The Online Library of Liberty

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• The Liberty Fund Library of the Works of Ludwig Von Mises
• Foreword to the Liberty Fund Edition
• Preface
• Omnipotent Government
• Introduction
• Part I: The Collapse of German Liberalism
• I: German Liberalism
• 1.: The Ancien Régime and Liberalism
• 2.: The Weakness of German Liberalism
• 3.: The Prussian Army
• 4.: The Constitutional Conflict In Prussia
• 5.: The “little German” Program
• 6.: The Lassalle Episode
• II: The Triumph of Militarism
• 1.: The Prussian Army In the New German Empire
• 2.: German Militarism
• 3.: The Liberals and Militarism
• 4.: The Current Explanation of the Success of Militarism
• Part II: Nationalism
• III: Etatism
• 1.: The New Mentality
• 2.: The State
• 3.: The Political and Social Doctrines of Liberalism
• 4.: Socialism
• 5.: Socialism In Russia and In Germany
• 6.: Interventionism
• 7.: Etatism and Protectionism
• 8.: Economic Nationalism and Domestic Monopoly Prices
• 9.: Autarky
• 10.: German Protectionism
• IV: Etatism and Nationalism
• 1.: The Principle of Nationality
• 2.: The Linguistic Group
• 3.: Liberalism and the Principle of Nationality
• 4.: Aggressive Nationalism
• 5.: Colonial Imperialism
• 6.: Foreign Investment and Foreign Loans
• 7.: Total War
• 8.: Socialism and War
• V: Refutation of Some Fallacious Explanations
• 1.: The Shortcomings of Current Explanations
• 2.: The Alleged Irrationality of Nationalism
• 3.: The Aristocratic Doctrine
• 4.: Misapprehended Darwinism
• 5.: The Role of Chauvinism
• 6.: The Role of Myths
• Part III: German Nazism
• VI: The Peculiar Characteristics of German Nationalism
• 1.: The Awakening
• 2.: The Ascendancy of Pan-germanism
• 3.: German Nationalism Within an Etatist World
• 4.: A Critique of German Nationalism
• 5.: Nazism and German Philosophy
• 6.: Polylogism
• 7.: Pan-germanism and Nazism
• VII: The Social Democrats In Imperial Germany
• 1.: The Legend
• 2.: Marxism and the Labor Movement
• 3.: The German Workers and the German State
• 4.: The Social Democrats Within the German Caste System
• 5.: The Social Democrats and War
• VIII: Anti-semitism and Racism
• 1.: The Role of Racism
• 2.: The Struggle Against the Jewish Mind
• 3.: Interventionism and Legal Discrimination Against Jews
• 4.: The “stab In the Back”
• 5.: Anti-semitism As a Factor In International Politics
• IX: The Weimar Republic and Its Collapse
• 1.: The Weimar Constitution
• 2.: The Abortive Socialization
• 3.: The Armed Parties
• 4.: The Treaty of Versailles
• 5.: The Economic Depression
• 6.: Nazism and German Labor
• 7.: The Foreign Critics of Nazism
• X: Nazism As a World Problem
• 1.: The Scope and Limitations of History
• 2.: The Fallacy of the Concept of “national Character”
• 3.: Germany’s Rubicon
• 4.: The Alternative
• Part IV: The Future of Western Civilization
• XI: The Delusions of World Planning
• 1.: The Term “planning”
• 2.: The Dictatorship Complex
• 3.: A World Government
• 4.: Planned Production
• 5.: Foreign Trade Agreements
• 6.: Monet Ary Planning
• 7.: Planning International Capital Transactions
• XII: Peace Schemes
• 1.: Armament Control
• 2.: A Critique of Some Other Schemes Proposed
• 3.: The Union of the Western Democracies
• 4.: Peace In Eastern Europe
• 5.: The Problems of Asia
• 6.: The Role of the League of Nations
• Conclusion

2.

The Ascendancy of Pan-Germanism

Pan-Germanism was an achievement of intellectuals and writers. The professors of history, law, economics, political science, geography, and philosophy were its most uncompromising advocates. They converted the students of the universities to their ideas. Very soon the graduates made more converts. As teachers in the field of higher education (in the famous German Gymnasium and educational institutions of the same rank), as lawyers, judges, civil servants, and diplomats they had ample opportunity to serve their cause.

All other strata of the population resisted the new ideas for some time. They did not want more wars and conquests; they wanted to live in peace. They were, as the nationalists scornfully observed, selfish people, not eager to die but to enjoy life.

The popular theory that the Junkers and officers, big business and finance, and the middle classes were the initiators of German nationalism is contrary to fact. All these groups were at first strongly opposed to the aspirations of Pan-Germanism. But their resistance was vain because it lacked an ideological backing. There were no longer any liberal authors in Germany. Thus the nationalist writers and professors easily conquered. Very soon the youth came back from the universities and lower schools convinced Pan-Germans. By the end of the century Germany was almost unanimous in its approval of Pan-Germanism.

Businessmen and bankers were for many years the sturdiest opponents of Pan-Germanism. They were more familiar with foreign conditions than were the nationalists. They knew that France and Great Britain were not decadent, and that it would be very difficult to conquer the world. They did not want to imperil their foreign trade and investments through wars. They did not believe that armored cruisers could accomplish the tasks of commercial travelers and bring them higher profits. They were afraid of the budgetary consequences of greater armaments. They wanted increased sales, not booty. But it was easy for the nationalists to silence these plutocratic opponents. All important offices soon came into the hands of men whom university training had imbued with nationalist ideas. In the etatist state entrepreneurs are at the mercy of officialdom. Officials enjoy discretion to decide questions on which the existence of every firm depends. They are practically free to ruin any entrepreneur they want to. They had the power not only to silence these objectors but even to force them to contribute to the party funds of nationalism. In the trade associations of businessmen the syndics (executives) were supreme. Former pupils of the Pan-German university teachers, they tried to outdo each other in nationalist radicalism. Thus they sought to please the government officials and further their own careers through successful intercession on behalf of the interests of their members.

German nationalism was not, as the Marxians insist, the “ideological superstructure of the selfish class interests of the armaments industry.” In the 1870’s Germany possessed—apart from the Krupp plant—only comparatively small and not very profitable armament works. There is not the slightest evidence for the assumption that they subsidized the contemporary nationalist free-lance writers. They had nothing whatever to do with the much more effective propaganda of the university teachers. The large capital invested in munitions works since the ’eighties has been rather a consequence than the cause of German armaments.* Of course every businessman is in favor of tendencies that may result in an increase in his sales. “Soap capital” desires more cleanliness, “building capital” a greater demand for homes, “publishing capital” more and better education, and “armaments capital” bigger armaments. The short-run interests of every branch of business encourage such attitudes. In the long run, however, increased demand results in an inflow of more capital into the booming branch, and the competition of the new enterprises cuts down the profits.

The dedication of a greater part of Germany’s national income to military expenditure correspondingly reduced that part of the national income that could be spent by individual consumers for their own consumption. In proportion as armaments increased the sales of munition plants, they reduced the sales of all other industries. The more subtle Marxians do not maintain that the nationalist authors have been bribed by munitions capital but that they have “unconsciously” supported its interests. But this implies that they have to the same extent “unconsciously” hurt the interests of the greater part of the German entrepreneurs and capitalists. What made the “world soul,” which directs the working of philosophers and writers against their will, and forces them to adjust their ideas to the lines prescribed by inevitable trends of evolution, so partial as to favor some branches of business at the expense of other, more numerous branches?

It is true that since the beginning of the twentieth century almost all German capitalists and entrepreneurs have been nationalists. But so were, even to a greater degree, all other strata, groups, and classes of Germany. This was the result of nationalist education. This was an achievement of authors like Lagarde, Peters, Langbehn, Treitschke, Schmoller, Houston Stewart Chamberlain, and Naumann.

It is not true that the Berlin court, the Junkers, and the aristocratic officers sympathized from the beginning with the Pan-German ideas. The Hohenzollerns and their retainers had sought Prussian hegemony in Germany and an increase in German prestige in Europe. They had attained these goals and were satisfied. They did not want more. They were anxious to preserve the German caste system, with the privileges of the dynasties and of the aristocracy; this was more important for them than the struggle for world domination. They were not enthusiastic about the construction of a strong navy or about colonial expansion. Bismarck yielded unwillingly to colonial plans.

But courts and noblemen were unable to offer successful resistance to a popular movement supported by intellectuals. They had long since lost all influence on public opinion. They derived an advantage from the defeat of liberalism, the deadly foe of their own privileges. But they themselves had contributed nothing to the ascendancy of the new etatist ideas; they simply profited by the change of mentality. They regarded the nationalist ideas as somewhat dangerous. Pan-Germanism was full of praise for old Prussia and its institutions, for the conservative party in its capacity as adversary of liberalism, for the army and the navy, for the commissioned officers and for the nobility. But the Junkers disliked one point in the nationalist mentality which seemed to them democratic and revolutionary. They considered the nationalist commoners’ interference with foreign policy and military problems a piece of impudence. In their eyes these two fields were the exclusive domain of the sovereign. While the support which the nationalists granted to the government’s domestic policies pleased them, they regarded as a kind of rebellion the fact that the Pan-Germans had views of their own about “higher politics.” The court and the nobles seemed to doubt the right of the people even to applaud their achievements in these fields.

But all such qualms were limited to the older generations, to the men who had reached maturity before the foundation of the new Empire. William II and all his contemporaries were already nationalists. The rising generation could not protect itself from the power of the new ideas. The schools taught them nationalism. They entered the stage of politics as nationalists. True, when in public office, they were obliged to maintain a diplomatic reserve. Thus it happened time and again that the government publicly rebuked the Pan-Germans and sharply rejected suggestions with which it secretly sympathized. But as officialdom and Pan-Germans were in perfect agreement about ultimate aims, such incidents were of little importance.

The third group which opposed radical nationalism was Catholicism. But Catholicism’s political organization, the Center party, was neither prepared nor mentally fitted to combat a great intellectual evolution. Its method consisted simply in yielding to every popular trend and trying to use it for its own purposes, the preservation and improvement of the Church’s position. The Center’s only principle was Catholicism. For the rest it had neither principles nor convictions, it was purely opportunist. It did everything from which success in the next election campaign could be expected. It coöperated, according to changing conditions, at one time with the Protestant conservatives, at another with the nationalists, at another with the Social Democrats. It worked with the Social Democrats in 1918 to overthrow the old system and later in the Weimar Republic. But in 1933 the Center was ready to share power in the Third Reich with the Nazis. The Nazis frustrated these designs. The Center was not only disappointed but indignant when its offer was refused.

The Center party had organized a powerful system of Christian labor unions which formed one of its most valuable auxiliaries and was eager to call itself a working man’s party. As such it considered it its duty to further Germany’s export trade. The economic ideas generally accepted by German public opinion maintained that the best means of increasing exports was a great navy and an energetic foreign policy. Since the German pseudo-economists viewed every import as a disadvantage and every export as an advantage, they could not imagine how foreigners could be induced to buy more German products by other means than by “an impressive display of German naval power.” As most of the professors taught that whoever opposes increased armaments furthers unemployment and a lowering of the standard of living, the Center in its capacity as a labor party could not vigorously resist the nationalist extremists. Besides, there were other considerations. The territories marked first for annexation in Pan-Germanism’s program for conquest were inhabited mainly by Catholics. Their incorporation was bound to strengthen the Reich’s Catholic forces. Could the Center regard such plans as unsound?

Only liberalism would have had the power to antagonize Pan-Germanism. But there were no more liberals left in Germany.

[* ]Of the five iron armored battleships which the Germans had in the Franco-German war of 1870, three were built in England and two in France. It was only later that Germany developed a domestic industry of naval armaments.