hamack, the President, said : " What 
is good for the West may not be applicable to the East. Even the question 
of free migration in relation to rural districts is not a question that can be 
easily settled.'* The Evangelical Social Congress is not, of course, in any way 
representative of the agrarian classes. 



THE RURAL LABOUR PROBLEM 283 

in the Prussian Lower House has declared that the agrarians 
will not rest until sanction has been granted. When a few 
years ago a stream of labourers of Geiman nationality set in 
from Russia, the East Prussian manorial proprietors prorrptly 
urged the Government to take summary steps to retain forcibly 
this supply of labour for their special corner of the monarchy. 
It was simply to issue a decree that when any labourer crossed 
the frontier into Germany his passport should be taken from 
him and in its place he should be given a " labour ticket " 
directing him to an agricultural employer, whose service he 
should be required to enter on pain of deportation. Like many 
other absurd suggestions which have emanated from the same 
quarter, the idea was politely received but disregarded. 

Above all the agrarians agitate for a severer law on the 
subject of breach of contract. Here two irreconcilable tenden- 
cies of political thought show themselves in Prussia. On the 
one hand the Liberal parties wish to repeal the existing law of 
contract as between agricultural employers and employees 
and to regulate the question according to the Civil Code, making 
breach of contract a matter of civil process. On the other 
hand the agrarians ask that the existing money penalty shall 
be converted into imprisonment without the option of a fine, 
and that heavy penalties shall apply to employers who take 
into their service labourers who have broken their contracts 
of service, to employment agents through whose instrumen- 
tality their re-engagement may have been effected, and to 
labourers who may be proved to have encouraged their fellows 
to the commission of illegal acts. The law of Mecklenburg 
already covers all these points. 

Meanwhile, as has been stated, the labour difficulty is 
palliated by the importation of seasonal labourers. Throughout 
the whole of the East and the North of Prussia, and to a less 
degree in other parts of the kingdom and of Germany generally, 
foreign labour is systematically employed from spring to 
autumn, and the large estates rely almost wholly upon this 
supply. The majority of the foreigners used to be Russians, 
but a large number now come from Galicia. For a long time 
several of the Prussian Chambers of Agriculture maintained 
employment agencies on the Russian and Austrian frontiers, 
from which, from early spring onwards, a constant stream of 
labourers, each supplied with passport and railway ticket, 
was passed on to various destinations in the East and North. 
Some of these agencies engaged many thousands of labourers 
in the course of a season ; the migration continued until the 
harvest, and that over the return began, for these foreigners 
are not allowed to remain permanently in the country. Some 



284 THE EVOLUTION OF MODERN GERMANY 

time ago the Prussian Government introduced an official 
system of licensing on the frontiers. Russian labourers may 
engage themselves at fourteen places on the frontiers of Upper 
Silesia, West Prussia, and East Prussia, Galician labourers 
at two places in Silesia, and Hungarian labourers at one. 
Without a licence no foreign seasonal labourer is allowed to 
enter the country. 

The wages paid to these imported labourers are low, but as 
food and lodging (both of a very simple kind) are generally 
included, the men are able to take a few pounds home at the 
end of the season. The rates offered by the Brandenburg 
Chamber of Agriculture to labourers from Galicia are for men 
Is. per day from June 1st to September 1st, and lOfd. during 
the remainder of the year, so far as they are employed, and for 
women, girls, and youths, 9jd. and 8|d. respectively, with 
rations of bread, skimmed milk, potatoes, dripping, peas, 
rice, and salt. Money is not given instead of this food ; no 
portion of the food may be sold, and if any is not consumed 
it must be returned to the employer. The labourers are housed 
in a bothy, each having a straw mattress and a rug. 

The wages offered a few years ago to Russian labourers in 
East Prussia were : Men who can mow. Is. 9jd. per day, with 
2s. 3jd. per day during six weeks of harvest ; men and strong 
youths unable to mow. Is. 6d. per day, with 2s. during the 
harvest ; women, girls, and youths of inferior capacity. Is. 3|d. 
per day, with Is. 9jd. during harvest ; with in every case 
weekly rations of 27| lb. of potatoes, a little wheat-flour, and 
three pints of skimmed milk. It is seldom that the wages are 
paid in full, for a common clause in the agreement runs : 
" For the employer's security the wages of the first month 
and a half, or 8s. weekly for the first ten weeks, are only 
payable when the labourer leaves in a regular manner." 
When the labourer leaves otherwise — a point which he is 
not allowed to decide — this surety money is forfeited. 

The following conditions of employment are taken from an 
original contract of recent date, concluded between an East 
Prussian farmer and a Polish labourer, who also engaged his 
wife and the whole of his children of working age : — 

" Work begins at 5 a.m. and lasts until 7 p.m., with intervals 
of one hour at noon and half an hour each for breakfast and 
vesper. 

" In urgent cases the labourers must work beyond these 
hours, the employer or his agent alone determining when this 
shall be done. For overtime men and youths shall be paid 
Ifd. per hour, and women, girls, and boys Ijd. 

** Rates of time wages. — In ordinary seasons (not harvest 



THE RURAL LABOUR PROBLEM 285 

time) men who can mow receive Is. 6d. per day, women, youths, 
and girls over 16 years, Is. ; but during corn harvest in August 
2s. and Is. 6d. respectively. For potato digging with hoe or 
spade, 2^d. per basket of 1 cwt., but Ifd. it' the potatoes are 
ploughed up. In addition, every workman receives 27j lb. 
(English) of potatoes per week. If pint of skimmed milk daily, 
and quarters in the bothy, with straw mattress and woollen 
coverlet. 

" A common fireplace is also provided for cooking and wash- 
ing, together with the requisite fuel, and a box is supplied to 
every two persons for the preservation of their belongings. 

'' The men must bring their own scythes. Other implements 
will be provided, but they will be held responsible for their 
safety and proper care, and all injury caused by wrongful 
usage or loss must be made good. 

" Payment is every Saturday, but for eight weeks two 
shillings of the wages will be retained weekly, to be returned 
in the event of the labourer leaving under regular circumstances. 

" Should a labourer absent himself from work without 
permission, get drunk during work, or transgress the house 
regulations, he will be fined sixpence, which shall be retained 
from his wages at the next pay day." 

There is little sentimentality about the treatment of these 
foreign labourers. They are heartily disliked, but they 
are regarded as a necessary evil. It must also be admitted 
that the labourers are a severe test of patience, and breaches 
of contract are frequent. 

In the present state of the law there is little political propa- 
gandism amongst the agricultural labourers, and organization 
— even of the loosest and most informal kind — can hardly be 
said to exist. Their very poverty is an obstacle, for it makes 
them look askance at invitations to help movements which 
they know will cost money. Further, local labour leaders are 
at present inconceivable in rural districts, where autocracy 
rules and free speech is unknown. The Social Democrats do, 
indeed, make spasmodic attempts to stir up the agricultural 
labourers, but it is generally at election times, and the success 
which attends their efforts is not encouraging. 

The Socialists plead in explanation of their failure to 
attract the rural labourers to their banner that these labourers 
are as a class unfit for organization on trade union lines, that 
they lack class consciousness, and do not understand the 
significance of modern labour movements, and they point with 
a certain scorn to the fact that at present 75 per cent, of their 
number persist in voting with the Conservatives. This is all 
true ; but a deeper explanation lies in the fact that the rural 



286 THE EVOLUTION OF MODERN GERMANY 

labourer of the older generation — particularly in the Roman 
Catholic districts — regards the Social Democrat from the 
political standpoint and sees in him only an opponent and 
subverter of all the pillars of society which he has been trained 
to respect and revere — the monarchy, the Church, and the 
moralities of life. If the rural labourer shows no sign of a 
desire to make common cause with the advanced labour move- 
ment a powerful reason is that this movement has been identi- 
fied with measures which have nothing at all to do with labour. 

At the present time endeavours are being made to organize 
the rural labourers of Bavaria, where no legal hindrance to 
their coalition exists, under the banner of Roman Catholicism, 
and the leaders of the movement would appear to be confident 
of success. The obstacle there, however, lies less with the 
labourers than with the small peasants, who fear that the 
greater independence of labour will mean higher wages, a fear 
not without justification. 

In general it is a fi nil belief, honestly held, that the bestowal 
upon the agricultural labourer of the right to combine would 
fill to overflowing his cup of misfortune that causes the agrarian 
everywhere to offer unreserved opposition to this aspiration. 
And yet it is no paradox to say that the true and only way of 
checking the scarcity of labour is to make the labourer still 
more free to go his way, for only then will the landlord have a 
genuine incentive to persuade him to stay. The only argument 
by which the agrarians attempt to defend the existing law is 
that it is more necessary to bind the agricultural than the 
industrial labourer, since the sudden cessation of employment 
in the country might destroy the entire harvest. But the plea 
is quite inconclusive, and evades the true secret of the labour 
famine from which so many rural districts suffer. As a fact 
there are some industries, dependent on unskilled labour, 
whose employers run far greater risk in the event of sudden 
stoppages than is the case with farmers. What the agrarian 
has not learned and refuses to learn is the futility of his idea 
of bound service. There are scores of industrial employers in 
Germany to whom continuous work is necessary, and who have 
greater gain or loss at stake in a week than the largest East 
Elbe landowner during a whole season, who have voluntarily 
renounced the claim to notice from their workpeople, so that 
the relationship on both sides can be cancelled at any hour, 
yet it is the general experience of such employers that the 
looser in theory the tie between themselves and their work- 
people, the faster it is in reality, since the absence of any claim 
to have notice or obligation to give it exerts a steadying 
influence on both sides. 



THE RURAL LABOUR PROBLEM 287 

Every one who has studied the German rural question dis- 
interestedly, and has tried fairly to understand the mind of 
the rural labourer, knows that the present laws of association 
and contract, so unequal in their operation, so out of harmony 
with all modern ideas, are as much responsible as low wages 
and the generally unfavourable conditions of the labourer's 
life for the labour scarcity. It is also safe to predict that until 
and, indeed, long after these laws are modified and humanized 
— so slow in efiect is the amelioration of old-standing evils — 
the migration to the towns will continue. 



CHAPTER_^XV 

CO-OPERATION 

The German genius for Co-operation — The pioneer work of Schulze-Delitzsch 
and Raiffeisen — Niimber and character of Co-operative societies and 
undertakings — Importance of the rural banks and credit societies — Dis- 
tributive Co-operation not developed as much as in England — The 
Raiffeisen Co-operative movement described — The Prussian Central 
Co-operative Bank — The attitude of the State towards the Co-operative 
movement. 

A DISPOSITION to combine for the promotion of mutual 
interests, amounting almost to an instinct, has marked 
the German people from the earliest period, as the 
historian Gustav Freytag shows in his work, Pictures of the 
German Past, This characteristic has found expression in 
recent times in the development of Co-operation and in the 
application of the principle in the most various directions. 
Here the German spirit, in general so little original and creative, 
has shown its singular faculty for adaptation : an idea which 
originated elsewhere has been developed in Germany to an 
extent hardly equalled in any other country. On the lowest 
estimate one in every fifteen inhabitants of Germany belongs 
to a Co-operative society of one kind or another. The ratio 
in the United Kingdom, the home of Co-operation, is barely 
one in twenty. 

The credit for popularizing Co-operation in Germany belongs 
mainly to two men, Hermann Schulze, of Delitzsch, in the 
Prussian province of Saxony (commonly called for the sake of 
distinction Schulze-Delitzsch), who lived from 1808 to 1883, 
and Friedrich Wilhelm Raiffeisen, a Prussian likewise, a native 
of the Rhineland province, who lived from 1818 to 1888. 
These men first took up the question almost at the same time, 
and both were drawn to it by a desire to assist their poorer 
neighbours. Schulze was a politician of strong Progressive 
or Radical convictions ; he sat in the first Prussian National 
Assembly and later had a long and useful parliamentary career 
as a member of the Prussian, North German, and Imperial 
Diets. He formed his first Co-operative society in his native 

288 



CO-OPERATION 289 

town in 1849, and it was for the supply of raw material to small 
joiners and shoemakers, while his first credit society was formed 
two years later. Schulze took special interest in the small 
artisans of the towns, a class of men to whom he was drawn 
by political sympathies, for at that time they were still in the 
main adherents of the Radical party. He laid stress upon the 
virtue of self-help, and when early in the 'sixties Ferdinand 
LassaJle came forward with his project for State-aided Productive 
Associations, Schulze was one of his earliest and most uncom- 
promising opponents. Such was the success of his propagandism 
for Co-operation that by the year 1864 the societies formed 
on his principles were able to combine in a General Federation, 
with a head office at Potsdam, where Schulze had settled. 
In the same year the " German Co-operative Bank of Soergel, 
Parisius, & Co." was formed as a central credit agency in the 
service of his system of Co-operative socieities. The bank 
failed, however, to enlist the confidence and support of the 
societies to the extent hoped, and eventually (1904) it joined 
hands with the private Dresden Bank, which continued to 
carry it on as a separate institution, though the union was not 
favoured by friends of Co-operation in general, who regarded 
it as incongruous. 

Now for some time the Co-operative movement slackened 
in Germany. The quarrel between Lassalle and Schulze over 
the respective merits of State help and self-help undoubtedly 
alienated the working classes temporarily from the movement, 
though the coolness which they began to manifest towards 
it was also due, to some extent, to the fact that the gospel 
of Socialism, with its more alluring promises of speedy social 
amelioration, was now being busily preached to sympathetic 
ears. 

Schulze, however, no longer had the field to himself, for 
Raiffeis-n had begun his successful work on behalf of a hitherto 
disregarded section of the community. As Schulze had specially 
in mind the needs of artisans and the little people of the 
towns, so Raiffeisen wished to assist the small peasants and 
farmers and the rural labouring classes. In their methods of 
procedure also the two men differed greatly, and this was par- 
ticularly the case in relation to their credit and loan societies. 
While Schulze founded these societies upon as wide a basis as 
possible, and admitted to membership the adherents of various 
trades and occupations, with a view to ensuring the utmost 
degree of security, Raiffeisen confined his societies to the rural 
inhabitants of separate villages and parishes. 

Both classes of societies formed reserve funds, but those of 
the Raiffeisen societies were indivisible and inalienable, so 

19 



290 THE EVOLUTION OF MODERN GERMANY 

that if a society were dissolved there remained as a rule a nest 
egg for the benefit of some successor. Further, the Schulze 
societies required their members to take up shares, and upon 
these shares a dividend, taken from the profits, was payable. 
This arrangement Raiffeisen regarded as mercenary, and it 
was only when it was made obligatory by legislation — passed 
largely at Schulze's instigation — that he capitulated ; and 
even then he took care that the dividend that might be declared 
upon the subscribed shares was fixed at a quite nominal sum. 
Later legislation (1896) restored the old freedom of action. 
Again, while the Schulze societies advanced money only on 
strict commercial principles, requiring sound security, and 
lending only for short terms, the Raifleisen societies were more 
accommodating and lent for long periods. In a word, Schulze 
worked on hard business principles, while Raiffeisen was 
influenced pre-eminently by humane considerations. 

The motives of the two men were equally creditable, and 
both wished to do the greatest amount of good to the greatest 
number of their needy fellowmen, but Schulze acted through- 
out as a shrewd man of the world, while Raiffeisen was a 
philanthropist pur sang. Perhaps the prosaic business man's 
method made more certainly for security and stability, but 
Raiffeisen exerted a greater attraction upon his associates and 
the co-operative world. 

Ihe Raiffeisen societies, which had originated in the Rhine- 
land, united to form a Rhenish Agricultural Co-operative 
Bank in 1872, with its seat at Neuwied, and similar agencies 
were formed for Hesse and Westphalia, whereupon these 
provincial banks combined in 1874 to form the Agricultural 
General Bank. All three institutions were compelled soon 
afterwards to dissolve, owing to a technical infraction of the 
Law on Co-operation, which had been detected by the lynx- 
eye of Schulze, but the Rhenish bank was reconstituted in 

1876 as a share company, and a central credit institute for all 
Germany was founded with the style Agricultural Central 
Loan Bank, Raiffeisen being the first general manager. In 

1877 the Raiffeisen societies were united in a federation, with 
Neuwied as its headquarters. 

Although the first in the field, the Schulze and Raiffeisen 
systems of Co-operation failed to embrace the entire Co-operative 
movement, for side by side with the societies and agencies 
identified with them a host of miscellaneous organizations and 
unions sprang up throughout the country. In the end far 
more co-operators were organized independently of these rival 
systems — perhaps because of their rivalry — than were brought 
within their folds. The third great national federation, which 



CO-OPERATION 291 

was destined to become in number of members the most 
powerful of all, was the General Federation of the Agricultural 
Co-operative Societies, a loose association formed in 1890, 
with its head office at Darmstadt, and comprising a number of 
West and South German unions of Co-operative organizations 
of different kinds. In 1903 this " General " Federation, which 
in the meantime had greatly increased its membership and 
influence, took the name " Imperial," and two years later it 
amalgamated with the central Raiffeisen organization of 
Neuwied, which had suffered greatly from the competition of 
its younger rival, as well as from difficulties inherent in its 
own principles and methods of working. The amalgamation 
did not imply absorption on either side, however, for the two 
organizations continued to work separately, representatives 
of each being added to the central executive of the other. 

The fourth large German federation of Co-operative societies, 
that of the " stores " societies, was formed as late as 1903 as 
a sequel to the secession of about a hundred such societies 
from the Schulze General Federation. It is significant that 
neither Lassalle, Schulze, nor Raiffeisen thought very highly 
of this form of Co-operation, and it was the consciousness that 
they were in uncongenial company that induced the seceding 
societies to form a central union of their own. Other societies 
speedily joined them, and in 1903 560 societies formed themselves 
into the Central Federation, with its head office at Dresden. 
The present Co-operative Wholesale Society of Germany, 
which is located at Hamburg, dates from 1894. It is, however, 
the second society of the kind, for one was formed by Schulze 
in 1869 at Mannheim, though it went into liquidation six years 
later. 

Resuming what has been said, the German Co-operative 
societies may be classed into four main groups, as represented 
by federations, viz., (1) the " General Federation " of societies 
bearing the name of Schulze-Delitzsch ; (2) the Raiffeisen 
system of societies, for the most part agricultural ; (3) the 
Imperial Federation of agricultural societies, now allied with 
the Raiffeisen system ; and (4) the Central Federation of 
retail "" stores " societies. The societies composed within 
these various groups may now be specified in greater detail. 
As to purpose, the main types are credit societies, both agri- 
cultural and industrial, societies for the purchase and supply 
of raw materials, productive societies, societies trading in 
manufactured goods, food stores, and building societies. The 
last group disregards, of course, the large number of " public 
utility " and other building societies which have been formed 
for the purpose of erecting cheap working-class dwellings in 



292 THE EVOLUTION OF MODERN GERMANY 

town and country by the aid of State credit or loans from the 
Insurance Boards. For practical purposes the Co-operative 
societies may be further divided into those which depend on 
self-help and eschew State patronage, comprising the entire 
Schultze-Delitzsch group and the ordinary distributive stores, 
and the predominantly agricultural societies of the Raiffeisen 
and Imperial Federation types, which claim and receive 
State encouragement and even subsidy. 

The aggregate number of societies of all kinds at the beginning 
of 1912 was 31,757, and their membership was 5,555,803. 
Roughly, only one in fourteen was a " stores " society and only 
one in three of the members belonged to societies of that type, 
for the uniqueness and strength of the German Co-operative 
movement, lie in the hold which it has obtained upon the 
agricultural classes, and especially the small farmers. The 
following were the societies, with their membership, in exist- 
ence at the date named : — 



Character or Purpose of Societies. 


Number of 
Societies. 


Number of 
Members. 


Credit . . . . . . - 

Industrial raw material . . 
Agricultural raw material 
Purchase of goods 
Industrial work . . 
Agricultural work 
Purchase of machinery and insti 
Industrial trading warehouses . 
Agricultural trading warehouses 
Industrial raw material and war 
Agricultural raw material and w 
Productive (industrial) . . 
Productive (agricultural), viz. — 

1. Dairy and cheesery 

2. Distillery 

3. Wine 

4. Field and garden produc 

6. Butchers 

6. Fishery 

Forestry 

Breeding . . : . 
Co-operative Stores 
House and Building 
House and Building (for commo 


'uments 

ehouse 
arehouse 

Q purposes) . . 


18,057 

392 

2,117 

235 

316 

1,322 

18 

109 

474 

501 

20 

381 

3,307 

197 

198 

159 

3 

9 

5 

354 

2,318 

1,173 

114 

329 


2,677,595 

18,886 

205,518 

14,351 

25,841 

51,036 

1,488 

6,464 

88,499 

7,389 

4,516 

50,080 

304,278 

3,611 

11,213 

13,438 

640 

461 

143 

20,271 

1,753,829 

225,672 

22,199 

48,485 






Totals 


31,757 


6,555,803 





In Prussia alone the number of registered Co-operative 
societies increased from 2,912 in 1890 to 5,135 in 1895, 9,429 
in 1900, 13,331 in 1905, and 17,597 in 1912, in which year the 



CO-OPERATION 293 

average number of members was 177. Here, too, the most 
numerous group of societies is that of the credit societies. 

Of the credit societies the great majority are rural. Most 
of them are based on the Hmited liabihty principle, though the 
Raiffeisen societies are an important exception. Of the raw 
material societies the principal are those of the shoemakers, 
tailors, bakers and confectioners, metal workers, filers, barbers, 
joiners, and painters and varnishers. Lassalle's movement 
at the beginning of the 'sixties had a powerful influence in 
directing the minds of the working classes to the productive 
applications of the Co-operative principle. What are called 
the " industrial work " societies chiefly carry on corn mills, 
electrical and gas works, joinery works and butchers' shops ; 
and of the " agricultural work " societies the majority are 
thrashing societies, while the rest own and work steam ploughs 
and other agricultural machinery. The warehouse societies 
deal mainly in furniture, bricks, hides and skins, live stock, 
poultry and eggs, corn, spirit, hops, and tobacco. The industrial 
raw material societies consist of basket makers, tailors, wood 
workers, shoemakers, fitters, sniiths, and tinners, etc. ; the 
industrial productive societies of bakers, printers, brewers, 
furniture, starch, and brick makers, spinners and weavers ; 
the agricultural productive societies carry on dairies, spirit 
distilleries, vineyards, corn mills, fruit farms, jam factories, 
and preserved food factories. The miscellaneous societies 
include societies for water supply, insurance, land purchase 
and allotment, or carrying on publishing works, sanatoria, 
and licensed premises. 

It is a remarkable fact that while English co-operators 
have laid stress upon the distributive side of Co-operation, 
inasmuch that to the average co-operator in this country the 
beginning and end of the movement, which was started with 
aims and ideals s6 much wider and more fertilizing, is the 
half-yearly dividend of the grocery store, in Germany stress 
has never been laid upon this form of Co-operation. In several 
of the larger towns, like Hamburg, Breslau, Dresden, and 
Leipzig, the stores have appropriated a large share of working- 
class trade, but in most towns distributive Co-operation is a 
plant of slow and uncertain growth. The stores may report 
a large nominal membership, but often the annual turnover 
per head does not exceed a week's or a fortnight's household 
needs, and it is evident that the average co-operator has 
greater faith in the goods or the dealings of the private trader. 
As a rule the stores are only allowed to sell to members, unless 
they actually produce the goods purveyed (bread is almost 
the only exception), in which case they may supply the general 



294 THE EVOLUTION OF MODERN GERMANY 

public. The 2,318 German Co-operative stores, with their 
1,753,829 members, which existed at the beginning of 1912, 
compared with 1,399 stores, with a membership of over two 
milhons, in the United Kingdom. The turnover of the German 
societies per member is Httle more than half that of the English 
societies. 

On the other hand, the agricultural societies of all kinds 
have enormously increased in number, membership, and 
activity during recent years, and it is safe to say that they have 
done more for the small farmers than all the agrarian and 
protective laws together. 

Conservative in many things, the German farmer was quick 
to recognize the value of associations which placed credit 
within his reach on terms more favourable than he had secured 
from private banks and money-lenders ; which enabled him 
to purchase his manures and other raw materials direct from 
the manufacturers, without paying tribute to the middleman ; 
brought into his parish steam ploughs, reaping machinery, 
and other costly mechanical aids beyond the means of indi- 
vidual tenants ; collected his produce, his corn, potatoes, 
fruit, milk, and eggs, and found for it a sale at better prices 
than he had been able to obtain so long as he bargained alone ; 
established dairies, creameries, and cheeseries, and with 
machinery of the most modern kind produced for him and 
all the countryside butter and cheese of better quality and 
higher marketable value than had been possible with the old 
homely methods ; introduced superior strains into his stalls 
and stables, folds and styes, improved his seed and orchard 
stocks — in a word, which offered him the advantages that had 
hitherto been the monopoly of the large proprietors, thanks 
to their command of the resources of wealth, science, knowledge, 
and experience. 

Societies for the realization of all these aims exist in large 
numbers in all the agricultural States, and their work increases 
in importance every year. As an illustration of what agri- 
culturists are willing to do for themselves, it may be stated 
that an agricultural combination recently purchased the 
majority of shares in a potash mining company in Prussia with 
a view to securing a preponderance of influence on behalf of 
their industry. 

It is, however, the credit societies which have done most 
for agriculture. An agrarian authority recently stated, " The 
German peasantry were saved from ruin when by means of 
Co-operation personal credit was established." So important 
is the work which has been done by these societies, and is being 
continued to-day with undiminished energy and success, that 



CO-OPERATION 295 

more than a passing reference to the pioneer Raiffeisen credit 
banks seems called for. The history of these banks is the 
more interesting since they seem to point to the solution of a 
notorious agricultural difficulty of our own — the lack of easy 
and advantageous ways of procuring ready money when it is 
most needed. There are the legitimate banks and the loan 
agencies, good and bad, but in resorting to either the farmer 
is compelled to pay a high rate of interest, and in the absence 
of substantial security he cannot succeed in borrowing money 
at all, however urgently he may require it. Under the circum- 
stances, therefore, it is remarkable that the principle of 
co-operative banking and lending has so far made so little 
headway in this country amongst the agricultural classes. 
It is not likely that the money difficulty is an insuperable one, 
or the movement associated with the names of Raiffeisen and 
Schulze-Delitsch would not have made such remarkable progress 
in Germany and Austria. 

It was while acting as mayor of several rural communes 
of the Rhineland that Raiffeisen' s attention was drawn to the 
financial difficulties under which farmers laboured. He saw 
that the smaller of their number were perpetually, in want of 
capital, and that the means taken to cover the lack were 
extravagant and ruinous, since they allowed themselves to 
pass into the power of unscrupulous money-lenders. The 
Jews were the principal offenders, and again and again he saw 
how peasants, pressed for money to repay loans or to meet 
current rent, would almost give away both stock and imple- 
ments to the usurer, in return for temporary financial relief. 
The simple rustic was seldom a match for the astute money- 
lender, who, while keeping on the side of the law, plundered 
his victims right and left. With a view to prevent this species 
of roguery Raiffeisen constantly intervened between the 
peasants and their dishonest patrons, and his official position 
and his native shrewdness enabled him to negotiate for the 
former fairer terms than they would otherwise have obtained. 
Taking his stand in the market-places, he would himself do the 
bargaining when cattle or sheep had to be disposed of, and in 
him the Jew met his" master. Amongst the usurers, naturally, 
he was no favourite ; but to the peasants he often proved a 
true and timely friend. The experience thus gained of the 
farmers' wants and weaknesses originated in Raiffeisen's mind 
the idea of Co-operative Credit Associations. After sundry 
experiments these associations were established on a modest 
scale in several places on the Rhine, and gradually their influ- 
ence and fame spread until their founder was compelled to 
devote himself entirely to the work of directing a great 



296 THE EVOLUTION OF MODERN GERMANY 

Co-operative movement amongst the farmers of Germany, 
having many ramifications and achieving remarkably successful 
results. 

Nowadays not only are loan associations established all over 
the Empire, in direct connection with a Central Institute at 
Neuwied, but affiliated to them farmers' Co-operative stores 
are carried on in great numbers, while the central authorities 
have called into existence, for the common good, a series 
of large establishments for the supply of agricultural requisites 
of all kinds. For example, there is a large machinery depot 
at Frankfort ; Cologne is the seat of a central warehouse 
which buys on a wholesale scale on behalf of the branches ; 
and elsewhere there are artificial manure manufactories, and 
even a tobacco manufactory, all conducted on the Co-operative 
principle. An idea of the magnitude of the system of Raiffeisen 
institutions may be gained from the fact that it requires a 
permanent staff of some hundreds of officials of all grades. 

Only the main principles upon which the Co-operative 
banks are based can be named in so summary a statement as 
this. The financial foundation of a credit association is laid 
by means of what are called " business shares " (Geschaftsanteile) 
of the maximum value of 10s. No member can hold more 
than one share, and no higher dividend can be paid than the 
association pays in interest on money borrowed. The under- 
lying principle is that of Co-operation with unlimited liability 
on the part of the members, a principle to which objection has 
frequently been taken theoretically, yet which in practice has 
worked with complete success. It is stated that during the 
whole fifty years' existence of the Raiffeisen associations it 
has not happened once that members have suffered owing to 
the enforcement of this rule. This is not unnatural, for the 
rule ensures that men of character and ability, and, where 
possible, of substance, are placed at the head of affairs, and 
that a rigid system of control is exercised. 

Deserving farmers of all grades are the special objects of 
solicitude — men who are in their right place, who understand 
their calling, and who, even in spite of occasional difficulty 
and misfortune, can be trusted to help themselves. On the 
other hand, men of careless, improvident, and irregular habits 
are refused help from the invested funds. Yet artisans and 
labourers, who are practically interested, in however small a 
degree, in the land, and who are in want of a little money for 
the purchase of implements or the building or repair of houses, 
are favourable considered. 

The first essential, on a request for an advance of money 
being received, is that the affairs of the would-be borrower 



CO-OPERATION 297 

shall be carefully investigated, not inquisitorially, but with a 
view to learning his pecuniary position, his credit, the value 
of the security which he is able to offer, and the probable 
utility of the purpose for which the money desired is intended. 
This investigation is as desirable from the farmer's standpoint 
as it is necessary from the association's, for it is a cardinal 
point in the system that those who are taken under the a^gis 
of these associations are advised and helped in every possible 
way. The security, which generally takes the form of mortgage, 
is fixed by statute at twice the amount of the loan, but this 
somewhat hard rule is not adhered to in practice. 

As to the period of the loan, three modes of payment exist. 
There are short-term loans which must be returned in three 
months ; there are long-term loans up to two years, with annual 
repayments ; and there are loans for indefinite terms which 
can be reduced at the borrower's convenience. No laxity is 
allowed in regard to compliance with the terms and conditions 
of repayment agreed on, a matter which is regarded as vital 
to the success of the banks, and the right to call in any loan 
at a month's notice is reserved by the association. 

Great stress is laid upon the mutual principle, and that in 
various ways. Any profit that may be made by an association 
must be placed without deduction to a reserve fund, though it 
is expected that money will be advanced to members on the 
most favourable conditions. It is understood, too, that all 
branch officers must be honorary, save the actuary, though the 
payment of out-of-pocket expenses is allowable. Throughout, 
indeed, an endeavour is made to cultivate amongst the associated 
farmers the feeling and habit of mutual helpfulness, and in 
every direction the statutes of the associations eliminate, as 
far as possible, the play of self-interest. It is not surprising 
to hear that an invaluable part is often played in the work of 
these rural societies by the village schoolmaster. This public- 
spirited official often serves as the pivot around which the 
entire economic system of a rural community revolves. He 
not merely acts as secretary to the Raiffeisen bank and contracts 
loans for the small peasants, but he advises as to methods of 
agriculture and the sale of produce, he encourages thrift and 
receives the villagers' savings once a week ; in a word, he is 
a guide, philosopher, and friend to the whole countryside, and 
without reward discharges functions of untold value to the 
simple folk amongst whom his lot is cast. 

It is expected, and indeed required, that all credit associa- 
tions shall be affiliated to the Central Bank in Neuwied, whence 
the motive power of the entire Raiffeisen organization proceeds. 
But this attachment to the Central Bank is no purposeless and 



298 THE EVOLUTION OF MODERN GERMANY 

arbitrary condition ; on the contrary, it is of the greatest prac- 
tical advantage to the various local banks that they shall be 
associated with a large institution in which they may deposit 
superfluous funds, and from which they may obtain money 
which it is beyond their own power otherwise to raise. The 
Central Bank was established in 1876 with a capital of £250,000 
in shares of £50. Its principles and regulations entirely preclude 
the possibility of the Bank being subjected to the risk of specu- 
lative influences. The shares are held for the most part by 
the local associations, which may not transfer them without 
permission, and whose liability only extends to their own 
shares. Such is the confidence felt in the Central Bank that 
no fewer than over four thousand local associations are now 
connected with it, and it has a turnover of many millions of 
pounds. In the year 1906, when the Imperial Bank was 
charging 7 and 8 per cent, for advances, and private banks 
were asking as much as 10 per cent, for temporary accommo- 
dation, the Raiffeisen Central Bank, thanks to its large resources 
and its credit, yet also to help given by the Prussian State 
Co-operative Bank, was able to lend money to its members at 
the rate of from 3| to 4 per cent. 

The General Director has courteously sent me several 
sample reports of recent date showing the work which is being 
done by the associations in typical agricultural villages. From 
these may be quoted passages which illustrate the wide-reaching 
character and influence of the associations' operations : — 

" The savings bank at Baesweiler can report the best 
possible success. Since its establishment some fifteen houses 
for artisans and miners have been purchased, and the prosperity 
of the place has decidedly progressed. The thrift of the members 
is shown by their deposits of £3,000. The Bank lends at 4 
per cent., and pays 3| per cent, interest on deposits up to £25. 
It may truly be said that the Bank has been a blessing to the 
parish." 

Again : " The business of the Co-operative store is devel- 
oping wonderfully and proves of the greatest benefit to the 
members. Various agricultural implements have been provided 
by the association and have proved of great value, in enabling 
farmers at last to benefit by modern mechanical improvements." 

From another place the following is reported : " Here the 
custom used to prevail of hiring oxen for ploughing, etc., the 
result being very beneficial to the lender, but unsatisfactory 
and uneconomical for the farmer. The association has, however, 
superseded this custom by advancing money wherewith farmers 
have been able to purchase their own oxen. By the provision 
of artificial manures remarkable success has also been secured 



CO-OPERATION 299 

in the cultivation of waste lands, which, though formerly 
entirely disregarded, now yield the most luxurious crops." 

Finally, the following is from the report of an official inspector 
upon the associations of Lorraine generally : " The advantages 
of the loan system are unmistakable, particularly the facility 
of repayment, since this can take place in instalments from week 
to week, or at shorter intervals, just as money can be spared. 
The articles offered for sale on the Co-operative principle are 
very popular. In districts without Raiffeisen associations the 
prices for artificial manures were formerly very high, but 
after the introduction of these associations they fell very 
considerably, and the result of their wide use is that the 
fertility of the soil has been greatly increased, insomuch 
that people who formerly could only produce wheat to last 
them three months can now supply their needs for the whole 
year out of their own harvests. Moreover, by the co-operative 
sale of machinery, marketable corn is produced, fetching the 
highest prices, and the peasant is enabled to use his crops 
better and to provide for himself a refreshing summer drink, 
whereby intemperance has been decidedly checked. The 
abuses of usury have been carefully watched, and in general 
the members have been helped with advice and practical 
measures by the officials of the associations." 

At the present time no fewer than 5,097 rural Co-operative 
associations, with a membership of over half a million, are 
affiliated to the Neuwied Central Organization. Thus out of 
humble beginnings has grown a movement not merely of 
national but of European extent ; for Austria, Italy, Switzer- 
land, and more lately England and Ireland, are among the 
countries which have profited by Raiffeisen's efforts. While, 
however, the material benefits conferred upon the farming 
class have been incalculable, the moral benefit has also been 
great, for the true Raiffeisen ideal has ever been that the 
ultimate aim must be the permanent moral elevation of the 
associated farmers, and that economic and financial help must 
only be regarded as a means to this end. 

The Raiffeisen Central Association has a special department 
for social welfare, which encourages the establishment, in 
connection with the local organizations, of agricultural con- 
tinuation schools for young people of both sexes, cookery 
schools, village baths and wash-houses, libraries, and reading- 
rooms, sickness and burial funds, nursing homes, etc. It has 
also begun to interest itself in the establishment of home 
industries in rural districts in the hope of checking the 
movement to the towns. 

The Raiffeisen movement— let it be candidly admitted— 



300 THE EVOLUTION OF MODERN GERMANY 

has many critics in the land of its origin, and critics whose 
comments are not of a friendly character. But no adverse 
criticism has yet been levelled at the objects which it aims at 
attaining ; the criticism is rather directed to some of the 
methods followed, and it is noteworthy that the methods singled 
out for attack, or at least for question, are precisely those to 
which Raiffeisen himself attached the most importance — those 
which must act as a check upon selfishness and which most 
promote solidarity and mutual dependence. 

One of the most useful auxiliaries of the Co-operative credit 
societies in Prussia is the institution known as the Central 
Co-operative Bank, a State institution established with ample 
resources for the purpose of providing needy Co-operative 
credit societies with funds. It was long ago found that the 
rural savings and loan societies and the small credit societies 
in general were not strong enough to obtain sufficient money 
on satisfactory terms, and the wider their operations became 
the greater became this difficulty. Capital was the perpetual 
need of societies whose work lay chiefly amongst the small 
farmers, and the local resources available were seldom adequate. 
An endeavour was first made to remedy this deficiency by 
associated effort, the societies of districts or provinces joining 
to form limited liability companies, whose object it was to 
equalize the resources of the affiliated societies more effectively, 
so that the ampler investments of well-to-do societies might 
supply the needs of new and struggling organizations. 

A further step was taken in 1894 when the tenth congress 
of the German Agricultural Co-operative Societies, held at 
Hanover, decided on the formation of a Central Bank to serve 
for the whole Empire. The idea was everywhere applauded 
as an excellent one, so excellent, indeed, that before it could 
be carried into effect the Prussian Government borrowed it 
and promptly took measures to apply it in Prussia. Hence 
came into existence in 1895 the State Central Co-operative 
Bank (or Kasse), whose object it was and is to perform for 
the smaller agriculturists the same monetary service which 
is done for the commercial world by the Imperial Bank and the 
Seehandlung. The Bank was provided with an initial capital 
of £250,000, and the interest upon this capital was fixed at a 
maximum of 3 per cent. A year later the State increased this 
capital to £1,000,000, and in 1898 to £2,500,000, the rate of 
interest remaining at 3 per cent., though this rate has since 
fluctuated. The Bank is managed by a board of directors, 
with a president at the head, subject to the Minister of Finance, 
There is also an advisory committee of forty members, com- 
prising the president of the Bank, as chairman, representatives 



CO-OPERATION 801 

of the Ministries of Finance, Agricultural, and Commerce, and 
Co-operative experts. 

Having at command large funds at a low interest, the Bank 
is able to offer to agriculturists far cheaper credit than could 
be obtained from private sources. In the interest of security, 
loans are not made to individuals nor yet to individual 
Co-operative societies, but only to associations of such societies. 
Its operations have greatly encouraged and strengthened the 
Co-operative credit movement, and have brought needed funds 
within the reach of large classes of small farmers and even 
labourers who would have been unable to pay the usual com- 
mercial interest, for even after the Bank's advances have passed 
through the hands of the Co-operative societies loans still 
reach the affiliated members at 4 per cent, or less. 

Nor has the influence of the Central Co-operative Bank 
stopped here, for it has led to the multiplication of Co-operative 
savings and loan societies amongst the artisan class, to which 
the Bank offers equal help on the same conditions. Largely 
owing to the stimulus and encouragement offered by the Bank, 
and the prospect of benefiting by the offer of credit facilities, 
a host of Co-operative credit organizations have been formed 
amongst the handicraftsmen of the towns, both large and 
small, and to the number of over seven hundred these organi- 
zations have been federated in a national union, the Chief 
Federation of German Industrial Co-operative Societies. 

It is worthy of note that the leaders of the Schulze-Delizsch 
Co-operative movement, faithful to its traditional maxim of 
self-help, vigorously opposed the idea of a State Co-operative 
Bank, and their spokesmen in the Prussian Lower House did 
their best to defeat the Government's scheme. The State 
Bank had not long been in operation, however, before a recog- 
nition of its advantages spread even to the co-operators of the 
Manchester school, who formed federations in various parts 
of the country for the purpose of sharing in the offered help. 
Since then the Bank has been empowered to accept loans 
and deposits from the public Savings Banks, of which a large 
number are affiliated to it. More important still, the example of 
Prussia has borne fruit in several other German States. In 
Bavaria, Saxony, Mecklenburg, and elsewhere flourishing 
State institutions of the same kind have now for a long time 
been in operation. 

At the present time over fifty unions of Co-operative societies 
and banks are associated with the Prussian Central Bank, 
representing nearly 15,000 individual societies with an aggre- 
gate membership of a million and a quarter. During the 
financial year 1912 loans were granted to the amount of 



302 THE EVOLUTION OF MODERN GERMANY 

seventy million pounds, and the capital and reserves at the 
end of the year stood at four and a quarter millions. 

Never in its history was the Co-operative movement so 
vigorous in Germany as at the present time, and never was 
the faith of the agriculturist in its efficiency so strong. Perhaps 
in the very strength of this faith there lies a source of weakness, 
or at least of potential disappointment. For there is a danger 
of Co-operation being made a fetish and giving rise to expec- 
tations which it is quite incapable of fulfilling. Quite recently 
a Prussian agrarian deputy appealed to his Government to 
give still more cordial help to the Co-operative societies by 
way of " proving that the spirit of Christianity was not yet 
dead in the land," while another deputy urged that a professor- 
ship of Co-operation should be set up in each of the agricultural 
colleges. While, however, the enthusiasts of the movement 
now and then carry their zeal to extremes, the actual work 
which Co-operation is doing for the agricultural class in a 
variety of ways is of untold value. 

The practical sympathy which the Central and State Govern- 
ments give to the Co-operative movement is naturally a sore 
grievance with the retail traders, and petitions to Parliament 
pleading for the restriction of the operations of Co-operative 
societies by legislative measures are of common occurrence. 
There is no doubt that the trade in agricultural machinery, 
manures, and other requisites has to a large extent passed out 
of private hands since the affiliation of the Co-operative 
societies in powerful unions enabled the farmer to purchase 
direct from the manufacturer, to the great advantage of his 
pocket. The middleman complains with reason that while the 
State exists by taxing him, it is, by supporting Co-operation, 
doing its best to extinguish him, and he contends that its action 
is all the more inconsiderate and unjustifiable since to the 
funds which are used for subsidizing Co-operative societies and 
providing them with capital he is required to contribute. The 
plea is unanswerable, though it fails to carry conviction, for 
German Governments have never considered private interests 
when their sympathy has been won on behalf of works of 
recognized public utility. 

Nevertheless, the Co-operative societies no longer enjoy 
all the favour which was formerly shown to them. It has been 
stated that the retail traders have been successful in imposing 
the condition that Co-operative societies must confine their 
operations in general to their members and must not sell goods 
to the outside public, a fact which probably explains the spirit 
of tranquillity which usually pervades a German Co-operative 
store and the indifference of its managers to shop -window 



CO-OPERATION 303 

allures. They have also succeeded in depriving the societies of 
certain privileges in regard to taxation. In the earlier period 
of their history there was a disposition to tax lightly or not at 
all societies which traded only with their members, but this 
tendency has more and more disappeared, thanks to the hostile 
attitude of their private competitors. 

This is a matter which every State settles for itself, but 
the general principle now holds good that co-operative societies 
carried on for gain are subject to the usual taxation conform- 
able to their character. In Prussia, for example, societies in 
general whose profits do not amount to £75 and whose working 
capital is less than £150 are exempted from the local trade 
tax, just like private businesses subject to the same conditions, 
but other societies can claim exemption only if their operations 
are confined exclusively to their members, not merely by 
rule but in fact, if they do not distribute profits or dividend, 
and if they do not divide their reserve funds amongst the 
members in the event of dissolution. Exemption from the 
income tax, both State and local, can be claimed only if they 
do not sell to the outside public and if their profits do not 
amount to £75 or their working capital to £150. No exemptions 
of any kind are enjoyed, however, by Co-operative stores, 
whether registered or unregistered, and whether they trade 
only with their members or not. 



CHAPTER XVI 

THE POPULATION QUESTION 

The crusade against infantile mortality — The decline in the birth-rate — Its 
effect on population counteracted by a decreasing death-rate — Vitality 
statistics of towns and country districts compared — Natality and mor- 
tality rates of Prussia, Bavaria, Saxony, and Wiirtemberg — Causes of 
high infantile mortality — Action of the State and municipal authorities 
— Decline of natural feeding and its encouragement — The work of the 
infant dispensaries in the large towns — Public regulation of the milk 
supply — The care for children of illegitimate birth — The protection of 
mothers — Provisions of the Industrial Code on the subject — A scheme 
of motherhood insurance — The Kaiserin Augusta Victoria House at 
Charlottenburg — The significance of the infant mortality crusade from 
the standpoint of population — Solicitude for youth of school age — The 
pioneer work of Tiirk and Fr5bel — Children spared in Germany where 
women are spared in England — The factory laws and the employment 
of children — The doctor in the school — The anti-consumption crusade 
— Physical exercises and outdoor pastimes — Housing reform — Co-oper- 
ation of the Social Democrats in social reform movements — Industrial 
legislation and the insurance laws. 

THOUGH there is little talk of national efficiency in 
Germany, a vast amount of effort is being directed, 
in systematic and well-reasoned ways, towards the 
production of a stronger and more vigorous race. Germany 
is showing wisdom in taking up the population question in the 
cradle, and endeavouring to ensure the health and virility of 
the stock at its source, instead of being content with merely 
patching up a decrepit manhood and womanhood upon which 
neglect and deterioration have already done their worst. During 
recent years there has grown up an earnest crusade in the interest 
of infant welfare, and coincident with it energetic measures 
are being taken to combat excessive infant mortality. This 
combined movement covers the length and breadth of the 
land, and although it is undoubtedly true that Germany 
awakened but tardily to the importance of this question, no 
pains are being spared to regain the lost ground. 

Attention was first seriously arrested when, in the early 
years of the new century, the decline in the birth-rate was 
found to have become a settled factor of the population question, 

304 



THE POPULATION QUESTION 



305 



and it was seen that, in spite of the steady fall in the general 
death-rate for some years, the rate of infantile mortality 
showed little or no diminution. The birth-rate for the whole 
Empire reached the maximum figure in 1876, when it stood 
at 41-0 per 1,000 of the population (stillborn infants, about 
4 per cent, of all born, or 1*7 per 1,000 of the population, being 
here excluded). The highest figure before the French war 
had been 38 per 1,000, a figure which occurred five times 
during the preceding decade. Up to that time the rate had 
been a slowly ascending rate. Since 1876 the movement has 
been steadily downward, with the slightest possible break 
at the beginning of the 'nineties. In 1905 the low rate of 33 
per 1,000 of the population was reached, comparing with only 
27 per 1,000 in England and Wales. The general movement 
of the birth-rate up to that date may be shown by the 
following means, based on decennial periods : — 



1851-1860 
1861-1870 
1871-1880 
1881-1890 
1891-1900 



35-3 per 1,000 inhabitants. 

37-2 

39-1 

36*8 „ „ 

36-2 



During the years 1901-1905 the rate fell further to 34*3 
per 1,000, while from 1906 the decrease was as follows : — 

.. 29'8 per 1,000 

.. 28-6 „ 

.. 28-3 

.. 27-5 



1906 .. 


.. 33-1 per 1,000 


1910.. 


1907 .. 


.. 32-3 


1901.. 


1908 .. 


.. 321 


1912.. 


1909 .. 


.. 310 „ 


1913.. 



In some of the large towns the decline in the birth-rate 
has been still more marked. Thus Berlin had a rate of 45 '4 
per 1,000 in 1876, after which the strong upward movement 
which followed the war was exhausted, and gave place to an 
equally strong decline, and in 1913 the rate had fallen to 
19*4 per 1,000. Had Berlin's rate in 1876 continued, there 
would have been born in 1913 over 95,000 infants instead of 
40,850. 

Of the larger States only Prussia and Bavaria have a higher 
birth-rate than that of the Empire as a whole, while Wiirtem- 
berg, Saxony, Baden are among the States whose rates fall 
below it. In Prussia the highest birth-rate is found in the 
Eastern province of Silesia, West Prussia, and Posen, and the 
Western provinces of Westphalia and Rhineland. The following 
have been the mean rates per 1,000 of the population in the 
East and West of the monarchy respectively for quinquennial 
periods since 1890 : — 

20 



306 THE EVOLUTION OF MODERN GERMANY 



1891-1895. 1896-1900. 1901-1905. i 1906-1910. 



Posen . . 
West Prussia 

Rhineland 
Westphalia 

All Prussia 



41-5 
41-6 

37-2 
39-3 

36-9 



42-2 
42-1 

37-6 
40-5 

36-5 



41-0 
40-7 

36-9 
40-7 

37-4 



38-4 
38-0 

33-8 
38-5 

32-3 



It is true that the effect of a decreased birth-rate has, to 
some extent, been mitigated by the heavy fall in the general 
death-rate. The highest rates recorded during the second half 
of last century were 80 '6 per 1,000 (stillborn infants excluded) 
in 1866, 29-6 in 1871, and 290 in 1872. It was not until 1876 
that a decided decline set in, but from that time, when the 
rate was 26 '4, there has been a continuous fall, until the rela- 
tively low rate of 15 per 1,000 was recorded in 1913. Shown 
by decades the mean death-rates (stillborn infants excluded) 
have been as follows since 1850 : — 

1851-1860 .. 26-3 per 1,000. 

1861-1870 27-0 

1871-1880 27-2 

1881-1890 25-1 

1891-1900 22-3 

1901-1910 18-7 

The rates from 1910 have been as follows : — 1910, 16*2 
per 1,000 ; 1911, 173 ; 1912, 156 ; 1913, 15 0. 

The fall in the death-rate, however, no longer quite counter- 
balances the decline in the rate of births. The excess of the 
latter on the average of the decade 1851 to 1860 was 9 per 
1,000 of the population ; during the following decade the 
excess reached 102 ; during the years 1871-1880 it was 11-9; 
1881-1890, 11-7; 1891-1900, 13 9 per 1,000; and 1901-1910, 
14 2 ; but the excess during the four years 1910-1913 was only 
13 '6, 11-3, 12*7, and 12 5 respectively. 

It is specially interesting to follow the natality and mortality 
rates of Prussia, since that State represents in population 
three-fifths of the Empire. The table on the opposite page 
shows the rates since the middle of last century. 

Thus the birth-rate has declined during the period covered 
by these figures by 9*4 per 1,000, and the general death-rate 
by 11 8 per 1,000. Yet until the present decade the decline 
in the death-rate was in only a small degree attributable to 
the greater care taken of infant life. If a still longer period 
be covered, it is found that while Prussia's general death-rate 
fell from 26*9 per thousand of the population in 1816-1820 



THE POPULATION QUESTION 



307 



to 19*6 per 1,000 in 1905, its infantile death-rate increased 
during this period from 16*9 to 198 per cent, of the births, 
the latter rate being higher than any recorded during the 
whole of the first half of last century. Of all important Euro- 
pean countries save Austria and Russia, Prussia had then the 
highest infantile mortality, and in the general death-rate 
only two other States were behind it, viz. Italy and Spain. 

Of the other three monarchies of the Empire, Bavaria 
reached its highest birth-rate during the years 1876-1880, 
viz., 40*6 per 1,000 of the population, since when the rate had 
fallen to 28 6 per 1,000 in 1913. On the other hand, Bavaria 
had all through last century a high infantile mortality. Early 
in the century the rate was 28*4 per cent., and it increased in 



Years. 


Birth-rate per 
1,000 of the Popula- 
tion (exclusive of 
StiUbirths). 


General Death- 
rate per 1 ,000 of 
the Population. 


Infantile Mortal- 
ity per cent, of 
Births. 


1851-1855 .. 


[ 37-6 




19-4 


1856-1860 






26-8 


19-9 


1861-1865 






1 38-3 




20-8 


1866-1870 






27-0 


21-4 


1871-1875 






38-8 


27-7 


22-4 


1876-1880 






39-2 


25-4 


20-5 


1881-1885 






37-4 


25-4 


20-9 


1886-1890 






37-5 


24-0 


20-8 


1891-1895 






37-2 


22-8 


20-5 


1896-1900 






36-7 


21-2 


20-1 


1901-1905 






34-9 


19-6 


19-9 


1906-1910 






32-3 


17-3 


16-8 


1910 .. 






30-5 


16-0 


16-2 


1911 .. 






29-4 


17-2 


19-2 


1912 .. 






28-9 


15-6 


14-7 


1913 .. 






28-2 


150 


15-1 



the 'sixties to the maximum of 32*7, after which there was a 
steady decline until 25 7 per cent, was reached at the end of 
the century, and the rate in 1913 was 18 2. It is significant 
that the highest infantile mortality has always occurred in 
that portion of Bavaria which is right of the Rhine (Upper 
Bavaria, Central Franconia, and Swabia), which at one time 
had rates between 48 and 54 per cent., while Bavaria left of 
the Rhine (including Lower and Upper Franconia) seldom 
exceeded 20 ; it should be observed, however, that the rate 
of illegitimate births in the Right Rhine portion of the kingdom 
(viz., 13-5 per cent, of all births in 1913) is nearly twice that 
of the rest of the country (7-1 per cent.). 

Saxony's birth-rate had fallen from its maximum of 43 4 
per 1,000 in the years 1876-1880 to 24*9 in 1913. Its infantile 



808 THE EVOLUTION OF MODERN GERMANY 

death-rate in the middle of last century was 25*3 per cent., 
rising to 28-7 in 1871-1875, and then falling again to 15*7 in 1913. 

Wiirtemberg's highest birth-rate was 43*7 per 1,000 in the 
years 1871-1875, and it fell to 27*2 in 1913. Wurtemberg 
has always had a heavy infantile death-rate ; in the Danubian 
districts it was as high as 44 per cent, in the middle of last 
century, and in 1905 it was still 30 per cent., although taking 
the kingdom as a whole there was a decline from 32 per cent, at 
the beginning of last century to 25 4 and even 23*4 per cent, 
at the end, while the rate in 1913 was 14 per cent. 

It may be accepted as a general rule that the rate of infantile 
mortality is proportionate to the general standard of civilization 
prevalent. Here racial characteristics and social habits, as 
well as material circumstances, enter into play. Hence it is 
not surprising to find that the conditions which exist in the 
progressive West of Prussia, though industrial in character, 
are far more favourable to infantile life than are those in the 
agricultural East, with its strong Polish complexion. Thus 
the infantile mortality rates for the Western Provinces in 1913 
were : Schleswig-Holstein 12*2 per cent., Hanover 10*8, West- 
phalia 12*4, Hesse-Nassau 9-1, and Rhineland 12*7 ; while 
the rates for the Eastern Provinces were : East Prussia 18*5, 
West Prussia 19*1, Silesia 19*4, Posen 17*7, Brandenburg 16-2, 
and Pomerania 17*6. It does not appear that industrial towns 
as such have high infantile death-rates, for the mortality rather 
seems to be dependent on the character of the staple industries, 
and especially on the degree to which female labour is employed. 
Another factor of great significance is the housing question. 
The highest infant mortality is naturally found in those districts 
of a town in which the working classes specially live. Thus 
in the " residential " as opposed to the industrial districts 
of Berlin the infant mortality in 1905 was 15 per cent., while 
in the districts chiefly inhabited by the working classes it was 
24 per cent., and in individual districts much higher. 

The steady decrease in the rate of natural growth of popu- 
lation was bound to excite apprehension in a country whose 
youth is regarded as potential material for the barracks and 
the drill-ground. Even to-day Germany's position is this — 
that of nearly two million infants born alive each year 
(1,869,636 in 1912 and 1,838,750 in 1913) over a quarter of a 
million (275,571 in 1912 and 277,196 in 1913) die under the 
age of twelve months. 

Although the crusade against infantile mortality is still 
in the initial stages, experience has already shown the entire 
needlessness of a great part of the sacrifice of life which has 
been going on unchecked for so many years. No sooner have 



THE POPULATION QUESTION 809 

remedial measures been applied in any locality than a large 
decline in mortality has at once been effected, proving that 
the loss to the nation, under the age of twelve months, of one 
out of every five infants born has been unnecessary, the result 
of ignorance, apathy, and fatalism combined. To-day the 
old idea that the high mortality of infants of tender years is 
a wise provision of nature, intended to weed out the " unfit," 
is virtually obsolete in Germany. A very large part of this 
mortality has been shown to be due to conditions which are 
in the highest degree unnatural, and cannot therefore be 
regarded as falling in with any rational theory of selection — 
artificial feeding, fouled food, insanitary dwellings, absence 
of light and air, etc. — and it is held that to regard infants who 
perish through causes like these as predoomed by nature to 
extinction is as sensible as to condemn as " unfit " the child 
who is thrown out of a window by a drunken mother or burned 
to death in a locked-up room. 

The national war against this loss of life has been taken up 
by a number of separate forces working in different directions, 
yet all, with admirable wisdom, viewing their diverse efforts as 
part of one great movement towards a common purpose, of 
which movement the late Emperor and Empress placed them- 
selves at the head. 

Chief among the agencies and organizations active in the 
cause are the provincial and district administrative bodies, 
with their medical officers, the municipal authorities, the various 
branches of the Women's Patriotic Association and the Red 
Cross Association, and many special societies formed in the 
large towns for the establishment of refugees, homes, dispen- 
saries, and hospitals for mothers and infants, public creches 
and nurseries, milk depots, etc. In this, as in most other 
great reform movements, such as the anti-consumption, tem- 
perance, housing, and school-doctor movements, the State is 
in the forefront, setting an example of zeal and enterprise 
which public and private bodies are not slow to emulate. The 
Prussian Ministers of the Interior and of Education and Public 
Health have issued a decree requiring the Chief Presidents 
to call upon the registrars of births to afford all possible assist- 
ance to associations which are engaged in the combating of 
infantile mortality, to actively co-operate in the instruction 
of the people by lectures and publications, and in every way 
to use their influence for the reduction of the needless sacrifice 
of life. When some time ago the Women's Patriotic Association 
arranged to circulate a million and a half leaflets on the feeding 
and management of infants the registrars of births were 
enjoined to do all they could to help in the work. Similarly 



310 THE EVOLUTION OF MODERN GERMANY 

the Bavarian Minister of the Interior has issued a decree to 
the District Governments urging them to increased activity 
in the same cause. They are asked to give special attention to 
housing conditions and to the nursing and feeding of infants, 
and to this end are to induce the district and communal 
authorities, and the medical and poor law doctors, to unite 
upon well-devised schemes of reform. The measures specified 
are the establishment of infant dispensaries and clinics, 
kitchens and milk depots, the encouragement of natural feeding 
by the offer of money rewards and the supply of milk, and the 
better supervision of foster and illegitimate children. 

Very wisely it has been recognized that mere administrative 
measures, however efficacious and necessary, are incapable 
alone of carrying this humane crusade to a triumphant issue. 
The most potent influence favourable to the preservation of 
infant life is that which is exerted in the home by the mother 
herself. Here many municipalities and still more philanthropic 
societies have found a great sphere of usefulness. The crux of 
the question is the right feeding and nursing of infants during 
the first twelve months of their life. Statistics show that if 
that dangerous bridge is safely crossed the chances of safety 
for a long time are enormously multiplied. Great stress is 
everywhere laid upon natural feeding, for it has been found 
that the mortality of hand -fed infants is from five to six times 
that of breast-fed. Here there is a great leeway to be made 
up. Natural feeding has gone entirely out of fashion in whole 
districts and almost whole States, and especially is this the case 
in South Germany. In connection with several censuses a 
careful inquiry has been made into the subject in Berlin. In 
1885 of every 1,000 infants enumerated 552 were suckled and 
839 fed on cow's milk, in 1890 the corresponding numbers were 
507 and 439, in 1895 the proportions were 431 and 452, and in 
1900 335 were suckled and 517 artificially fed. Thus during 
fifteen years the proportion of brea? t-fed infants fell from one- 
half to a third. The effect of the different modes of feeding 
upon the death-rate is shown by the following table : — 



OF EVERY 1,000 INFANTS OF THE SAME CLASS THERE 
AT THE AGES STATED:— 


DIED 


Year 


Suckled. 


Hand-Fed. 


Fed In Both Ways. 




1 Month. 2 Months. 


1 Month. 1 2 Months. 

1 


1 Months. 


2 Months. 


1890 . . 
1891 
1895 
1896 . . 


22-9 9-26 
20-45 7-67 
20'16 7-30 
19-4 7-40 


147-9 
170-7 
112-8 
lU-0 


77-4 
89-4 
62-9 
54*5 


115-0 

128-0 

88-2 

64-0 


88-2 
64-16 
60-9 
38-6 



THE POPULATION QUESTION 311 

Again, in the Westerburg Circle of Westphalia, containing 
82 rural townships, it was found that 4,363 infants survived 
birth during the five years 1899-1903, and of these 3,929, or 
90 05 per cent., were suckled, and 434, or 9'95 per cent., arti- 
ficially fed. Of the suckled infants 8*5 per cent, died under one 
year and 2*8 per cent, under two years of age, while the mor- 
tality at these ages in the case of the artificially-fed infants 
was 200 and 55 per cent, respectively. 

Similarly an investigation made in Cologne, a town with a 
high infantile mortality, showed that only four out of ten 
mothers suckled their children ; while at Solingen, a town 
with a low infantile death-rate, the ratio was seven out of ten. 

The feeding question has been seriously taken up by the 
infant dispensaries which have been established in many towns 
by the municipalities, either alone or in conjunction with 
philanthropic bodies. Berlin has over a dozen of these dispen- 
saries, distributed in the working-class districts of the city, 
each under the care of a specialist in infant maladies, assisted 
by qualified doctors and nurses ; and many other large towns 
have dispensaries in number more or less proportionate to 
their industrial population. While these dispensaries never 
work on narrow lines, the principle generally followed in Berlin 
is that applicants for gratuitous advice and help must give 
proof of need. The idea is to give preference to the people of 
small means, those who are in receipt of poor-relief, foster 
parents, and the guardians of orphans, illegitimate children, 
etc. " At the dispensaries," runs one of the regulations, 
" every mother in needy circumstances receives free advice as 
to the judicious feeding and nursing of her weak or sickly 
child. If in need mothers who suckle their infants receive 
support in money, and other mothers receive sterilized milk 
either free or at a reduced price." Information is required of 
each applicant as to the legitimacy or otherwise of the child, 
the occupation of the father, the earnings of the father and 
mother, and the size, rent, and sanitary conditions of the 
dwelling. " The clientele of the dispensaries," states a i-ecent 
report, " consists in the main of working-class families, and 
indeed almost entirely of unskilled labourers with a usual 
income of from 20s. to 23s. per week. The fathers have read 
in the newspapers about the dispensaries, and they send their 
wives in order to receive advice in case of sickness, though 
often without this special reason. Then one woman recom- 
mends the dispensaries to another, and in addition the lady 
superintendents, acting under the police and the ' Housekeeping 
Associations,' send people to the dispensary, while foster 
parents come in large numbers. The giving of milk for children 



312 THE EVOLUTION OF MODERN GERMANY 

at a low price and the grant of money or milk to mothers who 
suckle their infants have proved a strong tie between the 
institution and the public, and cause the majority of the appli- 
cants to follow the advice given willingly." The plan is adopted 
of following the advice given at the dispensary by a visit from 
a sister for the purpose of inspecting the home conditions and 
of inquiring whether the mode of treatment prescribed has 
been followed. In this way defects in nursing and feeding are 
pointed out. But this visitation of the homes of the clients 
does not relieve the latter of the obligation to attend at the 
dispensary once a week so long as the doctor requires it. In 
the principal dispensary the practitioner in charge gives regular 
demonstrations in nursing to women of the working class. 

The Berlin dispensaries are not intended for the actual 
treatment of sick children, but this wider sphere belongs to 
the children's clinic which has been at work for some years at 
Hamburg, and which has of late extended its mission to the 
systematic instruction of mothers in the right feeding and 
nursing of their infants. Four doctors, assisted by as many 
sisters, are engaged in the work. The municipality of Berlin 
supports lying-in hospitals for women in needy circumstances, 
homes for similar women who are nursing young children, and 
forest convalescent homes for mothers and infants, and it also 
subsidizes creches conducted by philanthropic societies. At 
Schoneberg, near Berlin, a maternity home has been opened for 
the reception of single women during the first three months 
after confinement. The help given in all these ways from the 
public funds does not rank as poor-relief, so that no electoral 
disqualification is caused to the heads of families concerned. 

At the Charlottenburg's children's dispensaries the greatest 
importance is attached to natural feeding. The town offers 
to women about to be confined, whether married or not, for a 
period of four weeks, free milk and dinner daily, or 6s. in money 
per week, supplemented later by premiums on suckling and 
other support if necessary. The result has been a great decrease 
in infant mortality. An infants' clinic has also been opened 
in Charlottenburg with municipal help. At Munich a food 
depot has been established at which any woman who certifies 
her need by bringing with her a young infant can have a free 
meal every noon. 

From insisting on the importance of good milk both for 
mothers and infants to the adoption of measures to safeguard 
the quality of the milk supplied is a natural step, and it is a 
step which many German municipalities have taken. Police 
control of the milk supply has been exercised for years in 
German towns, but it has proved very inadequate. It was 



THE POPULATION QUESTION 818 

possible to detect and to prevent the grosser forms of adultera- 
tion and impurity, but it was not possible to ensure the supply- 
to the working classes of a thoroughly hygienic and nutritious 
article, nor has police control been deliberately directed to 
that end. Hence the demand for close medical supervision, 
exercised no longer in a perfunctory way by the police 
authority, but by the municipal administration. Some of the 
more progressive towns have even established milk depots 
for the sale to mothers of the working class of pure sterilized 
milk at a reasonable price. Halle, Wiesbaden, Cologne, and 
Stettin may specially be instanced. Many large employers 
of labour are emulating the public authorities in this respect. 
There are scores of factories in various parts of Germany, with 
welfare departments conducted by skilled and zealous directors, 
which supply to their employees both for use in the works and 
at home milk of tested quality at a lower price than that of 
the retail traders. Naturally this factory milk is in great 
demand. 

Particular attention is being given to the fate of infants of 
illegitimate birth. The importance of this aspect of the 
question will be understood when it is said that the rate of 
mortality under one year amongst illegitimate children is nearly 
twice that amongst legitimate. There are born every year in 
Germany 184,000 illegitimate children, equal to about one- 
tenth of the total births, though the rate of illegitimacy varied 
in 1913 from a minimum 5 per cent, in several of the small 
States to over 16 per cent, in Saxony. Large as has been the 
reduction in the mortality of these illegitimate children during 
recent years, nearly one-fourth of them still die under one 
year, though there is great disproportion as between the various 
States. The States with the highest rates of mortality are 
the Mecklenburgs, Prussia, and Bavaria. An investigation 
made at Bremen showed that of the legitimate children born 
in a given year 20 per cent, died within four years, but of 
the illegitimate 20 per cent, died within the first three months ; 
at the end of one year twice as many illegitimate as legitimate 
children had died, and the same proportions held good in the 
second year. An investigation made at Konigsberg showed 
that during the years 1877 to 1905 the deaths in the first year 
of children of illegitimate birth were almost twice as numerous 
as those of legitimate birth, though the placing of illegitimate 
children under police supervision has since greatly diminished 
the mortality amongst them. 

The institutions which have been called into existence as 
part of the crusade against infantile mortality do not dis- 
tinguish between legitimate and illegitimate children, unless 



314 THE EVOLUTION OF MODERN GERMANY 

by giving special attention to the latter, as standing in greater 
need of protection. Some of the large towns, however, taking 
a broad and generous view of the question, have undertaken 
the legal guardianship of all infants of illegitimate birth, with 
a view to the system.atic supervision of their nursing and later 
up-bringing and incidentally also of apportioning paternal 
responsibility for maintenance where it should properly fall. 
These measures have made no addition to the municipal 
burdens, for neither fathers nor mothers of illegitimate 
infants are relieved of their obligation ; on the contrary, it has 
been found that a municipality, free from influence and eager 
to do its duty to unmarried mothers and through them to the 
community, is able to bring shirking seducers to book where 
their victims fail. Charlottenburg, Leipzig, are among the 
towns which have undertaken this humane and judicious 
responsibility, and from both places it is reported that the 
infants, the mothers, and not least the fathers, are looked 
after better than before. 

But at these efforts the infant mortality crusade does not 
stop. A strong endeavour is being made to increase the protec- 
tion given to mothers by factory legislation, and to extend it 
to all classes of women workers. It is held that the health of 
the child depends largely upon the health of the mother. Good 
feeding and nursing, though important, are not everything ; 
and the most scientific nursing will avail but little if the child 
comes into the world with its chances of life diminished owing 
to unfavourable pre-natal conditions. The Industrial Code 
does not overlook the necessity for protecting mothers who 
anticipate confinement, but it is held that the protection does 
not go far enough. The law named provides (section 137) 
that during four weeks after confinement women may not 
work at all in factories and workshops subject to inspection, 
and during two further weeks only on the strength of a medical 
certificate ; and all this time a woman may receive sickness 
benefit under the insurance laws. Wom.en expecting confine- 
ment may also be given sickness benefit for six weeks in the 
event of incapacity to work, and free nursing and medicine 
may be added. It is contended that these provisions need to 
be extended. Leading medical authorities advocate a system 
of benefits for women in childbirth extending over six wrecks 
preceding and six weeks following confinement, and including 
not only the full allowances payable under the insurance law, 
but two premiums of 25s. each for natural feeding, one claimable 
after six weeks and the other at the end of a year. It has been 
estimated that the cost of these benefits would be six and 
three-quarter million pounds per annum, yet it is contended 



THE POPULATION QUESTION 315 

that the results would be worth the expenditure, inasmuch as 
a large proportion of the present infantile mortality would 
be saved and a great amount of sickness would be prevented 
in later years. 

Active propagandism on the same lines is being carried on 
by the Motherhood Protection League, an organization which 
has been called into existence by the crusade against infantile 
mortality, and whose purpose is "to improve the position 
of women as mothers in legal, economic, and social matters, 
and especially to protect unmarried mothers and their children 
from economic and moral danger and to remove the prevailing 
prejudices against them." It is a leading principle of the 
League that no questions are asked as to the antecedents of 
mothers and children needing help : above its door is written 
the motto, " We are not here to judge." The League agitates, 
by literature, the Press, and lectures, for the reform of the 
legal position of unmarried mothers and their children, with 
a view to alleviating the stigma under which they live ; it 
helps such mothers both before and after confinement and 
endeavours to place them in a position to support themselves 
and their offspring ; but its largest demand is for a thorough- 
going scheme of " motherhood insurance," linked on to the 
present system of industrial sickness insurance. It would 
first extend sickness insurance to all wage-earners without 
exception, including workers in the home industries, and would 
then add a special maternity benefit, the cost of which would 
be met by increasing the contributions payable by workpeople 
and employers, the present proportions, viz., two-thirds and 
one-third respectively, being retained, but supplemented by 
a State subsidy. The idea is that the benefit should extend 
over a period of twelve weeks, six weeks before and six weeks 
after confinement, and include full wages, free midwifery and 
medical attendance, and premiums on suckling. It is also 
proposed that sickness insurance organizations should be 
empowered to establish, or by loans assist others to establish, 
advice agencies for mothers and women expecting confinement, 
as well as maternity homes, and to grant help towards the 
proper feeding of infants. 

A more original demand is that the labour protective legisla- 
tion should be so amended as to require every factory or 
workshop employing female workers on a large scale to set 
apart a room for a nursery, and to arrange for intervals 
during which mothers may feed their infants. Certainly the 
League has no fear of expense, and although its scheme would 
cost some fourteen million pounds a year, it is able to point 
to the dictum of the late Emperor, that " The prohibition 



316 THE EVOLUTION OF MODERN GERMANY 

of the employment of women during the period of childbirth 
is closely connected with the elevation of the race, and in such 
a matter money should not be considered." 

Although it is not likely that schemes like these have any 
hope of immediate success, they are significant as showing 
the importance attached to the question of race efficiency in 
Germany. Already the League's vigorous propagandism has 
produced a great impression on the public mind. 

In the meantime private action is doing voluntarily to a 
small extent what can only be done on a large scale with the 
help of legislative measures. Many employers already incur 
considerable expense in encouraging mothers to stay away 
from work as long as the needs of their newly-born children 
require. One employer at Miinchen-Gladbach, in the Rhenish 
textile district, pays such mothers 2s. a day for thirteen wxeks 
after the expiration of the six weeks' sickness insurance benefit 
on condition that they remain at home and devote themselves 
to the nursing of their infants. A novel experiment has for 
some years been tried in a large factory near Hanover, where 
a nursery has been equipped to which the infants of mothers 
employed in the factory are brought so that they may be fed 
during the day in nature's wholesome way. More recently the 
same idea has been developed in two suburbs of Berlin, 
Schoneberg, and Weissensee, where factory owners have been 
required by ordinance of the Home Minister to provide rooms 
in which mothers may feed their infants. The municipalities 
have agreed to bear all the attendant expense. 

One further outcome of this movement must be mentioned, 
and in some ways it is the most remarkable of all. In Decem- 
ber, 1907, there was laid in Charlottenburg the foundation-stone 
of the Kaiserin Augusta Victoria House. This is the name of 
a physiological research institute which serves as a central 
agency for the entire infantile mortality crusade in Germany. 
There the best ways of feeding and nursing infants are investi- 
gated, children's doctors and nurses are trained, " infantile 
hygiene " in all its aspects is studied and popularized, and the 
latest discoveries and inventions of science useful in the service 
of this great work are made available to every town and village 
in the Empire. The late Empress gave the impetus which has 
called this unique project into being, and for that reason it 
bears her name. The town of Charlottenburg gave for the 
purpose a large site of 3| acres, valued at £20,000, while the 
cost of the necessary buildings and their equipment was several 
times that amount. The costs of maintenance are defrayed 
out of the proceeds of endowments and various Government 
and other public grants. 



THE POPULATION QUESTION 81^ 

It must be added, to the praise of the women of Germany, 
that in all the large towns many of the educated and leisured 
of their number give ungrudgingly of their time and ability 
to this great work of mercy and of national benefit. Not only 
so, but in order that their co-operation may be of a wise and 
helpful kind they are ready to organize and attend preparatory 
classes in which to equip themselves with physiological, 
medical, and hygienic knowledge, and the authority which that 
knowledge confers. The members of the Women's Patriotic 
Society regularly hold courses of lectures for the instruction 
of mothers of the working class in nursing and feeding and in 
general household management. 

The importance to Germany of this life and health crusade 
will be understood when the rates of mortality which have 
already been referred to are borne in mind. Assuming that 
I the birth-rate continues to fall for some time, as in all probability 
it will do, there is yet reason to believe, judging by the improve- 
ment shown in recent years, that the greater expectation of 
life of adults will alone counteract this deficiency, in which 
case the reduction in infantile mortality would represent a 
clear gain to the population. At the present time the deaths 
of children under twelve months in Germany exceed by about 
eight to nine per hundred born those in the United Kingdom. 
Even should this leakage alone be stopped, and no more, 
an expectation which must be regarded as a very moderate 
one, there would be implied an annual addition to Germany's 
population of a hundred and forty thousand, making the total 
increase little short of a million per annum. 

But this care for the health and welfare of the coming 
generation by no means stops at infancy. A multitude of 
agencies work in the interest of youth at every stage. Professor 
von Kirchenheim, of Heidelberg, recently summarized these 
multifarious endeavours in a sentence : " Our age occupies 
itself more than formerly with the health and physical efficiency 
of youth, both during the years before and after school age, 
and the recent decades have created quite a new order of 
measures whose aim is to win back the neglected, forsaken, 
demoralized, and even the already criminal youth — a fund of 
national strength now half or wholly lost." Next in order 
to the dispensaries, creches, and other agencies which in growing 
numbers devote themselves to the care of infants, come the 
day nurseries, play-schools, and similar institutions maintained 
in all the large towns for the reception of children too young 
for admission to the kindergartens proper. Berlin took the 
lead in this work more than a hundred years ago. As early 
as the beginning of the nineteenth century a well-known 



318 THE EVOLUTION OF MODERN GERMANY 

education reformer and member of the municipal school 
administration, Herr von Tiirk, established nurseries in which 
children between the ages of three and six years were received 
during the day hours. They were kindergartens of a very 
primitive type, for not only was there no teaching, but 
there were no games. Nurseries of the kind still exist, but in 
general they have given place to a higher and more intelligent 
conception of the needs of childhood. 

Some of the modern nurseries are known as " play-schools," 
and the name sufficiently explains their character, for recrea- 
tion is the chief concern. Later came the " schools for small 
children " (Kleinkinderschulen), which were first established 
by religious bodies, and were accordingly conducted upon a 
religious basis, and in close touch with the churches ; they 
paid due attention to the phj^sical and recreative needs of the 
children, but their educational value was slight. A distinct 
era in popular education was opened when Frobel began the 
kindergartens which have been so largely copied from Germany 
by this and other countries and developed on many progressive 
lines. Frobel lived from 1782 to 1852, and during the later 
period of his life he devoted himself entirely to the w^orking 
out of his kindergarten theories. He proceeded from the 
nurseries of Tiirk in Berlin, with which he was familiar, yet 
not satisfied, since they lacked educational purpose. His idea 
was to train the faculties of the children by intelligent employ- 
ments, for which reason he first called his nursery schools 
" occupation schools," and only later kindergartens, by which 
term he sought to popularize the idea of nature-training. 
Observation teaching, narrative and repetition, play, music, 
song, bodily exercises, simple hand-work, gardening, and the 
care of animals were the means by which Frobel endeavoured 
to awaken the dormant nature of the child, to rationalize its 
instincts, and to develop in it the idea of unity with its fellows 
which constitutes the social sense. These kindergartens are 
still carried on under various names, and form part of the 
official primary school system in many German towns. 

It is when the child has passed into the care of the public 
education authority, however, that the solicitude for its welfare 
is shown most systematically. There is no reason to believe 
that England values its childhood and youth less than other 
countries, yet it must be confessed that its concern for them 
is often shown in very curious and unconvincing ways. It 
is only a few years since child toy-sellers and miscellaneous 
hawkers of tender age were removed from the streets of our 
towns, and even that concession to humanity aroused much 
selfish and misguided opposition. There has never been a 



THE POPULATION QUESTION 319 

time for a generation when such employment of children 
could by any possibility have occurred in Germany ; the law 
would not have allowed it, public opinion would not have 
tolerated it, and it may even be questionable whether the 
parental sense would have sanctioned it. 

Up to quite recent years a German visiting a large English 
town was invariably shocked at the sight of miserably clad 
boys and girls of tender years hawking newspapers and matches 
in the public streets, just as an Englishman visiting Germany 
was shocked at the hard and unfeminine work which was 
often allotted to women there. The repugnance of both was 
quite sincere, though as a rule neither was conscious of the 
fact that there was plenty of room for broom work at his own 
door. Broadly speaking, England has hitherto spared its 
women where Germany has spared its children ; each has 
done well, but the application of a humanitarian spirit in both 
directions is the ideal thing, and neither country has yet done 
its full duty in that respect. 

Several significant facts may be noted in relation to the 
protection of childhood in Germany. The legal age of admission 
to full employment in factories and workshops is fourteen 
years, though on the production of efficiency certificates children 
may be employed for not more than six hours daily at the 
age of thirteen, yet of the 6,321,642 industrial workers subject 
to inspection in 1913 only 11,722, or under 0'2 per cent,, were 
below fourteen years, and in some States there were none. 
To show the progress which has been made in this respect 
it may be stated that in 1875 10 per cent, of the factory workers 
were between twelve and fourteen years of age. On the other 
hand, according to the report of the Chief Inspector of Fac- 
tories and Workshops for 1907 the children under fourteen 
years employed in British factories and workshops as half- 
timers formed 0-7 per cent, of all workers (37,127 out of 
5,127,109). At the same time there is reason to believe that 
a serious exhaustion of juvenile strength takes place in the 
unregulated home industries of Germany. Further, from the 
age of six the child of the people attends the primary school 
for seven or eight years, and in many cases he is required to 
attend a continuation school several years longer. In most 
of the large towns the scholar from first to last receives free 
systematic medical care at the hands of the school doctors. 
It begins with a thorough examination on admission, and the 
health record thus opened is continued throughout the whole 
period of school life, so that the child is under constant 
medical supervision until it reaches the working age. Many 
towns have gone further, and have established dental sur- 



320 THE EVOLUTION OF MODERN GERMANY 

geries, and attached eye and ear specialists to the primary 
schools. 

The anti-consumption crusade has also been extended to 
the schools. Until several years ago all the endeavours directed 
against the ravages of this disease were confined to adults, 
with the result that while the general rate of mortality from 
tuberculosis fell in Prussia to the extent of 33 per cent, in the 
course of twenty-five years, it was found to be increasing in 
the case of children under twelve years. Dr. Kirschner, Chief 
Medical Councillor of the Prussian Department of Public 
Health, stated at the International Congress for School Hygiene, 
held in London in August, 1907, that " of all transmittable 
maladies to which children succumb in school age, tuberculosis 
accounts for 60 per cent, in the case of girls and 40 per cent, in 
the case of boys." Attention is now being given to the children, 
both in the schools and by means of special dispensaries for con- 
sumptives, maintained by the municipalities and philanthropic 
societies, and in this way a prophylactic work of untold value 
is being done. The Prussian Government has also established 
quarantine institutions at the seaside for the reception of 
teachers suffering from tuberculosis, with a view to affording 
them the best possible chance of recovery, so protecting the 
scholars against risk. This work amongst sickly children 
is admirably supported by a network of public and private 
agencies for feeding under-nourished scholars, as well as by 
forest schools for the delicate, holiday colonies, and tramping 
parties. It is also worthy of note that many school authorities 
are doing their best to discourage the giving of alcohol to 
children, a practice which still widely prevails in Germany. 
In Berlin a tractate setting forth reasons for withholding alcohol 
from the young is given to the parents of every child newly 
registered on the school books. 

Finally, increasing attention is being given to physical 
exercises and outdoor pastimes, a branch of school hygiene 
in which, in spite of their love of mild gymnastic drill, German 
schools have hitherto been very deficient. The new standpoint 
was defined as follows by Dr. Dominicus, the Chief Mayor of 
Schoneberg, at a recent congress on public hygiene : — 

" The German workman is far behind the English workman 
in the sport movement, and the reason is to be found in the 
unfavourable conditions as to labour and wages which prevail 
in Germany as compared with England. It is a common thing 
in England for factories to close early in the afternoon (of 
Saturday), so that the workpeople are able to devote themselves 
to sport for the rest of the day. In Germany work is too 
intensive to allow of any time being given on weekdays to 



THE POPULATION QUESTION 321 

play.* This circumstance explains why German workmen take 
such a small part in sports. Our workmen have not learned 
games in their youth, and hence when grown up they are unable 
to follow them. The town building plans of the future must 
allow sufficient space for playgrounds, and both during the 
school term and in the holidays the children must be syste- 
matically taken to these playgrounds. For the children 
attending continuation schools games should be obligatory 
on Sunday afternoons. But above all the State should by 
law reduce the hours of labour, so that the workers may be 
given the opportunity of taking part in outdoor pastimes." 

During recent years increasing attention has been given to 
the organization of children's games. Many of the larger 
towns have laid out in central positions, easily accessible by 
children of the working and poorer classes, special playgrounds, 
with athletic contrivances for the older children and simpler 
resources of amusement, even to sandheaps and spades, for 
the infants. Similar arrangements are also provided in many 
of the colonies of workmen's dwellings erected bj'' philanthropic 
building societies. The Municipal Council of Berlin throws 
open a number of the schoolyards as playgrounds during the 
holidays, and latterly the plan has been adopted of taking 
children of both sexes daily to the fields and forest outside 
the town, there to join in games from morning until evening. 
Several hundred pounds a year are found sufficient to pay for 
these vacation games. The town of Charlottenburg has even 
bought a woodland playground for its children. 

Another department of social reform in which the State, 
the municipal bodies, philanthropic and co-operative societies, 
and many private employers have done notable work is that 
of the housing of the working classes. Vast sums of money 
have been expended in this way during recent years, and it 
is almost a point of honour for a progressive German town to 
own a colony or two of model workmen's dwellings, in the 
letting of which municipal employees usually have preference. 
All the larger towns keep a constant record of local house 
accommodation, and many of them conduct free house -letting 
agencies in the interest of small tenants. The public " Housing 
Office," as it is called, dates from nearly twenty years ago, 
and in 1911 the institution had been introduced in twenty-four 
towns. Since then, and particularly during the war, the 
movement has received a strong stimulus, and at present forty 
towns at least have agencies of the kind. Most of the agencies 
are carried on by the municipalities, but a few have been 

* The German factory seldom closes before five o'clock on Saturday ; often 
it continues until six, and in many districts work is prolonged until seven. 

21 



322 THE EVOLUTION OF MODERN GERMANY 

founded by public utility or social welfare societies. From the 
first the Housing Offices were largely used by house- seekers, 
particularly those of the working class, but so long as it was 
optional for the house-owners to report empty dwellings or 
not as they chose their utility was greatly restricted. The 
first town to introduce obligatory notification (it was done in 
1902 by public regulation, needing no legislative sanction) 
was Stuttgart, and other towns have since followed suit. In 
these towns the owners of " small " dwellings — the definition 
differs in different towns — are required to notify empty dwellings 
to the public Housing Office within a few days (usually a week) 
of their being free, and also to notify all lettings as soon as 
effected. A Housing Act passed by the Prussian Diet early 
in 1918 requires the establishment of municipal Housing 
Offices in all towns with over 10,000 inhabitants where other 
arrangements of the same kind do not exist, and empowers 
the local police authority to order obligatory notification of 
empty and let dwellings. 

It is interesting to know that no class of society co-operates 
more actively and intelligently in these various efforts to safe- 
guard the health and vigour of youth than the Social Democrats. 
There is a widespread opinion abroad that the German Socialist 
wastes his energies too lavishly upon the pursuit of shadowy 
schemes of social reformation, upon political chimeras and 
pedantic discussions of economic impossibilities. No doubt 
much time is spent in these ways, yet in the domain of 
municipal politics, and in all movements which bear on the 
" condition of the people " problem, the Socialists are singularly 
practical and irrepressibly enthusiastic. The zeal and the 
deep sense of responsibility with which the local leaders and 
Press of Socialism have taken up the national health crusade 
in all its aspects deserve frank and cordial recognition. Here 
their practice strangely belies their precept ; for while the 
theory of Socialism overlooks the individual and assumes that 
society can be transformed by wholesale methods, the attitude 
of the Socialists who are found in increasing numbers on public 
and philanthropic bodies shows that they are in no doubt 
that the family is the national unit, and that physical and 
moral reformation is an individual and not a collective process. 

Not only so, but in spite of all their advocacy of the State 
training of children and of the loosening of the marriage tie 
the Socialists are, among tjie foremost friends of childhood 
and of home culture. A recent conference of Social Democratic 
women, held at Mannheim, discussed the question of the ill- 
treatment of children, and " called upon all comrades to make 
it their duty to earnestly combat such atrocities." In some 



THE POPULATION QUESTION 828 

towns Socialist Children's Protection Societies exist for the 
purpose of bringing to light and to justice any evasions of the 
laws relating to the welfare of children. A well-known German 
labour journal wrote recently, " The workman's child of to-day 
is the workman of to-morrow. Hence whatever is done to-day 
for the children, in order to preserve them in health, will return 
a high interest in later years." In this spirit the Socialist party 
is everywhere loyally co-operating with the " burgher " classes 
— if not always side by side, still as a battalion in the same 
army of reform — in the various efforts which are comprehended 
in the great movement known as " social hygiene." 

The efforts which the State and public bodies are making 
to promote the health and maintain the efficiency of the workers 
of maturer years — as by the insurance laws, the system of 
hospitals, convalescent homes, and sanatoria of all kinds, etc. 
— are incidentally referred to in other parts of this book, and 
have been described before for the benefit of English readers.^ 
It must suffice to say in conclusion that the two movements, 
one concerned with youth and the other with age, are unques- 
tionably achieving a work of great national value. In the 
early years of the epoch of industry Germany undoubtedly 
drew unduly upon the physical powers of her workers. Excessive 
hours of labour, under-payment, insanitary factories and work- 
shops, the over-working of women and children, and bad hous- 
ing are evils which Germany has no more been spared than 
other industrial countries, but these evils have been resolutely 
faced, and since the era of social reform opened in 1881 the 
conditions of industrial life have been immensely improved. 
Speaking of the insurance laws in particular. Count Posadow- 
sky, who, when Secretary of State for the Interior, described 
himself as a " Minister for social policy," stated in the Reichstag 
on one occasion : " The great progress marked by our insurance 
laws is that in place of poor-relief we have given the workmen 
a right, a right which he has acquired through his participation 
in the contributions. I believe that we shall never again 
deviate from that system in Germany. To those who attack 
our social-political legislation because the working classes are 
ungrateful, I would answer that no State passes laws for the 
sake of obtaining gratitude. Further, it is necessary to ask 
what sort of conditions would have been developed if since the 
time the Imperial Rescript (of 1881) was issued nothing had 
been done for the workers, in spite of the great expansion of 
our industry." 

* The monograph on The Oerman Workman : a Study in National Efficiency^ 
by the present author (London : P., S. King So Son, 1906), deals solely with 
this question. The German Insurance Laws are expounded in detail in 
Social Insurance in Oermany, 1883-1911, by the same author (London : T. F. 
Unwin, Ltd., 1912). 



824 THE EVOLUTION OF MODERN GERMANY 

As to the factory legislation and regulations in general, not 
only do they afford to children and juveniles a greater measure 
of protection, in regard to hours and other conditions of work, 
than is enforced by the English Factory Acts, but many of 
their provisions for ensuring the health, comfort, and safety 
of all workers go beyond the limits which are thought sufficient 
in this country. On this question it is interesting to read a 
German working-class opinion. " Although the legal protection 
of the workers in Germany still leaves much to be desired," 
reports the deputation of Trade Union officials which visited 
English industrial towns in 1906, " it appears in general to 
be more advanced — excluding the legal status of labour — than 
in England. The contrivances for protecting machinery which 
we saw in the metal goods and textile factories were extremely 
defective ; dressing and washing rooms are also more numerous 
in Germany. In neither of the three coal-mines visited did 
arrangements for washing exist at all. The workmen go home 
dirty, so that the miners of the Rhenish Westphalian colliery 
district, who both change their clothes and take a bath after 
every shift, are at a great advantage. In the blast furnaces 
and shipbuilding yards the workmen were exposed to the full 
force of wind and weather, where in Germany they would 
for the most part be under cover, or at least be protected 
against rain." ^ German employers find the cost of this 
labour legislation a heavy burden, and many of them grumble 
freely, yet those who look beyond the interests of the present 
recognize that what is good for the workman is ultimately 
good for industry and for capital, and it is from this far-sighted 
standpoint that the Government has consistently proceeded 
in developing its policy of labour protection and will develop 
it further. 

* Oewerkschajtlicke Studien in England, p. 26. 






CHAPTER XVII 

NATIONAL EXPANSION 

Prince Bismarck's idea of Germany as a " saturated " State — His conceptions 
of foreign policy — The modem development of Weltpolitik on Germany 
— Weltpolitik an economic necessity for Germany — The pressure of the 
population question — Dr. P. Rohrbach on Germany's economic limita- 
tions — The alternatives open to Germany : emigration or new trade 
outlets — The national food question — Limits of Germany's corn -growing 
capacity — The ideal of the agricultural State threatened — The present 
and possible density of population in Germany — A Socialistic view of 
Weltpolitik — German mercantile competition is bound to become more 
severe — The possibility of emigration — Germany's colonies of little 
value for settlement purposes — Emigration has greatly decreased during 
recent years — Pan-Germanic projects offer no solution of the population 
problem — Attention turned to South America and Asia Minor — The 
German colonies in Brazil — The Bagdad Railway and German expecta- 
tions — The policy of the " open door " — The extension of Germany's sea 
power — Popularity of the " large navy " movement — Two motives in 
operation, the economic and the political — William II the true 
director of naval policy — His conceptions of world-policy — The naval 
construction programmes — The nation imited in calling for a large navy 
— The forces behind the movement — The Navy League and its propa- 
gandism. 

THE foreign policy pursued by Prince Bismarck after the 
French war and the rectification of the Western frontier 
which followed it was based on the assumption that 
Germany had reached the limit of her territorial ambitions ; she 
had become, in the phrase of Metternich, a " saturated State," 
and needed no further expansion. Nor was this opinion 
professed merely in the hope of reassuring those nations which 
were inclined to view the rise of the new Empire with suspicion 
and alarm. It was Bismarck's fixed conviction that Germany 
had henceforth nothing to ask of other nations except the 
right to strengthen her frontiers and develop her resources 
in peace, and so long as he continued in power German foreign 
policy continued to be conducted on these lines. 

It is remarkable how seldom Bismarck spoke of world- 
policy. Half, and more than half, of his official life was spent 
in tying and untying knots in foreign affairs, but in those days 
foreign politics meant in the main the relations of half a dozen 
of the larger European States to each other, and with the other 

325 



326 THE EVOLUTION OF MODERN GERMANY 

Continents the European Concert concerned itself but little. 
Bismarck did, indeed, early in the 'eighties, turn his glance 
across the seas when, almost against his will, he was persuaded 
to acquire colonies, yet the colonial movement which he in- 
augurated never became in his time part of a scheme of 
imperialism, and when later it took that form it departed from 
the principles which he laid down. 

He had not long passed away before an altogether different 
conception of foreign politics began to prevail. Whereas 
aforetime Europe had been at the centre of the old circle of 
ideas, its position became removed to the periphery ; now the 
questions vital to the progressive European nations were held 
to be those relating to the future of the Eastern empires and 
races. The populations of Western Europe were outgrowing 
their geographical and economic limits, and it became recog- 
nized that their capacity for expansion depended upon the 
opening up of new and receptive markets in other parts of the 
world, in which manufactures might be exchanged for food 
and raw materials — the products of industry for the produce 
of the soil. These considerations, amongst others, widened 
the old formulas and transformed European policy into 
world-policy, and Germany was not slow to accept the new 
order of ideas. 

Politicians in other lands naturally looked exclusively to 
political causes for an explanation of the Weltpolitik which 
Germany now began to follow ; they saw in it part of a deep- 
seated design against the existing balance of power in Europe ; 
attributing it to territorial ambition pure and simple, they 
assumed its ultimate aim to be nothing less than a redistribution 
of colonial empire. It is no part of the present purpose to 
follow these lines of speculation, since to do so would lead us 
into highly controversial ground. It is also the less needful 
since, disregarding hypothetical motives of national policy, 
the candid student of Germany's position finds himself con- 
fronted by economic facts which alone would be sufficient to 
explain why Germany in recent years turned her attention 
with increasing urgency to the expansion of her influence 
abroad. A glance at the figures on p. 327, showing the growth 
of the Empire's population since Bismarck adjusted the national 
frontiers in 1871, and having done that declared that Germany 
was a completed State, is enough to explain this outward look. 

These figures clearly prove the gravity of the population 
problem by which Germany is threatened. Since Bismarck 
spoke of " saturation," and based his foreign policy on the 
idea that all Germany had henceforth to do was to keep her 
domestic affairs in order, twentv-seven millions have been 



NATIONAL EXPANSION 



327 



added to the inhabitants of the Empire. On the eve of the 
war the annual increase of population was between 800,000 
and 900,000, and there were German authorities who estimated 
that by the year 1925 the population of the Empire would 
be eighty millions, or nearly twice its number when Bismarck 
spoke of territorial finalitj^^ 

The questions which these facts raise are, of course, primarily 
physical and economic : Where will this large population live ; 
how will it be employed ; how will it be fed ? 

Discussing the population problem in a recent work. Dr. 
Paul Rohrbach says : " Our land and climate, under the 
conditions that will continue as far as one can foresee, allow of 
the production of corn for some forty million people. Hence 
it will be necessary to buy bread from abroad, not to the extent 
of one-sixth or one-fifth as now, but of nearly one-half. How 







Increase. 


Year 


Population. 








Absolute Increase. 


Per Cent. 


1870 


40,818,000 


_ 




1875 


42,729,000 


1,911,000 


4-7 


1880 


45,236,000 


2,507,000 


6-9 


1885 


46,858,000 


1,622,000 


3-6 


1890 


49,428,000 


2,570,000 


5-5 


1895 


52,280,000 


2,852,000 


6-8 


1900 


56,367,000 


4,087,000 


7-8 


1905 


60,641,000 


4,274,000 


7-6 


1910 


64,926,000 


4,285,000 


71 


1914 (June) 


67,812,000 
(estimated) 


2,886,000 





will this bread be paid for ? Whoever buys from abroad must 
give back in return either money or goods. But we do not 
possess a single commodity which we can produce in such 
quantity that it can be an equivalent for this foreign bread. 
We have neither precious metals in any great abundance, nor 
valuable plants, nor coal, iron, and ores in superfluity. Not 
only so, but we manufacture hardly any of the raw materials 
necessary for our industry in adequate quantities at home. 
We import iron, copper, wool, and flax ; we do not possess a 
single fibre of cotton or silk, not to speak of less needful stuffs. 
The only way of purchasing food for those for whom none is 
produced at home is by importing raw materials from abroad, 
manufacturing them, multiplying their value by the process, 
and then paying other nations who need our products with 

» At the time of writing (October 1918) it would obviously be unfruitful 
to speculate upon the effect of the war upon population. 



328 THE EVOLUTION OF MODERN GERMANY 

this increased value which our labour has given to the original 
material." ^ 

Again : — 

" The increase of our population is 800,000 yearly. No 
ingenuity and no exertion can bring the food of these 800,000 
people out of the ground. The number of those who must live 
on foreign corn increases, and the increase will soon be a million 
a year. 2 Whoever cannot get rid of this million is bound to 
answer the question how otherwise he will feed them than by 
the produce of our industry — in the manufacture of raw mate- 
rials brought from abroad and the sale of our own products 
to foreign nations, or the produce of the capital created here 
and invested abroad. If that is so, then for Germany all 
questions of foreign politics must be viewed from the standpoint 
of the creation and maintenance of markets abroad, and especi- 
ally in transoceanic countries. For good or ill we must all 
accustom ourselves in our political thinking to the application 
of the same principles as the English. In England the deter- 
mination of foreign policy according to the requirements of 
trade, and therefore of industry, is an axiom of the national 
consciousness which no one any longer disputes. If the possi- 
bility of disposing of its industrial products abroad were 
one day to cease or to be visibly limited for England the 
immediate result would be, not merely the economic ruin of 
millions of industrial existences on both sides of the ocean, 
but the political collapse of Britain as a Great Power. Yet the 
position is not materially different for ourselves." 3 

This fact of a great annual increase of population has an 
intimate and vital bearing upon the question of German 
industrial expansion. This increase, which is almost equal to 
the combined increases of the United Kingdom, Austria- 
Hungary, and Italy, with France thrown in, must exist and 
must maintain its existence by labour. Short of strangling 
her infants at birth, only two possible courses are open to 
Germany so long as her population continues to grow at the 
present rate, viz. the multiplication of her industrial occupations 
or emigration on a scale never experienced before. Stating 
the facts more concretely, Germany is to-day compelled by 
certain fundamental facts of her life as a nation — her growth 
of population, limitations of territory, natural resources, and 
climate, her inability to feed the increasing millions of her workers 
— ^to seek and to find either (1) outlets for such population as 
cannot be maintained at home in a New Germany across land 

1 Deutachland unter den Weltvolkeim, pp. 10, 11. 

2 Apart from the effects of the war, the fall in the birth rate, as already shown, 
had for the present deferred the prospect of this rate of natural increase. 

• Deutschland unter den Weltvolkem, pp. 11, 12. 



NATIONAL EXPANSION 829 

or sea, or (2) if for the present the population is to remain at 
home, and as a consequence be maintained by industry, new 
markets which shall be able to receive an enormously increased 
industrial output in exchange for food. The position of Germany 
is that of a prolific nation which is growing beyond the physical 
conditions of its surroundings. 

How serious the population question appears to Germans 
who have studied it — and in one phase or another the question 
has for a long time taken a prominent place in the bulk of 
German economic literature — may be judged from the following 
passage in Dr. Rohrbach's book, already mentioned : — 

" That feeling of 1870-1871 which finds expression in the 
poems of Geibel and his consorts, in verses like — 

* Glorious shall ever stand 
Our German fatherland,' 

which created the German self-consciousness after the conquest 
of France as a sort of lyrical -romantic pendant to the Bis- 
marckian dictum about ' saturation,' and which even to-day 
passes in the elect ' patriotic ' circles as the officially accredited 
expression of German national sentiment — this feeling must 
be rooted out and must give place to the sober resolution, the 
clear and positive determination, to acquire national power — 
a resolution and determination proceeding from the knowledge 
that we are by no means surrounded by a halo of glory, but 
stand in the midst of a profoundly dangerous crisis, a crisis 
which will try all our powers, and will determine our part in 
the history of the world for centuries, if not for ever." ^ 

Considering the food question, there is no reason to believe 
that the corn-growing capacity of the country is as yet exhausted, 
yet it is a fact which points its own moral that in spite of the 
careful protection of the agricultural industry the production 
of food corn, as we have already seen, while it increases abso- 
lutely, has ceased to keep pace with the growth of population. 
Nor is there any great likelihood that any measures which 
legislation and individual enterprise may together adopt will 
to any appreciable degree diminish the relative deficiency 
which has already set in. Several facts speak against any 
such expectation. Short of a sliding scale of duties, devised 
so as to maintain the price of corn in all circumstances at a 
given height above the level of the world-market, the home 
corn-grower, driven more and more by dearer labour and 
higher rents to a more intensive cultivation of the soil, cannot 
hope to compete with countries which have the advantage 
of low costs of production, whether caused by cheap labour, 

^ Deutechland unter den Weltvolkem, pp. 7, 8. 



330 THE EVOLUTION OF MODERN GERMANY 

as in Russia, or low rents, as in Argentina. In the meantime, 
he finds it increasingly difficult to obtain labour in consequence 
of the competition of industry and the towns — the former 
offering higher wages than agriculture can possibly pay, and 
the latter amenities of life which have an irresistible attraction 
for the rural labourer who has served his two years in garrison. 

Further, owing to these facts, an increasing number of 
agriculturists are recognizing that their greatest hope lies in 
a change from arable farming to grazing, and every tendency 
seems to point in the same direction, not least the movement 
for the multiplication of small owners. The best that can be 
hoped, therefore, is that for some time longer corn-growing 
will hold its own, yet it is also inevitable that the greater the 
amount of food that has to be imported the heavier will become 
the charge on the national income caused by the corn duties, 
until the burden reaches the straining-point. Should these 
duties be withdrawn, however, corn-growing will necessarily give 
way still more to other forms of agriculture and to industry. 

If, however, the yearly increase of population cannot be 
kept on the land the only outlets for its labour are trade and 
industry ; in other words, the ideal of the agricultural State 
must be sacrificed. On this supposition Germany will, for a 
long time to come, have room not only for its existing popula- 
tion but for the yearly increase of a million inhabitants which 
appears imminent. At the present time the population of 
the Empire averages only 325 persons to the square mile (com- 
paring with about 200 in 1875), while that of the two most 
industrial countries of Europe, England and Wales and Belgium, 
was at the last census 625 and 653 respectively. Even in 
Germany there are States which, without showing any signs 
of congestion, maintain a far larger ratio of population than 
the Empire as a whole. Saxony has 830 inhabitants to the 
square mile, and even in Prussia, whose ratio is only 298, the 
province of Rhineland has a density of 683 inhabitants to the 
square mile, and the province of Westphalia one of 528. That 
Germany, even as an industrial State, could hope to support 
a population as dense as that of the two industrial provinces 
of the North- West, which together have at the present time 
620 persons per square mile, is hardly to be expected. For 
that the natural resources of a large part of the country are 
too poor, a fact which explains why, for example, whole provinces 
in the East of Prussia have not half the relatively low density 
of the Empire as a whole. 

Between a present national ratio of 325 persons per square 
mile and the ratio of the two great industrial provinces of 
West Prussia there is, however, a difference which represents 



NATIONAL EXPANSION 331 

a population of some sixty millions, and within that limit there 
is clearly a very considerable capacity for expansion. This 
expansion, to whatever extent it may be practicable, will 
necessarily be on industrial and not on agricultural lines. It 
has, indeed, been estimated that there are ten million acres of 
moorland and other waste land which could be brought under 
cultivation and which would provide holdings of 25 acres for 
400,000 families, but the aggregate population so represented 
is only equal to two years' increase. 

But the increase of industry implies the increase of markets, 
for to the extent that food must be bought abroad commodities 
must be sold there. It is interesting to note the impression 
made by this aspect of the problem upon the mind of a clear- 
thinking Socialist writer, Herr Richard Calwer, who, though 
a warm Protectionist, cannot be accused of Chauvinism. Herr 
Calwer writes in the Sozialistische Monotshefte : — 

" Truly Germany occupies no pleasant position in the 
world-market. On the one side there is England, blessed with 
its colonial empire, which more and more approaches towards 
the goal of an Imperial Customs Union, and on the other side 
there is the North American Union, which not only regards 
South America as its domain, but because of natural, technical, 
and economic reasons, is in many respects superior and dangerous 
to us. For the present Japan and Russia may be left out of 
our calculations. Between the two stands Germany, which is 
maintaining an extremely difficult struggle, not merely for the 
maintenance and expansion of her markets, but for the protec- 
tion and cheapening of her supplies of raw materials. We have 
a yearly increase of population amounting to about 900,000. 
Our agriculture is not able to feed this increase, and it must 
for the most part be thrown on the industrial labour market. 
The industrial production of Germany, therefore, will increase, 
and must increase more rapidly than in any other industrial 
country which competes with us. But for our increasing produc- 
tion we need to find a sale, and one on as favourable and 
healthy conditions as possible, and measures must also be 
taken to secure adequate supplies of raw material." 

Unpleasant though the prospect must be for older industrial 
nations, which see themselves threatened from several sides 
simultaneously, German competition in the world markets 
will inevitably become more severe. The individual indus- 
trialist pushes forward his trade outposts for personal advantage, 
but to the nation collectively extended markets are a condition 
of life. 

There remains the alternative of emigration, and it is one 
to which Germany is fully alive. Here, however, Germany is 



382 THE EVOLUTION OF MODERN GERMANY 

handicapped by the fact that, owing to her late appearance in 
the field as a colonial Power, few territories under her protec- 
tion are suited to the settlement of Europeans. Germany, 
indeed, does not possess colonies in the true sense. Her colonial 
empire is composed of protectorates and dependencies, bureau- 
cratically governed from Berlin, situated for the most part 
in tropical countries, and suited only for plantation enterprises 
worked by native labour. Hence it is that the emigration 
to these colonies of Germans,* as of whites of any nationality, 
has hitherto been insignificant, and that the entire emigration 
movement continues now as ever to be a source of permanent 
injury to the Empire. During the twenty years 1894 to 1913 
552,000 Germans have left the mother-country, and with 
exceptions so few as to be relatively insignificant they have 
made their homes under foreign flags, and for the most part 
in the United States. The principal transoceanic destinations 
of these emigrants were as follows : — 



United States 

Brazil 

Other American States 

Australia . . 

Africa 

Asia 



482,700 

11,400 

38,000 

3,900 

6,700 

980 



The loss to the home country of this population is naturally 
a sore point with all patriotic Germans, and is an argument 
for colonization with which outsiders should be able to sympa- 
thize. At the present time, it is true, the emigration figure 
is very low, amounting to an average of little over 20,000 a 
year, but thirty years ago it exceeded 100,000 annually, a little 
earlier it exceeded 200,000, and it would be unsafe to predict 
that the tide will not turn again. 

It is evident that no mere extension of her European boun- 
daries, even were that conceivable, would afford Germany 
permanent relief. Whatever reality there may be in the 
immoral agitation of the Pan-Germanists, their predatory 
schemes offer no solution of the population problem. 
Even were it likely that the German-speaking portions 
of the Austro-Hungarian Empire would eventually tlirow 
in their lot with the more progressive Empire in the 
North, and that at some remote period German-speaking 
territories outside the old Empire would pass under the 
Imperial eagle, territorial extensions of that kind would in 
no way abate, and might even increase, the economic pressure 
of the population question. ' 

1 It is estimated that the German-speaking people of the world number 
86,000,000. Of these some 72 per cent, live in the Empire ; the vast majority 
of the remainder are distributed in Austria, the United States, and Switzerland, 
but only a fraction of them are still citizens of the Empire. 



NATIONAL EXPANSION 333 

Before the war the idea which seemed to be gaining ground 
was the establishment in undeveloped and spacious countries 
of temperate climate of settlements, on the model of those in 
South Brazil, which should act as pioneers of German influence, 
enterprise, and trade. " We must resign ourselves in all clear- 
ness and calm to the fact that there is no possibility of acquiring 
colonies suitable for emigration," writes Dr. Rohrbach. " But 
if we cannot have such colonies it by no means follows that we 
cannot obtain the advantages, if only to a limited extent, 
which makes these colonies desirable. It is a mistake to 
regard the mere possession of extensive transoceanic territories, 
even when they are able to absorb a part of the national surplus 
of population, as necessarily a direct increase of power. 
Australia, Canada, and South Africa do not increase the power 
of the British Empire because they are British possessions, 
nor yet because a few million British emigrants with their 
descendants live in them, but because by the trade with them 
the wealth and with it the defensive strength of the mother- 
country are increased. Colonies which do not produce that 
result have but little value ; and countries which possess this 
importance for a nation, even though they are not its colonies, 
are in this decisive point a substitute for colonial possessions 
in the ordinary sense." ^ 

Those who approached the question from this standpoint 
were accustomed to direct their attention specially to three 
possible spheres of influence — Brazil, Argentina, and Asia 
Minor. Most serious publicists recognize that the way to 
colonial empire in South America is blocked by the Monroe 
Doctrine, amongst other practical difficulties, but that doctrine 
does not apply to settlements, and it has not prevented the 
establishment already in the southern parts of Brazil of several 
large German colonies which both multiply and prosper. 
According to a recent estimate the Germans now resident in 
Brazil number some 400,000, the great majority being settled 
in the southern States of Rio Grande do Sul, Parana, and Santa 
Catarina, while a small number are found in Sao Paulo and 
Espirito Santo, in the north. This population is for the most 
part the result of natural increase, for of late years emigration 
thither has greatly declined. Thirty years ago the yearly 
average was some 2,500 ; of late years it has fallen to several 
hundreds, partly owing to the great decrease in the general 
stream of emigration, but also owing to the Brazilian Govern- 
ment's less friendly attitude towards foreigners. Nevertheless, 
it is held that Germanism in Brazil might still be largely 
strengthened by well-directed emigration, and that settlements 
^ Deutschland unter den WeUvdlkem, pp. 159, 160. 



334 THE EVOLUTION OF MODERN GERMANY 

might, with equal prospects of success, be estabhshed in 
Uruguay and Paraguay. 

In Near Asia, too, German colonization is by no means of 
recent origin. There are in Transcaucasia agricultural settle- 
ments established by Wiirtemberg farmers, whose descendants, 
in the third generation, live in their own villages, and still 
speak their native language. In Palestine there are the German 
Templar colonies on the coast, which have prospered so well 
as to excite the resentment of the natives. 

The promotion of the Bagdad railway scheme turned 
German attention to the fertile regions of Anatolia and Mesopo- 
tamia. No disguise has ever been made of the fact that 
German industrialists have built great expectations upon this 
railway, which has hitherto been regarded as the key to new 
markets in which Germany would have a preponderant position. 
The attitude of the commercial world was stated some time 
ago by the Cologne Gazette as follows : " The Bagdad railway 
means for the Turkish Empire the opening up of large terri- 
tories, but for Germany it is simply an enterprise by means 
of which it may be possible to obtain for German capital and 
trade a new field of activity. German finance did its best to 
induce English and French capitalists to co-operate in the 
building of the line, and it is not to blame if they have refused 
to come in. It is ridiculous that German policy should be 
reproached with a desire to obtain a footing in Asia Minor to 
the injury of other foreign interests. We are doing in Turkey 
just what we are doing in other parts of the world — we are 
seeking new markets for our exports and new spheres of 
investment for our capital." 

An official imprimatur was placed upon this statement of 
German views in Asia Minor by the late Secretary of State von 
Schon, who stated in the Imperial Diet on March 24, 1908 : 
" He trusted and believed that, in accordance with the pre- 
dominant part which Germans had taken in initiating and 
financing the scheme, German influence would remain predomi- 
nant in the enterprise. But all the assertions which had been 
advanced with regard to German political schemes in connection 
with the railway, or with reference to an alleged plan of German 
colonization in the districts through which it passed, were 
pure inventions." ' 

* Such an avowal of legitimate ends is more credible than the plea put 
forward by a prominent member of the Diet that Germany's only interest in 
the Bagdad railway is archseological. Count Hertling (later Imperial Chan- 
cellor) stated on April 30, 1907 : " It is true that a German corporation obtained 
the concession for this railway from the Ottoman Government in 1904, and 
we have every inducement to use Grerman capital in opening up that old centre 
of civilization for the purposes of science and exploration, but that political 
considerations are involved would never occur to me." 



NATIONAL EXPANSION 335 

An interesting light is thrown upon the singular faculty of 
the German for combining " idealist " with " realist '* politics 
by Dr. Rohrbach's advice that his countrymen should put away 
all thoughts of acquiring territory in Asia Minor and seek to 
establish influence there by a well-directed conjunction of 
philanthropy and business. Remembering the pioneer work 
which has been done by the Italians in the Levant with schools 
and by the French in other parts of the Turkish Empire with 
hospitals, he urged Germans to employ the same means of 
winning the confidence — and obtaining the orders— of the 
people of Mesopotamia and Babylonia. He has written : — 

" From these two things, the school — that is, the making 
accessible to the people of the German language, with a 
certain acquaintance with German culture — and more especially 
medical institutions, the most fruitful efforts in the strength- 
ening of economic relations will be obtained. Every penny 
expended in this way in Turkey from to-day forward will in 
due time be converted into a certain import value. That is 
the policy which we should follow in the territory opened by 
the Bagdad railway." ^ 

To follow the later developments of the Bagdad railway 
controversy, particularly after it passed under the influence 
of the militant imperialists, with their propagandism in support 
of a policy of spoliation all round, would lead to no profitable 
result in view of the abnormal character of international 
relations all the world over. For the same reasons all specula- 
tions upon the question of German expansion in general, whether 
in Near Asia or elsewhere, must lack a basis of actuality. The 
war may prove a severe corrective of Pan-German aberrations, 
and its end may find Germany prepared to return to the more 
temperate views of her destiny as an industrial nation which 
held the field before counsels of force and aggression gained 
the upper hand. In illustration of that soberer attitude the 
words addressed by Herr von Miihlberg, Under-Secretary 
for Foreign Affairs, to a delegation of British journalists on 
May 29, 1907, may be recalled with relief. 

" Everywhere in Asia and in Africa," he said, " Germany 
has only one aim — the open door, I believe that it is just on 
this point of policy that we could meet and count on your 
support. Everywhere in the world where Great Britain has 
brought any country under her influence she has never sup- 
pressed the trade development of other lands, as many nations 
have done to their own detriment. You have always devoted 
your energies and labours to the opening up of the country's 
sources of production, and bringing it nearer to civilization 

^ Dtutachland unter den Wdtvolkem, p. 177. 



336 THE EVOLUTION OF MODERN GERMANY 

and progress. You have never excluded other States from 
territories under British influence, but allowed them to go in 
along with you. This policy of yours is now celebrating one 
of its greatest triumphs in Egypt. The policy of my Imperial 
master shares this conception of the tasks and aims to which 
the civilized State must aspire. Here, I believe, is the connect- 
ing bridge which we can cross together and join hands upon 
without any prejudice to the friendships and alliances uniting 
your Empire to other nations." 

Such an attitude, while it cannot diminish the mercantile 
rivalry between nations, may yet do much to mitigate the 
conditions under which that rivalry will in future be carried 
on, and unless the lessons of the war have been lost upon 
mankind it may be hoped that one of the pledges of the security 
of future peace will be sought in the adoption by mutual agree- 
ment of a larger measure of commercial freedom and equality 
in the undeveloped territories of the world than has been 
possible in the past. 

There remains to be considered one other outcome of Welt- 
politik as understood in Germany in the present day, and for 
Great Britain it possesses special interest. If new markets 
are necessary to Germany's growing population, it is no less 
inevitable that her sea power will be increased, for the protection 
of her maritime trade, and not least, as the dependence upon 
foreign corn increases, her food supply. It is not too much 
to 'say that during the years immediately preceding the war 
the policy of naval expansion had drawn German parties 
together as nothing else had succeeded in doing since the 
Empire was established, and that, more than any other 
movement, it enlisted the nation's enthusiastic and undivided 
attachment. 

Two motives influenced different sections of the nation. 
The one was the legitimate desire to see the German navy brought 
to such a standard of numbers and strength that the national 
interests on the sea and in distant lands might at all times 
count upon prompt and efficient defence. The other motive 
was the ambition for a larger " place in the sun." The first 
of these motives may be illustrated by some words written by 
the late Professor F. Paulsen, in his day one of the warmest 
advocates in Germany of a good understanding between that 
country and our own. " The German Empire," he said, " has 
participated in the policy of expansion out of Europe — at 
first modestly, of late with growing decision. The enormous 
increase of its industrial production and its trade compelled 
it to take measures for the extension and the security of its 
oversea interests. In the course of a single generation Germany, 



NATIONAL EXPANSION 887 

as an industrial and mercantile State, has worked her way into 
the second position in Europe ; to-day England alone is ahead 
of it, yet by no great distance, and the distance decreases every 
year. The necessity of protecting this position by a strong 
naval force has during recent decades become a dominant 
factor in the political thought of the nation." » 

On the other hand, the political aspects of the question of 
naval expansion formed the substance of much of the propagand- 
ism of the Pan-Germanist party and Press, which professedly 
regarded sea power as an indispensable condition of a policy of 
imperialism, and as the large -navy movement grew it was 
these aspects which gradually came to dominate military and 
governing circles. 

More than any other man the late Emperor was responsible 
for the success of the naval expansion policy which has proved 
so fruitful a source of distrust and embitterment between 
the British and German nations. Not only was it his consti- 
tutional right to direct naval policy,' but from the beginning 
of his reign he made it clear that the creation of a strong navy 
would be one of his measures for extending Germany's foreign 
commerce and her political influence abroad. It was not 
without significance that on coming to the throne he addressed 
a special message to the navy, reminding it that " since my 
earliest youth I have been . connected with it by a cordial and 
vivid sympathy." He had only been on the throne several 
months when (September, 1888) he placed the increase of the 
navy in the forefront of national questions. " I hope," he said, 
in reviewing the fleet at Wilhelmshaven, '' that the navy will 
powerfully grow and contribute to the defence and strength of 
the fatherland and the security of its coasts." 

The desire to see the navy strengthened dated much farther 
back, however, for he told in later years (at Bremen in March, 
1905) how " as a young man, as I stood before the model of 
Bromme's ship, 3 it was with feelings of resentment that I realized 
the disgrace which had fallen on our fleet and the flag we 
flew in those days." Even more powerful than those early 
impressions was that " drop of sailor-blood from my mother's 
side " which, as the Emperor has reminded us, flows in his 
veins, and " gave me the clue as to how and in what manner 

1 Internationale Wocfienschrift fiir Wissenschojt, Kunst, und Technik (October 
26, 1907), p. 18. 

* The right belonged to him under article 63 of the Imperial Constitution : 
" The navy of the Empire is a united one under the supreme command of the 
Emperor. The Emperor is charged with its organization and arrangement, 
and he shall appoint the officers and officials of the navy and in his name, 
these and the seamen shall be sworn in." 

' In 1853, by resolution of the old Federal Diet at Frankfort, the federal 
fleet, including the flagship of Admiral Bronune, wm sold by auction. 

22 



838 THE EVOLUTION OF MODERN GERMANY 

I was to frame my conception of the duties which henceforth 
lay before the German Empire." 

Many of the speeches made by the Emperor during the 
first decade of his reign were designed to prepare the pubhc 
mind for an important departure in naval policy. With a 
sure instinct he appealed to the spirit of national pride and 
ambition. " The Empire has become a world-empire," he 
said on January 18, 1896, the twenty-fifth anniversary of the 
foundation of the Empire ; '' thousands of our German country- 
men live in all parts of the globe. German goods, German 
knowledge, German enterprise go across the ocean. The 
values which Germany carries upon the sea figure at thousands 
of millions (of marks). It is your solemn duty to bind this 
greater German Empire fast to the Empire at home." " Im- 
perial power," he said on December 13, 1897, " denotes sea 
power, and Imperial power and sea power are complementary ; 
the one cannot exist without the other." Still more significant 
were some words spoken by him on July 3, 1900. 

" The wave-beat knocks powerfully at our national gates," 
he then said, " and calls us as a great nation to maintain our 
place in the world — in other words, to follow world-policy. 
The ocean is indispensable for Germany's greatness, but the 
ocean also reminds us that neither on it nor across it in the 
distance can any great decision be again consummated without 
Germany and the German Emperor. It is not my opinion that 
our German people conquered and bled thirty years ago under 
the leadership of their princes in order to be pushed on one 
side when great and momentous foreign decisions are come 
to. Were that so there would once for all be an end of the 
world-power of the German nation, and I am not going to 
allow that to happen. To use the most appropriate, and if 
necessary the most drastic, means to prevent this is not only 
my duty but my noblest privilege." 

It is not necessary to weigh too critically winged words 
like " The trident must pass into our hands " or " Our future 
lies on the water." It is sufficient to know that their author 
never attempted to conceal his ambition to make Germany 
as strong on sea as on land. " Notwithstanding the great 
war " (of 1870), the Emperor said at Bremen in March, 1905, 
" the period during which I grew to man's estate was neither 
great nor glorious for the seafaring portion of our nation. 
Here, too, I have drawn the logical conclusions of that which 
my forefathers have accomplished. At home the army had 
been developed as far as was necessary. The time for naval 
armament had come. To-day . . . the fleet is afloat, and is 
still being built. Every German warship launched is one 



NATIONAL EXPANSION 839 

guarantee more for peace on earth, yet it also means that our 
adversaries will be so much less inclined to pick a quarrel 
with us, while it will render us pro tanto more valuable as 
allies." 

From the first, therefore, the Emperor was bent upon 
pursuing a policy of naval expansion, though he recognized 
that in order to success he must carry the nation with him. 
For a long time he piped to spectators who did not dance, 
and eight years of his reign had passed before the Reichstag 
granted the reformed Admiralty a vote which enabled it to 
undertake the reorganization of the navy in earnest, so " setting 
its hand to a work which will receive the grateful appreciation 
of coming generations " (May 6, 1896). 

In the exposition which accompanied his first important 
Navy Bill of 1898 there was no suggestion of menace to the 
naval power of the older maritime States. Its object was 
said to be to create within a definite time a national fleet 
sufficiently strong to protect effectively the naval interests 
of the Empire, and the programme of construction was 
moderate and but little calculated to cause alarm. All it was 
proposed to do was to furnish Germany within seven years 
with a navy consisting of 19 battleships, 8 armoured vessels 
for coast defence, 12 large cruisers, and 30 small cruisers. Of 
these vessels three large and ten small cruisers were intended 
for service in foreign waters. The battleships and armoured 
vessels were to be replaced after 25 years and the large and 
small cruisers after 20 and 15 years respectively. With the 
passing of this law it was supposed that Germany's naval 
requirements were met for many years, but this proved not 
to be the case. There had come to the head of the Admiralty 
an ambitious imperialist in the person of Admiral von Tirpitz, 
who adroitly fostered the Emperor's hankering after a fleet 
which in number and strength should be a worthy counterpart 
of the army. Moreover, the foreign outlook had been clouded 
by the Russo-French alliance and the troubles in South Africa, 
and the relations between Germany and Great Britain were 
becoming more and more strained. Prince BUlow has since 
written that if Germany did not intervene in a sense hostile 
to this country in the Boer War which broke out at the end of 
1899 the reason was that her navy was too weak. 

On the plea of national security a new Navy Bill was 
introduced in 1900 and the Diet accepted it almost without 
demur. There was now no longer any concealment of the 
fact that the Emperor wanted a navy strong enough to be 
thrown in the scale against any Power which crossed Ger- 
many's path. The exposS des motifs stated : " To protect 



840 THE EVOLUTION OF MODERN GERMANY 

the Empire's maritime trade and colonies only one method 
can avail. Germany must have a battle fleet so strong that 
even the adversary possessed of the greatest sea power will 
attack it only at great risk to himself." In the course of the 
debates in the Diet the official exponents of the Bill admitted 
that it was aimed at Great Britain. 

The construction programme of 1900 marked the definite 
triumph of the large-navy party. The programme was devised 
so as to give to Germany by 1917 a fleet of 38 line ships and 
14 large and 38 small cruisers. Six years later even this large 
programme was exceeded. The Anglo-French entente had 
been concluded at the beginning of 1904 ; the Algeciras Con- 
ference on Morocco had seen Germany contending against 
the rest of the Powers aided only by a " brilhant second " in 
the person of Austria-Hungary ; already the " encirclement '* 
scare had taken powerful hold of the national mind ; and, 
moreover, the " Dreadnought " had made its appearance in 
an English naval dockyard. In these circumstances the 
Government once more obtained its way without difficulty ; 
a law of June 5, 1906, provided for the addition of six cruisers 
to the construction programme already approved, and with 
a view to the building of larger vessels increased the annual 
expenditure upon the navy by one-third. Further Navy 
Bills were passed in 1908 and 1912, the former reducing the 
service age of ironclads from 25 to 20 years and making pro- 
vision for the building by 1917 of fifteen battleships beyond 
the number contemplated in 1900, while the latter added 
three battleships and two cruisers, made provision for a 
large fleet of submarines, and created a third active squad- 
ron, the effect of which was that nearly four-fifths of the 
entire navy would henceforth be maintained in full permanent 
commission. 

What this naval expansion policy has meant financially for 
Germany may be judged by the fact that while thirty years 
ago her naval estimates amounted to three and a half million 
pounds and twenty years ago to less than five millions, her 
expenditure has since 1911 exceeded twenty-two millions a 
year. Again, while thirty years ago the navy was manned 
by 15,000 officers and seamen, the number in 1913 exceeded 
80,000. 

Long before the war broke out both the Diet and the nation 
had been won over to the policy of a powerful fleet. The 
greatest significance of the naval expansion movement lay 
in the fact that behind it were the deliberate will and calm 
resolution of a united people. The whole influence of the 
imiversities was on the side of this movement and of the 



NATIONAL EXPANSION 841 

Imperialism of which it was at once its effect and cause. 'f Behind 
it were also the pressure and the money of the armament and 
other powerful industrial interests, with a vigorous and well- 
directed advocacy in the Press and not a few spokesmen in the 
Reichstag. The Rhenish- Westphalian iron and steel industrialists 
called, indeed, for a navy whose cost should at least be equal 
to 5 per cent, of the sea-going trade. In the Diet even 
the Radicals, the traditional friends of economy and good 
relations with all the world, who were ready early in the 
'nineties to abandon the colonies because of their cost, had 
ceased to resist the ever- increasing calls for larger naval votes. 

A curious illustration of the changed Radical attitude 
was afforded by the volte face performed within the short space 
of two years by the Vossische Zeitung, the leading organ of 
the commercial, anti-military Radical party of Prussia. In 
1905 this journal wrote in disparagement of a navy scheme 
of that day : " The more eager and excited the demands which, 
with the fullest publicity, are advanced for a considerable 
increase in the German navy — an agitation which does not 
scruple to hint at the possibility of war with England — the 
stronger will be the inducements for other States, and, in 
particular, for Great Britain, to strengthen their own naval 
forces. The boundless extravagances in which the spokesmen 
of the Navy League indulge may easily produce a result which 
was not contemplated. The more ' shouting ' there is in 
Germany the more ships will England build." Yet two years 
later the same journal wrote, when the proposal of a still 
larger scheme led to controversy abroad : " Why is Germany 
put in the foreground in discussions of the armament question ? 
The Government's plans have been publicly explained, and 
have been sanctioned by the Reichstag. England will surely 
not express or indicate a wish in Berlin that the new German 
Navy Bill shall not be carried into effect ? If the English 
believe that in spite of their friendly relations with France 
and Japan, and in spite of their understanding with Russia, 
they must lay down two ships of the same type for each one 
that Germany lays down, we ought not to be made responsible 
for the increase of the English Naval Estimates." 

Even the Socialists as a party had ceased to be hostile to 
the building up of a strong naval force, in spite of the hyper- 

^ A conference of Berlin professors and representatives of learning and 
science to which the new Colonial Secretary unfolded his colonial programme 
in January, 1907, adopted the formal resolution that " a great civilized nation 
like the German nation cannot permanently restrict itself to internal politics, 
but must take part with the other great nations in colonial and world-politics," 
and formed a standing committee to make propagandism for the cause, '' without 
direct participation in party warfare." 



342 THE EVOLUTION OF MODERN GERMANY 

critical attitude of some of their parliamentary leaders, an 
attitude best explained by the maxim that it is the duty of 
an Opposition to oppose. Years ago the Socialist Herr R. 
Calwer wrote : " To-day, when Germany is the equal, economi- 
cally, of England and the United States, and is compelled to 
take up an attitude towards all questions of world-politics 
in the interest of her industry, the naval policy of modern 
industrial States may indeed be severely condemned, but it 
cannot be expected of one's own country that it shall take up 
an exceptional position which might be fatal. As matters 
are to-day the prestige of a State abroad depends on its readiness 
for war both on sea and land." ^ 

If proof were needed that the nation at large was behind 
the Diet in its willingness to respond to every call made by 
the Tirpitz school such proof was afforded by the rapid 
growth of the Navy League. Founded in 1898, this organi- 
zation succeeded in enrolling within a few years a membership 
of over a million. Saxony alone, though not one of the maritime 
States of the Empire, contributing a quarter. The League 
has branches in every town and in almost every village in the 
country ; members of the reigning houses are its most energetic 
workers ; its maps and charts, illustrating and comparing 
the navies of England and Germany, are found in tens of 
thousands of schoolrooms, libraries, and offices, and it keeps 
the country literally deluged with pamphlets and leaflets in 
advocacy of a large fleet policy. The Government has taken 
care to disown the ambitious shipbuilding programmes which 
the League puts forward from time to time, yet it would be 
very unwilling to deny that the League's effective agitation 
has afforded substantial and welcome help to its policy of 
naval expansion, and moreover there is an unmistakable 
tendency for the League's programmes to translate themselves 
into fact. 

The League is distinctly Chauvinistic in spirit, though it 
also fosters much genuine patriotism. The tone which prevails 
in its ruling circles may be judged from a passage taken from 
a speech made by Major-General Keim at one of its annual 
meetings, held at Cologne in May 1907 ; — 

*' The German Navy League is twenty times as large as all 
other Navy Leagues in the world together. Even the English 
Navy League has written to us asking an explanation of how 
we have succeeded in growing so quickly. We have sent the 
English Navy League our rules, and with our usual courtesy 
have given it advice and directions. Not our rules, however, 
but rather the spirit that lives in the League has won for us 

* Sozialistiache MoncUshefte, November 1905. 



NATIONAL EXPANSION 848 

this success. For that reason no Navy League in the world 
can imitate us. The spirit upon which we are founded is that 
of German ideahsm. Our navy recognizes only one flag, ' black, 
white and red,* and this symbol of German unity, the war 
flag, we shall maintain, for in it is incorporated the idealism 
of the German nation. It is the duty of the Navy League to 
spread amongst the nations the conviction that we urgently 
need a strong fleet. Our entire political relations with foreign 
countries depend upon the question of power. The Imperial 
Chancellor may write the prettiest notes, but the world always 
asks what lies behind. And because the Powers know that 
behind Germany there stands a victorious army, they say, 
' We had better take care.' But that does not apply, alas ! 
to our navy, and so we must work unceasingly for the rapid 
increase of our fleet. There is no great political art in dictating 
laws and concluding alliances everywhere when one has such 
a navy as the English. But for that reason the German nation 
should not be told that it has no reason to be nervous." 

For some time, seeing how events were moving and wishful 
to avoid a purposeless and ruinous rivalry in shipbuilding, 
the British Government had endeavoured to come to an 
arrangement with the German Admiralty for a mutual reduction 
of naval expenditure, without prejudice to the existing relative 
strength of the two navies. These well-meant advances were 
received with verbal assurances of an entire absence of ill- 
intent, but without any serious indication of a desire for 
accommodation, and before the outbreak of the war it had 
become evident that Germany was bent upon following her 
own devices, and that in all future shipbuilding plans Great 
Britain would have to be guided entirely by her own interests. 

It would be premature to attempt to forecast the attitude 
of these two countries to each other on the navy question 
after the close of the war, but for both the question is obviously 
one of the utmost gravity. In the past there may have been 
few Germans, outside the ranks of the Chauvinists, who seriously 
entertained the desire to see the navy outrival that of Great 
Britain. It will be different in future unless the settlement 
brings about such an international situation as will encourage 
on all sides a disposition to check the past ruinous expenditure 
on armaments. Failing that, the outlook for both countries 
will be dismal in the extreme. 



CHAPTER XVIII 

THE COLONIES 

Early colonial enterprises — The modern colonial movement — Bismarck's unwil- 
lingness to give a lead — Annexation of German South-west Africa — 
Colonies acquired in West and East Africa and the Pacific — Bismarck's 
principles of colonization — " Governing merchant, not governing bureau- 
crat " — The Africa-Heligoland Convention of 1890 — The Measiu-es for 
the suppression of slavery in East and West Africa. — Administrative 
deficiencies — Government on Prussian principles — The "colonial scandals" 
— The excesses of the white traders — Wars and Insurrections — The 
Herero rising — The force theory of colonization. 

ONE of the many German historians of the colonial move- 
ment dates his story from the end of the Crusades, 
while another, not to be outdone in the national virtue 
of thoroughness, traces its origins to the shadowy vistas of 
pre-Christian annals. Though, however, the movement has 
a respectable lineage, it acquired practical importance only 
in comparatively modern times. 

There were genuine if tentative efforts at colonization as 
early as the seventeenth century, when the Great Elector of 
Brandenburg (who reigned 1640-1688) established settlements 
on the West coast of Africa. Had his policy of foreign enter- 
prise been supported by his successors Prussia might have 
ranked to-day amongst the foremost of Colonial Powers ; for 
the Great Elector had all the instincts of our Elizabethan 
adventurers. " The surest wealth and the credit of a land 
come from its commerce," he wrote ; " shipping and trade are 
the most honourable pillars of a State." He built a strong 
jfleet, he traded, explored, and buccaneered, and at the close 
of his reign Brandenburg seemed to be on the threshold of a 
great maritime career. Earlier still the Hanseatic Free Cities 
would fain have traded in foreign territories as well as foreign 
merchandise, had not jealous eyes been turned on them at 
home. " Not Clive but a Hamburg Senator," said the 
Wiirtemberg publicist Moser over a hundred years ago, " would 
command the Ganges to-day, had the aims of the German 

344 



THE COLONIES 845 

Hanseatic towns been supported instead of combated by the 
old Empire." 

But Prussia's and Germany's dreams of foreign conquest 
and colonization, such as they were, were dispelled when King 
Frederick William I of Prussia (1718-1740), more Concerned 
to assure and extend his sovereignty at home than to dissipate 
his strength upon imperialistic enterprises, abandoned the 
Great Elector's settlements. The new policy was shared by 
Frederick the Great (1740-1786), who wrote in the collection 
of maxims which he prepared for the benefit of his successors, 
his " Expose du gouvernement prussien," " All distant posses- 
sions are a burden to the State. A village on the frontier is 
worth a principality two hundred and fifty miles away." 

Nevertheless, hopes and ambitions had been fired in the 
German mind which were never again wholly extinguished. 
From the beginning of the nineteenth century forward a colonial 
sentiment gradually took definite shape. Its beginnings may 
be traced to the era of exploration and travel which dated 
from that time. 

From the middle of the century in particular German 
explorers were active in various parts of the world. For a 
long time they were content to follow purely scientific aims. 
Perceiving, however, that other nations were not equally in- 
different to practical considerations, the idea of securing for 
Germany a share in the unappropriated regions of Africa and 
the Pacific took possession of them. More and more the 
question of colonization received prominence in the literature 
of the day. Friedrich List had already begun to advocate 
colonial enterprise as one of the measures supremely necessary 
to the economic and political development of Germany, and 
in one of his earliest works Wilhelm Roscher similarly urged 
the importance of colonization. " Germany," he wrote, " must 
lose no time if the last suitable territories are not to be seized 
by other and more resolute nations." The idea appears 
to have been actively discussed in political circles in the 
'forties. 

In the meantime the colonial idea had been greatly assisted 
by the large amount of emigration from Germany which took 
place during the first half of the century, owing to the growing 
recognition of the serious permanent loss to the nation which 
was entailed by the indiscriminate transference of population 
to foreign territories. On the whole the main stream of emigra- 
tion during last century was to the United States. After 
allowing for a large amount of repatriation it has been estimated 
that during the fh-st eighty years of the century 4,500,000 
Germans emigrated, and that of these all but half a million 



346 THE EVOLUTION OF MODERN GERMANY 

went to the United States. Many emigrants, however, went 
to Brazil, Russia, and to certain of the British Colonies, and 
particularly to Australia, Canada, and Tasmania. 

So important became the emigration movement in the 
middle of the century that societies were formed in various 
States for its encouragement and regulation, and the later care 
of the emigrants. Some of these societies have carried on 
their activities with varying success down to the present day. 
Beyond occasionally discouraging or prohibiting the touting 
activities of emigration agents acting in the interests of 
undesirable countries, the German Government, however, 
took no steps to regulate emigration until the establishment 
of the North-German Confederation in 1867, since which time 
the Central Government has taken the question more and 
more under its control. 

The movement was also assisted by the formation of societies 
of a scientific and commercial character. Thus the Central 
Association for Commercial Geography and the Promotion of 
German Interests Abroad was formed in Berlin in 1868 for 
*' the study of those lands in which organized German settle- 
ments already exist, the social and commercial conditions and 
the spread of information thereon, the promotion of emigration 
to regions where settlers of German origin are already estab- 
lished under conditions favourable to the genius of the 
German people, the promotion of intellectual and material 
intercourse between the German colonial settlements and the 
German fatherland, and, lastly, the furtherance of trade and 
navigation and the acquisition of colonies." Other societies 
which indirectly served the colonial cause were the German 
Society for the Scientific Exploration of Equatorial Africa, 
formed in 1873, and the German African Society of 1876, which 
in 1878 were merged in the German African Society of Berlin. 
Many of the later African explorers were sent out by the 
last-named society. 

Naturally the movement duly received warm encouragement 
from the merchants of the Hanseatic seaport towns, many 
of whom had had factories and trading stations on the East, 
West, and South-west coasts of Africa since the middle of 
the century, and in whose interest Prussia, the North German 
Confederation, and later the Empire had successively con- 
cluded commercial treaties with the independent native rulers 
or the European States exercising suzerainty there. Never- 
theless, the privileges so obtained, valuable though they were, 
and successfully though they were used, were not held to 
compensate for colonies owned by the motherland, and when 
the interest of the Hamburg and Bremen traders and bankers 



THE COLONIES 847 

had once been won for the colonial movement these men were 
amongst the most vigorous of its supporters. 

All sorts of schemes were proposed at this time by men 
eager for action, though for the most part lacking in practical 
ideas. Among the countries recommended as fields for 
colonial enterprise were Madagascar, Formosa, New Guinea, 
the New Britain Archipelago, Fiji, Tonga, and other islands 
of the Pacific, with various parts of Africa. The proposal 
to appropriate New Guinea created excitement in Australia ; 
and the British Government was urged without success to 
annex the island before it was too late. Other territories 
urged as eligible for colonization were Uruguay, North Borneo, 
Hainan, Timor, the Philippines, Zululand, Tripoli, Tunis, 
and Morocco. There were even writers who seriously discussed 
the possibility of acquiring New Zealand for Germany by 
purchase. 

Increasingly urgent though the colonial movement became, 
however, it still failed of practical result owing to one insuper- 
able obstacle. This was the hostility of the Government. Since 
1862 Bismarck had been Minister-President and Foreign 
Minister of Prussia, and since 1867 Federal Chancellor and 
Foreign Secretary of the North-German Confederation, and he 
was too much occupied with domestic and military questions, 
and above all with the problem of Germany's consolidation, 
to give a thought to projects of over-sea expansion. Bismarck's 
earliest known utterance on the colonial question takes the 
form of a letter, written on January 9, 1868, to Boon, the 
Minister of War and Marine, and in this he appeared as a 
stout opponent of colonization. 

" The advantages expected from colonies for the trade 
and industry of the mother-country," he wrote, " rest for the 
most part on illusions. For the costs entailed by the estab- 
lishment, support, and particularly by the retention of the 
colonies, very often exceed — as the experience of the colonial 
policy of England and France proves — the benefit derived by 
the motherland, apart from the fact that it is difficult to 
justify the imposition of heavy taxation upon the whole nation 
for the benefit of a few branches of trade and industry." 

For the rest he contended that the defence of colonies 
was incompatible with the principle of universal service, which 
contemplated only home defence, that they would prove a 
potential source of international discord, and finally that they 
were rather a matter for private enterprise than for State 
action. 

Holding these opinions, it is not surprising that at the 
time of the Franco-German war, when voices called loudly for 



848 THE EVOLUTION OF MODERN GERMANY 

the seizure of French colonies — Cochin-China, Tahiti, the 
Marquesas Islands, Reunion, even Algiers and Madagascar — 
as a part of the expected indemnity, Bismarck turned a deaf 
ear to them. During the peace negotiations at Versailles, when 
the idea of acquiring Pondichery and other French colonies 
was still urged upon him by men high in position, he replied, 
" I want no colonies. They are only good for providing offices. 
For us colonial enterprises would be just like the silk-sable 
in Polish noble families, who for the rest have no shirts." 
Three years later (1873) he said to Lord Odo Russell, the British 
ambassador in Berlin : " Colonies would be a source of weakness, 
because they could only be defended by powerful fleets, and 
Germany's geographical position does not necessitate her 
development into a first-class maritime Power." 

During the first years of the new Empire Bismarck continued 
to resist every proposal of over-sea annexation which colonial 
enthusiasts continued to press upon his attention. When, 
in 1872, the ruler of the Fiji Islands and, in 1874, the Sultan 
of Zanzibar asked for the protection of the Empire, he promptly 
declined to give it ; and in the event the Fiji Islands went to 
Great Britain a little later. On the occasion of a dispute with 
Spain in 1874 he spoke of Germany's renunciation of colonies 
as a deliberate act of policy, while insisting on the duty of 
other countries to reciprocate by showing fair-play to German 
trade in their colonial territories. 

It remained for a later generation to recognize and deplore 
Bismarck's singular omission to turn to advantage oppor- 
tunities of colonization which were exceptional and never 
returned. At the beginning of the 'seventies the greater part 
of North and Central Africa was still unappropriated, and an 
energetic policy of exploration, discreetly supported by diplo- 
macy at home, might not merely have secured to Germany 
large and rich regions which soon afterwards fell to some of 
her Continental neighbours, but might even have obstructed 
the consolidation of British influence which has happily 
been consummated in the southern half of the African 
continent. 

When Bismarck at last decided upon action he was influ- 
enced by a conjunction of events. One was a dispute with 
Great Britain upon German land claims in the Fiji Islands. 
When, in 1874, these islands were annexed by Great Britain, 
in agreement with their ruler, all lands were made over to the 
British Crown in the first instance, and questions of title to 
such properties as were claimed by foreigners were referred 
to a commission for adjudication. German traders, some of 
whom had been settled in the islands since 1860, alleged that 



THE COLONIES 849 

obstacles were put in the way of the examination and proof 
of their titles, and that rightful claims were arbitrarily rejected. 
Their Government had repeatedly brought specific complaints 
to the notice of the British Foreign Office, but had failed to 
secure a settlement. A man of prompt decision himself, this 
procrastination and apparent unwillingness to give to his 
countrymen's grievances a fair hearing was a source of vexa- 
tion to the German Chancellor, and created in his mind, as he 
said later, the impression that, if Germans over-sea were to 
have effectual protection, they must look for it to the Imperial 
Government. Further, the resignation, on the eve of the 
introduction of Protection in 1879, of his Liberal colleagues 
in the Prussian Ministry, and particularly of Delbriick, the 
" keeper of his economic conscience," undoubtedly led him to 
regard the colonial question with a more open mind. Still 
more, however, was he influenced by the colonial activity which 
other nations, notably France, Portugal, and Belgium, began 
to show in Africa at the close of the 'seventies, since this gave 
rise to the apprehension that Germany, unless she asserted 
herself without delay, would be excluded from any share in 
that continent. 

It was symptomatic of the change that was coming over 
his mind that in 1880 he decided to test the attitude of the 
Imperial Diet. This he did by means of a proposal that the 
Empire should guarantee the interest of a company which 
had been formed for the purpose of acquiring the large estates 
of a German trading-house in Samoa, which had fallen into 
financial difficulties. To his disappointment the Diet had 
refused to go to the rescue of this threatened German enter- 
prise, and Bismarck accepted its decision as a sign that the 
colonial question was not ripe for State action : for the present, 
he said, he must leave private adventurers to act on their own 
responsibility. 

Several new propagandist organizations w^ere established 
under influential auspices about this time, notably the German 
Colonial Association of 1882. In that year the German African 
Society published a considered colonial programme in which 
it urged the importance of sending out without delay two 
separate expeditions, one proceeding from the coast of Angola 
and working towards the Congo, establishing stations on the 
way in virtue of agreements with the local rulers, and the other 
starting from the Benue in the direction of the middle course 
of the river, and confining itself to exploration pure and 
simple. The Society also addressed to the Government a 
petition, urging it to use its influence to prevent the Congo 
and Niger, with their navigable tributaries, from being annexed 



850 THE EVOLUTION OF MODERN GERMANY 

by any European State, and to keep these waters neutral 
and open to the trade of all nations on equal terms. 

Yielding at last to pressure from many sides, Bismarck 
on April 14, 1883, instructed the Prussian envoy to the Han- 
seatic Cities to obtain from their Senates an expression of 
opinion as to how the interests of German traders on the West 
Coast of Africa might best be protected and furthered. The 
result of this inquiry was a long memorandum, dated July 6, 
1883, which was prepared by the Hamburg Chamber of Com- 
merce and duly placed before the Imperial Government. It 
pointed out that a large part of the West African coast was 
already in the hands of Great Britain, France, and Portugal, 
and that the tendency of these States was to extend their juris- 
diction. It paid a willing tribute to the generous spirit in 
which the British colonial authorities facilitated trade without 
distinction of nationality, but complained that other countries 
were less considerate. As measures of relief, needful in the 
interest of Germans in particular, it recommended (a) the 
establishment of a German consul for the Gold Coast ; (b) the 
permanent stationing of ships of war in West African waters, 
for which purpose it was urged that the island of Fernando Po 
should be acquired from Spain as a coaling station ; and (c) 
the conclusion of treaties of commerce and friendship with 
the more powerful chiefs, with a view to giving to Germany 
a more prominent position on the coast and ensuring freedom 
for her trade. Further, the Chamber of Commerce urged 
the acquisition of a trading colony on the mainland opposite 
Fernando Po, and the Cameroons country was mentioned as 
specially suitable for the purpose. Pointing out that Great 
Britain had her eye upon this region, the report urged that 
action to this end should be taken without delay, or Germany 
would be prevented for ever from gaining a territorial foothold 
in West Africa. Bismarck received this report gratefully, as 
throwing, perhaps for the first time, a clear light upon his 
path. In the event the programme so recommended was in 
substance carried out. 

It was a Bremen trader, F. A. E. Luderitz, who gave to 
Germany the earliest of her colonial possessions. He chose 
as the scene of his enterprise a part of South-west Africa 
in which German missionaries for over forty years had been 
active, and had practically worked alone. In November 
1882 Luderitz informed the Government in Berlin that it was 
his intention to acquire land and set up trading stations in 
the neighbourhood of the Bay of Angra Pequena, in Namaqua- 
land, and asked for Imperial protection for these contemplated 
properties. Before committing himself, Bismarck in the 



THE COLONIES 851 

following February invited the British Government to say 
whether it claimed jurisdiction in the territory in question. 

For thirty years successive British Foreign and Colonial 
Secretaries had set their faces steadily against the extension 
of the Queen's rule in South Africa. Not only had the home 
Government twice refused to annex Namaqualand and Damara- 
land when urged to do so by the German missionary society 
established there, but petitions to the same effect from the 
Cape had been similarly refused, though Whale Bay and some 
of the Guano Islands had been appropriated. In order to make 
clear the British attitude on the question of territorial sover- 
eignty Lord Kimberley, the Colonial Secretary, on December 30, 
1880, informed Sir Hercules Robinson, Governor of the Cape 
and High Commissioner for South Africa, that in the Govern- 
ment's opinion the Orange River must be regarded as the 
north-western frontier of Cape Colony, and that the Government 
would not support the extension of British jurisdiction beyond 
it. In that year, in fact, all British officials were withdrawn 
from Damaraland, and Whale Bay remained the only point 
on the South-west coast at which British influence was 
represented. 

Although this had been the attitude of his predecessors, 
Lord Granville deemed it expedient to refer to the Cape 
Government before answering Bismarck's inquiry. What 
followed might have been expected. Apprehensive lest the 
South-west coast should fall into German hands, the Cape 
Government renewed its petition for annexation. Nevertheless, 
some rnonths passed before the British Foreign Office replied 
to Bismarck's inquiry of February, and in the meantime 
Luderitz, through his agents, had acquired from the native 
chiefs a tract of land on the Bay of Angra Pequena about 
200 English square miles in extent, with a coast of ten miles. 
News of his action reached England in July, but it does not 
appear to have created alarm. The Foreign Office in particular 
was reassured by a dispatch from the chargi d'affaires in Berlin 
(August 31), who, recalling a dispatch of Lord Odo Russell 
(now Lord Ampthill) of September 9, 1880, gave the assurance : 

" It would be a mistake, to suppose that the Imperial 
Government have any present intention of establishing Crown 
Colonies, or of imitating . . . the practice adopted by France 
of assuming a protectorate over any territory acquired by a 
French traveller or explorer. The German Government are 
opposed to any plan which might hamper their foreign relations, 
and I believe that what Lord Ampthill stated in his dispatch, 
to which I have referred, is as true to-day as it was in 1880." 

As after six months' waiting a reply from London to his 



352 THE EVOLUTION OF MODERN GERMANY 

inquiry of February was still outstanding, Bismarck in August 
informed the German Consul-General at Capetown that his 
Government had decided to give protection to Liideritz's 
possessions in so far as they did not transgress prior well- 
founded rights, and that decision he notified to the British 
Foreign Office (September 10th), together with the pointed 
question whether it claimed suzerainty over Angra Pequena 
or not, and if it did, on what grounds the claim rested. As no 
answer had been received by November 16th, the German 
ambassador called at the Foreign Office on that day in order 
to repeat the inquiry. Finally, on November 21st, Lord 
Granville replied that although the British Government had 
not proclaimed the Queen's sovereignty along the whole 
South-west coast, but only at certain points, such as Whale 
Bay and the Angra Pequena islands, " they consid-er that any 
claim to sovereignty or jurisdiction by a foreign Power between 
the southern point of Portuguese jurisdiction at latitude 18 
and the frontier of Cape Colony would infringe their legitimate 
rights." Bismarck refused to accept the view that territory 
which Great Britain had never claimed might not be claimed 
by any other country, as involving the application of a British 
Monroe Doctrine to Africa, and (December 31st) again invited 
the British Government, in the event of its claiming sover- 
eignty over the territory in question, to say on what title such 
a claim was based, and what steps had been taken to give 
adequate protection to German subjects and their properties. 
Again for four months the British Government made no reply, 
and now, weary of waiting, Bismarck telegraphed to the 
German Consul-General in Capetown (April 24, 1884) : " Ac- 
cording to the representations of Herr Llideritz the English 
colonial authorities doubt whether his acquisitions north of 
the Orange River can claim Germany's protection. Declare 
publicly that both Herr Liideritz and his settlements are under 
the protection of the Empire." 

The transaction gave to Germany the coastland extending 
from the Orange River to Cape Frio, exclusive of Whale Bay. 
Both the British Government and the Cape Ministry for a time 
clung to the hope that this territory might be secured for the 
British Crown, but in the end the inevitable was accepted, 
and in June German sovereignty was formally acknowledged. 
A little later the German claim was extended over the entire 
coast, with its hinterland, from the Orange River to the 
Portuguese frontier north of Cape Fio, with the exception of 
Whale Bay. 

Strong representations were made still to the Colonial 
Office in London by the Cape Government, but Lord Derby 



THE COLONIES 85^ 

pointed out to Sir Hercules Robinson in a letter of December 
that the dispute related to " a strip of territory to which England 
had no sufficient legal title," and in which German trading 
and missionary interests were apparently more considerable 
than British. " Great Britain," he said, " which already 
possesses large tracts of unoccupied territory, could not fairly 
grudge to a friendly Power a country difficult of development, 
with regard to which it might have been said that we had 
never thought it worth acquiring until it seemed to be wanted 
by our neighbour." 

Almost simultaneously with the acquisition of South-west 
Africa territories were annexed in West Africa, the Government 
in this case taking the initiative. Early in 1884 Dr. Nachtigal, 
an experienced African traveller, then Consul-General in Tunis, 
was appointed Imperial Commissioner, and charged with a 
mission of investigation to various points on the west and 
south-west coasts. The British Foreign Office, being requested 
to facilitate his work, considerately offered him all possible 
facilities. The courtesy was ill-requited, for Nachtigal's mission 
was really one of acquisition, and the first of his annexations 
was the Cameroons territory, which the British Government 
had long intended to take under protection at some convenient 
season, but had neglected to acquire while there was still time. 
Togoland was likewise added to the German Empire at the 
same time. Over the Cameroons, as over Angra Pequena, 
there was much diplomatic controversy, but there, too, the 
British Government proved unable to substantiate its claims, 
though it succeeded in acquiring for the British Crown the 
little settlement of Victoria, in Ambos Bay, and the Oil River 
districts and the Niger delta lying between the Rio del Rey 
and Lagos. On the other hand, German attempts to obtain 
a foothold in South-east Africa were frustrated by the intelli- 
gent anticipation shown by the British authorities on the spot. 
While acquisitions were thus being made in Africa settlements 
were also being established in the Pacific, not without collisions 
with Great Britain and the Australian Colonies. There Germany 
obtained early in 1885 the northern portion of New Guinea, 
calling it Kaiser Wilhelmsland (Holland already possessed the 
western end, and the southern portion fell to Great Britain), 
together with the New Britain Archipelago, which was renamed 
Bismarck Archipelago, and later the Solomon, Marshall, Gilbert, 
and Ellice groups of islands, though some of these were later 
ceded to Great Britain. The Caroline and Pelew Islands 
were also claimed in 1885, but Spain asserted a prior right of 
suzerainty. On the question being referred to the Pope for 
settlement, the Spanish title was upheld, though Germany was 

23 



854 THE EVOLUTION OF MODERN GERMANY 

awarded a right of pre-emption, and of this right she was able 
to take advantage in February 1899, when the CaroHne, Mari- 
anne, and Pelew^ Islands came to her for the sum of £837,500. 
In 1885 also a beginning was made with the foundation 
of a German empire in East Africa. German explorers and 
colonial propagandist societies had long had their eyes upon 
that country and Zanzibar, but they had made no headway. It 
was chiefly due to the energy and resource of a young and not 
very scrupulous adventurer. Dr. Karl Peters, that Germany 
obtained a footing in this part of Africa. Forming in March 
1884, with the aid of a few friends, the Society for German 
Colonization, Peters himself led an expedition to the country 
in face of Government discouragement. Crossing over from 
Zanzibar to Sandani in November, he followed the river Wami 
inland, and as soon as he had passed the coast territory within 
which the Sultan of Zanzibar exercised direct suzerainty and 
entered the Usagara country, concluded treaties with a number 
of native chiefs on behalf of his society. Before the end of 
the year, territories lying north of the port of Bagamoyo, with 
an area of 60,000 square miles, had been acquired virtually as 
a free gift. In the following February Peters was back in 
Berlin with a wallet full of treaties, not a few of which had 
undoubtedly been obtained from the chiefs by misrepresentation 
or in ignorance of their meaning. By means of glowing 
descriptions of the country and its prospects, he now succeeded 
without difficulty in forming the German East Africa Company 
for the exploitation of his acquired rights. Now the Govern- 
ment, which had refused to countenance him when he sought 
its patronage with empty hands, readily gave him (February 27, 
1885) a charter, the first of the kind to be issued, and the 
Emperor and some of the other German Princes took shares 
in his enterprise. It was not long before the German com- 
pany, with British official assistance, effectually supplanted 
the Sultan of Zanzibar in the coastal districts over which he 
claimed jurisdiction, though against his vigorous protests 
and active opposition. Had Peters had his way, he would 
have done his best to supplant British influence in East Africa 
likewise, but while he was still in the interior the British and 
German Governments concluded a somewhat one-sided boundary 
convention delimiting the spheres of influence of the two 
countries (October 29-November 1, 1886). By this agreement 
the whole of the Kilimanjaro region passed under German 
control, while the country north of the Tana and that lying 
to the north-west of the British sphere, including Uganda, 
were also left free for German operations. To the Sultan of 
Zanzibar were assigned the islands of Zanzibar, Pemba, Lama, 



THE COLONIES 855 

and Mafia, with a strip of coast and certain towns on the main- 
land. A later agreement revised this territorial arrangement 
in favour of Great Britain. 

Such was the ardour thrown into the colonial movement 
in the early days that after two years of diligent search and 
salvage amongst the still unregarded regions of the African 
Continent and the Pacific, Germany found herself in possession 
of a colonial Empire four times larger than the Empire at 
home, insomuch that the Imperial Chancellor could say, " The 
colonial movement has been in flux for two years, and the 
reception given to it has far surpassed my expectations." 

Some time elapsed before further additions were made to 
this oversea dominion, but it will be convenient to relate them 
here. Germany had long had important commercial relations 
with the Samoan Islands, and her consular representatives there 
had lost no opportunity of increasing their country's influence. 
By treaties concluded between 1876 and 1879 with the Samoan 
and Tonga Islands, coaling stations had been acquired in these 
islands. It was only in 1899, however, after a long period of 
disorder and civil strife, due to the claims to sovereignty of 
rival pretenders, that there was established in the Samoan 
group the political status which gave to Germany territorial 
sovereignty in two of the larger islands. In the hope of 
restoring peace and tranquillity to the islands the Governments 
of Great Britain, Germany, and the United States drew up 
the Samoa Act of June 14, 1889, stipulating that the islands 
should remain independent and neutral, that the citizens and 
subjects of the three Powers should have equal rights therein, 
and that none of the Powers should exercise any separate 
control over the islands or their government, and also intro- 
ducing various administrative changes. Tribal feuds continuing, 
however, the kingdom was abolished in 1899, all administra- 
tive powers were transferred to the Consuls of the three Powers, 
and the native population was disarmed. Finally, by the 
Anglo-German convention and declaration of November 14 
of the same year Great Britain withdrew altogether from the 
Samoan group, surrendering in favour of Germany all her 
rights over the islands of Upolu and Savaii, and in favour of 
the United States all her rights over the island of Tutuila and 
adjacent smaller islands of the group ; while Germany in 
return renounced in favour of Great Britain all her rights 
over the Tonga Islands and Savage Island, and her share of 
the Solomon Islands (including the Howe Islands) east and 
south-east of, but excluding, Bougainville and Buka. Great 
Britain also made concessions in West Africa and Germany 
reciprocated in East Africa. A convention of December 2nd 



356 THE EVOLUTION OF MODERN GERMANY 

following brought into the settlement the United States, which 
acquired Tutuila but renounced her claims in respect of Upolu 
and Savaii and other smaller islands of the Samoan group. 

The last of the protectorates was acquired in 1898. In 
October of the preceding year the officers of a German vessel 
of war were attacked by the Chinese population of Wutchang ; 
and a little later a German mission station shared the same 
fate, two missionaries being killed. In addition to requiring 
money compensation for these crimes, the German Government 
in November occupied the Bay of Kiaochao, in the province 
of Shantung, and in the following month obtained the promise 
of a ninety-nine years' lease, carrying full suzerain rights, 
of the bay and a strip of the adjacent mainland. To the 
concession was attached the right to build a railway into the 
interior. The acquisition was in general warmly approved 
in Germany. As the port was intended to be a naval depot, 
it was at once placed under the Admiralty. 

The colonial movement had undoubtedly a remarkably 
auspicious beginning. The nation was carried away by a 
wave of patriotic sentiment, and the movement created the 
heated enthusiasm which national movements seldom fail 
to evoke amongst emotional people. Nevertheless, it may 
be questioned whether there existed at that time any genuine 
comprehension of the question of colonization and the momen- 
tous issues which it involved. The most assertive colonial 
advocates in those days were less practical politicians and 
hard-headed men of business than Pan-German imperialists 
and sword-rattling Chauvinists who regarded colonies as the 
natural appanage of empire. 

It is significant that Prince Bismarck, whose assistance 
alone made the colonial movement possible and national, 
never came to have any great faith in colonies — so late as 1899 
he declared that he was " still no colony man " — and it is 
probable that if he could have had his way he would not have 
touched the question. His policy was consolidation at home, 
and he regarded the pursuit of indefinite schemes of expansion 
abroad as impolitic, if not dangerous. When at last he allowed 
himself to be persuaded to inaugurate a colonial policy he 
did it admittedly " with little confidence in its expediency, 
yet with unreserved confidence from the standpoint of State 
duty." For, as we have seen, the obligation of asserting 
Imperial protection over territories in which German subjects 
had acquired a foothold and material interests was the principal 
consideration which weighed with him. Even so, he acted 
from the first on the principle that if he were to undertake a 
colonial mission it must be on the express demand of the nation ; 



THE COLONIES 357 

for he would not undertake the responsibility on his own 
account. Hence he insisted that the nation must make known 
its deliberate convictions and wishes on the subject, not once 
but repeatedly, before he could accept a definite mandate. 
When the Liberals opposed his colonial projects he did not 
altogether resent their action, but merely asked the nation to 
choose between the Government and its critics. Anticipating 
such opposition, he had said in 1884 : — 

" In such a case it would be the duty of the federal Govern- 
ments to convince themselves whether the sentiment of the 
nation in the new elections shares the hostility shown by the 
present majority of the Reichstag, in which case the judgment 
would once more be definitely pronounced upon our colonial 
endeavour, or whether it was of a different mind. I do not 
regard this question as settled, and I am far from wishing to 
answer it : I simply state dispassionately what I regard to be 
the duty of the federal Governments, which is to carry forward 
our colonial policy so long as they have reason to hope that a 
majority of the German nation are behind them, but to drop 
it should this hope be unjustified, instead of pursuing unfruitful 
enterprises in a struggle with a majority of the Reichstag." 

Not only so, but Bismarck foresaw the difficulty of colonizing 
in the English sense. He did not view lightly the obstacles 
of climate and national inexperience. Hence he never contem- 
plated the immigration of white settlers into the German 
colonies in the way in which Australia and Canada have been 
won for the British race. Nor, on the other hand, did he 
regard the colonies as a means of establishing a Prussian 
system of bureaucracy across the seas. The colonies he had 
in mind were of the nature of trading stations, and traders 
were in the main to be responsible for their administration as 
well as for their industrial and commercial development. My 
aim," he said on October 28, 1885, "is the governing merchant 
and not the governing bureaucrat in those regions. Our 
privy councillors and expectant subalterns are excellent enough 
at home, but in the colonial territories I expect more from the 
Hanseatics who have been there." The principle was sound 
and statesmanlike, and it would have been well for Germany 
and her colonial empire if it had been consistently applied, 
for much failure, disappointment and loss, and many scandals 
would then have been avoided. 

The time soon came, however, when the colonial movement, 
which was inaugurated with such a fanfare of national exaltation, 
insomuch that for a time the nation was " colony mad," became 
one of the most controverted questions in Imperial politics, 
dividing political parties and the nation as no other. For the 



S58 THE EVOLUTION OF MODERN GERMANY 

first impressions created by a more intimate knowledge and 
a soberer appreciation of the colonies were unfavourable. 
Every one of the colonies had been represented to the Govern- 
ment and the public as a potential El Dorado, but in no single 
case did experience justify the roseate forecast. The result 
was disillusionment and disappointment. Admiral Raule, the 
colonial adviser of the Great Elector, reported to his master 
on one occasion : " No man is so unreasonable as to expect 
fruit from a newly-planted tree." That might have been the 
case in the patient seventeenth century, but it did not apply 
to the modern German colonist ; and because the fruit did 
not come at once he blamed the tree, and soon showed a desire 
to hew it down as a useless cumberer of the ground. It was 
also a source of anxiety that almost everywhere, except in 
Togoland and the island groups of the Pacific, the native 
populations were sullen and unfriendly, if not openly hostile, 
so that from the first punitive expeditions, premonitory of 
so much later mischief, had to be undertaken in the Cameroons 
and East Africa. 

When Bismarck ceased to be Imperial Chancellor in 1890 
the further direction of colonial policy fell to a statesman 
even less convinced than himself that Germany was here 
treading a safe path. Count von Caprivi loyally took up the 
colonial burden, however, never doubting that as the hand 
had been put to the plough there could be no turning back, 
yet he was not eager to see the oversea empire extended, and 
he clearly betrayed his secret misgivings when he said in one 
of the earliest of his official utterances that no greater mis- 
fortune could befall Germany than that the whole of Africa 
should fall into her hands. Nevertheless, administrative 
progress was made during the four years of his Chancellorship. 
He introduced important reforms in the administration of 
the colonies, creating a separate colonial department of the 
Foreign Office, with Dr. Krauel and later Dr. Kayser at the 
head, and forming a Colonial Council of experts and repre- 
sentatives of colonial companies to advise the new department 
and the Government. The first year of his Chancellorship 
saw the conclusion of the Anglo-German agreement (July 1, 
1890), by which Great Britain ceded Heligoland to Germany 
in return for her renunciation of further interest in Zanzibar 
and her surrender of certain territorial claims in East Africa. 
Certain frontier adjustments in West and South-west Africa 
were part of the same agreement. In the same year the Empire 
took over complete responsibility for the administration of 
the East African colony, and the German East Africa Company 
was left to follow purely commercial enterprises. The Govern- 



THE COLONIES 359 

merit of South-west Africa had ah^eady been transferred to 
the Imperial Government. 

While there was slow material progress, much was done 
by the Government for the amelioration of the condition 
of the native populations by the provision of hospitals and 
schools and the adoption of measures of sanitation. Not 
the least beneficial results of the coming of the European 
was the combating of slavery. The suppression of the 
slave trade was one of the main objects of the British 
Government in its cordial co-operation with the other Powers 
at the Congo Conference of 1884-5, and in the prosecution of 
that work Great Britain and Germany in particular showed 
great zeal, both in East and Central Africa, in the years immedi- 
ately following. A little later the German Government began 
to adopt measures with a view to discouraging and gradually 
suppressing all kinds of domestic slavery both in the East 
African and West African colonies, though in so doing great 
prudence had to be exercised. Imperial ordinances were 
issued on September 1 and November 29, 1891, regulating 
the ransoming of slaves in East Africa, and somewhat similar 
ordinances were issued in the Cameroons and Togoland a 
little later. The provisions of these ordinances speedily 
became known amongst the native populations, and as soon as 
the slaves learned that they were able to buy their freedom by 
the payment of a comparatively small and easily earned sum 
the right was largely exercised. Simultaneously the sentiment 
of independence was strengthened amongst the natives. A 
British Foreign Office report on East Africa published in 1894 
stated : "A few years ago no labourer would have dared to 
bring a civil or criminal action against his master. Now they 
do so, not only before the Government tribunals, but before 
their own native courts, a sure sign of the civilizing influence 
exercised by the Government and the missions over native 
public opinion." 

Nevertheless, the early administration of the colonies was 
characterized by much irregularity, folly, and cruelty. To 
the last Bismarck had adhered, in principle at least, to the 
system of " protective colonization " ; i.e., the Empire was to 
give protection to the traders in respect of their territories, 
but the traders were to administer these territories through 
chartered companies, formed for commercial purposes. His 
faith in chartered company government even survived the 
proof of its failure. As we have seen, the early colonial adven- 
turers were impatient for results, hoping to reap without first 
sowing. Viewing the colonies chiefly from the commercial 
side, these men, organized in their companies and syndicates, 



860 THE EVOLUTION OF MODERN GERMANY 

showed little aptitude or desire for the delicate work of adminis- 
tration, and before Bismarck gave place to a successor it had 
become evident that the Empire would have to shoulder a 
large part of this burden. Nor was the Empire itself successful 
for a long time in its administrative officials and methods. In 
undertaking this new task the Germans unfortunately abandoned 
the national habit of preceding practice by theory, and took 
upon themselves light-heartedly the government of vast terri- 
tories and uncivilized races in the confident belief that the 
" cameral sciences " which had for generations proved an 
efficient preparation for local administration at home w^ould 
qualify equally well for administration in Africa. The secret 
of the administrative order that reigns at home is system, 
and it was taken for granted that if sufficient system were 
introduced into the government of the colonies the same results 
would follow. If system alone could have built up a stable 
colonial empire, these ends would have been attained at once. 

Colonial government, however, was for Germany a hitherto 
untried field, and moreover Germans lacked in general the 
precise qualities which have made British colonial administration 
the praise and envy of the world. The British Empire, viewed 
only as a monument of national enterprise and daring, is a 
wonderful creation, but it is perhaps still more remarkable 
as an expression and symbol of the national genius for govern- 
ment as developed by centuries of training in political and 
public life and in the bracing school of independence and 
self-reliance. But Germans had had no experience whatever 
of colonial administration, and the system of government at 
home had not encouraged in them the sense of individual 
responsibility and initiative, the public spirit, the instinct of 
statecraft, and the judicial balance of mind which the 
successful British colonial official owes, whether he knows it 
or not, far more to natural endowment than to any influence 
or traditions of family or school, however important these 
may be in individual cases. 

Inexperience alone would have made administrative failure 
for a time probable, but carelessness in the choice of the men 
who were sent out to the colonies made it inevitable. Bismarck 
had once expressed the fear that to establish an imperial colonial 
bureaucracy might be to pack it with '' questionable existences." 
Of doubtful characters the colonial service had far too many 
in the early years ; and their immoral, cruel, and often revolting 
practices were a source of profound discontent and the direct 
occasion of many local insurrections. Some of the governors 
who were put in charge of the African protectorates have 
done infinite credit to their country and to themselves ; for 



THE COLONIES 861 

Dr. von Wissmann was not by any means the only high official 
who, in Prince Bismarck's phrase, returned home " with a 
white waistcoat." But when justice has been done to the fine 
flower of the colonial service — men who carried with them to 
difficult and dangerous posts a high sense of public duty and 
a high standard of personal rectitude — the fact remains that 
the administration of most of the colonies has been tarnished 
at one time or another by scandals which left an evil memory. 
One enthusiastic advocate of colonial enterprise had seriously 
pleaded that colonies should be established in order that " the 
swamps of our social life might be drained, their dirty waters 
let ori and cleansed," and on a small scale that is what 
happened. The colonies were for a long time looked upon as 
a happy hunting-ground for adventurers unable to settle down 
to steady work at home, or as convenient outlets for family 
failures. If a man succeeded at nothing else he was thought 
good enough for the colonial service, and many shady careers 
were closed in Germany, only to be reopened across the sea, 
with results disastrous for the colonies and the national reputa- 
tion. For while forgotten by their friends at home, the very 
defects of character which made it prudent for these questionable 
characters to seek a new life in the distant tropics were respon- 
sible for many of the excesses and crimes which from time to 
time came to light in administration, and which, so long as 
they lasted, caused the colonial empire and colonial policy 
altogether to sound disagreeable in honest ears. 

In the Speech from the Throne with which the Diet was 
opened on November 22, 1888, when the colonial movement 
was at its height and a good deal of genuine idealism still 
remained, it was declared that it must be a solemn duty of the 
Empire to " win the Dark Continent for Christian civilization." 
Not much Christian civilization, or civilization of any kind, 
was carried to the colonies by the early pioneers and adminis- 
trators. Stories of slavery, violence, cruelty, illegality, and 
lust, committed both by officials and planters, were sent home 
only too frequently by missionaries and clean-handed men in the 
colonial service who could not see these things and be silent, 
and disciplinary proceedings at home generally confirmed the 
imputations of report, and frequently proved that the half 
had not been told. It would serve no purpose to detail these 
stories or to further pillory the men whose crimes were visited 
by punishment, and that the less as the whole record stands 
written in many German books, official and otherwise, for as 
to the facts there is no dispute. In one of the most notorious 
cases, however, a colonial governor. Dr. Karl Peters, was found 
guilty of brutality, of taking lives unjustifiably, and of being 



862 THE EVOLUTION OF MODERN GERMANY 

prompted by sensual motives to acts of vindictiveness, and 
he was deprived of office and titles. Another governor was 
fined, reprimanded, and relieved of office for forging a passport 
for a paramour whom he had audaciously set up by his side 
in the place of administration. A third was dismissed the 
service for torturing a native chief to death by flogging him 
and chaining him to a flagstaff for thirty-six hours without 
food or water. These cases are typical of the w^orst crimes 
which have been committed by high officials, but the entire 
record makes a terrible story of obliquity. 

Where there was laxity on the part of officials it is not 
surprising that the conduct of the German traders was often 
far from exemplary. Perhaps it is fairer that German witnesses 
should here speak, and, indeed, no stronger words have been 
written in condemnation of the ill-treatment of the natives 
and colonial scandals in general than those which have come 
from leaders of German public opinion. Captain Schennemann, 
who was appointed to report on the origin of the risings in the 
Cameroons of 1904-5, which necessitated several expeditions, 
after stating the faults of the natives, added : " It is equally 
indubitable that gross indiscretions on the part of the white 
traders in the treatment of these militant cannibal tribes were 
the occasion of the catastrophe." Another writer says of the 
causes of the same troubles : — 

" After the rising of the Bakwiri in the Cameroon Mountains 
the Government declared their entire territory Crown land. 
All the land capable of cultivation was then sold to large 
plantation companies at the price of 5s. per hectare (2| acres). 
Only 1|- to 2 hectares per family were reserved for the support 
of the natives. It would have proved sufficient if the natives 
followed rational agriculture, and if the reserved lands had 
everywhere been cultivable, though no provision was made 
for future increase of population. The result was, however, 
that great scarcity soon appeared amongst the Bakwiri, and 
the discontent increased to such an extent that a rising was 
apprehended ; for it was not enough that the natives were 
robbed of their land, they were robbed also of their cattle. 
Many planters carried on the capture of cattle as a sport, and 
boasted how much ' fresh meat ' they obtained for their 
companies in this way. The Government and the planters 
may thank the efforts of the Basle Missionary Society that a 
bloody rising was prevented." ^ 

The writer points out further that the missionaries had 
agreed at first to act as labour agents for the planters, but 

* J. Scholze in Deutsche Kolonien (" The Truth about the Mission to the 
Heathen and its Opponents "). 



THE COLONIES 363 

*' When they saw how cruelly the labourers were often treated 
on the plantations, how in the course of a year the fourth part 
of them died off and had to serve as manure for the land, while 
the greater part of the remainder became seriously ill, and 
when they saw how, through the brandy which was thrust 
upon them and the evil example of most of their masters 
the labourers sank ever lower, they could not face the responsi- 
bility before God and their consciences of being parties to such 
an unjust and wicked business." 

Incidents like this explain the frequent attacks upon the 
missionaries, who have often stood between the natives and 
injustice and violence. They also give point to the incriminating 
apology of the colonial enthusiast who wrote : '' The mission- 
aries have often made themselves obnoxious to the merchants. 
It must be remembered that the merchants who go out to the 
colonies even to-day are not men of mild natures, who are 
contented to pass their lives on the turnstools of a dull counting- 
house, but are possessed of a superabundance of energy, and 
now and then this energy takes forms which, it must be 
admitted, cannot be pleasing to the missionaries." 

The Herero rebellion of 1903-7, the most disastrous 
episode in the history of the German colonies, was largely due 
to the fraudulent conduct of the German traders, and wherever 
else trouble has occurred ill-treatment of the native population 
and the excesses of the military have been the predisposing 
causes. Upon this subject a German historian of the colonial 
movement, referring particularly to the continual risings and 
punitive expeditions which made up so much of the early 
history of the Cameroons, writes : — 

" Apart from the loss of human life and the heavy expenditure 
incurred, these enterprises occasioned growing odium, as it 
became gradually known that the incautious and inconsiderate 
treatment of the natives by the whites was often the chief 
cause of the risings. It was also shown that often the ardent 
wish of young officers and officials to gain military distinctions 
disposed them to these warlike measures." ^ 

It was only under the third Chancellor, Prince Chlodwig 
von Hohenlohe, that serious step& were taken to curb the 
excessive powers and zeal of the military, whose independence 
of the civil authority had made efficient administration im- 
possible. 

At the same time it is only fair to add that the Diet and 
the Press at home never failed to condemn unsparingly both 
maladministration and the excesses of the traders whenever 
they came to light, and in adopting this attitude thej^ faithfully 

1 Dr. Alfred Zimmerman, Geschichte der detUschen Kolonialpolitik, p. 259. 



864 THE EVOLUTION OF MODERN GERMANY 

reflected public opinion. The Clerical, Radical and Social 
Democratic parties in particular distinguished themselves by 
the persistency with which they defended the right of the 
natives to just and clement treatment. 

Such was the disfavour into which the colonies had fallen 
owing to administrative failure, paucity of material results, 
the grievances of the natives, and the ever-increasing cost to 
the Imperial Exchequer, that a period of " colonial weariness " 
began early in the century. So far did the reaction go that 
at a conference of the Radical party held at Wiesbaden in 
September 1905 a resolution was adopted against " the continu- 
ance and extension of the present colonial policy," while one 
member of the Parliamentary group declared, amid applause, 
that he " would be willing to put the colonies up to auction if 
he thought a bid would be forthcoming." 



CHAPTER XIX 

THE NEW COLONIAL ERA 

Formation of a Colonial Office — Dr. Demburg's colonial crusade — The appeal 
to national pride and interest — Restoration of national confidence in 
the colonies — Present condition of the colonies — Plantation versus 
settlement — The cultivation of cotton — Mineral resources — Prospects 
of East Africa and South-west Africa — The development of the rail- 
ways — Foreign trade of the colonies — ^Extent of the white population 
— Colonial finance — Present attitude of the nation on the colonial 
question — The nation's honour at stake — Unity of parties on the ques- 
tion — ^Attitude of the Social Democrats. 

THE colonies entered an entirely new and more hopeful 
phase of development with the creation in May 1907 
of a Colonial Office with large independent powers. 
The Department of the Foreign Office which had hitherto had 
charge of colonial affairs had been subject to the immediate 
and personal authority of the Foreign Secretary. The result 
was that the work of colonial administration was hampered 
at every turn. Successive Foreign Secretaries had been willing 
enough to give the Colonial Director a large liberty of action, 
yet they were unable to delegate to him constitutionally any 
of their own responsibility. The arrangement was bad for 
both sides — bad for the Foreign Office, upon which it imposed 
authority without executive functions, besides saddling it 
with a host of unnecessary burdens, and bad for the Colonial 
Department, which had to discharge important executive duties 
without possessing ultimate authority. 

As far back as Count von Capri vi's Chancellorship the 
Government tried to induce the Reichstag to create an indepen- 
dent Colonial Office, but the scheme had fallen through. Prince 
Biilow, who succeeded Prince Hohenlohe in 1897, tried again 
early in 1907, and this time the Diet was convinced. 

The formation of the new Department was coincident with, 
and a consequence of, the succession to the Colonial Directorship 
of Dr. Bernhard Dernburg in the preceding September. For 
a long time the country had called for the appointment of a 
'' practical business man " to this office, and in the choice 

365 



366 THE EVOLUTION OF MODERN GERMANY 

of a successful bank manager its wish was gratified. Dr. 
Dernburg entered upon his task with complete understanding 
both of its character and its difficulty. He took office at a 
time when the material and moral prestige of the colonial 
movement was at its lowest, and when hardly any one had a 
good word to say for the colonies or anything that concerned 
them, and it is his unquestioned desert that he gave to the 
nation at large a more confident opinion of the value and 
potentialities of its colonial empire than it had ever entertained 
before. He had made the elections of the preceding January 
the occasion for a vigorous crusade in various parts of the 
country, in the cause of which he expounded, at conferences 
and public meetings, different aspects of the colonial movement. 
Like the practised financier that he was, he accomplished 
wonders by the use of imposing figures which no one could 
dispute, because no one was in a position to test them. Instead 
of the colonial empire being the bankrupt enterprise which 
the nation had been led to believe it, he represented it as one 
of wonderful promise, needing only capital, labour, railways, 
and faith for its full development. Undoubtedly he brought 
to the portrayal of the colonies more than a suggestion of an 
Oriental imagination, as when, in one of his electioneering 
speeches in Berlin, he told the story of a box of dried dates 
which had fallen to the ground in course of transport in South- 
west Africa, with the result that " three years later the 
astonished traveller saw in its place date palms three metres 
high and already bearing fruit." All such borrowings from 
the Arabian Nights, however, left unshaken his main 
contention, which was that the colonies were, both commercially 
and politically, a great imperial asset. 

He thus in a short time succeeded, as no preceding colonial 
administrator had done, in rekindling the early colonial ardour 
and in creating a confidence in colonial enterprise which had 
never existed before in an equal degree. And although, with 
an exaggeration which was on the whole that of an honest 
credulity, he held out