Industrial Growth
From the perspective of the troubled 1930s, the late nineteenth century seemed an almost idyllic period remembered nostalgically as the "Belle Époque" of happy stability. Yet it was also the breeding ground of twentieth century conflict and doubt. So let's take a look at this Belle Époque: What are some of its characteristics? One of the most important—and one that I have been constantly alluding to throughout the last several chapters—is that of industrial growth. Indeed, industrial growth during this period became so marked that it is common to refer to a "second" industrial revolution. It is characterized by rapid economic growth, by accelerated industrial change—notably in steel, in the chemical industry, and in the applications of electricity—by an emphasis on large-scale production, by the spread of industrialization in central and eastern Europe, and by ever-expanding markets at home and abroad. Prosperity spread to all classes, and for the first time in history, economic growth was expected to continue year after year.
As mentioned before, the expansion of the German economy following unification was the most spectacular. Coal mining, iron and steel production and the chemical industry made rapid progress. German steel production, the major index of industrial power, for example, surpassed that of Britain in 1893 and had almost doubled the British effort by the outbreak of the First World War. This emergence of an industrial Germany was the major fact of European economic and political life at the turn of the century.
Everything seemed to foster the new nation's industrialization. Already rich in natural resources, Germany acquired more raw materials as well as factories with the annexation of Alsace-Lorraine. Its system of railroads provided excellent communications; its educational system produced ample numbers of well-educated people—ready and able to take command as administrators, engineers, businessmen—filling the increasing positions that the commercial sector now required. The government, which had played an active role in every facet of industrialization, continued to cooperate with business interests. Military needs stimulated basic industry, and a growing population provided an eager domestic market.
German factories were newer than those of Britain or France, and were therefore able to employ the latest and most efficient equipment, obtaining the necessary capital through a modern banking structure. By 1900 those plants were far bigger than anyone else's, and firms engaged in the various stages of production often combined in huge cartels dominating an entire field of enterprise as Germany became preeminent in new fields such as chemicals and electricity. German salesmen appeared in the farthest reaches of the world, with catalogues printed in native languages and weights and measures in the local standards. Products sold were suited to local conditions, and credit was often offered as an incentive to buy German.
Needless to say, the rest of Europe—and the British in particular—did not particularly warm to such commercial and industrial aggressiveness. The older industrial economies of Britain, Belgium and France continued to grow, but more slowly. French iron production, for example, more than doubled in the first 25 years of the Third Republic, and new processes made French ore output second only to that of the United States.