Continental opinion regarding a proposed middle European tariff-union

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JOHNS HOPKINS UNIVERSITY STUDIES

IN

Historical and Political Science

(Edited 1882- 1901 by H. B. Adams.)

J. M. VINCENT
J. H. HOLLANDER W. W. WILLOUGHBY

Editors

VOLUME XX

COLONIAL AND ECONOMIC
HISTORY

baltimore

Johns Hopkins Press

1902

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COPYRIGHT, 1902, BY

THE JOHNS HOPKINS PRESS

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Thb Frieoenwalo Company

BALTIMORE, MD., V. S. A.

TABLE OF CONTENTS

PAGE

I. Western Maryland in the Revolution. By B. C. Steiner s
II-III. State Banks Since the Passage of the National Bank Act,

By G. E. Barnett 67

IV. Early History of Internal Improvement in Alabama. By

W. E. Martin 127

V-VI. Trust Companies in the United States. By George Cator 269
VII-VIII. The Maryland Constitution of 1851. By J. W. Harry . 387
IX-X. Political Activities of Philip Freneau. By S. E. Forman 473
XI-XII. Continental Opinion Regarding a Proposed Middle Euro-
pean Tariff-Union. By G. M. Fisk 575

CONTINENTAL OPINION REGARDING A

PROPOSED MIDDLE EUROPEAN

TARIFF-UNION

Series XX Nos. 11-12

JOHNS HOPKINS UNIVERSITY STUDIES

IN

Historical and Political Science

(Edited 1 882- 1 901 by H. B. Adams.)

J. M. VINCENT
J. H. HOLLANDER W. W. WILLOUGHBY

Editors

CONTINENTAL OPINION REGARDING

A PROPOSED MIDDLE EUROPEAN

TARIFF-UNION

BY

GEORGE M. FISK, Ph. D.

Professor of Commerce In the University of llfinois. Albert Shaw Lecturer on
Diplomatic History, 1902, in the Johns Hopkins University

BALTIMORE
THE JOHNS HOPKINS PRESS

PUBLISHED MONTHLY

NOVEMBER-DECEMBER, 1902

Copyright, 190a, by

THE JOHNS HOPKINS PRESS

THE FRIRDENWALD COMPANY
BALTIMOKB. MD.

CONTINENTAL OPINION REGARDING
PROPOSED MIDDLE EUROPEAN
TARIFF-UNION

In the European press, more especially in that of Ger-
many, one often meets with the expression ** Middle Euro-
pean Zollverein." A study of its content reveals the exist-
ence of a movement — more academic than political — con-
templating, for one reason or another, greater unity of
action on the part of certain European countries, primarily
Germany and Austria-Hungary.

The purpose of this article will be to describe this move-
ment and set forth European opinion with reference to a
subject whose possible realization might be fraught with
enormous economic consequences to the United States.

The tendencies which operated to make of England and
France modern states were counteracted in the countries
to the east — primarily Germany and Austria — by other
forces. Unity, however, among the states of middle
Europe is not a new idea. It existed for centuries under
the name of the " Holy Roman Empire." This fiction
ceased in 1806, and in 181 5, after the Napoleonic wars,
there was formed in its stead the " Germanic Confedera-
tion " which lasted until 1866. This governmental organi-
zation had no real power but all the weaknesses which
characterized the Government of the United States under
the '* Articles of Confederation." Almost contemporane-
ously with its inception there was formed in Prussia in
1818 an economic measure known as the " Zollverein."
Beginning with Prussia this Verein gradually absorbed
other German states so that by 1834, when it assumed the

6 Contittefttal Opinion' Regarding a [576

name of the German Zollverein, it included practically all
the German states excepting Austria and Hanover. This
exclusion of Austria brings us to the first chapter in the
consideration of a ** Middle European Zollverein," using
this term in its modem acceptation. Between 1834 and
1866 Austria attempted repeatedly to ingraft herself as a
member — or rather as the leading member — of this German
Zollverein. Her exclusion was a matter of politics rather
than economics, or as Prof. Lotz of Munich in a conversa-
tion once expressed it: "Economic events invited union;
political events, disunion." The duel was between Prussia
and Austria and the question was as to which of them should
play the chief role in German politics. The smaller German
states were an uncertain quantity in this duel. The first
crisis happened in the early sixties when, after France had
inaugurated her so-called " free-trade era " by a commercial
treaty in i860 with England, the question was presented to
the German states whether they should form a treaty with
France wherein the tariff-rates would be radically lowered.
Austria was hopelessly protectionist and in this direction
the South German states, especially Bavaria and Wurtem-
burg, had a strong leaning. In Prussia, although there
was a strong protectionist element, many classes, particu-
larly the merchants at the seaports, the large land-owners
and the Bureaucrats, had quite the opposite tendency.
Bismarck, however, solved the question for Prussia by
forming a treaty with France in 1862 and making its ac-
ceptance and the exclusion of Austria, a sine qua non to a
renewal of the Zollverein. The question received a more
definite solution by the events of 1866. Thus the first
attempts to form a Middle European Zollverein — whose
aim was essentially a protection of manufacturing interests
against English competition — ended in a failure.

In the latter part of the seventies we find, however,
totally different economic forces at work. The agricultural
development, particularly in the United States, coupled
with improved means of transportation and an enor-

677] Proposed Middle European Tariff-Union. t

mous industrial awakening in Germany, changed the latter
country — as well as Western Europe — from an agricultural
exporting to an agricultural importing country. The re-
sult was the German Tariff Act of 1879 — which was essen-
tially an agrarian protective measure. Bearing in mind
that in the first chapter of the discussion of a Middle Euro-
pean Zollverein (1834- 1866) the economic basis was manu-
facturing protection and the common enemy England;
while in the second chapter, extending from the latter part
of the seventies up to the present time the economic basis
is more particularly agrarian protection and the common
enemies are primarily the United States and Russia, and
secondarily Great Britain with her colonies, let us examine
somewhat in detail the literature of our subject. G. de
Molinari, editor-in-chief of the " Journal des Economistes,'*
treated, in the February number (1879) of that magazine,
the subject of a Middle European Zollverein (Union
douaniere de TEurope Centrale). He favored the idea and
would have such a union comprise France, Belgium, Hol-
land, Denmark, Germany, Austria-Hungary and Switzer-
land. There should be free-trade between the members of
the Union. The objection that such a measure would
destroy a very important source of revenue was answered
by his saying that it was well known to specialists that the
great bulk of tariff-revenue of the countries of Western
Europe was derived from foreign wares and that domestic
wares scarcely paid for their cost of collection. Thus nine-
tenths of the tariff revenue of France was derived from
colonial wares (coffee, sugar, cacao, spices, etc.), while
much of the balance was obtained from goods imported
from England, Spain, Norway, etc. — countries outside the
proposed Union. Similar conditions existed also for Ger-
many. The probability is that such a Union would in-
crease rather than diminish the revenue derived from im-
port duties. De Molinari did not, of course, deny the exist-
ence of difficulties in the way of race prejudices and the
like, but he did not regard them as insurmountable. Such

8 Cofttineiital Opinion Regarding a [578

a Union was possible as were Unions regarding coinage,
postage, weights and measures, telegraphs, etc. For its
formation there were four essential points :

1. The agreement on the tariff-rate for the Union. There
would be no great difficulty in this owing to similar indus-
trial conditions in the countries composing the Union.

2. The apportionment of the import revenues. This
would not be so difficult as it appears. Each country would
retain its own tariff administration, the net revenue only
being divided and upon the basis, probably, of population.

3. Equalization or apportionment of the consumption or
internal revenue taxes. Molinari regarded this as the
most difficult problem to be met by the propMDsed Union, as
had been the case in the former German Zollverein. The
diffictdty lay not so much in the articles taxed — being
quite the same in all the states (tobacco, sugar, salt, beer,
brandy, etc.) as in the rate and mode of taxation.

4. The formation of an international tariff commission to
direct the execution of the new system — similar to the
tariff conferences in the German Zollverein.

A reading of de Molinari's article shows that the Union
which he contemplated had its model in the German Zoll-
verein. He conceived that a beginning might be made*by
two or more states with provision for the entrance later
of other states. His proposition was discussed on Febru-
ary 5th, 1879, ^^ ^ meeting of French economists. Leroy-
Beaulieu, although in general an advocate of the idea,
spoke against the plan of De Molinari, principally because
he thought proposition 3 — the equalization of taxes on
consumption — impossible. France by such a measure
would have to replace one milliard indirect by direct taxes.
A. Courtois, Ch. M. Limousin and Josef Garnier spoke in
favor of the proposition, while Pascal Duprat thought that
such a Union applied to the Latin races would be possible.
The Chamber of Commerce at Verviers, Belgium, con-
sidered the plan and recommended it to the Belgian Fed-
eration of Chambers of Commerce, while a committee in

579] Proposed Middle European Tariif-Union. 9

Zurich, composed of industrial and commercial people,
recommended a Tariff-Union between Switzerland and
France as a basis for a Middle European Zollverein. In
Alsace the question was discussed in the press by Berg-
mann, Lalance and others.

Already, in the latter part of 1878, De Molinari had
solicited the opinion of Bismarck on his proposition. The
reply of the Chancellor shows very clearly that he did not
regard the subject as a question of practical politics
although it has been claimed by many that he was favor-
able to the general plan. In his reply to de Molinari,
under date of September 25th, 1878 ("Aktenstucken zur
Wirthschaftspolitik des Fiirsten Bismarcks," von Po-
schinger), Bismarck said: "If I were able to obtain a
favorable opinion from the Minister of Finance of the
smallest nations which I have just cited you — France,
Belgium, Holland, Denmark or Switzerland — I would
promise to consider the question seriously with you."

In 1879 a pamphlet on this subject — " L' Association
douaniere de TEurope Centrale " — appeared under the
authorship of R. Kaufmann. Its basis was agrarian rather
than industrial protection. To withstand the competition
of other countries, especially of the United States, the
writer recommended a Middle European Zollverein, com-
prising the three large states of France, Germany and
Austria-Hungary and the three small ones of Belgium,
Holland and Switzerland, containing a population of from
125 to 130 million. Many objections of a political, eco-
nomic, financial, administrative, theoretical or practical
nature would, of course, be raised against the scheme, but
they were not insurmountable. Politically, it is hardly pos-
sible that a Tariff-Union would in any way jeopardize the
independence of the individual states. The large ones
would offer an equilibrium to one another and at the same
time would prevent the absorption of the smaller ones.
Such a Union ought to be received favorably by both
protectionists and free-traders. Industry would be aided

10 Continental Opinion Regarding a [580

by an increase in markets and a more eflfective protection
against England. Many difficulties would be encountered
in arranging the tariff-rates and they would have to be
settled — as all tariff arrangements are settled — by com-
promises. Such was the case in the German Zollverein.
It might happen that some states would derive proportion-
ally less tariff-revenue but this would, if necessary, be
equalized by other forms of taxation. Such a Union could
only be realized by a gradual development, beginning,
perhaps, with commercial treaties among the six countries
in which as many acceptable points as possible should be
incorporated. The Union would have a moral effect in
increasing international good feeling and making wars
more difficult. Views similar to those of Kaufmann were
expressed by Bergmann, a former member of the German
Reichstag, in 1879 in a pamphlet entitled, " Die zukiinf-
tigen Zollvertrage auf der Grundlage autonomer Tarife der
industriellen Lander des Europaischen Kontinents." Dr.
A. Peez, member of the Austrian Abgeordnetenhaus,
treated, in 1879, ^^^ subject of a Tariff-Union between Ger-
many and Austria — " Zollvertrag mit Deutschland, oder
wirthschaftliche Autonomic?" This idea had won many
adherents but when one examined the question carefully
the difficulties appeared to make the plan unlikely of reali-
zation. Compared with former years political complica-
tions had diminished since the events of 1866. Financial
difficulties may be said also to have decreased since the
passage of the German Tariff Law of 1879, which increased
the consumption taxes. There was also a movement in
Germany toward a government monopoly of tobacco.
Such measures, of course, decreased the necessity of tariffs
for revenue purposes. The condition is quite different
when one studies the economic side of the question. The
industries of Germany being much better developed than
those of Austria, German industrialists might be expected
to favor the idea of a commercial Union, while, on the
other hand, Austria-Hungary being more agrarian than

581] Proposed Middle European Tariff -Union. 11

Germany might be expected to view the question in the
same Hght, for free-trade between the two countries would
mean that Germany would supply her neighbor with manu-
factured products and receive from her the products of the
farm. For reasons apparent the scheme would, on the
other hand, meet with opposition from German agrarians
and Austrian industrialists. Finally, there was a positive
international difficulty. Article XI of the Frankfort
Treaty of 1871 between Germany and France guaranteed
that they would treat each other forever on the basis of
the " most favored nation," in their treaty relations with
England, Belgium, Holland, Switzerland, Austria and Rus-
sia. Hence a differential treaty such as that contemplated
by the advocates of a Zollverein between Germany and
Austria could not be effected. It is interesting to note the
position at this time taken by Dr. Peez, for we shall find
him somewhat later among the most brilliant advocates of
the general plan of a Middle European Zollverein.

Guido von Baussern, a Hungarian member of the Reichs-
tag, advocated in many of his speeches a Tariff-Union
between Germany and Austria-Hungary (see Deutschland
und Oesterreich-Ungarn. Abhandlungen, Reden und Briefe
von Guido von Baussern. Leipzig, 1890). The motives
which prompted him to advocate such a Union were largely
political. Political relations would obtain greater soli-
darity by a cementing of material interests. Von Baus-
sern's ideas are best studied from a memoir which he
addressed to Bismarck on February 2, 1880. The only
right starting-point leading toward a settlement of the
commercial-political questions between Austria-Hungary
and Germany is the organization of the nations of Middle
Europe into a powerful tariff or commercial Union. The
principle of protection and free-trade can work harmoni-
ously together when applied to large territories. A Union
of Middle European states would bring together nations
which should naturally be united by virtue of their geo-
graphical position and economic development. The German

12 Continental Opinion Regarding a [582

Zollverein realized this in part. Union would decrease costs
connected with the raising and administration of the cus-
toms. That such a Zollverein would, as in the case of the
German Zollverein, lead to political union is not possible.
The German Zollverein led to a political union of people of
the same race, while the proposed scheme contemplated a
union of people of different nationalities. Should such a
union so increase the German element as to endanger the
political autonomy of the other elements, the latter could
easily combine, the result being what it has always been
from the time of Alexander the Great to that of Napoleon.
The German element is very conservative. It took 60 years
to unite a part of its people into the present German
Empire and particularism is not yet dead. The realiza-
tion of this Empire has made possible an economic Union
between Germany and Austria, but such a Union should
extend to other European states. A development along
this line would ensure a greater solidarity of material
interests, guarantee peace, strengthen national independ-
ence and enable central Europe to become the regulator
of the world's trade and commerce. The political rivalry
of Austria and Germany in the fifties and sixties alone
made an economic Union impossible. Effective rivalry
ceased with the results of 1866. Should they now unite
they should contemplate the gradual incorporation into the
Union of the following additional states : Switzerland, Den-
mark, Holland and Belgium in Western Europe and the
Balkan States in the East.

On March 5, 1880, Bismarck, replying to this memoir,
said: " I have noted carefully the contents of your commu-
nication and share your view to the extent that I regard
such a Tariff-Union between Austria-Hungary and Ger-
many as designating the ideal direction of our commercial
relations. I do not know whether we can ever reach this
ideal but the nearer we approach it the closer will our
commercial and political interests correspond. However,
as both countries have lately revised their tariffs any defi-

583] Proposed Middle European Tariff-Union. 13

nite move in this direction is for the present excluded."
Dr. Karl Walcker in his work, " Schutz-Zolle, Laissez-
faire und Freihandel " (Leipzig, 1880), devoted a chapter
to the consideration of a Tariff-Union between Germany
and Austria-Hungary. It is unnecessary, he says, to ex-
plain to the free-traders and moderate protectionists the
enormous economic, political and military advantages
which would accrue to Germany from a Tariff-Union with
Austria-Hungary. These advantages would be similar to
those which Germany derived from the German ZoUverein.
Among other things it would enable these countries to
obtain more easily economic concessions from France,
Russia and other countries. Walcker enumerates what he
regards as the chief obstacles to the realization of this plan:

1. It would be opposed by a large majority of the Ger-
man and Austro-Hungarian protectionists, but this oppo-
sition could be overcome by a coalition of the free-traders,
landlords and the military party.

2. Another obstacle is the Austrian currency confusion
and the varieties of consumption customs (Konsumptions-
sitten) of the two countries. These obstacles are not, how-
ever, insuperable. Even if Austria-Hungary adopted the
silver currency, the customs-duties could be levied in gold.
Differences in " Konsumptionssitten " exist within the
German Empire itself — for example, more coffee per capita
is consumed in Saxony and North Germany than in Ba-
varia— but they form no insurmountable obstacle.

3. Difficulty would arise in the distribution of the reve-
nue. It has been proposed that it should be upon the
basis of population, but should this be found inequitable
a more equitable basis should be and could be devised.

4. Apparently the strongest argument against a ZoU-
verein is the fact that in Austria-Hungary there exists a
state tobacco monopoly and this would probably necessi-
tate a more or less modified form of nationalization of this
article of commerce in Germany.

5. It would be necessary to abolish the salt-monopoly

14 Continental Opinion Regarding a [584

in Austria-Hungary as it would be impossible to inaugu-
rate this system in Germany. As far as the other taxes on
consumption — beer, sugar, brandy, etc. — are concerned,
they would offer no serious impediment.

The question of the commercial relations between Ger-
many and Austria-Hungary was discussed at the 19th Con-
gress of German Economists (Kongress Deutscher Volks-
wirte) held at Berlin on October 21, 22 and 23, 1880.
Upon a motion by Dr. Max Weigert (Berlin), seconded by
M. Bromel, the following resolution was passed by this
organization :

" A Tariff-Union (Zolleinigung) is not admissible, —

" (a) Because it entirely destroys the independence of the
individual states of the Union so far as commercial legis-
lation is concerned by making the will of one state depend-
ant upon that of another.

"(b) Because it presupposes a similarity in internal reve-
nue-taxation, which at the present time is neither practical
nor desirable for Germany.

" (c) Because by its partial execution, or during an in-
definite transition period it would engender exclusive tariff
privileges."

Many took part in the discussion of this resolution.
Weigert, the chairman, speaking in favor of it, said that
local interests would not be safeguarded by such a Union,
that regulations governing its organization must, of neces-
sity, be too artificial and inflexible and hence opposed to
the general interests of free-trade, and finally that such a
Tariff-Union would be nothing more nor less than a repeti-
tion— with its direful results — of the so-called " continental
system." The editor, Hirschberg (Bromberg), opposed the
idea of a Tariff-Union because the economic homogeneity,
absolutely necessary for such an institution, was lacking.
Dr. Wolff (Stettin) regarded such a Union as an illusion
which, if persisted in, would endanger the permanence of
German unity. The correspondent Bromel (Berlin), in
seconding the resolution, said he feared a Tariff-Union

585] Proposed Middle European Tariff-Union, 15

would strengthen protectionism. The Austrian " Indus-
trialists " must not forget that they cannot, without the aid
of tariffs, withstand German competition. The German
" Industrialists " believe that such a Union will merely
make protectionism more permanent. Bromel added that
he thought a realization of the proposed plan would jeopar-
dize the very independence of the states by withdrawing or
diminishing their power to regulate their own finances.
Supposing, for example, one of the states of the Union
wanted extraordinary sums of money? Not being able to
alter its import duties and perhaps its other forms of
indirect taxation it must resort to direct taxation with
questionable results. Austria-Hungary is itself a Zoll-
verein. With Germany added it would hardly be a " Dual-
ismus " but rather a " Pluralismus," which is even more
unwieldy. Dr. Barth (Bremen) regarded a Tariff-Union
as impracticable and emphasized the financial confusion
which would ensue were one party at war. Schiflf (Berlin)
believed that a Union, even if formed, could not be main-
tained.

The principal advocates of a Tariflf-Union at this Con-
gress were Austrians. Baron von Kiibeck (Vienna) was
among this number. He hoped that the Congress, if it
could not recommend a Union, would at least not go on
record as opposing it. Dr. Welker (Berlin) regarded with
favor a Union based upon free-trade principles or a tariff
for revenue only. This he thought would tend to weaken
the strong protective walls of neighboring states like
France, Russia and even of the United States.

Dr. Hertzka (Vienna) in a similar way favored the plan
of a Tariff-Union, believing that its realization would lead
to general free-trade. He regarded the point about the
" Continental System " made by Dr. Weigert as not well
taken, nor had the question of indirect taxes to be
brought in. It made no difference to Austria whether
Germany had a tobacco monopoly or not. Dr. Dorn
(Trieste) spoke in favor of a Union, the line of his argu-
ment being similar to that of Dr. Hertzka,

16 Continental Opinion Regarding a [586

M. Schraut, in his " System der Handelsvertrage und
der Meistbegiinstigung " (Leipzig, 1884), considered from
a purely theoretical standpoint the subject of a Tariff-
Union between Germany and Austria-Hungary. He did
not regard the difficulties in the way of a Union as tariff-
political (zollpolitisch) so much as financial and " political."
The question of internal revenue-taxation and of the con-
sumptive ability of the people would have to be studied
with special care. The statement that should Germany
and Austria-Hungary offer reciprocal tariff advantages in
forming such a Union, these advantages could be claimed
by all states enjoying the most-favored-nation rights, is
denied by Schraut, since such a regulation has not the
nature of guaranteed tariff and commercial advantages,
but represents rather a financial " association-treaty (Asso-
ciationsvertrag) through which the financial and economic
character of the contracting parties is changed. Should
such a Union, however, be of an incomplete form, as a com-
mon external or transit tariff-regulation it is possible that
third states might regard the measure as a commercial
arrangement which would justify them in claiming the
same advantages by virtue of their " most-favored-nation "
rights. Schraut next proceeds to enumerate what he re-
gards as some of the essential points in the proposed TariflF
Union.

(a) The external tariff (Aussentariflf) must be agreed
upon and can only be altered through the reciprocal action
of the contracting parties either by means of a mutual
independent organ or by their regular legislative bodies.

(b) The intermediate tariff (Zwischenzolltariff) must be
arranged in organic relation with the external tariff so
that the rates will be expressed in the same proportional
amounts. If there is to be any flexibility in this arrange-
ment Schraut suggests the plan incorporated in the com-
mercial treaty made between the Zollverein and Austria on
February 19, 1853, wherein each state reserved to itself
the right to raise the intermediate rate by the amount

587] Proposed Middle European Tariff-Union. 17

which the corresponding external tariflf-rate of the other
state is lowered.

(c) The external and intermediate tariffs should, in prin-
ciple, include the majority of objects subject to tariff-
duties. The most important exceptions to this rule are,
perhaps, the essentially revenue-tariff objects, especially
such as are closely related to the domestic taxation and
tariffs on articles which affect only slightly the inter-state
trade relations.

It is not necessary that the intermediate tariff-rates be
the same for both countries. Their determination must
take into consideration the various economic, social and
political factors involved.

(d) The formation of treaties with other states should
be based upon the mutual agreement on this point existing
among the parties to the Union.

The International Agrarian Congress, which met at
Budapest in 1885, passed the following resolution regard-
ing a Middle European Zollverein: "The state should,
during the epoch of its economic transformation, protect
its raw production interests by means of tariffs. While a
perfected Middle European Zollverein is not practical, it is
very desirable that the Middle European states, for the
security of their common economic interests, should come
to an understanding by which, while not surrendering their
right to regulate their own commercial affairs, they may
effectively protect themselves against the non-confederated
states."

The Hungarian member of the Reichstag, Eugen von
Gaal, embodied in his report at this Congress upon the
subject of " Agricultural Crises " the idea contained in the
above resolution — a commercial-treaty system between
Germany and Austria-Hungary and possibly between
France and Austria-Hungary, whose characteristic should
be an " autonomy " tariff with advanced rates on manu-
factured and raw materials coming from England, Russia
and " countries beyond the sea."
41

18 Contifiental Opinion Regarding a [588

Paul Dehn has treated at some length the subject at
hand (" Deutschland nach Osten! III. Oesterreich-Ungarn
in Reichsdeutschem Licht. Zweiter Theil : Wirthschaftliche
Verhaltnisse ")• His line of argument is somewhat as
follows: Differences in the finances, taxation, money-
standards and general internal revenue systems are insup-
erable and make a pure Zollverein between Germany and
Austria-Hungar)' impossible. A modified Union, how-
ever, is practical and for its realization the following sug-
gestions are made:

1. The existing " autonomy " tariff is to be maintained,
but Germany and Austria-Hungary should aim to equalize,
as much as possible, their tariffs as regards classification,
rates, etc. This would tend to strengthen their political
and economic relations with each other and, indirectly,
with other powers.

2. As corollary to the above and with reference to the
future, both empires should agree to ascertain, in a most
thorough manner, the foundations (Grundlagen) for a com-
mercial agreement with moderate and equalized tariff-rates.

3. In order to be less hampered in the modification of
their tariff-rates for the furthering of their inter-state com-
mercial relations it might be well for both Empires to give
the necessary notice for the abrogation of their most-fav-
ored-nation agreements with other countries.

4. Since the most-favored-nation regulation between
Germany and France (Art. XI of Frankfort Treaty, 1871)
relates only to the import, export and transit tariffs and
to the reciprocal treatment of their subjects, Germany and
Austria can have recourse to advantages outside of this
category, such as special railroad concessions and advan-
tages in refining processes and boundary-trade (Eisenbahn-
Veredlungs und Grenzverkehr).

5. There should be coupled with any commercial ar-
rangement between the two countries a definite policy as
to treaty-relations with third powers.

6. Finally there should be an attempt toward greater

589] Proposed Middle European Tariff-Union. 19

uniformity in certain phases of German and Austro-Hun-
garian legislation and administration such as Commercial
Law, Law of Exchange, Postal- Aft airs, Railroad-Legis-
lation, Coinage, Money-Standard, and Internal-Revenue
Taxation.

Professor Brentano, in his article ** Ueber eine zukiinftige
Handelspolitik des Deutschen Reiches," which appeared
in Schmoller's Jahrbuch for 1885, advocated an advance on
agricultural import duties sufficient to meet the necessities
of German agriculture, at the same time care being taken
to provide the industrial interests with additional markets
to compensate them for losses sustained by an advance in
the price of raw materials. This, Prof. Brentano believed,
could be accomplished for Germany through a Tariff-Union
with Austria-Hungary and the Balkan States. The
twentieth century will know only four or five world-powers
— the United States, Great Britain, Russia and perhaps
China and France (if her colonial policy proves a success).
Germany's only salvation then, if she is to remain a great
power, is in a Union such as that suggested above.

A tariff arrangement with moderate tariff-rates for Ger-
many and Austria-Hungary and higher rates for other
countries was advocated by the Austrian Chamber of Com-
merce at Troppau. With the object of furthering this view
this chamber addressed a circular note to all the chambers
of commerce in the two Empires, inquiring whether they
would take part in a Congress called to consider the ques-
tion. The replies to this letter of inquiry are interesting
as showing the trend of public opinion and may be thus
summarized: Seven Chambers — 5 Austrian (Bozen, Czer-
nowitz, Eger, Gorz and Klagenfurt) and 2 German (Munich
and Nuremberg) — favored the calling of such a Congress;
four German Chambers (Halle, Hildesheim, Regensburg
and Stollberg) refused to take part in the proposed Con-
gress. Fifteen Chambers — 9 German (Bielefeld, Bruns-
wick, Lauban, Oppeln, Osnabriick, Passau, Plauen,
Schweidnitz and Trier), 4 Austrian (Brunn, Innsbruck,

20 Contiftental Opinion Regarding a [590

Leoben and Vienna) and 2 Hungarian (Kronstadt and
Temesvar) — adopted what might be termed a ** waiting
attitude," and finally fourteen German Chambers (Barmen,
Bochum, Breslau, Bromberg, Cassel, Chemnitz, Koln,
Dortmund, Dresden, Duisburg, Hagen, Hanau, Leipzig
and Mannheim) opposed any closer commercial under-
standing with Austria-Hungary. It was proposed to hold
this Congress in 1886 but the tenor of the replies did not
warrant the execution of the plan.

Carl Mamroth, in his essay " Das Projekt eines Oester-
reichisch-deutschen ZoUvereins (Hirth's Annalen des
Deutschen Reiches, 1886), wrote against a Tariff -Union
between Germany and Austria-Hungary. His text was
taken from a speech made by Schulze-Delitzsch at a con-
gress of German Economists in 1882 — '* A Zollverein is
only practicable between states having no political or eco-
nomic antagonisms, or rather, stated positively, between
states whose political and economic interests are inter-
woven." Judged by such a text a Tariff-Union between the
two states in question is an impossibility. Mamroth next
proceeds to enumerate the various antagonisms and con-
cludes as follows: "The project of an Austrian-German
Zollverein is calculated, at first glance, to captivate fan-
tastic natures but when the pros and cons are carefully con-
sidered its realization appears extremely difficult. The
advantages — on the whole — appear very questionable for
Germany and arc vastly outweighed by the disadvantages."

Dr. Wermert, Secretary of the Chamber of Commerce
at Halle, in his " Betrachtungen iiber einen mitteleuro-
paischen Zollverein " (Hirth's Annalen, 1888), expressed
the belief that a Middle European Zollverein — comprising
the states of Germany, Austria-Hungary, Switzerland,
Denmark, Italy, Holland and the Balkan States, but ex-
cluding the " eternal mischief-maker and peace-disturber
France " — ^was necessary to counteract the growing com-
petition of America, England and Russia. Dr. Wermert's
plan contemplated free-trade between the members of the

591] Proposed Middle European Tariff-Union, 21

Union and a common tariff applied to the non-members.
Such a Union, he thought, would not only strengthen inter-
national interests but would also be a peace-guarantee.
He reiterated his ideas on this subject in 1894 in a work
entitled "Pro Memoria: Betrachtungen iiber die Agra-
rische auf den Handelsstand und die Handelspolitik der
Reichsregierung " (Halle, Kaemmerer & Co.).

Count Paul de Leusse argued, from the agrarian stand-
point, in favor of a Franco-German Zollverein in his
pamphlets " La paix par Tunion douaniere franco-alle-
mande " (Strassburg, 1888) and " Union douaniere agri-
cole du centre de TEurope " (Paris, 1890). Central Europe
is threatened with agricultural ruin. The realization of
this would mean industrial decadence, depopulation and
bankruptcy. To avert such an evil an economic Union
between Germany and France is a necessity. The force of
events will gradually attract to this Union Belgium, Switz-
erland, Holland, Austria-Hungary and possibly Italy and
Spain. The basis for the Union must be agrarian protec-
tion although this does not necessarily exclude the protec-
tion of other articles. The tariff-rates must be variable,
changing according to the price of the commodities paying
the duty. De Leusse recommended the establishment of a
Tariff Bureau (Zollamt) in some central place like Frank-
fort, composed of representatives of all the states of the
Union, whose power should be advisory and whose respon-
sibility should be to their respective governments.

We have found that Dr. Peez in 1879 (page 10) was
numbered among the opponents of a Tariff-Union between
Germany and Austria-Hungary. By 1885 (Miinchener
Allgemeine Zeitung, No. 129) he had changed his point of
view and in March, 1889, at a meeting of Austrian econo-
mists at Vienna, he still further elaborated his ideas. His
line of argument was in the following strain. Great Britain,
Russia and the United States are bent upon becoming
enormous commercial territories (Handelsgebiete). The
full realization of their efforts means the development of
three world-powers (Weltmachte), viz.:

22 Continental Opinion Regarding a [592

(a) Great Britain with her colonies and dependencies
comprising 17 per cent of the eaith's surface or 23,000,000
square kilometers, and 21 per cent of the total population
of the world or 313,000,000.

(b) The Russian Empire with 16 per cent of the earth's
surface or 22,000,000 square meters, and 7 per cent of the
world's population or 105,000,000.

(c) America with 22 per cent of the earth's surface or 30
million square kilometers and 7 per cent of the world's
population or 108,000,000. This development means the
gradual deterioration or absorption of the countries of
middle and western Europe unless there be some counter-
acting influence. The salvation of these countries rests in
the formation of a Middle European Zollverein comprising
the states of Germany, Austria-Hungary and Italy. France,
out of hatred for Germany, might possibly enter into closer
economic relations with Russia — a procedure admissible
so far as Article XI of the Frankfort Treaty is concerned.

An interesting observation — indirectly referring to our
subject — was made by Professor Fuch (Strassburg) in re-
viewing Professor Patten's work — " The Economic Basis
of Protection " (Philadelphia, 1890). Commenting upon the
economic isolation of the United States, not only as recom-
mended in Patten's book but as " actually existing in prac-
tice," he said: " Europe will do well to reckon, in the near
future, with this economic isolation of the United States
and to frame its legislation to meet it " (Schmoller's Jahr-
buch. Vol. XV, p. 294).

A very important work on the tariff-relations between
Germany and Austria-Hungary — which has been often
consulted in the preparation of this essay — appeared in
1891 under the authorship of Dr. Alexander von Matle-
kovits, an Hungarian member of the Reichstag (" Die
Zollpolitik der Oesterreichisch-Ungarischen Monarchic
und des Deutschen Reiches seit 1868 und deren nachste Zu-
kunft "). So far as relates to the subject in hand Matle-
kovits* idea was a Zollverein between the two Empires

593] Proposed Middle European Tariff-Union. 23

whose general principle should be a common tariff applied
to foreigti countries and inter-state free-trade. To this
latter principle, however, exceptions should be made to
meet economic and political differences (especially as re-
gards articles operated by one of the states, as a monop-
oly). Each state should have a free hand in the administra-
tion of its tariff but government officers of the one state
should at all times be allowed to inspect the system in the
other state. The tariff-revenue should be divided between
Germany and Austria-Hungary at the ratio of 4 to i ;
should, however, the revenue derived from grain and wood
not reach a certain definite amount the ratio for these two
commodities is to be 7 to 3. Each country should pay its
own cost for tariff administration. Provisional ref>orts
should be rendered quarterly and definite settlements
concluded yearly. Both states should attempt to simi-
larize their tariff-administration. To aid the process of
economic unification a " Unionrat " composed of 12 mem-
bers, 6 from each state, and having advisory power, should
be appointed. In matters of internal taxation and trade
neither party should discriminate against the other, and
there should be reciprocal protection in trade-marks and
railroad rates. Provision is made for the admission, in
the future, of other states and for a common commercial
treaty applied to foreign countries. The treaty, embody-
ing the scheme of Matlekovitz, should, according to its
author, come into force on January ist, 1892, and, if notice
of its abrogation be not given before January ist, 1901,
should continue in force 10 years longer. Prof. Schmoller,
in reviewing this work of Matlekovitz in his Jahrbuch
(Vol. XV, p. 275 et seq.), expresses his sympathy for the
general idea of a Middle European Zollverein but regrets
that the author's " standpoint is somewhat one-sided: in the
first place he is an Hungarian; in the second place, a free-
trader of the sixties, and in the third place, a public officer
(Beamter)."
About the time we are now considering there appeared a

34 Continental Opiniofi Regarding a [594

brilliantly written pamphlet under the title *' Die Zukunft
der Volker von Mitteleuropa." The author's name was
not attached to this essay. There was an attractiveness
in the style and a thoroughness in the portrayal of political
and economic conditions which caused it to be widely read
and much commented upon. Some went so far as to claim
that it was either written by the Chancellor himself (Cap-
rivi) or by some one in sympathy with his ideas (see Prof.
Farnam in " Yale Review " of May, 1892), and was there-
fore suppKDsed by some to give a possible trend to the
German and Austro-Hungarian commercial treaty which
was soon to be renewed. It might be added, in passing,
that, so far as the writer of this article is informed, Caprivi
never expressed himself in favor of a Zollverein between
the two Empires. Furthermore the writer happens to
know the real author of the pamphlet in question and can
therefore state that he is not Caprivi. The fact is empha-
sized in the work that the states of Central Europe were
becoming more and more dependent upon foreign coun-
tries for their food supply. This economic development
threatens not only the prosperity but also the civilization
of these states. The author is somewhat anti-American
in his sentiments. As regards our tariff policy he observes
that " a calm reflection leads to the belief that the Ameri-
can effort to gain complete emancipation from European
civilization and from its products will, sooner or later, be
crowned with success." He advocates a European Tariff-
Union composed primarily of Germany, Austria-Hungary,
Italy and France, to which may possibly be added the
smaller states of Switzerland, Belgium, Holland, Norway
and Sweden.

We come now to a period in our discussion, during which
certain political measures, particularly in the United States,
have given more of an anti-American political trend to
the subject of a European Zollverein. The most important
of these measures are the McKinley Tariff Act of 1890;
the Wilson Bill, particularly the sugar schedule, by which

595] Proposed Middle European Tariff-Union. 25

Germany believed that her most-favored-nation rights had
been violated; and the Dingley Bill. This legislation has
been economically hostile to German industrial interests by
the difficulties imposed upon the importation into the
United States of goods made in Germany, and has given
strength to the " anti-American trend."

As regards Germany, the tariff act of 1879 was, in prin-
ciple, agrarian protection. The assurances then made as
to the maintenance of the price of wheat were not made
good, although in 1885 the grain tariff was tripled and in
1887 increased fivefold. In Germany's Commercial Treaty
of 1892 with Austria-Hungary these rates were somewhat
lowered and the factor of stability, or rather inflexibility,
introduced by the agreement that the treaties must con-
tinue unchanged for 12 years, or, more correctly, that rates
should not be raised above a certain point during this
period. This measure may thus be regarded as a slight
reaction favorable to the industrial classes.

During the agitation of this bill those favorable to a
Middle European Zollverein were inclined to look upon
the measure as a definite step in this direction and were
further inclined to represent the Government as sharing
this view. Later events proved this belief to have had its
foundation in fiction rather than in fact. In the " Yale
Review " of May, 1892, Prof. Farnam, speaking of the
general subject of a Zollverein but more in particular re-
garding the recent treaty, said: " There is, undoubtedly, a
considerable literary movement in favor of this policy (that
is, the policy of a Middle European Zollverein), but when
we look at the facts they are not very encouraging." The
facts referred to by Prof. Farnam are that Germany, after
concluding her commercial treaty with Austria-Hungary,
made siijiilar treaties with three other European states and
then extended the advantages of these reductions to no
less than 30 other states, including the United States, by
virtue of her most-favored-nation agreement — facts not
very encouraging to those who looked upon the treaty of
1892 as the basis for a Middle European Zollverein.

26 Continental Opinion Regarding a [596

Prof. Werner Sombart, in an article in Schmoller's Jahr-
buch (Vol. XVI, 1892) on Germany's new commercial trea-
ties (" Die neuen Handelsvertrage, insbesondere Deutsch-
land "), comes to the conclusion that nothing is more
foolish than the idea advanced by some that these treaties
were a step in the direction of a Middle European Zoll-
verein. Such a plan is not possible to realize, at least not
inside of a few hundred years. " He who understands in
a most superficial manner the commercial-political develop-
ment of the European states will regard it as entirely out
of the question that, within a conceivable time, tariff modi-
fications among these different countries can be radically
lowered."

Finally and officially, it was stated by Secretary of State
Von Marshall, in his speech in the Reichstag on May 3rd,
1897, in reply to the interpellation of Count Kanitz on the
"Saratoga Agreement," that "the Confederated Govern-
ments, when they negotiated the commercial treaty with
Austria-Hungary in 1891, did not doubt a moment but
that they were under obligation to* concede to the United
States the tariff reductions which were granted Austria-
Hungary. It would have been an infringement upon good
faith to have denied this legal obligation after we had
repeatedly asked for similar favors to be granted us."

In 1895 ^" interesting and instructive work on modern
commercial politics (" Zur neuesten Handelspolitik ") by
Dr. Peez appeared. Its central idea was that of a Middle
European ZoUverein. He and Matlekovitz stand on simi-
lar ground except that his plan is somewhat more exten-
sive than the latter's — making the entrance of France into
the Union a sitie qua non. He also appears to be consider-
ably irritated by the high tariff-rates of the McKinley Bill.
Without Union he seems to regard Middle and Western
Europe at the mercy of the " Foreign Policy " of Great
Britain and the "Commercial Policy" of the United
States. He tells us that soon after the passage of the
American Tariff Act of 1890 an article appeared in the

597] Proposed Middle European Tar Of -Union. 27

French " Journal des Debats/' the writer of which regarded
a tariff war between Europe and the United States as
unavoidable and advised not only France, but Europe in
general, to take immediate action. American pork, lard,
petroleum and grain imported into Europe ought to be
compelled to pay as high an import duty as European
products sent to the United States. Similarly we are told
that Burdeau, a member of the French Chamber of Depu-
ties, in addressing his constituents at Lyons, declared that
the United States should be treated as she treated others.
He suggested that France should buy her petroleum of
Russia and her grain of Austria-Hungary. The " Temps "
regarded it as not improbable that the triumph of the
prohibitive tendencies in the United States might lead to
an abolition of the tariff barriers between European coun-
tries "as Colbert had abolished the customs barriers be-
tween the provinces." Finally, Peez, who devotes con-
siderable attention to French public opinion on American
tariff legislation, tells us that Lockroy, a former French
Minister of Commerce, while speaking against any anti-
American combinations in Europe, said: " Let us content
ourselves with judicious tariff duties against American
pork and we shall then be able to obtain desired advan-
tages from America."

Prof. Schmoller, in his Jahrbuch of 1895 (pp. 1049-1053),
in reviewing Peez's work, speaks of the author as an " ex-
pert of the first rank." His criticism has the double value
of being an excellent analysis of the economic side of
Peez's work and at the same time of giving us a picture
of his own view, which he shows no disposition to conceal.
The basis of Peez's work, he tells us, is the relation of the
Middle European states to England, Russia and the United
States. The last two seek by means of high tariffs — Eng-
land (to use Prof. Schmoller's words) " by means of its
selfish intriguing commercial supremacy (egoistische
rankevolle Handelsherrschaft)" and her colonial policy — ^to
place in jeopardy the economic interests of the smaller

28 Continental Opinion Regarding a [598

states. The average ad valorem tariff-rates (statistics for
1892-93) in the United States is 29.1 per cent, in Russia
27.8 per cent, in Italy 17.9 per cent, in Sweden 11.4 per
cent, in Denmark 10.9 per cent, in Norway 10.6 per cent, in
France 10.2 per cert, in Germany 9.2 per cent, in Roumania
y.y per cent, in Austria-Hungary 7 per cent, in Great
Britain 4.9 per cent, in Switzerland 3.9 per cent, in Belgium
1.8 per cent, and in Holland .5 per cent. In Russia and
the United States tariff-rates vary from 60 to 300 per
cent. They compel the rest of the world to buy their raw
material but refuse, in return, to purchase foreign manu-
factured products. Taking the Russian estimates for 1888
and those of the United States for the fiscal year 1888-1889
the following statistical table tells the story (value in
marks).

Imports from Europe. Exports to Europe.

Russia 918,400,000 2,378,000,000

United States - - - 1,613,600,000 2,288,700,000

2,532,000,000 4,666,700,000

That is to say, these two countries exported nearly 2,100,-
000,000 more marks worth of goods to Europe than they
imported therefrom. Although Russia lately made treaties
with Germany and Austria-Hungary, this fact does not
materially alter conditions, and besides tariff-arrangements
are only a part of the Russian commercial policy. The
Siberian and other railroads, and the development of the
cotton, petroleum and other industries in RuSsia are plac-
ing the other countries of Europe, relatively speaking, at
an increasing industrial disadvantage to her. Similar
economic changes are taking place in the United States,
while England, comprising only 10.6 per cent of the popu-
lation of Europe and only 3.2 per cent of its surface, pro-
duces from 50 to 70 per cent of all the materials manufac-
tured in Europe. Although in late years this island has
proclaimed the policy that she desires no additional col-
onies, she has in the last 20 years practically annexed
4,500,000 square miles of land. From the beginning of

599] Proposed Middle European Tariff-Union. 29

the century England furnished Continental Europe with
manufactured products, taking in exchange their raw pro-
ducts. Since 1875, however, the latter has been supplied
by the United States. Peez therefore comes to the con-
clusion that the German protective policy from 1878 to
1887 was a necessity, a view which is shared by Prof.
Schmoller (" wie ich glaube ganz mit Recht ").

The latter concludes his review in about the following
words, which shows us very plainly his point of view upon
the subject of an European Zollverein: The imj>ortance of
the treaty of 1892 does not lie, so he tells us, in the recipro-
cal concessions which, for the present, are not great, but
in the removal of the dreaded tariff war and in the estab-
lishment of an economic community of interests (Wirth-
schaftsgemeinschaften) which, in many particulars can be
further developed even if we cannot, at present, have differ-
ential tariffs and a Zollverein. The three " world-powers "
— Great Britain, United States and Russia — have the great-
est interest in maintaining and increasing the commercial
antithesis among the Middle European states. Our aim
must be to minimize this antithesis and, where our inter-
ests coincide, to unite — as for example in common meas-
ures against the spread of cattle disease and in railroad
conventions.

In 1896 an International Agrarian Congress was held at
Budapest, at which prominent agrarians — landed proprie-
tors, editors, writers, economists, ministers of agriculture
and others were present. The proceedings of this Con-
gress were printed and appeared the year following in two
large volumes (Congres International D'Agriculture).
" Memoires '* and " replies " to questions previously sent
to prominent " Agrarians " and others are collected in
Vol. I, while the second volume contains the debates of the
Congress.

Among the questions considered were the following
(" Section III (a) Douanes, 3 "):

" In view of the existing international situation is it

30 Contifiental Opinion Regarding a [600

desirable that certain states establish among themselves
closer economic bonds?

'' What would be the industrial consequences of such
an economic Union? "

Of 49 who expressed themselves upon this subject, 14
were Hungarians, 8 were Austrians, 8 w^ere German, 5
were French, while 14 represented other European coun-
tries. Twenty-nine spoke more or less in favor of the
Union, 14 opposed it, while 6 might be classified as neutral
or doubtful. Among the Hungarians 10 were favorable to
the Union and 4 against it. All the Austrian, 6 Germans
and 2 Frenchmen were in favor of a Union, 3 Frenchmen
were against it and 2 Germans were neutral. Of the
remainder 3 were for a Union, 7 were against it and 4
were neutral. It must not be presumed that among those
classified as ** favorable " to a Union, all contemplated the
same kind of an agreement or the same degree of unifica-
tion. A reading of the proceedings of this Congress re-
veals the fact that the question was largely argued from
the standpoint of class interests, a smaller number basing
their observations upon the broader principles of common
weal. The central thought was, naturally, agricultural
protection.

It seems hardly profitable to go too much into detail
regarding this Congress but perhaps the observations
upon the subject of a Middle European Zollverein made
by a few of the most prominent members, may not be out
of place.

According to Geza von Gerloczy (Professor at the Royal
Agricultural Institute at Kassa, Hungary), a closer eco-
nomic Union among the states of Central Europe would
tend to weaken the present agricultural crisis.

Hugo H. Hitschmann, editor-in-chief of the " Wiener
Landwirthschaftliche Zeitung," thought the Union desir-
able because of the protection it would give to agricultural
interests — a view shared by Andre de Llaurado, Inspector-
General of Forests, from Barcelona. For more general

601] Proposed Middle European Tariff-Union. 31

reasons the Union was advocated by Dr. von Jureschek,
Aulic Councillor to the Austrian Central Statistical Com-
mission, and Professor at the University of Vienna, who
thought the plan should include the states of Germany,
Austria-Hungary, Italy and eventually Switzerland, Den-
mark, and the Balkan States.

Dr. W. Lexis, Professor of Economics at the University
at Gottingen, and one of the best German writers on com-
mercial questions, was of the opinion that " a European
Zollverein — at least between Germany and Austria-Hun-
gary— would be a very desirable thing, but the diversity of
agricultural and industrial interests — say nothing of the
political diflFerences — makes such a project almost impos-
sible of realization."

Dr. W. E. Martin of Melbourne (Secretary of Agricul-
ture) begged the question by stating that it depended upon
the political opinion of a person — " a free-trader naturally
looking at the project in a different light from a protec-
tionist."

Henry Sagnier, editor-in-chief of the " Journal de TAgri-
culture " at Paris, stated that such a Union was conceiv-
able between states whose economic interests are abso-
lutely common but that such not being the actual situation
in Europe a Union at the time was not to be thought of.

The Marquis de Vogiie, President of the Agricultural
Society of France, made the statement that such a Union
responded so little to the actual economic and political
situation of Europe, and its chances of realization appeared
so slight, that he thought it useless to consider it.

The two delegates from Russia, Kovalesky (Director
of the Department of Commerce and Manufactures) and
Kasperow (Chief of the Section of Cereals), in a " Memoire
sur les questions du Programme du Congres," concluded
that " the maintenance of customs-laws, be it in the simple
form or be it in the complicated form of Tariff-Unions,
ought to be declared as contravening universal progress."
This seems a good deal for delegates coming from per-

32 Continental Opinion Regarding a [602

haps the most protectionistic of the civilized states to say.
What they had, no doubt, uppermost in mind was a Tariff-
Union among the Middle European states which would
operate very disadvantageously against Russian agricul-
tural interests.

Among the delegates who took part in this Congress were
M. de Molinari, Dr. von Matlekovitz and Prof. Schmol-
ler. The latter suggested that possibly in 1902, when the
present commercial treaties would expire, an experiment in
the direction of a Tariff-Union might be made with grain,
cattle and perhaps other wares among the states of Ger-
many, Austria-Hungar>', Italy, Switzerland and possibly
France, Belgium and Holland. " I admit," says Prof.
Schmoller, " that the Union — like all things great and new
— is not easy to accomplish. Great statesmen with a wise
and energetic policy are necessary."

Louis Strauss, Vice-President of the Superior Council
for Industry and Commerce of Belgium, expressed him-
self at this Congress as follows : "A Tariff -Union of the
states of Central Europe is evidently a dream. The diffi-
culties opposed to its realization are much greater than
when de Molinari (1878-79), inspired by a desire to fortify
the solidarity of the nations involved, proclaimed this beau-
tiful and generous idea."

The Agrarian Von Ploetz, member of the German
Reichstag and Prussian Landtag and first President of the
" Bund der Landwirthe," while agreeing in general with
Professor Schmoller's remarks, styled his proposition to
wait until 1902 as " music of the future " (Zukunftsmusik).
Why should we wait six years before taking action, he
asked. Three points were regarded by him as essential
for the realization of a Tariff-Union, viz.:

(i) The re-establishment of the value of silver.

(2) Prohibition of dealings in futures in grain (already
accomplished in spring of 1896).

(3) Abrogation of the most-favored-nation clause with
non-Central European states.

603] Proposed Middle European Tariff-Union. 33

In view of the proceedings of the Congress above de-
scribed, coupled v^ith the fact that the Landvvirthschafts-
gesellschaft at its General Assembly at Vienna on Sep-
tember 1st, 1896, passed resolutions favoring a Middle
European Zollverein, it seems a rather questionable state-
ment when the " Deutsche Agrarzeitung " (September
18, 1898) says that neither at the Agrarian Congress in
Budapest nor at the one held at Vienna did any " agrarian,
German or otherwise ever propose or favor a European
Tariff-Union such as that of the old German Zollverein.
Only by the free-traders at Budapest was such a proposi-
tion made but it was rejected by the agrarians of all
countries."

Political and economic events in 1897 seemed to con-
spire to bring almost to a focus German, and, in fact, gen-
eral European, hostility to the United States. The Dingley
Bill, with its high import duties on manufactured products,
coupled with the clause whereby bounty-fed goods had to
pay additional duties equal to the amount of the direct
or indirect bounty paid, was the important political
" event " which antagonized especially the industrial classes
whose interests were adversely aflfected by the measure.

The important economic " event " was the coincidence
of good harvests in the United States and poor ones
in Europe, which caused enormous exportation from
the United States to Europe not only of grain but of other
food products, particularly meat. Such conditions were
not conducive to soothing the increasing bad humor of
the agrarians. The question of a tariff war or some sort of
a European tariff combination against the United States
was transferred from the realm of theoretical political
economy almost to that of practical politics. The press
nauseated itself with unkind statements about America.
It was this condition of things, coupled with a " Germanic "
consciousness of the possible or probable future economic
and political preponderance of the United States as a
" world power " which explains, in a large degree the anti-
42

34 Continental Opinion Regarding a [604

American tenor of the German press during the war be-
tween the United States and Spain.

Even before the Dingley Bill was enacted, but after its
passage became a foregone conclusion, the question of
Germany's most-favored-nation rights with the United
States was made the subject of an interpellation in the
Reichstag (May 3rd, 1897), by the Agrarian leader. Count
Kanitz. After emphasizing the common interests of agri-
culture and industry against the ** unreasonable " tariff
legislation of the United States, he said: "If we are to
arrive at some effective measures it will be desirable to go
hand-in-hand, if possible, with other European powers,
and I am happy to say there is some prospect that this
may be done. In all of the European states there is a
strong reaction against this new advancement of the Amer-
ican tariff-policy. The governments have made protests
through their diplomatic representatives at Washington.
Even in industrial circles the movement is beginning. The
sharpest protest was made by the industrialists of Austria.
They have lodged with their government the direct request
for a combination of the European states for the purpose
of adopting uniform counter-measures. I consider the
proposition worthy of a closer consideration." It appears,
as voiced in the reply of Secretary of State von Marshall,
that the government did not share this view of Count
Kanitz. " To do all," said von Marshall, " which Count
Kanitz has, at the present time, suggested would be the
greatest mistake and the greatest sin toward the interests
of those whose protection and welfare is placed in the
hands of the confederated governments."

In commenting upon a debate in the Bavarian Diet at
Munich on October 21st and 22nd, 1897, wherein the aboli-
tion of the most-favored-nation arrangement with the
United States had been recommended, the morning edition
of the Kreuzzeitung (October 23) expressed the hope that
an agreement might soon be made by Germany with France
and other important countries, such as Austria-Hungary,
Italy and Spain, to act conjointly against the United States.

605] Proposed Middle European Tariff -Union. 35

On November 20th, 1897, Count Goluchowski, Minister
of Foreign Affairs of the Empire of Austria-Hungary, in
an address to the Hungarian Committee of Foreign Rela-
tions recommended a European combination against " the
countries beyond the sea," meaning of course primarily
the United States.

The high political position of the speaker naturally gave
an official character to his statements and excited universal
comment. It therefore appears proper to quote somewhat
in detail from his speech which has been kindly furnished
the writer by Charles V. Herdliska, Esq., United States
Charge d'Affaires ad interim at Vienna (see Fremdenblatt
of November 21, 1897).

" The disastrous war of competition which we meet with
at every step and in every field of human activity upon the
part of the countries beyond the sea — a contest which is
not only now going on but which will become greater in
the near future — calls," says Count Goluchowski, " for an
immediate and comprehensive resistance unless the nations
of Europe are to be seriously crippled in their most vital
interests and are willing to fall victim to a disease which
will surely lead to their destruction. They must fight
shoulder to shoulder against this common danger and they
must go into this contest armed with every weapon of
defense which their resources can afford. This is a great
and heavy task and, unless all signs fail, it will impress its
character upon the epoch of history into which we are now
entering.

"As the i6th and 17th centuries were filled with religious
wars; as in the i8th century liberal thought made a way
for itself to the fore ; as the present century has been char-
acterized by the development of national questions; so the
20th century promises to be in Europe a struggle for exist-
ence in the politico-economical field, and European nations
must unite in order to contend successfully in defending the
conditions upon which depend their power to live.

" I trust that the realization of this may become general

36 Continental Opinion Regarding a [606

and that we may be permitted to employ the time of peace,
to which we all now confidently look forward, in gathering
our strength and turning it resolutely in that direction."

The " Neue Preussische Zeitung " (Kreuzzeitung), com-
menting upon this speech of Count Goluchowski, under
date of November 25th, 1897, stated that it was reported
that Spain had consented to take part in any movement
contemplating a European combination against American
tariff legislation. This paper further stated that the Italian
Minister-President Rudini had said that should the United
States persist in raising its tariflf the European countries
must take steps to counteract this evil. The French Min-
ister of Commerce, according to the same authority, had
expressed himself similarly. This papyer seemed to regard
Goluchowski's speech as a warning to Europe (Wahnruf
an Europa). »

On June 13th, 1898, there appeared in a social demo-
cratic magazine a very well written article by Richard
Calwer (recently elected a member of the German Reichs-
tag), entitled " Die Vorbereitung neuer Handelsvertrage,"
in which the writer affirmed that should international com-
petition be excluded by high protective walls to the coun-
tries of Middle and Western Europe it would cause, be-
cause of the smallness of the markets, a weakening of their
productive capacity. Industrial stagnation would ensue
and this would have its effect upon wages and general
consumption. With high tariff walls applied to enormous
territories like the United States, Russia or Great Britain
with her colonies the opposite effects would take place.
" The most rabid (linksstehendste) free-traders will admit,"
said Calwer, " that the present procedure of America makes
further encouragement of her imports into Europ^ an
impossibility."

In order to obtain advantages enjoyed by large coun-
tries, Europe must unite. Such a Union would place her
in a position to obtain concessions as well as give them.

The editors of "Die neue Zeit," in a footnote to this

607] Proposed Middle European Tariff-Union. 37

article, take pains to show their disapproval of the position
taken by its writer. Their argument runs as follows:
The rabid free-traders are by no means the only ones who
recognize that no further concessions to America are pos-
sible. If a Middle European Zollverein means a move in
the direction of doing away with the tariffs which hamper
the countries of Europe, then it should be hailed with joy.
If it means, however, protectionism and tariflf-wars (which
would probably be encouraged by such a Union), then we
are opposed to it. In any case there is no likelihood of
its realization. The truth is that such a Union means
nothing more than agrarianism and protectionism ex-
tended to Middle Europe. It is foolish to argue that
England will, in the near future, go over to protectionism.
This policy in the United States and Russia would prin-
cipally make such a Union necessary — if necessary at all.
Russia is no copy for us but the American people in their
opposition to monopolies are more free-traders in sym-
pathy. We Social Democrats do not want to antagonize
this sympathy by such a Zollverein. This view of the
editors may be regarded as the social democratic stand-
point since it corresponds to the utterances of nearly all the
prominent Social Democrats as voiced in their Parteitag
at Stuttgart on October 6th, 7th and 8th, 1898.

Volume II of the " Schriften der Centralstelle fiir Vorbe-
reitung von Handelsvertragen " — an organization whose
aim is to promote the industrial rather than the agrarian
interests of Germany — deals with the commercial relations
between Germany and the United States. The author,
Prof, von Waltershausen, after demonstrating that in a
tariflF-war with the United States Germany would be
worsted, comes to the conclusion that the countries of
Middle and Western Europe must come to a common
understanding regarding their economic relations with the
United States. Prof, von Waltershausen does not contem-
plate a European Tariff-Union modeled after that of the
old German Zollverein. His idea is that the individual

38 Continental Opinion Regarding a [603

members of the Union — which might begin with the coun-
tries comprising the Triple Alliance, but should eventually
include practically all the states of Central and Western
Continental Europe — should agree to form no commercial
treaty which was not essentially applicable to all members.
Should America not come to terms the combined action of
all members of the Union would make a tariflf-war much
more advisable and might be inaugurated by prohibitive
import duties on American tobacco, meats, lard, wheat, and
a diflferential tariflf on American cotton and products of the
mine.

As a basis for his plan, the following points are recom-
mended by Von Waltershausen :

1. Any agreement must last lo years.

2. The present German tariff-rates are to be applied to
American goods imported into the Union.

3. The tariflF-rates in the Wilson Bill are to be applied to
goods imported into the United States from the countries
of the Union.

4. The most-favored-nation clause is to be abolished.
This would allow greater freedom to the members of the
Union to make such special tariff arrangements with other
states as do not conflict with the regulations between the
Union and the United States.

Such a proposition as the above, appearing under the
auspices of an organization devoted to the German indus-
trial interests, might be regarded as significant were it not
for the fact that the book was prefaced with the following
words from the director of the organization : " We do
not agree with the personal views of the author in all
points; this applies especially to the final proposition ad-
vanced by him."

The next publication of this society is a work entitled
" Die Politik der Handelsvertrage," under the authorship
of its Director, Dr. Vosberg-Rekow. He speaks of the
plan of a Middle European Zollverein as " an idea ad-
vanced by a large number of theorists," which might seem

609] Proposed Middle European Tariff-Union. 39

to indicate that so far as industrialists are concerned the
matter is more a question of '* theory " than of " practice."

In a September number of the " Economist Frangais "
there was an article from the pen of the eminent French
economist, Paul Leroy-Beaulieu, on the subject of a Euro-
pean Federation. The Czar's disarmament proposal might
be realized under certain conditions, viz.: Germany's wil-
lingness to transfer to France, for an indemnity, Lorraine,
leaving Alsace to constitute itself into a small neutral state
guaranteed by the Powers or to join Switzerland, of which
it would form two cantons, while still remaining a part of
the German Zollverein. Such a plan, by removing the
cause of friction between Germany and France would make
possible the realization of a European Federation whose
objects should be (i) to proclaim a " Monroe Doctrine for
Europe " — a prohibition against any territorial establish-
ment on the part of a non-European Power (meaning, of
course, the United States) on the continents of Europe,
Africa and that part of Asia bordering upon the Mediter-
ranean sea ; and (2) an alliance among the European powers
to help one another with armed force in the Far East and
in the Pacific.

Leroy-Beaulieu recommended also that this federation
against the United States should not only be political but
also economic, and that the states of Europe should allow
each other a preferential customs tariflf. " If," concludes
the writer, " Europe does not want to abdicate in favor of
its new competitors it must make up its mind to constitute
itself on new lines."

" Die Grenzboten " of September 22nd, 1898, comment-
ing ufHDn this scheme of Leroy-Beaulieu, regarded it under
present conditions, as hardly worthy of discussion. This
paper, which is free-trade in its tendencies, further ob-
serves that protectionism applied on such a large scale
would be more objectionable than when applied, as at
present, to small individual states. Such a Tariff-Union
would bring about a greater tension between the states

40 Continental Opinion Regarding a [610

of Continental Europe and the three great powers of the
United States, Great Britain and Russia, with results more
disadvantageous to the former.

Subsequently (September, 1898) an Agrarian Congress
was held at Vienna. There was no recommendation of a
Middle European Zollverein but considerable attention was
given to the plan of the German and Austrian agrarians
advocating united action for obtaining grain-tariffs which
would practically prohibit importations from the United
States. The eminent economist, Prof. Adolf Wagner, in
reply to a letter of the writer, asking his opinion, for pur-
poses of publication, on the subject of a Middle European
Zollverein, expresses his sympathy for the movement,
emphasizing, however, that he fully appreciated the many
difficulties connected with its realization — difficulties which
he regarded as political rather than economic. France he
regarded as the great stumbling block in the way of the
movement but the boundlessly selfish ('* masslose egois-
tische ") commercial policy of the United States, Russia
and Great Britain will compel a gradual cooperation of
the countries of Middle and Western Europe in order to
obtain from these powers proper commercial concessions.
As expressed in a conversation with the writer. Prof. Ser-
ing, who is cited by permission, may be said to hold similar
views.

On October 7, 1898, Prof. H. H. Powers, then of Leland
Stanford University, addressed a circular letter to several
secretaries of German Chambers of Commerce, editors and
economists, asking their opinion, for purposes of publica-
tion, on the plan of a Middle or Western European Zoll-
verein. Professor Powers has kindly allowed the writer
to make citations from their replies.

Dr. Gensel, Secretary of the Chamber of Commerce at
Leipzig, believed that, owing to present protective tenden-
cies and inter-state mistrust and envy, the realization of a
Tariff-Union between Germany and Austria-Hungary or
between Germany and Western Europe in general, was a

611] Proposed Middle European Tariff-Union. 41

question of the far distant future. " This opinion," he
added, "is also shared, so far as I know, by our trading
classes (Handelsstande)."

The " Syndikus " of the Chamber of Commerce at Frank-
fort is unable to answer the question as his Chamber as
well as most other German Chambers has taken no posi-
tion on the question.

The " Secretary " at Konigsberg regards a Tariflf-Union
as an illusion (Traumbild), because of (i) the diversity of
interests among the states which should compose the
Union, and (2) impossibility of equitable ratio for a division
of the rates. " The example of the German Zollverein is
not to the point because this Verein comprised a single —
although somewhat disunited — people, that had never lost
its feeling of unity, and because the German Zollverein
was also simply the harbinger of the German Empire."

The " Syndikus " of the Chamber of Commerce at Aix-
la-Chapelle is favorable to a TariflF-Union between Ger-
many, Austria-Hungary and Italy. He recognized the
difficulties in the way and expressed doubts whether they
could be at present overcome. It may be a practical ques-
tion of the future — perhaps of the middle of the next cen-
tury, especially if " Imperial Federation (i. e., in Great
Britain) is realized."

The Secretary of the Chamber at Stuttgart expressed
his position in the following words: "An international
Zollverein, however plausible and sympathetic the idea
may be, is a Utopia whose realization is growing con-
stantly more difficult."

The semi-official organ, " Kolnische Zeitung," does not
regard a Tariflf-Union as possible. The various states
which should comprise such a Union are more or less un-
friendly to one another. " How is a Union, then, pos-
sible?"

The " Syndikus " of the Chamber of Commerce at
Bremen, refuses to express an opinion on the subject and
has "no interest in the matter," while the editor of the

12 Continental Opinion Regarding a [612

" Schlessische Zeitung " believes that the difficulties in the
way of the realization of a Union would probably be too
great to overcome.

Prof. Rathgen (Marburg) stated that theoretically such
a Tariflf-Union ought to embrace all European states ex-
cepting Russia, England and (for political reasons) Turkey.
Even an optimist, however, would not regard such a
scheme as possible. Greece, Spain and Portugal would
add no value to such a Union, while France's poHtical
antipathy would exclude her. The beginning would have
to be made with Germany, Austria-Hungary and possibly
Italy, while the smaller states of Europe would, by degrees,
be added. There would be many advantages as well as
disadvantages ^rom the proposed Zollverein. The proba-
bility of its realization is not, for the present, very great,
as no great class, as a unit, supports it. The strongest
interests favoring a Union are the agrarian. It will be
the birth of necessity and will come to pass, if at all,
through the development of industry in the United States
or through the realization of non-European-Continental
Zollvereins, namely, Pan-Americanism and Imperial Fed-
eration.

We have now reached the end of our task — an attempt
to portray European, or rather German, public opinion
upon the subject of a Middle European Zollverein. It has
been found that the discussion, so far as the present cen-
tury is concerned, divides itself into two periods. The
first extended from 1834, when the German Zollverein came
into existence, to 1866. The states contemplated as mem-
bers of a Middle European Zollverein, during this period,
were those of Germany and Austria. The underlying eco-
nomic idea was industrial protection against the common
enemy, England. The political " idea " was the struggle
between Prussia and Austria for German hegemony. The
economic crisis happened in the early sixties when the
question was presented to the members of the Zollverein
whether they should enter into new treaty relations with

613] Proposed Middle European Tariff-Union. 43

France and Western Europe, contemplating tariff modifi-
cations in the direction of free-trade, or with Austria, the
result of which would have been a strengthening of the
bonds of protection. The question was solved by Bis-
marck's adoption of the former plan. The political crisis
came in 1866 and was decided favorably to Prussia at
Koniggratz. The new birth was the North German Con-
federation and later the German Empire.

The second period began in the latter part of the seven-
ties when, owing to the industrial revolution in Germany,
cheapened means of transportation and the development of
American agriculture, causes which changed Germany from
a food-exporting to a food-importing country, the " Father-
land " embarked upon a system of agrarian protection
which reached its high-water mark in 1887, while the
German commercial treaties inaugurated in 1892 registered
a slight reaction favorable to the ever-increasing power
of the industrial classes. Economic conditions in the
United States have been an important factor in antagoniz-
ing German, or rather European, interests, while economic
legislation has had a similar effect upon large industrial
classes. This antagonism has expressed itself in recom-
mendations of some sort of an economic combination or
European Zollverein which should include most of the
countries of Middle and Western Europe. The underlying
economic "idea" may therefore be said to be primarily
agrarian protection against the common enemy, the food-
exporting countries, especially the United States.

Our study of the question has shown that no g^eat class
has, as a unit, definitely advocated a Middle European
Zollverein as a political program. The proposition of some
sort of a European Tariff-Union has been advocated in a
more or less modified form by the following:

1. A large number of important European, but more
particularly German, economists.

2. A large number of Hungarian and Austrian agrarians,
while the majority of German agrarians oppose the plan,
although perhaps somewhat less vigorously than formerly.

44 Continental Opinion Regarding a [614

3. Some German industrialists, while Austrian indus-
trialists, almost as a unit, oppose it.

4. Secretaries of boards of trade, journalists and poli-
ticians have, in considerable number and for various
motives, favored the plan.

The natural conclusion from the foregoing exposition
is that, while a European understanding upon some defi-
nite subject which might separate their interests as a class,
from those of one or more other countries, is not an impos-
sibility, the political prejudices and diversity of economic
interests excludes from the domain of practical politics the
proposition of a Middle European Zollverein as contem-
plated by the majority of writers above cited.

An American economist, Professor H. H. Powers, in a
recent article in the " Annals of the American Academy,"
entitled " The War as a Suggestion of Manifest Destiny,"
said : " It is probable that a generation more will see the
entire world under the jurisdiction or within the * sphere of
influence ' of half a dozen Powers who will continue the
struggle with increasing definiteness and determination."
Most people recognize this general tendency and it may
be said that the underlying principle of those who favor a
Middle European Zollverein is the conscious desire of the
members of such a " Verein " to constitute one of the
" half dozen Powers." There are many Germans who say
that this desire of Central Europeans will be realized with-
out the division of sovereignty contemplated by a Zoll-
verein. They reason as follows: Economic forces tend
toward state and inter-state centralization. So far as Mid-
dle Europe is concerned Austria, Denmark and Holland
with her colonies will gravitate toward Germany and will
become in time a united empire.

There are others who say that the enormous industrial
development in the United States and her reaching out
toward foreign markets will weaken her policy of isolation,
make her aims and commercial aspirations coincide with
those of England and Germany and bring a definite " col-

615] Proposed Middle European Tariff-Union. 45

onial open-door " policy. It is interesting to note, as bear-
ing on this point, the present Anglo-Saxon "good-feel-
ing " and more or less of an " approachment " between
England and Germany. A discussion of these latter points,
however, falls out of the scope of the present article.

George M. Fisk,
2nd Sec, U. S. Embassy.
Berlin, December 29, 1898.

Note. — The foregoing paper, as the date" shows, was
written about three years since and was not primarily in-
tended for publication. The diplomatic post held by the
writer precluded a discussion, on his part, of the political
and economic questions suggested by the subject in hand.
He therefore purposely confined his efforts to an attempt
to portray public opinion of Continental Europe on the
question, as reflected in the writings and addresses of her
economists, journalists and statesmen. Since the above
date there have been discussions on the subject called forth
from time to time by the political action of governments,
or by important commercial and industrial changes which
have been taking place in various countries, and especially
in the United States. One of these outbursts occurred
soon after the writing of the above report, being inaugu-
rated by an important Dutch paper which advocated closer
commercial relations between Holland and Germany. The
whole discussion has been confined largely within the con-
fines of Germany, Austria-Hungary and France — the coun-
tries primarily interested in the movement — but there are
of late signs of life in this direction on the part of the
Anglo-Saxon public, the most recent illustration being the
advocacy by Mr. Carnegie, in his installation address at
St. Andrew's University, of a United States of Europe.

The most satisfactory recent discussion of this question
is an article by Professor Francke of Berlin (Zollpolitische
Einigungsbestrebungen in Mitteleuropa wahrend des letz-
ten Jahrzehnts), which appeared in Volume XC of the

46 Continental Opinion Regarding a [616

** Schriften des Vereins fiir Socialpolitik." He reviews the
entire subject in a most scholarly way but is careful to
avoid definite conclusions as is evidenced by his concluding
remarks: "Will it come in the near future to a union of
the Middle European states whose natural leader is Ger-
many? The question mark which we make here must be
a very large one and we are frank to say we have neither
yes nor no for an answer."

We are told in a recent number of the Nation (July 4th,
1901) that "perhaps the most striking thing about the
much-discussed plan for a European trade combination
against America is the fact that nobody takes it seriously,"
while former Assistant Secretary Vanderlip (Forum for
February, 1902) makes the following statement: "The
best judgment in Europe and America is, I believe, pretty
well agreed on the futility of a European tariff alliance
against the United States. Not one of our ambassadors
or ministers believes it is a feasible programme for the
European states, no matter how antagonistic European
statesmen may become toward us on account of our com-
mercial success in foreign fields. I found no important
banker or manufacturer who thought it probable that the
conflicting interests of the various states could be brought
to any harmonious point of view from which to formulate
such a tariflf."

Probably this is a fair statement of the present situation,
and we may conclude that a Middle European Tariff-Union
modelled after the German Zollverein or even the more
moderate plan of general concerted action, such as that
advocated by Professor von Waltershausen, is hardly a
question of practical politics. However, when we review
past history and consider present conditions, especially the
gradual or rather rapid tendency toward not only indus-
trial but also political consolidation, it is not difficult to
feel that back of all this agitation there are forces at work
which are stronger, perhaps, than we realize. Political
institutions, now as in the past, have economic bases.

617] Proposed Middle European Tariff-Union. 47

When industrial conditions change, political institutions
must conform to these changes or go to the wall.

Four hundred years ago Middle Europe comprised many
hundred petty sovereign or virtually sovereign units. Now
the number does not exceed 35, even including the small
German states, and all are dominated by one really great
state — Prussia — which is powerful politically because she is
powerful industrially. The small states of Europe survive
to-day because of historic considerations which are gradu-
ally losing their force and not because there is any neces-
sity for their existence as separate political units. It seems
to the writer that the whole discussion has brought out
two very prominent facts:

1. The large majority of writers cited above have ad-
mitted, either directly or inferentially, that a Middle Euro-
pean Tarifif-Union of some sort was desirable because of
similar economic conditions and wants.

2. On the other hand, the majority have likewise de-
clared against such a Union because of opposing historical
and racial passions and prejudices. This is a virtual ad-
mission that Union in some form or other must come be-
cause in the long run prejudices and passions must give
way to economic and industrial forces. Just what form this
Union or consolidation will take is purely problematical.

George M. Fisk,
Professor of Commerce, University of Illinois.
Champaign-Urbana, III.,
November 3, 1902.

LITERATURE ON THE SUBJECT OF A MIDDLE
EUROPEAN ZOLLVEREIN.'

I. Fremdenblatt (Vienna, Count Goluchowski's speech),
Nov. 21, 1897.

^ In the compilation of the list, the writer has made use of the
bibliographical appendix of Prof. Francke's article (Schriften des
Vereins fiir Socialpolitik, Vol. XC).

48 Continental Opinion Regarding a [618

2. Journal des Economistes of Feb., 1879 (article by the
editor, G. de Molinari).

3. " Akten-stiicken zur Wirthschaftspolitik des Fiirsten
Bismarcks " von Poschinger — view of Bismarck under date
of Sept. 25, 1878.

4. " L' Association douaniere de TEurope Centrale," a
pamphlet by R. Kaufmann.

5. " Die zukunftigen Zollvertrage auf der Grundlage
autonomer Tarife der industriellen Lander des Euro-
paischen Kontinents " (1879, Bergman, member of Reichs-
tag).

6. " Zollvertrag mit Deutschland oder wirthschaftliche
Autonomic," by Dr. A. Peez, 1879 (member of Austrian
Abgeordnetenhaus. Peez opposed idea of Middle Euro-
pean Tariflf-Union, but afterwards became the most bril-
liant advocate).

7. Deutschland und Oesterreich-Ungarn. Abhandlungen,
Reden und Briefe von Guido von Baussem, Leipzig, 1890.

8. " Schutz-Zolle, Laissez-faire und Freihandel " (Leip-
zig, 1880, von Dr. Karl Walcker).

9. " Kongress Deutscher Volkswirte," held at Berlin,
Oct. 21-23, 1880.

10. " System der Handelsvertrage und der Meistbegiin-
stigung," Schraut, Leipzig, 1884.

11. Considered by International Agrarian Congress held
at Budapest in 1885.

12. "Deutschland nach Osten! Ill Oesterreich-Ungarn
in Reichsdeutschem Licht. Zweiter Theil : Wirthschaftliche
Verhaltnisse " von Paul Dehn.

13. " Ueber eine zukiinftige Handelspolitik des Deutsch-
en Reiches." Brentano in Schmoller's Jahrbuch for 1885.

14. " Das Projekt eines Oesterreichisch-Deutschen Zoll-
verein," Mamroth in Hirth's Annalen des Deutschen
Reiches, 1886.

15. " Betrachtungen iiber einen mitteleuropaischen Zoll-
verein." Dr. Wermert in " Hirth's Annalen, 1888.

619] Proposed Middle European Tariff -Union. 49

i6. See also Wermert's " Pro Memoria, etc." 1894
(Halle, Kaemmerer & Co.).

17. "La paix par runion douaniere franco-allemande."
Paul de Leusse, Strassburg, 1888.

18. See Peez in " Miinchener Allgemeine Zeitung, No.
129. Also his " Zur neuesten Handelspolitik." Wien,
1895 (a brilliantly written book).

19. Schmollers Jahrbuch, Vol. XV, p. 294 (Prof. Fuch's
review of Patten's Economical Basis of Protection).

20. " Die Zollpolitik der Oesterreich-ungarnischen Mon-
archic und des Deutschen Reiches seit 1868 und deren
nachte Zukunft," von Matlekovits, 1890— very important
work.

21. Schmoller's Jahrbuch, Vol. XV, p. 275 (Schmoller
reviewing Matlekovits' book).

22. " Zukunft der Volker von Mitteleuropa," 1890,
anonymous.

23. Yale Review for May, 1892.

24. Schmoller's Jahrbuch (Werner Sombart, Vol. XVI).

25. Speech of Secretary von Marshall in Reichstag, May

3, 1897.

26. Schmoller's Jahrbuch for 1895 (i049-i053» Schmoller
reviewing Peez's work).

27. Proceedings at the " Congres International D'Agri-
culture," held at Budapest, 1896.

28. Deutsche Agrarzeitung (Sept. 18, 1898).

29. Kreuzzeitung (Oct. 23, 1897).

30. Neue Preussische Zeitung, Nov. 25, 1897.

31. ** Die Vorbereitung neuer Handelsvertrage " (June
13, 1898, magazine article by Richard Calwer).

32. Vol. 2 of " Schriften der Centralstelle fiir Vorbereit-
ung von Handelsvertrage " (Prof, von Waltershausen).

33. Vol. 3 of above — " Die Politik der Handelsvertrage,"
von Dr. Vosberg-Rekow.

34. Sept. number (1898) of " Economist Fran^ais " (Prof.
Leroy-Beaulieu).

43

50 Continental Opinion Regarding a [620

35. " Die Grenzboten " (Sept. 22, 1898, and many other
reviews of Beaulieu's article).

36. *' Die Meistbegiinstigung der Vereinigten Staaten
von Nord Amerika," Calwer, 1902 (Berlin and Bern).

37. " Zollpolitische Einigungsbestrebungen in Mittel-
europa wahrend des letzten Jahrzehnts," von Prof. Ernst
Francke— Vol. LXXXX of Schriften des Vereins fiir
Socialpolitik, 1900. Best recent summary of situation.

38. Der deutsche Zollverein. Von W. Weber. Leipzig,
1869.

39. Die Handelspolitik des Deutschen Reiches vom
Frankfurter Frieden bis zur Gegenwart. Berlin, 1899.

40. Geschichte der preussisch-deutschen Handelspolitik.
A. Zimmerman, 1892.

41. System der nationalen Handelspolitik nach aussen.
J. Wernicke. 1896 (Jena).

42. " Die Idecn der Deutschen Handelspolitik von 1860-
1891." W. Lotz (Schriften des Vereins fiir Socialpolitik,
Band 50).

43. Die Handelspolitik der Grossstaaten und die Kriegs-
flotte. M. Sering (aus " Handels- und Machtpolitik."
Stuttgart, 1900).

44. Deutschland und die Weltwirthschaft. M. Hausho-
fer (Allgem. Zeitung, Miinchen, 1900).

45. Kommende Weltwirthschaft. P. Dehn, Berlin, 1898.

46. Vom Territorialstaat zur Weltmacht. A Wagner.
Rede zu Kaisers Geburtstag, 1900.

47. Weltwirthschaft und Volkswirthschaft. H. Dietzel,
Dresden, 1900.

48. Die Theorien von den drei Weltreichen. H. Dietzel,
Nation, 1900. No. 30-34.

49. Die Handelsvertrage des Jahres, 1903. Vosberg-
Reckow, Berlin, 1900.

50. Ein handelspolitisches Vademecum. W. Borgius,
Berlin, 1900.

51. Zollverein in Central Europe. G. de Molinari, Gun-
ton^s Magazine, XII, 38.

621] Proposed Middle European Tariff-Union. 51

52. Zur handelspolitischen Frage in Oesterreich-Ungarn.
Reichenberger Handelskammer, 1890.

53. Die Zoll- und Handelspolitik wahrend der letzten
Jahrzehnte. Von Mittschewsky, Leipzig, 1892.

54. Entwickelung der deutsch-osterreichischen Handels-
beziehungen von 1849- 1865. K. Mamroth, Berlin, 1887.

55. Oesterreichs kiinftige Handelspolitik vom Stand-
punkte der Industrie. Wien, 1899.

56. Ein Zoll- und Handelsbiindniss mit Deutschland.
Verhandlungen der Gesellschaft osterreichischer Volks-
wirte. Wien, 1900.

57. Mitteilungen des Industriellen Klubs. Wien, 1897-
1898 and 1900.

58. Die Handelspolitik Englands und seiner Kolonien
in den letzten Jahrzehnten. C. J. Fuchs, Leipzig, 1893.

59. Problems of Greater Britain. Charles Dilke, Lon-
don, 1890.

60. Made in Germany. E. E. Williams, London, 1897.

61. Die Kiindigung des englischen Handelsvertrages.
K. Rathgen, Leipzig, 1897.

62. Die Handelsbeziehungen Deutschlands zu England.
P. Arndt, Berlin, 1900.

63. Die Losung der Frage unserer volkswirthschaft-
lichen Existenz. E. Hauser, Ziirich, 1899.

64. Die Bedeutung Hollands fur die deutsche Volks-
wirthschaft. E. von Halle.

65. Die Zukunft Hollands und seine Kolonien. W. Lexis
(Allgem. Zeitung, Miinchen, 1900, No. 51).

66. Deutschland und Holland. O. von Houten (Nation,
Berlin, 1900, Nos. 35 and 36).

67. Ein deutsch-niederlandischer Zollverein. von Wal-
tershausen (Zeitschrift fiir Socialwissenschaft, 1900, Hefte
7 and 8).

68. Deutschland im 20. Jahrhundert. E. von Hartmann
(Die Gegenwart, Berlin, Jan., 1900).

69. Die Beziehungen zwischen Deutschland und den
Vereinigten Staaten von Amerika. G. M. Fisk, Stuttgart,
1897.

52 Proposed Middle European Tariif -Union. [622

70. Schmoller's Jahrbuch (articles by W. Stieda, 1883,
Sombart, 1892).

71. Das Handelsmuseum (articles by S. Feilbogen, 1899,
No. 43; A. Mayer, 1900, Nos. 34 and 15; F. Schonfeldt,
1900, No. 35; Heller, 1900, No. 36; G. Schacht, 1900, No.
42).

y2. Bayer. Handelsztg., Munchen (article of R. Zimmer-
man, 1900, Nos. 20 and 21).

73. A European Zollverein. W. C. Ford in Nation
(N. Y.), XLIV, 546.

74. Zollverein of the Central Powers. Spectator,
LXVII, 833.

75. One Government for the World. G. C. Sibley,
American Journal of Politics, III, 197.

76. Europe and the American Peril. A. D. Noyes,
Nation, N. Y., LXXIII, 5.

yy. American Commercial Invasion. F. A. Vanderlip,
Scribner's Magazine, XXXI, 194-213.

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