Fifty years separated the Polish January uprising and the Austro Hungarian Compromise from the First World War. These were the decades of the apogee of Europe and the great powers’ hegemony. The Franco-Prussian war of 1870 was the last major nineteenth-century struggle fought on the continent. A shaky balance prevailed thereafter, as the center of conflicts shifted overseas. Within Europe the Balkans became, after the Congress of Berlin of 1878, the object of intense rivalry between Russia and Austro-Hungary. The European cabinets viewed this rivalry with anxiety mixed with a condescending attitude toward national aspiration in the Balkans. The world belonged to the great powers which saw themselves and were seen by others as the carriers of material and cultural progress, indeed of variously defined civilizing missions.
The Industrial Revolution was in full swing. Economic processes going back to the sixteenth century, and characterized by the production of a surplus for the expanding market (hence the search for more sources of raw materials and bigger markets) were reaching their peak. Division of labor was becoming more complex; there was a rise of a novel kind of social consciousness. Economy and society were transformed through the application of technology, combined with developments that required a broad mobilization of all resources and energies. A new type of industrial society arose that lived on perpetual growth and on expected and continuous improvement. In view of the depth of transformation and the rapidity of change, the term “revolution” still seems appropriate, all the arguments against its use notwithstanding.
The Industrial Revolution went through several phases. In the last decades of the century it extended to most of Europe, engendered new industries (electrical, chemical) and produced a new type of financial capitalism, big business organization, and imperialist expansion. The high points were followed by cyclical depressions. Throughout the nineteenth century Europe retained much of its monarchic-aristocratic and agrarian character, but the new bourgeois civilization was in the ascendancy. It stood for modernization and progress
Although it offered no panacea to the social ills and national aspirations of the oppressed. The contrast between the rich and the poor, between the city and the countryside, remained acute and perhaps even increased.
Modern civilization exacted a heavy price in the form of city slums, child labor, and the tyranny of the factory bell. The masses, becoming more conscious and organized, were demanding economic, social, political, and national rights. The middle class appeared as the main enemy. The radicals viewed liberalism as a screen for the interests of the bourgeoisie and accused the middle class of having betrayed the cause of the people. The conservatives regarded the liberals as guilty of having engendered political and social revolt and thus undermined the traditional system.
The liberal tenet of the natural harmony of interests was successfully challenged by concepts of class or race struggle. Social Darwinism spoke of the survival of the fittest and provided justification for integral nationalism, which found the hatred of other people more attractive than the love of one’s own. Racism extolled the Aryan or Nordic myth and transformed Judeophobia into modern anti-Semitism. The Jew, whether in the writings of Charles Maurras in France, the pronouncements of Karl Lueger in Vienna, or the Russian Black Hundred, epitomized all evil.
While European society was under attack from radicals and socialists, the anarchists rejected the very notion of the state. Though electoral franchise was being enlarged, and in several cases was transformed into universal male suffrage, Russia needed a revolution in 1905 to install a semi-parliamentary regime. In the sphere of culture the fm de siecle produced various trends, including nihilism. Modernism sounded a call to struggle against the philistine outlook and the bourgeois system of values. The perennial truth that European civilization had two faces, one characterized by stability and prosperity, the other by malaise and rebellion, was brought out more forcibly.
Before turning to the challenge of the Industrial Revolution to East Central Europe one needs to look at the classic case study: England. In the late eighteenth century, European economy was based predominantly on agriculture, and drastic changes in that domain were needed for basic developments in industry to occur. England was the first country to go through the agricultural revolution during that century, that was characterized by the application of new techniques, changes in the utilization of the soil, and extensive and intensive farming and breeding. Production for the market increased greatly while the number of people working on the land diminished. The accumulation of capital and the existence of an available pool of labor were the prerequisites for the development of industries, whose production was revolutionized by the application of machinery. The advent of steam power heralded a new era. Cottage industries and manufactories made way for mechanized factories. Industrial towns grew; a new type of bourgeoisie developed, as did an industrial working class. Railroads created new mobility; novel types of credit arose; trade showed a phenomenal growth, increasing nine times between 1820 and 1880 and fifty times if we take the whole period from 1750 to 1913.
In the English pattern there were three phases: in the first, textiles showed a high output while heavy industries developed more slowly; during the second the latter rose rapidly; in the third a certain equilibrium between the two was reached. The brief period during which investments rose from 5 to 10 percent, and technological advances spread rapidly is usually referred to as the “take-off.” In England it occurred between the 1780s and 1802; in France and Belgium between 1830 and 1860; in Germany between 1850 and 1873. Unlike in England, the Industrial Revolution and the agricultural one occurred almost simultaneously on the continent, and were accompanied by changes in credit and transportation. The delay of continental West European developments was in part due to political reasons (the Napoleonic wars) and in part resulted from structural weaknesses in agriculture or artisan production, which adversely affected the mobility of labor and free enterprise.
The response of East Central Europe (except Bohemia which conformed more to the central and West European pattern) to the challenge of the Industrial Revolution was colored by the distinctive features of its economy. Agriculture was more primitive and the gap between farming on the big estates and peasant husbandry bigger. Bohemia alone developed a strong internal agricultural market. Although individual Polish or Hungarian estates achieved a high degree of modernization they could not diffuse it more widely. The pattern of textiles leading the way in technological progress to be followed by heavy industry was either reversed in this area, or the two processes occurred simultaneously. The role of textiles as a catalyst was to a large extent played instead by food-related industries.
An unevenness of modernization was also fairly typical for East Central European developments. Modern equipment imported from abroad coexisted with obsolete tools and implements, sometimes in the same branch of the economy. Differences between sectors were also great. Finally, the cheap and abundant pool of workers did not encourage enterprises to install labor-saving devices.
According to the classic formula of A. Gerschenkron the spontaneous process of domestic accumulation of capital in England contrasted with the need for deliberate bank financing in western and central Europe, and with state intervention in Hungary or Russia without which an industrial take-off would not have been possible. The Hungarian economic historians J. Berend and G. Ranki drew a more nuanced picture. They recalled that state intervention, although indirect and occurring earlier, was also necessary to prepare the ground in England and France. Further east, state intervention was more direct, came later, and assumed a greater dimension. Railroads on the continent, for instance, began as state enterprises, then were taken over by private capital, to end in most cases by being nationalized. Hence, it
Is not the peculiar and specific role of the state, but the import of capital, promoted and motivated by state activity which may be regarded as the feature distinguishing Eastern Europe from the rest of the Continent in the modern transformation of the economy.43
Foreign capital was important indeed. Usually it was exploitative in weaker economies while fulfilling useful functions in more developed structures. It is worthwhile to remember that during the century virtually every country attracted capital together with advanced technology and know-how from a more developed neighbor. Toward the end of this period Britain shifted most of its investments overseas, while West European countries invested more heavily in the eastern parts. In some cases foreign capital contributed to a significant acceleration of the production processes. Among states on the “periphery,” Spain is often given as an example.
Did the Industrial Revolution significantly deepen the difference between the most advanced zone (the core) and the east-central and eastern spheres? The individual regions undoubtedly differed with regard to their level of economic productivity and labor organization, social mobility and class structure, as well as the type of public authority. In all these respects the gap between the West and such countries as Hungary, and the Austrian and Russian parts of partitioned Poland, grew, all their progress notwithstanding. Prussian Poland and Moravia stood closer to the Western model. According to Marxist and New Left historians the reason that the economically weaker countries had to become relatively poorer and the stronger had to grow richer lay in the exploitative nature of trade between the two groups. The former, obliged to export foodstuffs and raw materials in exchange for finished products were perpetuating a onesided development. Trade served as means of exploitation of the poorer by the richer.
Another explanation of the growing discrepancy dwells on political, particularly military factors, namely a competition which placed a disproportionately heavy burden on weaker economies. Another argument advanced, for instance by Andrew Janos, is couched in socio-economic terms. The growing backwardness of the “periphery” is explained by the impact of innovations and expectations on its economy. In order to satisfy the demands of the upper classes capital resources are siphoned away from investments and go into elite consumption, unrealistic economic strategies, and are dissipated through corruption. Hence, Janos concludes, patterns of consumption prove “incongruous with existing modes of production.”
There is little doubt that while the European west and center responded fairly quickly to the English challenge, Polish and Hungarian economies reacted at first more sluggishly. It is also true that the west European demand for more food and raw materials exerted a pull that stimulated exports of these articles with the resulting one-sidedness mentioned above. Yet to speak of a “colonial” relationship or to draw close analogies to the Third World of today is an oversimplification. The “colonial” relationship implies that the demand by the “core” prompts investments in the export sectors needed by the “core,” investments stemming largely from imported capital. The rest of the economy has no chance of real development. But in the case of at least some countries of the European “periphery” investments did stimulate processes that led to structural changes and allowed the country to become part of the “core.” Thus Sweden in the late nineteenth and early twentieth centuries saw its export of wood, followed by that of iron, transform the economy to the extent that it ceased to be a “peripheral” country. In East Central Europe the transition from food to food-processed articles indicated possibilities of economic growth and transformation. But factors other than purely economic ones affected the development, being both a precondition of industrialization and a concomitant and constant complement to it. Hence, to cite again Berend and Ranki, the issue is
Not whether the export of foodstuffs and raw materials in itself leads to favourable or unfavourable terms of trade for a given area, but whether the countries of an area become trapped in the role of raw material exporters, or are, rather, able to go on from there to build up a suitable developed economic structure.44
The actual ability to build depends on such diverse elements as the wealth of natural resources, the network of communications, antecedents of preindustrialization, possibilities for the accumulation of capital, governmental policies, and social-political structure of the country.
World History
