The Unfinished Revolution of 1871

When Wilhelm I was proclaimed German Emperor in the Hall of Mirrors at Versailles on January 18, 1871, the ceremony marked the culmination of Otto von Bismarck’s realpolitik. The new Reich fulfilled one of the twin demands from the revolutionary year of 1848 – national unity – through the “small German solution” excluding Austria. Yet the other 1848 demand – political freedom – remained conspicuously unfulfilled. Bismarck’s constitutional framework carefully balanced Prussian dominance (through the Bundesrat) with limited parliamentary powers (through the Reichstag). This tension between authoritarian rule and liberal aspirations would define the empire’s first decade.

The military budget became an immediate battleground, consuming four-fifths of imperial expenditures. Bismarck’s 1874 push for a permanent military establishment of 401,000 troops (the “eternal budget”) clashed with liberal demands for parliamentary budget control. The resulting compromise – seven-year military budgets – became known as the “Septennat,” a temporary solution that would persist for decades. This fiscal arrangement symbolized Bismarck’s governing style: conceding just enough to maintain liberal support while preserving executive dominance.

The National Liberals: Architects and Prisoners of Unity

Emerging from the 1871 elections as the largest party with 23.3% of seats, the National Liberals under Rudolf von Bennigsen became Bismarck’s indispensable allies. Their legislative achievements between 1871-1875 transformed Germany’s infrastructure: a unified imperial currency, standardized coinage, and Prussian administrative reforms that created modern district governance. These “nation-building” measures reflected the National Liberal vision – a centralized, Protestant-dominated state with uniform legal and economic systems.

Yet the party’s identity crisis became apparent in its relationship with power. As historian Heinrich August Winkler observed, “The National Liberals wanted to use unity to achieve freedom, but found themselves used by Bismarck to limit freedom.” Their compromise on military budgets and later anti-socialist legislation revealed the paradox of liberal participation in an illiberal system. The more they achieved national goals, the more they became dependent on Bismarck’s patronage.

Kulturkampf: The War for Germany’s Soul

The cultural struggle against Catholicism (1871-1878) exposed deeper fractures in the new nation. Bismarck’s motives blended Prussian state interests with Protestant cultural imperialism. The May Laws (1873) required clergy to pass state examinations in German culture, while the Pulpit Law (1871) criminalized political sermons. Subsequent measures dissolved Jesuit orders (1872), mandated civil marriage (1875), and seized church properties through the “Breadbasket Law.”

This legislative assault backfired spectacularly. Rather than breaking Catholic resistance, it fueled the Center Party’s growth from 58 to 91 Reichstag seats by 1874. The Kulturkampf’s lasting damage was psychological – it institutionalized Catholic alienation while hardening Protestant prejudices. As Bishop Wilhelm von Ketteler famously declared, the conflict revealed a “Masonic-Jewish-Liberal conspiracy” against traditional values, a formulation that would haunt German politics.

The 1873 Crash and the Rise of Modern Antisemitism

The Vienna stock market crash of May 1873 triggered an economic crisis that reshaped German politics. As railroad speculator Bethel Henry Strousberg’s empire collapsed, antisemitic rhetoric surged. Newspapers like the Kreuzzeitung blamed “Jewish capital” for the crisis, while economist Otto Glagau’s popular writings contrasted “productive” Christian capital with “parasitic” Jewish finance.

This new antisemitism differed fundamentally from religious anti-Judaism. Figures like Wilhelm Marr (who coined the term “antisemitism” in 1879) framed Jews as a racial threat to German identity. Historian Heinrich von Treitschke’s declaration “The Jews are our misfortune” gained traction among educated elites, despite protests from colleagues like Theodor Mommsen. The 1870s thus witnessed antisemitism’s transformation from fringe bigotry to respectable prejudice.

The Protectionist Turn and Liberal Schism

Bismarck’s 1878-79 shift from free trade to protectionism marked a watershed. Facing budget deficits and agricultural crises, he forged an “iron and rye” alliance between heavy industry (represented by the Central Association of German Industrialists) and East Elbian Junkers. The 1879 tariff bill passed with conservative and Center Party support, splitting the National Liberals. Sixteen pro-tariff liberals defected, while left-liberals like Eduard Lasker formed the “Secession” movement.

This economic realignment had profound consequences. As economic historian Alexander Gerschenkron noted, protectionism allowed traditional elites to maintain political influence despite industrialization. The “marriage of iron and rye” created Germany’s conservative axis for decades to come.

The Anti-Socialist Law and the Erosion of Liberalism

The 1878 assassination attempts on Wilhelm I provided Bismarck pretext to crack down on socialism. Despite initial National Liberal opposition, the party ultimately supported the Anti-Socialist Law (October 1878) banning socialist organizations and publications. This marked liberalism’s moral capitulation – accepting illiberal measures to preserve political relevance.

The law’s twelve-year enforcement (1878-1890) had unintended consequences. Rather than destroying socialism, it fostered a persecuted subculture that strengthened working-class solidarity. Social Democrats adapted through legal loopholes, laying foundations for their later electoral success.

The Legacy of the Founding Decade

The 1870s established patterns that would define Imperial Germany: the tension between authoritarianism and participation; the mobilization of cultural and racial anxieties for political ends; the uneasy coexistence of rapid industrialization and traditional power structures. Bismarck’s system proved brilliant at maintaining stability but disastrous at fostering genuine national unity.

Most consequentially, the decade witnessed liberalism’s fragmentation and decline. As historian Gordon Craig observed, “The National Liberals’ tragedy was that their success in helping create the Reich made them superfluous.” Their compromises on militarism, authoritarianism, and antisemitism established precedents that would haunt Germany long after Bismarck’s dismissal in 1890. The “inner founding” of the Reich remained incomplete, leaving contradictions that would ultimately prove fatal to both the imperial system and German democracy.