Читать книгу From Empire to Europe: The Decline and Revival of British Industry Since the Second World War - Geoffrey Owen - Страница 10

At the start of the nineteenth century the German states lagged behind France and Britain in economic development, but the pace quickened in the 1840s. A powerful boost came from railway construction, and heavy industry played a more central role in German industrialisation than it did in Britain. One of Europe’s largest concentrations of coking coal was in the Ruhr valley in Westphalia, and within the space of thirty years this previously agricultural region was transformed into the powerhouse of German industry. Alfred Krupp built his first iron-works in Essen in 1836; by 1873 this firm’s labour force had increased to 16,000.¹⁹ The engineering industry also benefited from the railway boom. In the 1840s most of Germany’s locomotives were imported from Britain, but Borsig in Berlin and other German manufacturers gradually reduced their dependence on British technology and developed their own designs. By the 1860s import substitution was complete and Borsig was competing with British manufacturers in export markets.

The rapid growth of the iron and steel industry paralleled what had happened in the US, but in other respects Germany followed a different path. The division of the country into separate states meant that a unified market was slow to emerge. Even after the formation of the customs union in 1834 and the unification of the country under Prussian leadership in 1871, the domestic market was more fragmented than that of the US, and there was little scope for mass production. Since Germany was also poor in natural resources, apart from coal, entrepreneurs had to find other ways of catching up. They did so through skill rather than scale. Instead of tackling their British and American competitors head-on, they looked for market niches and sought to tailor their products to the needs of specific customers. In cotton textiles, for example, while the British were supplying large quantities of yarn and cloth to India and other distant countries, German mills concentrated on higher-income European customers who were willing to pay a premium for quality and variety.²⁰ In engineering the focus was on custom-designed machinery produced in small batches.²¹

This strategy was crucially dependent on the skills of the workforce. Like Britain, Germany relied on apprenticeship as the principal means of skill formation, but, in contrast to Britain, it was supplemented by government-financed vocational schools at which apprentices received part of their training. In addition, most states established technical high schools, later upgraded to universities, for the training of engineers. The classical universities were reformed, and, although their mission was strictly non-vocational, the systematic pursuit of knowledge for its own sake contributed to the scientific advances – notably in chemistry – which underpinned the success of German entrepreneurs in the second industrial revolution.

Scientific and technical education was one of the means by which German industry made up for its late start. Another was a financial innovation, the universal bank, which had no counterpart in Britain or the US. Local financial networks were less highly developed than in Britain, and heavy industry needed large amounts of initial capital.²² From the middle of the nineteenth century, and more extensively after 1870, the gap was filled by the universal banks, which combined commercial and investment banking under the same roof. The three leading Grossbanken – Deutsche Bank, Dresdner Bank and Commerzbank – formed a continuing relationship with their industrial clients, often becoming shareholders and taking seats on their boards of directors.

The influence of the Grossbanken was largely confined to heavy industry. In states such as Baden and Württemberg, which had a long pre-industrial tradition of skilled craftsmanship, the typical manufacturing enterprise was the family-owned firm, specialising in a narrow range of products.²³ Operating in such industries as textiles and mechanical engineering, they formed networks in which firms sub-contracted to each other the responsibility for particular components or manufacturing processes. The cutlery industry in Solingen, in the lower Rhineland, was a well-known example. These firms did not need large amounts of capital, and their financial requirements were met by local savings and cooperative banks.²⁴ Despite the rise of a few large companies, such as Krupp and Siemens, industry in Germany was much less concentrated than in the US at the time of the First World War.

Another difference from the US was that German manufacturers depended to a greater extent on exports. Trade policy was a contentious issue in German politics, as it was in Britain. But whereas British manufacturers favoured free trade and the landowners protection, in Germany the opposite was the case. Manufacturers wanted to keep imports out so that they could build up their industries. The landowners were large exporters of grain and feared that the imposition of a tariff would provoke retaliation, putting their overseas business at risk. The fall in grain prices in the 1870s, together with growing competition from American grain exporters, brought a change of heart, and tariffs were introduced in 1879. This represented a shift away from British-style liberalism towards the more nationalistic economic policy advocated by such thinkers as Friedrich List. List’s National System of Political Economy, published in the 1840s, was intended as a riposte to Adam Smith, and called for a national effort to resist Britain’s industrial expansion.²⁵

The lack of enthusiasm for free markets was also reflected in a tolerant attitude on the part of the German authorities towards cartels. Price-fixing and market-sharing agreements spread widely in German industry in the closing decades of the nineteenth century. In 1897, seven years after the Sherman Act was passed in the US, the German supreme court confirmed the legality of cartels.²⁶

The abandonment of free trade was the product of a pragmatic alliance between two previously hostile interest groups, the landowners and the industrialists. Their common enemy was an increasingly assertive working class. Trade unions began to organise themselves in the 1870s and the political arm of the labour movement, the Social Democratic Party, won nearly 500,000 votes in the Reichstag elections of 1877. The reaction of the ruling oligarchy was repression, balanced by attempts to de-politicise the working class through social insurance and other welfare measures. In contrast to Britain, no ‘viable class society’ emerged in Germany before the First World War, and there was no scope for the compromise between unions and employers which took place in Britain between 1850 and 1870. This had important consequences for the character of the German trade union movement. Although union membership was at first largely confined to skilled workers, the driving force was not, as in Britain, the desire to protect craft jobs against incursions from semi-skilled and unskilled workers, but the need for a common front against employers and the state. The German trade union movement was more class-based than craft-based.

The constitution of the German Reich, as devised by Bismarck at the time of unification, has been described as ‘an autocratic monarchy with a few parliamentary trimmings’.²⁷ This archaic political system perpetuated social strains which were to have catastrophic consequences in the inter-war years, but it did not prevent the rapid build-up of manufacturing industry. The distinctive features of German industrialisation were the commitment to technical education and workforce skills, the close links between heavy industry and the big banks, the special importance of small, craft-based firms, and the reliance on cartels and protection.