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AP Euro LMHS Spring 2008 Montaigne Ch. 14 Outline for “A History of the Modern World” 9th Edition Palmer, Colton, and Kramer Chapter 14: Economy and Politics, 1871-1914 14. 71 The Civilized World 1. Introduction a. From 1860 to 1918 Europe rose to world domination i. The climax of the modern phase ii. Material and industrial growth iii. International and domestic peace iv. Constitutional, representative, and democratic government v. Continued faith in science, reason, and progress b. New forces were emerging to challenge liberalism c. European imperialism spread across the globe i. Institutions of modern Europe were being challenged at home 2. Materialistic and Non-materialistic Ideals a. Modern Europe was perceived as civilized and the result of progress b. Others that did not adopt Europe’s model were “Backward” i. Civilized and Backward were central concepts in imperialism c. Ideals of civilization i. Higher standard of living 1. Food, shelter, clothing, and sanitation ii. Technological advances 1. Ocean liners, railroads, streetcars, and telecommunications iii. Scientific knowledge of nature 1. Moving superstition and demonology to the margins 2. Geographic knowledge of the earth iv. Morality separate from barbarism 1. Did not accept “relics of barbarism” a. Polygamy b. Infanticide c. Legalized prostitution d. Capricious divorce e. Sanguinary and immoral games f. Torture g. Caste and Slavery d. Further evidence of advancement i. Lower death rates ii. Lower infant mortality rates iii. Higher average age iv. Higher literacy rates v. Increased productivity of labor e. The intangibles of civilized living i. The way the mind was used ii. Attitude 1. Toward others 2. Toward planning life 3. The Zones of Civilization a. Inner Zone of steam and industry i. Britain, France, Germany, Belgium, northern Italy, southern Sweden, northeastern United States ii. Huge accumulation of capital iii. Cutting edge of science and technology iv. Most liberal and constitutional governments b. The outer zone of agriculture i. Ireland, Iberia, southern Italy, Europe east of Germany, southern and western United States ii. Poorer, less literate, less productivity, shorter lived iii. Existed by selling agricultural products to the west iv. Depended on the west 1. Capital: debt 2. Social and political philosophies 3. Engineers and technicians 4. University educations c. The third zone i. Asia and Africa ii. Viewed as backward by the Europeans iii. Heavily dependent upon Europe iv. The relations among the three zones illustrates much of the modern age 14.72 Basic Demography: The Increase of the Europeans 1. Europeans and World Population Growth Since 1860 a. European population growth superceded the world’s i. End of long periods of civil wars ii. European imperial government stabilized foreign regions iii. Longer average life spans iv. Africa lost population 1. slave trade 2. higher death rates v. Americas lost Native populations vi. Liberation from endemic affliction 1. plague subsides 2. vaccinations 3. relief of famine a. Agricultural advances b. Transportation systems 4. sanitation systems vii. European Race accounted fro one-third of the world’s population 1. By 2100 may account for only one-tenth 2. Stabilization of European Population a. Fall in birth rate leads to leveling of population growth i. France slows first (decadent? ii. Germany, England, and Italy grow larger iii. Births fall from 30 to 15 per 1000 b. Fall in birth rate is characteristics of a modern civilization i. Small family system ii. Contraception c. European family patterns i. Marry later 1. less time to produce children 2. time to acquire skills and save capital 3. lowered birth rates and reduced poverty 4. other factors a. Code Napoleon b. Distribution of inheritance to maintain high standard of living d. Life in the city i. More compatible to small families ii. Decline in child labor 1. Mandatory education a. Dependent on parents longer e. Limiting the size of the family i. Improved the position of women in society 1. education was more available 2. social and political activities f. Growth of population was accompanied with an increase in wealth i. Standard of living continued to rise 3. Growth of Cities and Urban Life a. New population migrated to the cities i. Railroad 1. Move raw materials to central locations 2. Move finished products to markets b. City populations rose dramatically from 1800 to 1900 i. Megalopolis c. Impact of urban life i. Impersonal and anonymous 1. Tied less to home and church 2. Collectivist public opinion 3. Progressive enlightened public opinion ii. . Socialism spread among the industrial masses of the European cities iii. Nationalism was enhanced by city life 1. Detached from home, family, church 2. Attached to the state 3. Alert and informed public 4. Migration from Europe 1850-1940 a. The Atlantic Migration i. 60 million people will leave Europe ii. One-fifth will come back iii. The remainder extend European culture to the world 1. Later migrations have been from non-European countries to Europe and America iv. All regions of Europe were well represented 1. Major contributors were England, Italy, Russia, and Germany 2. Destinations of choice were America, Asian Russia, Argentina, and Brazil b. Cause of the exodus i. New countries welcomed immigration 1. Later policies would shift to protectionism and quotas ii. New forms of mass transportation 1. Steam ship and railroad 2. Reduced cost of transportation iii. Opportunities abroad 1. Reduce famine 2. Land ownership iv. Political asylum 1. Jews v. Underlying liberalism of the age 1. freedom to move c. Mobility of populations remains a characteristic of the world today 14.73: The World Economy of the Nineteenth Century 1. Introduction a. How did the population feed itself and increase the standard of living i. Science, industry, communications, global “free” trade ii. Organization of business, finance, and labor 2. The New Industrial Revolution a. Industrial advances i. Early phase of the industrial revolution depended on coal, iron, and steam ii. New sources of power were developing 1. Electricity 2. Internal combustion engine 3. Oil iii. New chemical industries 1. Fertilizers 2. Explosives a. Tunnels, engineering 3. Synthetic fabrics iv. New communications industries 1. Telephone 2. Wireless radio v. New health industries 1. x-rays, anesthetics, inoculations, germ killers vi. New metallurgical industries 1. Improved steel processes 2. Aluminum 3. Metal alloys b. Spread of industrialism i. Britain and Belgium were only industrial countries in 1870 ii. Industry spread to France, Italy, Russia, Japan, Germany and the United States iii. Inner zone of Europe (Germany, France, and Britain) accounted for seven-tenths of all production iv. Germany was forging ahead v. By 1914 United States was outpacing the combined efforts of Euorpe 1. America was also pioneering new methods of manufacture of mass produced goods 3. Free Trade and the European “Balance of Payments” a. Britain led the movement toward free trade i. Repeal of the Corn Laws ii. Dependant on external sources of food b. Europe was more nationalistic and more open for trade than ever before i. De-politicizing economic activity (free hand of the market) c. Imports versus exports i. Create a system to pay for the huge import expenses ii. Europe was consuming more goods from abroad than it was sending out 1. Raw materials, food, and amenities d. Invisible exports i. Favorable “balance of payments” was achieved 1. Export of manufactures 2. Shipping 3. Insurance services rendered to foreigners 4. Interest on money lent out or invested (exported capital) 5. Lloyds of London 6. Banks of England 4. The Export of European Capital a. The export of European culture set the stage for the export of European capital i. Spending some of the gained capital on the improvement of foreign countries ii. Buying the stocks and bonds of foreign business enterprises and governments iii. Organizing companies of their own to operate in foreign countries b. Capital accumulation i. Pre consumer economy ii. Capital was reinvested rather than paid in wages iii. Excess capital was invested in foreign interests 1. Increased the gains and fueled further reinvestment 2. Potential for losses a. WWI led to loss of foreign investments 3. Britain, France, Germany were the largest exporters of capital c. The recipients of European capital i. The Americas, Asia, Africa 1. Railway systems 2. Business infrastructure 3. State and municipal bonds 5. An International Money System: The Gold Standard a. A person holding any “civilized” money could exchange it for set amounts of gold b. Currency exchange i. monies were freely exchanged to free up trade c. Effects of the gold standard i. Countries using the gold standard had to have on hand a sufficient share of gold to support their currencies ii. Hard on countries that lacked gold iii. Amount of gold lagged behind the expanding production of industrial and agricultural goods 1. caused prices to gradually decline as the currency buying power increased 2. declining prices hurt borrowers a. borrowed less expensive dollars and paid back loan with more expensive dollars 3. Helped lenders and wage earners 4. Cross of Gold Speech W.J. Bryan a. Against the system that worked against indebted persons and nations d. London at the center i. Amsterdam was destroyed during the French Revolution ii. Napoleon destroyed much of what was left on the Continent iii. London was left as the largest banking center 1. Served the governments of the world 2. Facilitated business with short term credit for drafts or notes 6. A World Market: Unity, Competition, and Insecurity a. High point of a unified world economy was achieved by 1870 b. True world market was created i. Goods and services crossed boundaries at uniform prices 1. Wheat was distributed according to ability to pay 2. The pinch of world competition was felt and caused regional economic challenges ii. Large global system based on unregulated capitalism was extremely precarious 1. Position of many interests in the economic system was vulnerable a. market prices might not be sufficient to produce profit in formerly protected economic systems b. Workers were exposed to boom and bust cycles of employment and transfer of jobs to cheaper labor markets c. Cycles of boom and depression i. “long depression” 1873 to 1893 1. credit collapse that dampened investment ii. Devices to combat the economic swings 1. Protective tariffs 2. Social insurance 3. Welfare legislation 4. Trade unionism 5. Socialist movements 6. Business mergers iii. Protective measures signaled the gradual decline of unregulated, laissez-faire capitalism 7. Changes in organization: Big Business a. The limited liability corporation i. Corporations were replacing small businesses 1. limited liability limited the investors loss 2. Larger endeavors required more capital 3. To attract capital limited potential loss was arranged in the case of bankruptcy 4. Fueled the development of finance capitalism b. Vertical integration i. Retail 1. Large department stores developed 2. Standardized prices ii. Industry 1. Steel industry needed to be in control of the raw materials 2. Developed coal mines, iron ore mines, rail roads, ships, smelting facilities, manufacturing centers, retail centers 3. Ownership of the entire process was the vertical integrated model of commerce c. Horizontal integrations i. Concerns at the same level combined with each other to reduce competition and protect from fluctuating prices 1. price fixing, gouging, manipulation 2. trusts or cartels 3. Captains of industry or titans of finance a. Carnegie, Morgan ii. Anti-trust acts had little actual effect on breaking the trusts d. Larger business structure led to less erratic business cycles, more stable prices and more continuous and secure employment e. Reduced the costs of production f. Critics claimed the system had a feudal structure i. Lords (captains of the corporate world) ii. Vassals (middle class salaried professionals with loyalties to the lords) iii. Peasants (labor class that had little influence within the system) iv. 14.74: The Advance of Democracy: Third French Republic, United Kingdom, German Empire 1. Introduction a. Vote was extended to the working class b. Mass political parties emerged c. Governments in part became more responsive to counteract the spread of socialism 2. France: The Establishment of the Third Republic a. Bismarck insisted on free elections i. Elections led to large monarchist presence in the National Assembly ii. Monarchists are again split between two royal houses iii. Paris republicans refused to accept the National Assembly iv. Harsh civil war between National Assembly and the Paris republicans 1. 20,000 anti-German, anti-aristocrats, anti-clergy, anti bourgeois republicans were executed 2. Some saw socialism rising within the republicans led to fierce reaction b. Constitutive laws were passed i. President ii. Parliament 1. Senate (indirect) 2. Chamber of Deputies (direct) a. Council of ministers with a premier i. Premier and the council became the true executive ii. Coalition government process c. Troubles of the Third French Republic i. Republicanism expanded 1. Dreyfus Affair a. Dreyfus was found guilty of treason b. Evidence emerged that he was innocent c. Conservatives and republicans took sides i. Conservatives supported the military ii. Republicans supported Dreyfus a. Dreyfus was pardoned 1. Fallout prompted the increase in republicanism a. Separation of church and state in France b. The Strength and Weakness of the Republic i. Domesticated republicanism ii. Population of painters, writers, scholars, scientists, bankers, bourgeois, and farmers living comfortably on the savings of generations iii. Not the stuff of leadership for the modern age iv. Plagued by short lived ministries (political instability) 3. The British Constitutional Monarchy a. Peaceable parliamentary government i. Liberal and conservative ii. Gladstone and Disraeli b. Extension of suffrage i. 1867 Reform Bill 1. Vote was extended to most workers i. 1884 Reform Bill 1. Vote was extended to rural areas i. 1918 Universal male suffrage c. Gladstone (liberal) i. Public education, secret ballot, legalized labor unions, examinations for civil service posts, eliminated the sale of commissions in the army, abolished religions tests in universities ii. Some provisions for workers 1. workman’s insurance and shorter working hours d. Disraeli (conservative) i. public sanitation improved, workplace conditions improved, regulation of housing conditions of the poor e. British Political Changes after 1900 i. Labor became an independent political force ii. Rise of labor caused the liberal party to pass a social welfare program 1. Sickness, accident, old-age, unemployment insurance, right to strike, minimum wage i. Lloyd George called for a progressive income and inheritance tax forcing the landed aristocracy to pay ii. House of Lords objected iii. Parliament Act of 1911 a. no veto for the HOL for money matters i. Salaries for parliament members ii. Conservative became industry and landed wealth iii. Labor party replaced the liberal party after the liberal party split f. The Irish Question i. 1914 Home rule was granted to Ireland ii. Protestants in northern Ireland objected to inclusion with Catholic majority iii. 1922 Ireland is granted dominion status except for the Ulster region (remained within Britain) 4. Bismarck and the German Empire, 1871 – 1890 a. Bismarck has consolidated power and is leaning on the National Liberals b. The Catholic church 1870 Syllabus of Errors i. Called all Catholics to support the interests of the Pope ii. Denounced government encroachment in educational and church affairs c. 1871 Kulturkampf Battle for modern civilization i. Jesuits expelled ii. Restrictions upon Catholic worship and education (later he backed off) d. 1879 protective tariffs were established to finance the government e. Socialism was expanding i. German Social Democratic party was founded in 1875 f. Bismarck set out to end socialism (failed) i. 1878 to 1890 socialism was driven underground ii. Reforms were made through social legislations 1. Workers insurance i. 1890 at 75 Bismarck was forced to retire 5. The German Empire after 1890: William II a. William I died in 1888 b. Frederick III died three months after coming to the throne c. William II 1888-1918 came to the throne d. Replaced Bismarck as the dominant political figure e. New course 1. colonial expansion 2. Naval expansion 3. aggressive diplomatic policy 4. dropped the antisocialist laws 5. expanded the social welfare system f. Social Democrats elected 110 members to the Reichstag g. Retained none of the highest government offices h. Imperial Germany was moving toward a conflict with constitutional interests and democracy 6. Developments Elsewhere, general Observations a. Political scene in Italy i. Unsteady trasformismo ii. Vote was extended to the working class b. c. d. e. f. g. h. i. iii. Poverty and illiteracy remained problems (south) iv. Direction of the future was unclear Austria-Hungary i. Emperor-King Francis Joseph ruled through ministries responsive to both legislatures ii. Francis Joseph dominated foreign affairs and military questions and help broad powers of decree iii. Socialism was repressed and offset by social provisions iv. Most serious problem was agitation by various nationalities 1. Austria introduced universal male suffrage 2. In Hungary the Magyars resisted universal male suffrage as it would undermine the Magyar political position Other countries introduced universal male suffrage i. Vote for women was less advanced Europe as a whole remained monarchical Parliaments were largely restricted United States, Britain, and France were the most advanced democracies Expansion of the vote was leading to mass political parties i. Socialist ii. Religious Constitutionalism and democracy was replacing older political organizations Criticism of corporations, financial institutions, and European ideas and attitudes provoked opposition i. Socialism ii. criticisms of imperialism