After
1878 National Liberalism, as such, had no constructive
policy to offer Germany.
1878 National Liberalism, as such, had no constructive
policy to offer Germany.
Robertson - Bismarck
handle.
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BISMARCK
would have failed to understand, or dismissed as irrelevant
verbiage: so far as it had an ascertainable paternity, the
genealogy of Bismarck's Socialism can be found, not in the
writings and teaching of Karl Marx, but in the doctrines
of F. List. But the new programme was a wonderful
illustration of Bismarck's intuitive sensitiveness to change
and ideas, that he exploited for his own political purposes.
So long as Germany was rent by the Kulturkampf this
comprehensive programme could not be fairly discussed
or embodied in law. The Kulturkampf was essentially a
controversy over principles, which brought the theory and
functions of the civil power into the arena of conflict. The
Clerical Centre, as developed by Windthorst with the aid
of the Roman Curia, was first and foremost a confessional
organisation which united in a single party every class from
the princes and hierarchs of the Church to the industrial
proletariat in the great Catholic centres of industry, and
which subordinated all the separable class interests of its
members to a broad aim, the practical independence of
the Roman Church. The new economic programme in-
volved a complete breach with Liberalism and Radicalism.
It could not therefore have any chance of success unless
the Centre were rallied to the side of the government.
The Kulturkampf must therefore be ended, as a prelimi-
nary condition to the new era. Bismarck's conversations
with Masella at Kissingen cleared up the situation. The
Vatican required the repeal of the May Laws and a return
broadly to the position in 18711 Bismarck required the
Centre vote on all governmental proposals. Both sides
had a valuable article to sell; both sides were weary of
the struggle, and neither side dared openly to don the
white sheet and publicly reverse their explicit statement
of principles. Each side thoroughly distrusted the other,
and with good reason. Windthorst feared that once
Bismarck had utilised the Centre he would throw them
over and reunite with the Liberals. Bismarck, uncertain
of how far Germany would accept the new programme,
and aware that the Liberal and Protestant forces would
resent an advance to Canossa, and that repeal of the May
Laws was a damaging blow to his prestige, dared not make
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? THE IMPERIAL CHANCELLOR 371
the Centre master of the situation. The exchange of a
Clerical control for the National Liberals was no gain but
loss. For he wanted to be independent alike of Clericals
and Liberals, and of the two the Clericals were more
difficult to satisfy. Foreign policy entered into his cal-
culations. Ultramontanism in France and Austria was a
continuous and disturbing element in the European
situation. Bismarck had to reckon with a possible Ultra-
montane supremacy in France upsetting the results
achieved by the Dual Alliance of 1879. And there was
always Poland--the eternal Poland, Catholic and Slav
in one.
It was essentially, therefore, a case for a slow and
gradual reconciliation, every concession being decided by
the situation of the moment and paid for in advance
by positive results. Bismarck began by heartening the Con-
servatives. In 1878 Camphausen, the Liberal financial
minister, was replaced by Maybach, a Conservative; Eulen-
berg, the new Minister of the Interior, was a strenuous
Conservative; Stolberg, the new Vice-Chancellor under
the Kanzlervertreter law was not a National Liberal, but
an unbending Conservative. On July 14, 1879, Falk's
resignation was accepted. He left office with all the in-
dications of dismissal. His health had failed; and to
assist him in his recovery he was given a riband, a eulo-
gistic letter, portraits and photographs, while his place
was taken by Puttkamer, a fierce Conservative. On
May 3 the members of the Reichstag who attended the
Chancellor's parliamentary soirees, where Bismarck^ cigar
in one hand and glass in the other, arranged his parlia-
mentary plans of campaign, saw with astonishment 'the
pearl of Meppen,' 'the little Chancellor,' Windthorst,
making his bow with the air of a habitut, and witnessed the
genial cordiality with which the 'big Chancellor' wel-
comed the apparition expected by himself and no one else.
Delbriick, Camphausen, Falk had gone, and in their place
was Windthorst, polished, smiling, and epigrammatic.
'Every courtesy as far as the gallows,' Bismarck had said
thirty years before to G. von Vincke. 'Every courtesy
as far as Canossa,' was now Windthorst's silent comment.
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BISMARCK
It cannot have been a happy evening for Bismarck, though
he made his new guest taste from the huge cask of the
finest Franciscan liqueur sent him by the reconciled monks.
The fruits of the negotiations behind the scenes were
laid on the table of the Prussian Landtag in 1880 in a
governmental bill. The measure was roughly handled and
drastically amended, and in its final form only passed by
four votes (206-202), a convincing proof of the strength of
Liberal feeling and voting power. As amended, the bill
did not repeal any of the fundamentals in the May Laws,
but gave to the government a qualified discretion in the
enforcement of the penal legislation. It had been pre-
ceded by a Papal announcement (February 24) authorising
the Roman bishops in Prussia to notify ecclesiastical
appointments in their diocese to the Prussian government
for approval (Anzeigepflicht). The bill was the first step
towards a complete peace. The remaining stages were
covered in the next four years. In 1882 (May 31) Roman
priests were largely dispensed from the necessity and con-
ditions of the State examination, prescribed in the May
Laws; in 1883 (July 11) Roman bishops were released
from the obligation to notify ecclesiastical appointments to
the civil authority, which simply retained a power of veto;
in the same year the Crown Prince visited Rome and had
an audience with the Pope; in 1884 the Roman bishops
were introduced into the Prussian Council of State; in
1886 Leo xii1. was invited by Bismarck to arbitrate'on the
dispute between Germany and Spain over the Caroline
Islands, and in the same year a new law empowered the
government practically to dispense at its discretion with
the penal code set up between 1873 and 1875. On
May 23, 1887, Leo xm. was able to assure the Consistory
that the Kulturkampf was at an end, and that the Roman
Church had secured the essentials for which it had fought.
Bismarck received the Order of Christ, the first Protestant
to be given this Papal decoration, a portrait of Leo xm. ,
and a copy of the Pope's Latin poems. He did not forward
in return a bound volume of his speeches in which he had
laid it down that he would not go to Canossa either in
body or in spirit.
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? THE IMPERIAL CHANCELLOR 373
'That journey,' as a distinguished German historian
said, 'nevertheless took place. ' The argument that
Bismarck was not beaten, and that he did not surrender,
cannot stand the test of indisputable fact. Still less
tenable is the view that Bismarck made the surrender
willingly. He was not the man, after all his stout words
and the violence of the conflict in which Protestant and
Liberal Germany had hailed him as a second Luther,
nailing 'the May Laws,' like the immortal ninety-five
theses at Wittenberg, to the Throne and Parliament of
Prussia. The attempt to enforce the omnipotence of the
Civil State had broken down; the attempt to assert civil
control over the faith, discipline, and education of the
Roman priesthood had collapsed. In 1873 Bismarck had
plainly miscalculated the resources of the foe he had chal-
lenged, and exaggerated the strength of the weapons at his
disposal. He had beaten a retreat because he could not
hold the position that he had occupied in the battle:
but he had not retreated without securing compensation
adequate to the humiliation. The Clerical vote enabled
him to carry out a policy more important in his eyes than
the principles enshrined in the May Laws, and in the criti-
cal controversy in 1887-8 over the Septennate the Centre
came to his" aid and secured the victory (see p. 451).
The Chancellor's surrender was a bitter blow to
Liberalism and Radicalism. To both parties the Clerical
Centre was, in Gambetta's phrase, the enemy, for Ultra-
montanism challenged every principle of importance in
the Liberal and Radical creed, and to them the victory of
Windthorst and the Vatican was a victory of obscurantism,
not merely in the narrow plot of theology and dogma,
but in the unlimited fields of intellectual and social life.
The far-reaching influence of the 'progress to Canossa'
between 1879 and 1887 on the German mind cannot yet
be fairly estimated, nor do they fall within the scope of
our subject, but its direct and immediate results were
obvious. It opened up an epoch of growing reaction in
home politics and administration, and the barometer of
Liberalism steadily fell. The Centre remained at a fairly
constant figure of approximately one hundred votes in
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? 374
BISMARCK
the Reichstag, and Bismarck's action made it the arbiter
of the parliamentary situation. The full effect of that
predominance was felt outside the period of Bismarck's
Chancellorship, and he left it as a dangerous inheritance to
his successors. They had to liquidate the bill incurred
between 1879 and 1887.
The smashing of Liberalism was the other conspicuous
result. Here again Bismarck reaped the direct advantage
for himself, and left the aftermath to his successors. But
when Bismarck broke the National Liberal party he left
the Empire with no buffer between the government and
Social Democracy except an uneasy marriage of con-
venience between Conservatism, which completely failed
to grow any stronger in voting power, and the Clerical
Centre--a coalition of interests, not a fusion of principles.
The inheritor of the broken Liberalism was the Socialist
Democratic party, and the growth of that party was a
fresh proof that Bismarck had miscalculated its strength,
the sources from which it drew its recruits, and the
methods by which it could be successfully combated.
The gradual degradation of the Reichstag, and with it
the deterioration of political life in Germany, began in
1879 when Bismarck for purely tactical reasons bought
the support of the Centre. That degradation was per-
haps inevitable, because the Reichstag under the Imperial
Constitution was simply a part, and not the most important
part, of the legislative machine; and no representative
body can retain its vitality, its dignity, and its self-respect
--the three qualities essential to a healthy and self-renew-
ing political life--when it is deliberately made a House of
Phrases and nothing else. But unquestionably the de-
terioration was materially hastened by Bismarck's policy.
Power and responsibility are correlatives in the life of
organised communities, and the Reichstag was steadily
deprived of the shreds of both that it once possessed.
When the generation that had produced Bennigsen,
Lasker, Forckenbeck, Miquel, and Richter had passed away,
as they practically did in Bismarck's lifetime, the ideals
and the effort to realise them which had been the life-blood
of the heroic Germany from 1848 to 1870 were no longer
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? THE IMPERIAL CHANCELLOR
there to inspire the new generation. An acute observer
remarked at the time when Prince Hohenlohe's Memoirs
were published, the painful disillusionment in Germany
at the revelation of the atmosphere of intrigue poisoning
the political world in which Hohenlohe had played his
part, with increasing aversion to the setting in which
he found himself. The disillusionment of the politicians
began long before 1902. The lifting of the curtain on
parliamentary history after 1879 reveals the Reichstag not
as the centre of national life where the principles of a
nation's policy are fought out in argument and open day-
light, but as the market-place where an irresponsible
government secured a more or less transient majority by
the sleepless manipulation of the leaders and the purchase
of votes by concessions to the rank and file. The real bar-
gaining took place in the Federal Council, and as to its
nature and terms our information is either non-existent
or so scanty as not even to justify the speculative hypotheses
of a Privatdozent. The function of the government was
reduced to securing a majority in the Reichstag in order
to place the legal stamp on decisions arrived at else-
where. And this function Bismarck performed with
remarkable skill, because he had an unrivalled personal
prestige, and to the end he exercised a personal hypnotism
over the men with whom he negotiated and the Germany
that they represented.
Here again the results affected his successors more dis-
astrously than himself. Surrounded by a network and an
atmosphere of intrigue he was strong enough to defeat it,
simply because he was Bismarck. But Caprivi, Hohenlohe,
and Bulow--to take the story no further--had to wrestle
with the system that Bismarck had created, and they were
the victims of that system. In home as in foreign politics
Bismarck did not wish to look beyond the immediate needs
of the hour. He saw the storms successively rolling up,
and he added one temporary lightning conductor after
another to divert the destructive force from the main
building. He had definite ends in view, but for their
realisation he implicitly relied on the tactical situation,
and even more on his own unrivalled power of extricating
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BISMARCK
himself from any and every difficulty by an unerring use
of opportunities.
He illustrated these qualities triumphantly in the great
struggle from 1879 to 1888, which was the climax to his
political career. The first step was the abandonment of
Free Trade and the return to Protection, embodied in the
measures submitted in May 1879. '^ne corn duties were
voted in May, and the new general tariff passed on July 12
by a majority of one hundred, the Centre voting with the
government. Bismarck's interest and share in the policy
was shown by his continuous intervention in debate. He
spoke no less than eight times, and his speeches were a
personal confession and the exposition of a comprehensive
programme. He desired to return to the ' time-honoured
ways of 1823 ' (when Prussia began to abandon its Pro-
tectionist system with the organisation of the Zollverein),
and he asked the Reichstag to believe that in 1862 he had,
to his shame, no ' economic tendencies ' at all; for fifteen
years he had been so completely absorbed in foreign policy
that he had had no leisure to form independent opinions or
an exhaustive investigation, and he had relied on Delbriick
and others, whose opinions he had accepted. Delbriick's
retirement in 1876 had compelled him to take up the
matter for himself, and he had discovered that Germany
and himself had been ' the dupes of an honest conviction'
(FreeTrade) 'worthy of the honourable capacity for dream-
ing in the German race. ' In a characteristic passage he
argued that surgery based on experience had made brilliant
progress, whereas medical science, unable to examine the
internal mechanism of the body, had practically stood
still: so with economics,' the abstract doctrines of science
leave me perfectly cold, my only standard of judgment
being experience,' and experience showed him that Pro-
tectionist countries prospered and Free Trade countries
were stagnant or retrograde. The unanimity of the pro-
fessors for, was in itself an argument against, Free Trade.
He concluded with his customary peroration that party
considerations never influenced his patriotic zeal, and that
in advocating the change he had but one motive, the
prosperity and well-being of the Empire.
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? THE IMPERIAL CHANCELLOR
As an account of Bismarck's conversion the speech was
as remarkable for its omissions as for its assertions, ignor-
ing as it did the powerful pressure exerted by the agri-
cultural and manufacturing interests. The passage on
science must have highly diverted Virchow, and had
Pasteur read it, would have caused him to raise his eye-
brows in amused contempt. Still more naive was the
assertion that Free Trade was a cause of decadence, when
it was precisely a Free Trade Great Britain whose com-
petition was so distressing to German manufacturers.
Windthorst, too, must have enjoyed the passionate protest
that party considerations never entered into the Chan-
cellor's calculations, for the night before he had been
haggling with Bismarck over the price for the Clerical vote.
The Chancellor struck the note of irresistible appeal when
he invited the Reichstag to save agriculture and preserve
the German market for German industry at all costs, and
by a large addition to the revenue release the Federated
States from the burden of the increasing matricular con-
stitutions. He bid for the material interests, and they
responded manfully to the invitation. 1
The division was a personal triumph, and the aged
Field-Marshal Moltke could be seen stumbling over his
sword, caught in the rails, as he mounted the steps to the
Chancellor's seat to congratulate him. Yet the triumph
was not unalloyed. Bismarck had been compelled to
accept the Franckenstein amendment by which all revenue,
above one hundred and thirty million marks, derived from
the new tariff was to be appropriated to the relief of the
Federated States. His desire to obtain the sole use of the
new revenue for imperial purposes was thereby frustrated,
and this damaging amendment was the beginning of a
series of disappointments and rebuffs.
For eighteen months the economic battle between Free
Trade and Protection had been squarely fought out in
Germany in the press, on public platforms, and in academic
controversy. The vote of July 1879 decided the issue,
1 'The political constitution of the Empire, the highest personal influences,
the most powerful industrial and commercial forces, some of the principal
press energies, all are on the side of the (Protectionist) system. '--Report already
cited, p. 75.
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BISMARCK
and the Centre gave the victory to Bismarck. The
National Liberals broke over the controversy; sixteen
voted with, but the majority against, the government.
Free Trade and a Free Parliament in a united and cen-
tralised Empire had been their programme since their
formation in 1867, and in the attack on Free Trade the
majority recognised a general assault on the whole Liberal
creed. The suspicion was confirmed by the revision of
the May Laws next year, and the party broke up. The
Secession, which included the ablest and most vigorous
members--Lasker, Forckenbeck, Bamberger, and Bunsen
--endeavoured to establish, like the Peelites in England,
an independent existence between the Conservatives, with
whom the right of the party now acted, and the Pro-
gressives under Richter. But the general election of 1881
was a further blow. True, it went badly for Bismarck
and the government, for the Conservatives lost a great
many seats, but it made clear that there was no room for
a divided National Liberalism, and it gave the gains to the
Centre, the Socialists, and the Radicals. Bennigsen, worn
out and disillusioned, retired from public life in 1883, and
the Secession was driven to unite with the Progressives, and
found under Richter's leadership a new party, the Deutsch
Freisinnige--the German Free Thinkers. The remnant
of the old party continued to exist under the old name,
and to support the government, because it was national
rather than Liberal. But between 1881 and 1883 the old
National Liberalism really ceased to exist. It became
under a misleading label a party moderately Conservative
at home, and fiercely Nationalist in foreign politics.
The old National Liberalism had been the most powerful
intellectual, educative, and political force in forming a
united Germany; but when in 1867 it subordinated free
institutions to unity, when in 1870 it accepted without a
struggle the system of 1867 as the basis of the Empire,
when it persistently helped the government by the Sep-
tennates to ruin the Budget control of Parliament, and
when in 1878 it consented to pass the law apainst the
Social Democrats, it destroyed itself.
Bismarck treated the party as he treated Napoleon 111. ;
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? THE IMPERIAL CHANCELLOR
and he used the support it gave him to be the engine of its
downfall. The middle class from which it drew its
strength turned either to Protection, from which it could
gain wealth, or to the Progressives who fought a hopeless
battle with the entrenched governing class. Richter's
party had at least an intelligible creed and an avowed aim
--that of destroying the Bismarckian system and of substi-
tuting for it responsible parliamentary government at
home, an economic regime not founded on prosperity for
the landowner and manufacturer and State doles to the
proletariat, and a foreign policy that did not rest on a
continuous expenditure on armaments and the Prussian
sword as the ultima ratio in international relations.
After
1878 National Liberalism, as such, had no constructive
policy to offer Germany. It resisted the conversion of
Bismarck, but it had no practical alternative to meet the
needs of the Empire it had largely created. It criticised
with acerbity, and voted with docility in the government
lobby, and its dissolution was a confession of bankruptcy.
Bismarck and the Radicals acted as joint-receivers, liqui-
dated the account, and distributed the business of a once-
flourishing and powerful House into various and hostile
hands. It was, indeed, the end of an old song.
The year 1880 was mainly occupied in opening the road
to Canossa, but from 1881 to 1889 Bismarck laid down the
main framework of the economic legislation that earned
him the title of the Great State Socialist of the nineteenth
century--the measure which provided for Employers'
Liability in accidents, for insurance against sickness, and
for the provision of Old Age Pensions. The feverish
energy--alles ging in galopp, as he said--with which these
measures were pressed is very remarkable, and still more
remarkable is the Chancellor's personal share in their con-
struction and in the task of carrying them in the teeth of
bitter opposition in the Reichstag. In the autumn of 1880
he took over the Ministry of Commerce, adding it to the
duties of Minister-President and Chancellor; he was then
in his sixty-fifth year, and during all this period he carried
alone the burden of foreign policy, in itself a tremendous
task, and was also engaged in the complicated negotiations
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? 38o
BISMARCK
with the Vatican and the Centre which ended the Kultur-
kampf. The expression that Bismarck was the govern-
ment and the government was Bismarck conveys a very
faint conception of the responsibility and labours that he
shouldered. The Prime Minister of a modern Parlia-
mentary State, such as Great Britain, carries no doubt an
onerous burden, but he shares his responsibility with
colleagues, while the party system relieves him of the duty
of creating a majority that will loyally vote as required;
because if the country refuses him the majority the burden
of office is transferred across the table to a rival party
leader. But Bismarck had to steer through the rocks,
shallows, and eddies of the parliamentary seas, finding
'allies where he could get them,' and uncertain whether in a
critical turn if the ministerial ship ' hung in stays' the crew
might not take to the boats. He had, moreover, as Chair-
man of the Federal Council to keep that essential organ
united and compliant, and the Federal Council was not a
Cabinet cemented by the ethos of collective responsibility
and composed of members in broad agreement on the
current questions of public policy. Mr. Gladstone or Lord
Salisbury would not have relished working the Parlia-
mentary System through a Cabinet of fifty-six members,
only seventeen of which could be implicitly trusted to vote
straight. It is not surprising therefore that Bismarck's
performance from 1879 to 1888, in the autumn of a life,
which had never spared itself from youth to old age, made
an indelible impression on Germany. Compared with the
'Iron Chancellor ' the other public figures seemed indeed
bloodless and fleeting shades. Every quality in the
Chancellor's person was titanic--the physical frame, the
head carved and moulded by a Berserker's hammer and
chisel, the will, the temper, the appetites, the ambitions.
The Empire that was Power was incarnated in that
hypnotic personality.
In 1881, 1884, and 1886, the Trade Law (Gewerbe-
ordnung) was substantially amended and extended; the
structure and scope of Trade Guilds were reorganised with
a view to strengthening artisans against the capitalist and
the factory (and incidentally to minimise the power of
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? THE IMPERIAL CHANCELLOR 381
Trade Unions), and ' in diametrical opposition to the prin-
ciple of laissez-faire, the abandonment of the weak to their
own resources and to private help. ' The measure pro-
viding for compulsory insurance against sickness was
destroyed by criticism in 1881, was reintroduced in 1882,
and carried against the Radicals and Socialists in 1883;
it was subsequently extended in 1885 and in 1886. A
bill for insurance against accidents was introduced in
1882 and became law in 1884 (July 6); it, too, was
amended and extended in 1885, 1886, and 1887. The
system was completed by the Old Age Insurance Law
of June 1889.
Concurrently with these measures of vast scope Bis-
marck was engaged in an effort to recast the whole
system of taxation, and to create an imperial revenue
that would provide the funds for 'the socialism of the
State. ' But he met in this sphere with more defeats
than successes.
The Stamp Tax of 1881 imposed a duty on Stock Ex-
change transactions, and the Usury Law of 1880 intro-
duced legal rates of interest. But the proposal to tax all
exemptions from military service was rejected in 1881,
Moltke ostentatiously leaving the Reichstag before the
division. The attempt to establish in 1882 a tobacco
monopoly which was to provide the funds for Old Age
Pensions broke down completely; and though an income
tax was introduced for Prussia, the idea of imposing a
separate Imperial Income Tax was dropped. The sug-
- gested monopoly in brandy was introduced in 1886 and
decisively defeated, and the failure destroyed the idea of
establishing a monopoly in sugar. The principles and
aims of this programme were fully set out in the Royal
Speech of November 17, 1881:--
'We express our conviction that the cure of social ills must be
sought, not exclusively in the repression of Social-Democratic ex-
cesses, but simultaneously in the positive advancement of the wel-
fare of the working classes. . . . The finding of the proper ways
and means is a difficult task, yet it is one of the highest of every
Commonwealth which is based on the ethical foundations of a
Christian national life. '
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BISMARCK
Bismarck's own views can be summarised by a few
quotations from his speeches :--
'In my opinion we are behind all great European States in regard
'to the development of our system of Taxation, especially with re-
spect to its reaction upon our economic conditions, and we have
much ground to recover in this domain' (February 22, 1878).
'In regard to exemption from taxation, I hold in general the
principle that the man who has nothing but his two hands, that is
untrained hands that have learned no industry, should be quite
exempted from both state taxes and imperial contributions, and
that the taxation should begin when a further capital exists'
(February 4, 1881).
'You know that I am an opponent of direct and a friend of in-
direct taxes . . . my ideal is not an Empire which must collect its
matricular contributions at the door of the individual states, but
an Empire which, having in its hands the principal source of good
finance--indirect taxes--would be in a position to pay contributions
to all the individual states' (February 26, 1878).
'I regard it as one of the greatest superiorities of our life in
Germany that a large part of our well-to-do classes live all the year
round in the country, carrying on agriculture themselves . . . if
you succeeded in destroying this race you would see the result in
the palsying of our entire economic and political life' (February 14,
i885)-.
'Give the working man the right to work as long as he is healthy,
assure him care when he is sick, assure him maintenance when he
is old. If you do that and do not fear the sacrifice, or cry out at
State Socialism--if the State will show a little more Christian
solicitude for the working man, then I believe that the gentlemen
of the Social-Democratic programme will sound their bird calls in
vain . . . yes, I acknowledge unconditionally a right to work, and
I will stand up for it as long as I am in this place' (May 9,1884).
'I should like to see the State which for the most part consists of
Christians--although you reject the name Christian State--pene-
trated to some extent by the principles of the religion it professes
. . . I, the Minister of the State, am a Christian, and as such I am
determined to act as I believe I am justified before God' (April 2,
1881 and Januarys 1882).
'It is a tradition for the dynasty which I serve that it takes the
side of the weak in the economic struggle. Frederick the Great
said Je serai le roi its gueux, and in his own way he carried out this
precept with strict justice . . . my present master is animated
by the lofty ambition to secure to the weakest class of our fellow-
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? THE IMPERIAL CHANCELLOR 383
citizens . . . confidence with which they can contemplate the
future of the State to which they belong' (January 9, 1882).
'If you believe that you can frighten any one or call up spectres
with the word " Socialism," you take a standpoint which I abandoned
long ago, and the abandonment of which is absolutely necessary for
our Imperial legislation' (March 1882).
'The popularity of a thing makes me rather suspicious about it
than otherwise, and I am induced to ask myself, if it is also sensible'
(June 12, 1882).
AU these measures were not carried without bitter
controversy, and the most strenuous pressure from the
government. They were attacked from three different
standpoints--individualistic Liberalism which feared the
extension of State functions, and on principle opposed
Protection as an economic system and for its ulterior
political results; the political school that feared, and
rightly, the immense accession of power to the centralised
imperial executive, vested in irresponsible hands, and the
Socialists who called the whole code 'bastard Socialism. '
The latter were savagely attacked because of their oppo-
sition. But their answer was effective. Every effort that
they made was futile to amend the legislation so as to
deprive it of its character of being a material sop to the
industrial working classes, and an instrument for diminish-
ing the political power of labour by making it dependent
on a State over which they could exercise no control.
To Bebel and his party Bismarck's ' socialistic ' policy was
the minimum of blackmail that the ruling classes would
pay in order to strengthen their own political power.
Again and again they pressed (with some help from the
Clerical Centre) for essential and complementary reforms
--the regulation of wages and of the hours and conditions
of labour, the amelioration of the status of the children,
the lads, the girls, and the women in the factories and work-
shops of the New Germany, and for an extension of the
powers of Trades Unions which would enable the worker
to confront capital on equal terms. Without legislative
regulation of these matters the State Socialism of the
Chancellor was, they contended, simply a tax on labour
aggravated by the effect of the Protectionist tariff. But
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BISMARCK
they pleaded in vain. The principles of the Christian State
which Bismarck set in the forefront of his programme did
not apparently require that women and children should
not be sweated, or that wages should be raised above the
barest minimum of subsistence,1 or that employers and the
State should see that their employees should live under con-
ditions which would ensure decency, health, and morality;
it did not even require that there should be one day of
rest for the workers toiling in the factory. The worker
was assumed to be a Christian and to belong to a Christian
State, but he was not to be assured of the leisure to
worship. The factory was to be his Heaven and his Hell.
The most damning criticism of the blots and defects--
the most effective exposition of the purely political char-
acter--of Bismarck's policy was set out in the resolutions of
the International Labour Conference of 1890, the meeting
of which Bismarck did his best to prevent.
The plain truth is that Bismarck's programme was in-
spired by the same fear and distrust that underlay his theory
of international relations; and much of his legislation was
(apart from its money-producing effectiveness) a reinsurance
scheme against the results of the manhood suffrage which
made the electoral law of the Empire. In 1867, when he
said that democracy would be more monarchical than
middle-class Liberalism, he did not foresee the industrial
revolution. He had in his mind an agricultural Germany,
and above all an agricultural Prussia, where the peasant
had been trained in a position of dependence on the land-
owner, with whose interests as a tiller of the soil his own in
many respects coincided. But he never understood the
industrial proletariat, the numbers of which increased by
leaps and bounds after 1871; he disliked towns and town-
dwellers; to the end he regarded industrialism as a
gigantic excrescence to be exploited and emasculated of
its strength, rather than assimilated, and his economics at
bottom were saturated with the postulates of the eigh-
teenth-century physiocrats j while he forgot that the new
1 <<One of the principal secrets of the expansion of the German export trade
is the prevalence of wages, which, in some branches, are hardly two-thirds or half
the British rates. '--Report already cited, p. 75.
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? THE IMPERIAL CHANCELLOR 385
and toiling Germany had no traditions, and no social mould
ready-made and tempered by generations of development,
into which it would steadily flow and be reshaped. On
the contrary, it had its traditions and outlook on life to
make in all the roar, dust, and fog of a vast economic
revolution. Taking experience and facts alone as his
guide Bismarck probed his way as best he could in the
teeth of opponents who, Kke himself, thought more of ends
than of means. There was no conservative Shaftesbury
to strop a dulled moral conscience; the bureaucracy at
his disposal smothered him with figures and facts compiled
in their offices; he was in the hands of the political
majority on which he relied, which resented the demands
of labour as subversive of their own power, and his own
system cut him off from utilising the help he might have
got from those who really knew. A close study of his
speeches reveals from time to time the note of despair--
the complexity and ramifications of the problem were so
great and so baffling--and his contempt for economic
science led him into avoidable blunders and many political
rebuffs. The repercussion and incidence of taxation, for
example--subjects engaging some of the best economic
minds in Europe--he more than once angrily brushed
aside as the pastime of professors. The realist had
neither time nor patience for such abstractions. If a tax
would bring in money here and now, it had fulfilled its
purpose, and the consequences could be dealt with later.
Volumes--a whole library indeed--have grown up round
the economic problems with which Bismarck wrestled,
and it is not possible to discuss issues which require
a separate monograph for adequate treatment. It must
suffice briefly to observe three or four outstanding features.
In two of his main objects Bismarck unquestionably
succeeded--the provision of money, and the preservation
of his political system. Whether the great expansion of
German industry was largely due to the adoption of Pro-
tection need not be argued here, for it opens issues too
large and controversial to be summarily decided;1 but,
1 See the report, already cited, where much material is statistically examined
and summed up.
B. IB
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? 386
BISMARCK
unquestionably, the remarkable industrial expansion pro-
vided in the Chancellor's political lifetime an expanding
revenue from indirect taxation, which met the exigent
needs of Bismarck's policy. Secondly, the ten years of
social legislation deeply impressed Europe, and in this, as
in other developments of German policy, the great ex-
periment was studied, praised, and copied. Germany
flattered itself that it was the pioneer as well as the model
of constructive statecraft, and Bismarck's legislation pro-
foundly stimulated economic thought and political
practice far outside the limits of the German Empire.
Bismarck,' the social reformer,' acquired a prestige devoid
of the dubious elements that discounted the fame of his
other political achievements. A later generation either
in or outside Germany, more accurately acquainted with
the motives, aims, and effects of the 'new era,' has not
been able to accept without serious qualifications the
eulogies so noticeable in the early nineties.
But in two notable respects the failure even in Bismarck's
lifetime was as conspicuous as the success. The spectre of
Social Democracy was not laid. Bebel, who had a good
right to know, told the Reichstag and the Chancellor that
the effort to put Social Democracy into a siding would
fail, and that the social legislation would be one of the
main causes of the failure. 'The bird call' became more,
not less, potent in its appeal just because the Christian
State did so little, when it could do so much; and
he warned the Chancellor that if you could not kill the
Socialist party by the law of 1878 you would not kill it
by compelling the artisan, with some help from the
State, to insure against accidents, sickness, and old age.
A compulsory and dilatory distribution of doles could
not extirpate a movement which had its roots deep in a
determination to secure political and social ends--political
and social power--through the economic status of the
worker: and the more the State compelled the workers
to organise, the more certainly they would use the organi-
sation for their own purposes. Bismarck recognised the
failure. But, unlike the Kulturkampf, he could not break
off the action when victory was no longer within his grasp.
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? THE IMPERIAL CHANCELLOR 387
He had committed the Empire to a course from which it
was impossible to recede.
Nor did his fiscal experiments succeed in solving the
problem of imperial finance. Within ten years of 1890
the problem of the matricular contributions and the de-
ficits in the Imperial Budget threatened to be no less
serious than in 1878-9. Bismarck could fairly say that
had the Empire become the monopolist that he desired
it to be in tobacco, brandy, sugar, and other articles of
general consumption; had it nationalised all the railways
and absorbed all the profits, even the great increase in
imperial expenditure might have been met. But he never
explained how in that case the Federated States were to
balance their several budgets, or how a large increase in
direct taxation, which he regarded as politically inexpedient
and economically indefensible, was to be avoided. Arma-
ments and State Socialism were the main causes of the
steady increase in expenditure. Bismarck's system placed
armaments outside the arena of discussion. The policy
and principles were imposed on the nation--whose duty
it then was obediently to pay the bill--and if the nation
resisted, a general election with the main issue of 'The
Empire and Army in danger and War in sight' invariably
proved decisive.
These ten years from 1879 to 1889 made a decade of
embittered home politics. The reactionary character of
the Chancellor's system was revealed in many ways.
Bismarck seriously suggested, for example, that biennial
budgets and biennial meetings of the . Reichstag would be
a desirable reform; the prosecutions for Bismarck Be-
leidigung steadily increased, and when men like Bunsen and
Mommsen were prosecuted (and happily acquitted) for
indicting the government measures as 'immoral,' every
one who cared for freedom of opinion and freedom of
criticism had just cause for deep misgiving. Bismarck
increasingly regarded opposition as a personal affair; to
complaints of bribery and intimidation by officials at
elections he invariably retorted by emphasising the char-
acter of the Prussian monarchy and the disloyalty of the
Progressives to the Throne. 'I do not believe,' he said,
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BISMARCK
'in electro-plated royalism. ' In 1886 he concluded one
of his speeches with unmistakable threats: 'We must aim
at becoming stronger; we must show that we stand not
on feet of clay, but of iron. We must find a means of
becoming independent of the obstruction of the majority
of the Reichstag. I do not advocate such a step, but if
the Fatherland should be endangered I should not hesitate
to propose to the Emperor the necessary measures. The
Minister who will not risk his head to save the Fatherland,
even against the will of the majority, is a coward. I will
not allow the achievements of our army to perish by
internal discord, which I will find the means of counter-
acting. ' (January 28, 1886, in the Prussian Landtag. )
Prussian Poland and Alsace-Lorraine were essentially
problems of home policy which illustrate the close con-
nection between the internal system and the principles of
Bismarck's foreign policy. The failure of Prussia to
Germanise her Polish provinces inspired the Prussian
government to drastic action. Puttkamer, the Minister
of the Interior, in 1885 pointed out that, whereas the
German element had increased from one to five per cent.
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BISMARCK
would have failed to understand, or dismissed as irrelevant
verbiage: so far as it had an ascertainable paternity, the
genealogy of Bismarck's Socialism can be found, not in the
writings and teaching of Karl Marx, but in the doctrines
of F. List. But the new programme was a wonderful
illustration of Bismarck's intuitive sensitiveness to change
and ideas, that he exploited for his own political purposes.
So long as Germany was rent by the Kulturkampf this
comprehensive programme could not be fairly discussed
or embodied in law. The Kulturkampf was essentially a
controversy over principles, which brought the theory and
functions of the civil power into the arena of conflict. The
Clerical Centre, as developed by Windthorst with the aid
of the Roman Curia, was first and foremost a confessional
organisation which united in a single party every class from
the princes and hierarchs of the Church to the industrial
proletariat in the great Catholic centres of industry, and
which subordinated all the separable class interests of its
members to a broad aim, the practical independence of
the Roman Church. The new economic programme in-
volved a complete breach with Liberalism and Radicalism.
It could not therefore have any chance of success unless
the Centre were rallied to the side of the government.
The Kulturkampf must therefore be ended, as a prelimi-
nary condition to the new era. Bismarck's conversations
with Masella at Kissingen cleared up the situation. The
Vatican required the repeal of the May Laws and a return
broadly to the position in 18711 Bismarck required the
Centre vote on all governmental proposals. Both sides
had a valuable article to sell; both sides were weary of
the struggle, and neither side dared openly to don the
white sheet and publicly reverse their explicit statement
of principles. Each side thoroughly distrusted the other,
and with good reason. Windthorst feared that once
Bismarck had utilised the Centre he would throw them
over and reunite with the Liberals. Bismarck, uncertain
of how far Germany would accept the new programme,
and aware that the Liberal and Protestant forces would
resent an advance to Canossa, and that repeal of the May
Laws was a damaging blow to his prestige, dared not make
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? THE IMPERIAL CHANCELLOR 371
the Centre master of the situation. The exchange of a
Clerical control for the National Liberals was no gain but
loss. For he wanted to be independent alike of Clericals
and Liberals, and of the two the Clericals were more
difficult to satisfy. Foreign policy entered into his cal-
culations. Ultramontanism in France and Austria was a
continuous and disturbing element in the European
situation. Bismarck had to reckon with a possible Ultra-
montane supremacy in France upsetting the results
achieved by the Dual Alliance of 1879. And there was
always Poland--the eternal Poland, Catholic and Slav
in one.
It was essentially, therefore, a case for a slow and
gradual reconciliation, every concession being decided by
the situation of the moment and paid for in advance
by positive results. Bismarck began by heartening the Con-
servatives. In 1878 Camphausen, the Liberal financial
minister, was replaced by Maybach, a Conservative; Eulen-
berg, the new Minister of the Interior, was a strenuous
Conservative; Stolberg, the new Vice-Chancellor under
the Kanzlervertreter law was not a National Liberal, but
an unbending Conservative. On July 14, 1879, Falk's
resignation was accepted. He left office with all the in-
dications of dismissal. His health had failed; and to
assist him in his recovery he was given a riband, a eulo-
gistic letter, portraits and photographs, while his place
was taken by Puttkamer, a fierce Conservative. On
May 3 the members of the Reichstag who attended the
Chancellor's parliamentary soirees, where Bismarck^ cigar
in one hand and glass in the other, arranged his parlia-
mentary plans of campaign, saw with astonishment 'the
pearl of Meppen,' 'the little Chancellor,' Windthorst,
making his bow with the air of a habitut, and witnessed the
genial cordiality with which the 'big Chancellor' wel-
comed the apparition expected by himself and no one else.
Delbriick, Camphausen, Falk had gone, and in their place
was Windthorst, polished, smiling, and epigrammatic.
'Every courtesy as far as the gallows,' Bismarck had said
thirty years before to G. von Vincke. 'Every courtesy
as far as Canossa,' was now Windthorst's silent comment.
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BISMARCK
It cannot have been a happy evening for Bismarck, though
he made his new guest taste from the huge cask of the
finest Franciscan liqueur sent him by the reconciled monks.
The fruits of the negotiations behind the scenes were
laid on the table of the Prussian Landtag in 1880 in a
governmental bill. The measure was roughly handled and
drastically amended, and in its final form only passed by
four votes (206-202), a convincing proof of the strength of
Liberal feeling and voting power. As amended, the bill
did not repeal any of the fundamentals in the May Laws,
but gave to the government a qualified discretion in the
enforcement of the penal legislation. It had been pre-
ceded by a Papal announcement (February 24) authorising
the Roman bishops in Prussia to notify ecclesiastical
appointments in their diocese to the Prussian government
for approval (Anzeigepflicht). The bill was the first step
towards a complete peace. The remaining stages were
covered in the next four years. In 1882 (May 31) Roman
priests were largely dispensed from the necessity and con-
ditions of the State examination, prescribed in the May
Laws; in 1883 (July 11) Roman bishops were released
from the obligation to notify ecclesiastical appointments to
the civil authority, which simply retained a power of veto;
in the same year the Crown Prince visited Rome and had
an audience with the Pope; in 1884 the Roman bishops
were introduced into the Prussian Council of State; in
1886 Leo xii1. was invited by Bismarck to arbitrate'on the
dispute between Germany and Spain over the Caroline
Islands, and in the same year a new law empowered the
government practically to dispense at its discretion with
the penal code set up between 1873 and 1875. On
May 23, 1887, Leo xm. was able to assure the Consistory
that the Kulturkampf was at an end, and that the Roman
Church had secured the essentials for which it had fought.
Bismarck received the Order of Christ, the first Protestant
to be given this Papal decoration, a portrait of Leo xm. ,
and a copy of the Pope's Latin poems. He did not forward
in return a bound volume of his speeches in which he had
laid it down that he would not go to Canossa either in
body or in spirit.
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? THE IMPERIAL CHANCELLOR 373
'That journey,' as a distinguished German historian
said, 'nevertheless took place. ' The argument that
Bismarck was not beaten, and that he did not surrender,
cannot stand the test of indisputable fact. Still less
tenable is the view that Bismarck made the surrender
willingly. He was not the man, after all his stout words
and the violence of the conflict in which Protestant and
Liberal Germany had hailed him as a second Luther,
nailing 'the May Laws,' like the immortal ninety-five
theses at Wittenberg, to the Throne and Parliament of
Prussia. The attempt to enforce the omnipotence of the
Civil State had broken down; the attempt to assert civil
control over the faith, discipline, and education of the
Roman priesthood had collapsed. In 1873 Bismarck had
plainly miscalculated the resources of the foe he had chal-
lenged, and exaggerated the strength of the weapons at his
disposal. He had beaten a retreat because he could not
hold the position that he had occupied in the battle:
but he had not retreated without securing compensation
adequate to the humiliation. The Clerical vote enabled
him to carry out a policy more important in his eyes than
the principles enshrined in the May Laws, and in the criti-
cal controversy in 1887-8 over the Septennate the Centre
came to his" aid and secured the victory (see p. 451).
The Chancellor's surrender was a bitter blow to
Liberalism and Radicalism. To both parties the Clerical
Centre was, in Gambetta's phrase, the enemy, for Ultra-
montanism challenged every principle of importance in
the Liberal and Radical creed, and to them the victory of
Windthorst and the Vatican was a victory of obscurantism,
not merely in the narrow plot of theology and dogma,
but in the unlimited fields of intellectual and social life.
The far-reaching influence of the 'progress to Canossa'
between 1879 and 1887 on the German mind cannot yet
be fairly estimated, nor do they fall within the scope of
our subject, but its direct and immediate results were
obvious. It opened up an epoch of growing reaction in
home politics and administration, and the barometer of
Liberalism steadily fell. The Centre remained at a fairly
constant figure of approximately one hundred votes in
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BISMARCK
the Reichstag, and Bismarck's action made it the arbiter
of the parliamentary situation. The full effect of that
predominance was felt outside the period of Bismarck's
Chancellorship, and he left it as a dangerous inheritance to
his successors. They had to liquidate the bill incurred
between 1879 and 1887.
The smashing of Liberalism was the other conspicuous
result. Here again Bismarck reaped the direct advantage
for himself, and left the aftermath to his successors. But
when Bismarck broke the National Liberal party he left
the Empire with no buffer between the government and
Social Democracy except an uneasy marriage of con-
venience between Conservatism, which completely failed
to grow any stronger in voting power, and the Clerical
Centre--a coalition of interests, not a fusion of principles.
The inheritor of the broken Liberalism was the Socialist
Democratic party, and the growth of that party was a
fresh proof that Bismarck had miscalculated its strength,
the sources from which it drew its recruits, and the
methods by which it could be successfully combated.
The gradual degradation of the Reichstag, and with it
the deterioration of political life in Germany, began in
1879 when Bismarck for purely tactical reasons bought
the support of the Centre. That degradation was per-
haps inevitable, because the Reichstag under the Imperial
Constitution was simply a part, and not the most important
part, of the legislative machine; and no representative
body can retain its vitality, its dignity, and its self-respect
--the three qualities essential to a healthy and self-renew-
ing political life--when it is deliberately made a House of
Phrases and nothing else. But unquestionably the de-
terioration was materially hastened by Bismarck's policy.
Power and responsibility are correlatives in the life of
organised communities, and the Reichstag was steadily
deprived of the shreds of both that it once possessed.
When the generation that had produced Bennigsen,
Lasker, Forckenbeck, Miquel, and Richter had passed away,
as they practically did in Bismarck's lifetime, the ideals
and the effort to realise them which had been the life-blood
of the heroic Germany from 1848 to 1870 were no longer
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? THE IMPERIAL CHANCELLOR
there to inspire the new generation. An acute observer
remarked at the time when Prince Hohenlohe's Memoirs
were published, the painful disillusionment in Germany
at the revelation of the atmosphere of intrigue poisoning
the political world in which Hohenlohe had played his
part, with increasing aversion to the setting in which
he found himself. The disillusionment of the politicians
began long before 1902. The lifting of the curtain on
parliamentary history after 1879 reveals the Reichstag not
as the centre of national life where the principles of a
nation's policy are fought out in argument and open day-
light, but as the market-place where an irresponsible
government secured a more or less transient majority by
the sleepless manipulation of the leaders and the purchase
of votes by concessions to the rank and file. The real bar-
gaining took place in the Federal Council, and as to its
nature and terms our information is either non-existent
or so scanty as not even to justify the speculative hypotheses
of a Privatdozent. The function of the government was
reduced to securing a majority in the Reichstag in order
to place the legal stamp on decisions arrived at else-
where. And this function Bismarck performed with
remarkable skill, because he had an unrivalled personal
prestige, and to the end he exercised a personal hypnotism
over the men with whom he negotiated and the Germany
that they represented.
Here again the results affected his successors more dis-
astrously than himself. Surrounded by a network and an
atmosphere of intrigue he was strong enough to defeat it,
simply because he was Bismarck. But Caprivi, Hohenlohe,
and Bulow--to take the story no further--had to wrestle
with the system that Bismarck had created, and they were
the victims of that system. In home as in foreign politics
Bismarck did not wish to look beyond the immediate needs
of the hour. He saw the storms successively rolling up,
and he added one temporary lightning conductor after
another to divert the destructive force from the main
building. He had definite ends in view, but for their
realisation he implicitly relied on the tactical situation,
and even more on his own unrivalled power of extricating
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BISMARCK
himself from any and every difficulty by an unerring use
of opportunities.
He illustrated these qualities triumphantly in the great
struggle from 1879 to 1888, which was the climax to his
political career. The first step was the abandonment of
Free Trade and the return to Protection, embodied in the
measures submitted in May 1879. '^ne corn duties were
voted in May, and the new general tariff passed on July 12
by a majority of one hundred, the Centre voting with the
government. Bismarck's interest and share in the policy
was shown by his continuous intervention in debate. He
spoke no less than eight times, and his speeches were a
personal confession and the exposition of a comprehensive
programme. He desired to return to the ' time-honoured
ways of 1823 ' (when Prussia began to abandon its Pro-
tectionist system with the organisation of the Zollverein),
and he asked the Reichstag to believe that in 1862 he had,
to his shame, no ' economic tendencies ' at all; for fifteen
years he had been so completely absorbed in foreign policy
that he had had no leisure to form independent opinions or
an exhaustive investigation, and he had relied on Delbriick
and others, whose opinions he had accepted. Delbriick's
retirement in 1876 had compelled him to take up the
matter for himself, and he had discovered that Germany
and himself had been ' the dupes of an honest conviction'
(FreeTrade) 'worthy of the honourable capacity for dream-
ing in the German race. ' In a characteristic passage he
argued that surgery based on experience had made brilliant
progress, whereas medical science, unable to examine the
internal mechanism of the body, had practically stood
still: so with economics,' the abstract doctrines of science
leave me perfectly cold, my only standard of judgment
being experience,' and experience showed him that Pro-
tectionist countries prospered and Free Trade countries
were stagnant or retrograde. The unanimity of the pro-
fessors for, was in itself an argument against, Free Trade.
He concluded with his customary peroration that party
considerations never influenced his patriotic zeal, and that
in advocating the change he had but one motive, the
prosperity and well-being of the Empire.
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? THE IMPERIAL CHANCELLOR
As an account of Bismarck's conversion the speech was
as remarkable for its omissions as for its assertions, ignor-
ing as it did the powerful pressure exerted by the agri-
cultural and manufacturing interests. The passage on
science must have highly diverted Virchow, and had
Pasteur read it, would have caused him to raise his eye-
brows in amused contempt. Still more naive was the
assertion that Free Trade was a cause of decadence, when
it was precisely a Free Trade Great Britain whose com-
petition was so distressing to German manufacturers.
Windthorst, too, must have enjoyed the passionate protest
that party considerations never entered into the Chan-
cellor's calculations, for the night before he had been
haggling with Bismarck over the price for the Clerical vote.
The Chancellor struck the note of irresistible appeal when
he invited the Reichstag to save agriculture and preserve
the German market for German industry at all costs, and
by a large addition to the revenue release the Federated
States from the burden of the increasing matricular con-
stitutions. He bid for the material interests, and they
responded manfully to the invitation. 1
The division was a personal triumph, and the aged
Field-Marshal Moltke could be seen stumbling over his
sword, caught in the rails, as he mounted the steps to the
Chancellor's seat to congratulate him. Yet the triumph
was not unalloyed. Bismarck had been compelled to
accept the Franckenstein amendment by which all revenue,
above one hundred and thirty million marks, derived from
the new tariff was to be appropriated to the relief of the
Federated States. His desire to obtain the sole use of the
new revenue for imperial purposes was thereby frustrated,
and this damaging amendment was the beginning of a
series of disappointments and rebuffs.
For eighteen months the economic battle between Free
Trade and Protection had been squarely fought out in
Germany in the press, on public platforms, and in academic
controversy. The vote of July 1879 decided the issue,
1 'The political constitution of the Empire, the highest personal influences,
the most powerful industrial and commercial forces, some of the principal
press energies, all are on the side of the (Protectionist) system. '--Report already
cited, p. 75.
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? 378
BISMARCK
and the Centre gave the victory to Bismarck. The
National Liberals broke over the controversy; sixteen
voted with, but the majority against, the government.
Free Trade and a Free Parliament in a united and cen-
tralised Empire had been their programme since their
formation in 1867, and in the attack on Free Trade the
majority recognised a general assault on the whole Liberal
creed. The suspicion was confirmed by the revision of
the May Laws next year, and the party broke up. The
Secession, which included the ablest and most vigorous
members--Lasker, Forckenbeck, Bamberger, and Bunsen
--endeavoured to establish, like the Peelites in England,
an independent existence between the Conservatives, with
whom the right of the party now acted, and the Pro-
gressives under Richter. But the general election of 1881
was a further blow. True, it went badly for Bismarck
and the government, for the Conservatives lost a great
many seats, but it made clear that there was no room for
a divided National Liberalism, and it gave the gains to the
Centre, the Socialists, and the Radicals. Bennigsen, worn
out and disillusioned, retired from public life in 1883, and
the Secession was driven to unite with the Progressives, and
found under Richter's leadership a new party, the Deutsch
Freisinnige--the German Free Thinkers. The remnant
of the old party continued to exist under the old name,
and to support the government, because it was national
rather than Liberal. But between 1881 and 1883 the old
National Liberalism really ceased to exist. It became
under a misleading label a party moderately Conservative
at home, and fiercely Nationalist in foreign politics.
The old National Liberalism had been the most powerful
intellectual, educative, and political force in forming a
united Germany; but when in 1867 it subordinated free
institutions to unity, when in 1870 it accepted without a
struggle the system of 1867 as the basis of the Empire,
when it persistently helped the government by the Sep-
tennates to ruin the Budget control of Parliament, and
when in 1878 it consented to pass the law apainst the
Social Democrats, it destroyed itself.
Bismarck treated the party as he treated Napoleon 111. ;
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? THE IMPERIAL CHANCELLOR
and he used the support it gave him to be the engine of its
downfall. The middle class from which it drew its
strength turned either to Protection, from which it could
gain wealth, or to the Progressives who fought a hopeless
battle with the entrenched governing class. Richter's
party had at least an intelligible creed and an avowed aim
--that of destroying the Bismarckian system and of substi-
tuting for it responsible parliamentary government at
home, an economic regime not founded on prosperity for
the landowner and manufacturer and State doles to the
proletariat, and a foreign policy that did not rest on a
continuous expenditure on armaments and the Prussian
sword as the ultima ratio in international relations.
After
1878 National Liberalism, as such, had no constructive
policy to offer Germany. It resisted the conversion of
Bismarck, but it had no practical alternative to meet the
needs of the Empire it had largely created. It criticised
with acerbity, and voted with docility in the government
lobby, and its dissolution was a confession of bankruptcy.
Bismarck and the Radicals acted as joint-receivers, liqui-
dated the account, and distributed the business of a once-
flourishing and powerful House into various and hostile
hands. It was, indeed, the end of an old song.
The year 1880 was mainly occupied in opening the road
to Canossa, but from 1881 to 1889 Bismarck laid down the
main framework of the economic legislation that earned
him the title of the Great State Socialist of the nineteenth
century--the measure which provided for Employers'
Liability in accidents, for insurance against sickness, and
for the provision of Old Age Pensions. The feverish
energy--alles ging in galopp, as he said--with which these
measures were pressed is very remarkable, and still more
remarkable is the Chancellor's personal share in their con-
struction and in the task of carrying them in the teeth of
bitter opposition in the Reichstag. In the autumn of 1880
he took over the Ministry of Commerce, adding it to the
duties of Minister-President and Chancellor; he was then
in his sixty-fifth year, and during all this period he carried
alone the burden of foreign policy, in itself a tremendous
task, and was also engaged in the complicated negotiations
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? 38o
BISMARCK
with the Vatican and the Centre which ended the Kultur-
kampf. The expression that Bismarck was the govern-
ment and the government was Bismarck conveys a very
faint conception of the responsibility and labours that he
shouldered. The Prime Minister of a modern Parlia-
mentary State, such as Great Britain, carries no doubt an
onerous burden, but he shares his responsibility with
colleagues, while the party system relieves him of the duty
of creating a majority that will loyally vote as required;
because if the country refuses him the majority the burden
of office is transferred across the table to a rival party
leader. But Bismarck had to steer through the rocks,
shallows, and eddies of the parliamentary seas, finding
'allies where he could get them,' and uncertain whether in a
critical turn if the ministerial ship ' hung in stays' the crew
might not take to the boats. He had, moreover, as Chair-
man of the Federal Council to keep that essential organ
united and compliant, and the Federal Council was not a
Cabinet cemented by the ethos of collective responsibility
and composed of members in broad agreement on the
current questions of public policy. Mr. Gladstone or Lord
Salisbury would not have relished working the Parlia-
mentary System through a Cabinet of fifty-six members,
only seventeen of which could be implicitly trusted to vote
straight. It is not surprising therefore that Bismarck's
performance from 1879 to 1888, in the autumn of a life,
which had never spared itself from youth to old age, made
an indelible impression on Germany. Compared with the
'Iron Chancellor ' the other public figures seemed indeed
bloodless and fleeting shades. Every quality in the
Chancellor's person was titanic--the physical frame, the
head carved and moulded by a Berserker's hammer and
chisel, the will, the temper, the appetites, the ambitions.
The Empire that was Power was incarnated in that
hypnotic personality.
In 1881, 1884, and 1886, the Trade Law (Gewerbe-
ordnung) was substantially amended and extended; the
structure and scope of Trade Guilds were reorganised with
a view to strengthening artisans against the capitalist and
the factory (and incidentally to minimise the power of
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? THE IMPERIAL CHANCELLOR 381
Trade Unions), and ' in diametrical opposition to the prin-
ciple of laissez-faire, the abandonment of the weak to their
own resources and to private help. ' The measure pro-
viding for compulsory insurance against sickness was
destroyed by criticism in 1881, was reintroduced in 1882,
and carried against the Radicals and Socialists in 1883;
it was subsequently extended in 1885 and in 1886. A
bill for insurance against accidents was introduced in
1882 and became law in 1884 (July 6); it, too, was
amended and extended in 1885, 1886, and 1887. The
system was completed by the Old Age Insurance Law
of June 1889.
Concurrently with these measures of vast scope Bis-
marck was engaged in an effort to recast the whole
system of taxation, and to create an imperial revenue
that would provide the funds for 'the socialism of the
State. ' But he met in this sphere with more defeats
than successes.
The Stamp Tax of 1881 imposed a duty on Stock Ex-
change transactions, and the Usury Law of 1880 intro-
duced legal rates of interest. But the proposal to tax all
exemptions from military service was rejected in 1881,
Moltke ostentatiously leaving the Reichstag before the
division. The attempt to establish in 1882 a tobacco
monopoly which was to provide the funds for Old Age
Pensions broke down completely; and though an income
tax was introduced for Prussia, the idea of imposing a
separate Imperial Income Tax was dropped. The sug-
- gested monopoly in brandy was introduced in 1886 and
decisively defeated, and the failure destroyed the idea of
establishing a monopoly in sugar. The principles and
aims of this programme were fully set out in the Royal
Speech of November 17, 1881:--
'We express our conviction that the cure of social ills must be
sought, not exclusively in the repression of Social-Democratic ex-
cesses, but simultaneously in the positive advancement of the wel-
fare of the working classes. . . . The finding of the proper ways
and means is a difficult task, yet it is one of the highest of every
Commonwealth which is based on the ethical foundations of a
Christian national life. '
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BISMARCK
Bismarck's own views can be summarised by a few
quotations from his speeches :--
'In my opinion we are behind all great European States in regard
'to the development of our system of Taxation, especially with re-
spect to its reaction upon our economic conditions, and we have
much ground to recover in this domain' (February 22, 1878).
'In regard to exemption from taxation, I hold in general the
principle that the man who has nothing but his two hands, that is
untrained hands that have learned no industry, should be quite
exempted from both state taxes and imperial contributions, and
that the taxation should begin when a further capital exists'
(February 4, 1881).
'You know that I am an opponent of direct and a friend of in-
direct taxes . . . my ideal is not an Empire which must collect its
matricular contributions at the door of the individual states, but
an Empire which, having in its hands the principal source of good
finance--indirect taxes--would be in a position to pay contributions
to all the individual states' (February 26, 1878).
'I regard it as one of the greatest superiorities of our life in
Germany that a large part of our well-to-do classes live all the year
round in the country, carrying on agriculture themselves . . . if
you succeeded in destroying this race you would see the result in
the palsying of our entire economic and political life' (February 14,
i885)-.
'Give the working man the right to work as long as he is healthy,
assure him care when he is sick, assure him maintenance when he
is old. If you do that and do not fear the sacrifice, or cry out at
State Socialism--if the State will show a little more Christian
solicitude for the working man, then I believe that the gentlemen
of the Social-Democratic programme will sound their bird calls in
vain . . . yes, I acknowledge unconditionally a right to work, and
I will stand up for it as long as I am in this place' (May 9,1884).
'I should like to see the State which for the most part consists of
Christians--although you reject the name Christian State--pene-
trated to some extent by the principles of the religion it professes
. . . I, the Minister of the State, am a Christian, and as such I am
determined to act as I believe I am justified before God' (April 2,
1881 and Januarys 1882).
'It is a tradition for the dynasty which I serve that it takes the
side of the weak in the economic struggle. Frederick the Great
said Je serai le roi its gueux, and in his own way he carried out this
precept with strict justice . . . my present master is animated
by the lofty ambition to secure to the weakest class of our fellow-
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? THE IMPERIAL CHANCELLOR 383
citizens . . . confidence with which they can contemplate the
future of the State to which they belong' (January 9, 1882).
'If you believe that you can frighten any one or call up spectres
with the word " Socialism," you take a standpoint which I abandoned
long ago, and the abandonment of which is absolutely necessary for
our Imperial legislation' (March 1882).
'The popularity of a thing makes me rather suspicious about it
than otherwise, and I am induced to ask myself, if it is also sensible'
(June 12, 1882).
AU these measures were not carried without bitter
controversy, and the most strenuous pressure from the
government. They were attacked from three different
standpoints--individualistic Liberalism which feared the
extension of State functions, and on principle opposed
Protection as an economic system and for its ulterior
political results; the political school that feared, and
rightly, the immense accession of power to the centralised
imperial executive, vested in irresponsible hands, and the
Socialists who called the whole code 'bastard Socialism. '
The latter were savagely attacked because of their oppo-
sition. But their answer was effective. Every effort that
they made was futile to amend the legislation so as to
deprive it of its character of being a material sop to the
industrial working classes, and an instrument for diminish-
ing the political power of labour by making it dependent
on a State over which they could exercise no control.
To Bebel and his party Bismarck's ' socialistic ' policy was
the minimum of blackmail that the ruling classes would
pay in order to strengthen their own political power.
Again and again they pressed (with some help from the
Clerical Centre) for essential and complementary reforms
--the regulation of wages and of the hours and conditions
of labour, the amelioration of the status of the children,
the lads, the girls, and the women in the factories and work-
shops of the New Germany, and for an extension of the
powers of Trades Unions which would enable the worker
to confront capital on equal terms. Without legislative
regulation of these matters the State Socialism of the
Chancellor was, they contended, simply a tax on labour
aggravated by the effect of the Protectionist tariff. But
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? 3<<4
BISMARCK
they pleaded in vain. The principles of the Christian State
which Bismarck set in the forefront of his programme did
not apparently require that women and children should
not be sweated, or that wages should be raised above the
barest minimum of subsistence,1 or that employers and the
State should see that their employees should live under con-
ditions which would ensure decency, health, and morality;
it did not even require that there should be one day of
rest for the workers toiling in the factory. The worker
was assumed to be a Christian and to belong to a Christian
State, but he was not to be assured of the leisure to
worship. The factory was to be his Heaven and his Hell.
The most damning criticism of the blots and defects--
the most effective exposition of the purely political char-
acter--of Bismarck's policy was set out in the resolutions of
the International Labour Conference of 1890, the meeting
of which Bismarck did his best to prevent.
The plain truth is that Bismarck's programme was in-
spired by the same fear and distrust that underlay his theory
of international relations; and much of his legislation was
(apart from its money-producing effectiveness) a reinsurance
scheme against the results of the manhood suffrage which
made the electoral law of the Empire. In 1867, when he
said that democracy would be more monarchical than
middle-class Liberalism, he did not foresee the industrial
revolution. He had in his mind an agricultural Germany,
and above all an agricultural Prussia, where the peasant
had been trained in a position of dependence on the land-
owner, with whose interests as a tiller of the soil his own in
many respects coincided. But he never understood the
industrial proletariat, the numbers of which increased by
leaps and bounds after 1871; he disliked towns and town-
dwellers; to the end he regarded industrialism as a
gigantic excrescence to be exploited and emasculated of
its strength, rather than assimilated, and his economics at
bottom were saturated with the postulates of the eigh-
teenth-century physiocrats j while he forgot that the new
1 <<One of the principal secrets of the expansion of the German export trade
is the prevalence of wages, which, in some branches, are hardly two-thirds or half
the British rates. '--Report already cited, p. 75.
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? THE IMPERIAL CHANCELLOR 385
and toiling Germany had no traditions, and no social mould
ready-made and tempered by generations of development,
into which it would steadily flow and be reshaped. On
the contrary, it had its traditions and outlook on life to
make in all the roar, dust, and fog of a vast economic
revolution. Taking experience and facts alone as his
guide Bismarck probed his way as best he could in the
teeth of opponents who, Kke himself, thought more of ends
than of means. There was no conservative Shaftesbury
to strop a dulled moral conscience; the bureaucracy at
his disposal smothered him with figures and facts compiled
in their offices; he was in the hands of the political
majority on which he relied, which resented the demands
of labour as subversive of their own power, and his own
system cut him off from utilising the help he might have
got from those who really knew. A close study of his
speeches reveals from time to time the note of despair--
the complexity and ramifications of the problem were so
great and so baffling--and his contempt for economic
science led him into avoidable blunders and many political
rebuffs. The repercussion and incidence of taxation, for
example--subjects engaging some of the best economic
minds in Europe--he more than once angrily brushed
aside as the pastime of professors. The realist had
neither time nor patience for such abstractions. If a tax
would bring in money here and now, it had fulfilled its
purpose, and the consequences could be dealt with later.
Volumes--a whole library indeed--have grown up round
the economic problems with which Bismarck wrestled,
and it is not possible to discuss issues which require
a separate monograph for adequate treatment. It must
suffice briefly to observe three or four outstanding features.
In two of his main objects Bismarck unquestionably
succeeded--the provision of money, and the preservation
of his political system. Whether the great expansion of
German industry was largely due to the adoption of Pro-
tection need not be argued here, for it opens issues too
large and controversial to be summarily decided;1 but,
1 See the report, already cited, where much material is statistically examined
and summed up.
B. IB
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? 386
BISMARCK
unquestionably, the remarkable industrial expansion pro-
vided in the Chancellor's political lifetime an expanding
revenue from indirect taxation, which met the exigent
needs of Bismarck's policy. Secondly, the ten years of
social legislation deeply impressed Europe, and in this, as
in other developments of German policy, the great ex-
periment was studied, praised, and copied. Germany
flattered itself that it was the pioneer as well as the model
of constructive statecraft, and Bismarck's legislation pro-
foundly stimulated economic thought and political
practice far outside the limits of the German Empire.
Bismarck,' the social reformer,' acquired a prestige devoid
of the dubious elements that discounted the fame of his
other political achievements. A later generation either
in or outside Germany, more accurately acquainted with
the motives, aims, and effects of the 'new era,' has not
been able to accept without serious qualifications the
eulogies so noticeable in the early nineties.
But in two notable respects the failure even in Bismarck's
lifetime was as conspicuous as the success. The spectre of
Social Democracy was not laid. Bebel, who had a good
right to know, told the Reichstag and the Chancellor that
the effort to put Social Democracy into a siding would
fail, and that the social legislation would be one of the
main causes of the failure. 'The bird call' became more,
not less, potent in its appeal just because the Christian
State did so little, when it could do so much; and
he warned the Chancellor that if you could not kill the
Socialist party by the law of 1878 you would not kill it
by compelling the artisan, with some help from the
State, to insure against accidents, sickness, and old age.
A compulsory and dilatory distribution of doles could
not extirpate a movement which had its roots deep in a
determination to secure political and social ends--political
and social power--through the economic status of the
worker: and the more the State compelled the workers
to organise, the more certainly they would use the organi-
sation for their own purposes. Bismarck recognised the
failure. But, unlike the Kulturkampf, he could not break
off the action when victory was no longer within his grasp.
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? THE IMPERIAL CHANCELLOR 387
He had committed the Empire to a course from which it
was impossible to recede.
Nor did his fiscal experiments succeed in solving the
problem of imperial finance. Within ten years of 1890
the problem of the matricular contributions and the de-
ficits in the Imperial Budget threatened to be no less
serious than in 1878-9. Bismarck could fairly say that
had the Empire become the monopolist that he desired
it to be in tobacco, brandy, sugar, and other articles of
general consumption; had it nationalised all the railways
and absorbed all the profits, even the great increase in
imperial expenditure might have been met. But he never
explained how in that case the Federated States were to
balance their several budgets, or how a large increase in
direct taxation, which he regarded as politically inexpedient
and economically indefensible, was to be avoided. Arma-
ments and State Socialism were the main causes of the
steady increase in expenditure. Bismarck's system placed
armaments outside the arena of discussion. The policy
and principles were imposed on the nation--whose duty
it then was obediently to pay the bill--and if the nation
resisted, a general election with the main issue of 'The
Empire and Army in danger and War in sight' invariably
proved decisive.
These ten years from 1879 to 1889 made a decade of
embittered home politics. The reactionary character of
the Chancellor's system was revealed in many ways.
Bismarck seriously suggested, for example, that biennial
budgets and biennial meetings of the . Reichstag would be
a desirable reform; the prosecutions for Bismarck Be-
leidigung steadily increased, and when men like Bunsen and
Mommsen were prosecuted (and happily acquitted) for
indicting the government measures as 'immoral,' every
one who cared for freedom of opinion and freedom of
criticism had just cause for deep misgiving. Bismarck
increasingly regarded opposition as a personal affair; to
complaints of bribery and intimidation by officials at
elections he invariably retorted by emphasising the char-
acter of the Prussian monarchy and the disloyalty of the
Progressives to the Throne. 'I do not believe,' he said,
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? 388
BISMARCK
'in electro-plated royalism. ' In 1886 he concluded one
of his speeches with unmistakable threats: 'We must aim
at becoming stronger; we must show that we stand not
on feet of clay, but of iron. We must find a means of
becoming independent of the obstruction of the majority
of the Reichstag. I do not advocate such a step, but if
the Fatherland should be endangered I should not hesitate
to propose to the Emperor the necessary measures. The
Minister who will not risk his head to save the Fatherland,
even against the will of the majority, is a coward. I will
not allow the achievements of our army to perish by
internal discord, which I will find the means of counter-
acting. ' (January 28, 1886, in the Prussian Landtag. )
Prussian Poland and Alsace-Lorraine were essentially
problems of home policy which illustrate the close con-
nection between the internal system and the principles of
Bismarck's foreign policy. The failure of Prussia to
Germanise her Polish provinces inspired the Prussian
government to drastic action. Puttkamer, the Minister
of the Interior, in 1885 pointed out that, whereas the
German element had increased from one to five per cent.
