The influence of protection on agriculture in Germany

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GIFT OF

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PRICE ONE PENNY

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The

Influence of Protec

on

Agriculture in Germany

Publi.hed by CASSELL AND COMPANY, LTD.,

La Belle Sauvage, Ludgate Hill, London, E.C.,
FOR THE

COBDEN CLUB, Caxton House, Westminster, S.W.

1910

The

Influence of Protection

on Agriculture in

Germany

Published by CASSELL & COMPANY, LTD.,

La Belle Sauvage, Ludgate Hill, London, E.G.,

FOR THE

GOBDEN CLUB, Gaxton House, Westminster, S.W.

1910

ttf2

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> .

The Influence of Protection on
Agriculture in Germany

Nothing in German political history of to-day has
been more remarkable than the results of the recent
by-elections to the Reichstag, at Usedom-Wollin and
Friedberg-Biidingen. Both are essentially agrarian con-
stituencies, and the latter specially was represented for
seventeen years by one of the chief Agrarian leaders in
Germany, Count Oriola, a pillar of the formidable Union
of Farmers, the organisation of Prussian and other
Junkers. Yet in both the Agrarian candidates have sus-
tained a crushing defeat, and that at the hands of the
Social Democrats. Seeing that the latter had at no time
in the course of their previous history been able to obtain
anything like a solid footing in the agricultural districts,
and at the general election of 1907 lost enormously pre-
cisely in the rural and semi-rural constituencies, the present
remarkable swing of political opinion among the agricul-
tural population cannot but be regarded as a symptom
of profound unrest, due to some formidable cause. A
peasant population, which in Germany, as elsewhere, is
not only dominated by the squire and parson, but by the
whole chain of traditions and conceptions handed down
from centuries before, is not easily moved even on the
road which lies nearest to it, and when we see it swing-
ing round within a short period of three years from
extreme conservatism to extreme revolutionism, flouting,
as it were, all authority and all traditions, we are entitled
to suppose some very powerful agency at work.

What is that agency? The Socialist Vorw'drts* in
commenting upon the result of the by-election at Fried-

* June 25, 1910.

berg-Biidingen, put the matter in a nutshell when it said :
"A portion at least of the small farmers have now at last
realised that they had been duped by the Union of
Farmers and had been sacrificed in the interests of the
large landlords." Those who have followed German home
politics during the last decade will not need to be told
what this means. It means that the small farmers have
become disappointed with the Agrarian tariff of 1902,
which they had been induced to support as a measure
calculated to further their interests, but which has ulti-
mately turned out to be to their disadvantage and to
further the interests only of the large landed proprietor.
It is, then, according to the Socialist organ, the discovery
that high Protection has brought them great harm that
has induced the small farmers to revolt against the Junkers
and is driving them into the most uncompromising oppo-
sition to the present order of things.

There is a good deal of truth in this view, for though
the last Agrarian tariff has only been in operation four
years, its detrimental effect on the economic condition of
the small landholder and farmer is becoming patent to all
students of German agriculture. It is desirable that in
this country, too, the public should know what this effect
is, seeing that our Tariff Reformers lay great stress on
the benefits which small farming would derive from pro-
tective duties on agricultural produce, and even profess
to see in them the basis on which a class of peasant pro-
prietors could be created and reared afresh in this country.

There was a time, as everybody knows, when the
German Agrarians were most passionate Free Traders.
"It is true," said Herr von Wedell, the leader of the
Conservatives in the Reichstag, as late as 1877,* "that
there are duties on some agricultural produce, such as
hops, butter, cheese, and pigs. But these duties are
purely financial, and I can tell you— I think all the German

* Janssen, " Liberate Bauernpolitik," Berlin, 1910, p. 53.

farmers will support me — that we are prepared at any
moment to abolish them." Germany was at the time a
great grain-exporting country, and the Junkers had no
interest in duties which would bring them nothing and
would create difficulties for their exports. But in 1879
Bismarck, yielding to the pressure of the big industrialists,
decided to introduce Protection for the manufacturing
interests, and in order to conciliate the Agrarians, who
looked with disfavour on the industrialisation of the
country, he offered them a duty on corn. Not all
Agrarians accepted the bargain. Some fought against it,
and only accepted a duty of 5 marks per ton for purposes
of import "registration." But others saw in the proposed
duty a compensation for the possible decrease of exports,
and even effected an increase to 10 marks per ton. Herr
Wedell now himself declared* that "the protection of
iron and of rye is equally indispensable to the welfare of
the Fatherland." "The welfare of the Fatherland" has
since then become synonymous with a high import duty
on corn and other agricultural produce. In the very year
1879, when he was creating industrial as well as Agrarian
Protection, Bismarck declaredf that "even the most in-
sane Agrarian will never think of a duty of 30 marks per
ton." But in 1885 the duty was raised to that figure, and
two years later it even rose to 50 marks. With the fall of
Bismarck and the advent of Caprivi there came a period
of comparative relaxation, due to the new policy of com-
mercial treaties, and the duties were lowered to 35 marks
for wheat and rye, 28 marks for oats, 20 marks for barley,
and so all round. The amount of Protection thus offered
to the pockets of the Junkers was still very ample, but so
used had they become to make additional profit from

* Janssen, I.e., p. 53.

t Gothein, " Der von der staatlichen Wirtschaftspolitik in Deutschland
erzielte Effekt auf industrielle und landwirtschaftliche Entwicklung,"
Berlin, 1909, p. 2.

the home consumers that its slight curtailment turned
them all into revolutionists. "I propose to you," ran the
famous appeal of one of their stalwarts, Herr Rupert,*
"nothing more nor less than that we should all join the
Social Democrats and make serious opposition to the
Government. We must show it that we will not stand
the bad treatment meted out to us, and that we must
make it feel our power. . . . We must shout so that the
whole country shall hear us; we must shout until our
voices reach the halls of Parliament and of the Ministries;
we must shout until our voice is heard on the very steps
of the throne." And they did shout and oppose the
Government in a manner that up to that time had been
unknown in Germany. They did not, indeed, join the
Social Democrats, but they formed an organisation of
their own — the Union of Farmers — which soon shook
heaven and earth with its cries. It did not matter to
them that the Prussian State Council, after considering
their demands, declined to accede to them, finding it "a
doubtful policy for the State to increase the prime neces-
sity of life." f Nor were they much moved when the
Prussian Minister of Agriculture, Herr von Hammerstein,
openly declared their agitation to be "dangerous from a
public point of view." They did not even mind being
branded by the Kaiser himself as " bread-usurers. "J They
proceeded in their agitation with an ever increasing energy
and unscrupulousness, gained the adherence of the fore-
most Junkers, titled and otherwise, in the land, overthrew
first Count Caprivi and then Prince Hohenlohe, and lastly,
having obtained a Chancellor after their own heart in
Biilow and sympathetic allies in the Clerical Centre, they
succeeded in overpowering all opposition and ultimately,
after a great parliamentary fight, carried their object

* Janssen, I.e., p. 61.

t E. Wurin, " Die Finanzgeschichte des Deutschen Retches," Hamburg,
1910, p. 133.

X Wurm, ib.

through. On the night of December 14, 1902, the new
Agrarian Tariff was adopted in the Reichstag by a
majority of 202 against 100 votes, and came into force in
March, 1906. By it the duty on wheat was raised to
55 marks per ton, on rye to 50 marks, on oats likewise to
50 marks, on malt barley to 40 marks, on fresh meat to
270 marks, on boneless fresh meat to 224 marks, on frozen
meat to 350 marks, and so forth in a generous manner,
excluding from Protection only donkeys, foreign decora-
tions, and dead bodies in coffins.

Undoubtedly the peasants and small farmers formed
the main support of the Agrarian agitation. Even at
present,* out of 316,000 members of the Union of Farmers,
only about 2,000 belong to the class of large proprietors,
who, it is true, manage the Union, but represent, never-
theless, a small minority. The bulk belongs to the peasant
class, which has been gained over by specious arguments
concerning high profits, exclusion of imports, extension
of farm land, safety of the home market, and all the good
things which are usually trotted out on such occasions.
Let us, then, consider how these prospects have been
realised.

The most obvious effect of the Agrarian duties has
been a rise of prices of agricultural produce. To take
but the chief kinds of corn, wheat and rye, we find the
following movement of prices (in marks per ton) on the
Berlin market :t

1895 .«

1900 ...

1901 ...

1902 ...

1903 ...

1904 ...

This table exhibits not only a steady increase of prices

Vheat.

Rye.

Wheat.

Rye.

142.5

1 19.8

1905 ...

.. 174.8

i5i-3

151.8

142.6

1906 ...

.. 179.6

160.6

163.6

140.7

1907 ...

206.3

193.2

163. 1

144.2

1908 ...

211. 2

186.5

161. 1

132.2

1909 ...

•• 233.9

176-5

174-4

i35-i

1910 (Jan.

1) 227.1

167.0

* Wurm, I.e., p. 130.

t Compiled from the data of Berlin Statistical Bureau by the
Vorwarts," No. 123, 1910 (" Wirtschaftlicher Wochenbericht ").

s

of corn in the course of the last fifteen years, but, what
is of special interest to us, a considerable jump in the
year 1906-7, immediately after the new Tariff came into
force, and the unmistakable growth since then. It may,
of course, be argued that this increase of prices has been
noticeable in all countries and is not confined to Germany
alone. As against this it is but necessary to compare
the prices in Germany and this country in order to see
that all through German prices have been increased by
the amount of the duty. Thus the annual average prices
of wheat per imperial quarter in England and Wales and
Prussia have been, since 1875, as follows:*

England and

Amount of

Wales.

Prussia.

Duty.

s.

d.

s.

d.

s. d.

187s ...

45

2

4i

11

—

1880 ...

44

4 ■•■

46

10

2 2

1885 ... .

33

10

34

8

3 2

1890 ...

3i

11

4i

2

6 6%

1895 ...

23

1

30

0

7 VA

1900 ...

26

11

33

1

7 7%

1905 ...

29

8 ...

36

7

7 7X

1906 ...

28

3

37

3

11 10

1907 ...

3°

7 ■••

43

1

11 10

1908 ...

32

0

43

8

11 10

Ever since the first duties were introduced the prices
in Prussia have invariably stood above those in England
and Wales almost to the exact amount of the duty.t
Indeed, it could not be otherwise, for though the pro-
duction of corn cannot be regulated in a manner similar
to that of manufactured articles, in consequence of which
a good crop must necessarily lead to a fall of home prices,
be the import duty ever so high, that danger has been

" British and Foreign Trade and Industry," 1909 (Cd. 4954), pp.
194-195.

t According to the " Vierteljahrshcft zur Statistik des Deutschen
Reiches," 1910, I., the price for wheat in the first quarter of the current
year was as follows: Berlin, 226.2; London, 164.5; Odessa, 167.6;
Chicago, 173.5, ar|d Liverpool, 191.3 marks (shillings) per ton.

obviated in Germany by a provision allowing a remission
of duty to the exporters of corn in the shape of certifi-
cates entitling the holders to a rebate of equal amount on
certain articles — coffee, petroleum, flour, and corn — im-
ported from abroad. Thus, supposing one exports 1,000
tons of wheat, the exporter gets a certificate of the value
of 5,500 marks, which is the amount of duty which that
quantity of wheat would pay if it were imported. The
certificates can then be sold to an importer of coffee at
the usual discount, and the rebate is turned into an export
bounty. In this way the corn market is effectually relieved
from a superfluity of corn which might have reduced the
price, and the corn grower, even when selling abroad at
the world's market price, pockets his duty.*

So far so good — not, indeed, for the consumer, but for
the corn grower. But who is that fortunate person who
is always secure of his additional "earning" of 5 marks
or 5 marks 50 pfennig per ton? Is it the small farmer?
Not in the least. Prince Hohenlohe, in the course of the
Agrarian debate in the Reichstag on March 29, 1895,
spoke as follows : f

"Such proposals will by no means benefit all the
farmers. The major portion of farming concerns will
derive no benefit from them, and there are many which,

* Report on Frankfort for 1908, pp. 17-19 ; Wurm, I.e., pp. 141-142.
This clever contrivance is operated under the cloak of the law, which
permits the free importation of goods intended for re-export, provided
they carry with them a proof of their identity. In the case of corn,
however, this latter provision was abolished in 1894, as a result of which
corn is exported as if it has been previously imported. The State loses
by this veiled system of export bounties enormously, the exports being,
of course, much larger than the imports. Thus, between August 1, 1908,
and July 1, 1909, the duty on rye yielded to the Exchequer ,£540,000,
and the expenditure in connection with the issue of the remission certificates
amounted to .£1,940,000. The difference — the taxpayers' money — was
pocketed by the exporting landlords. Recently the Government made an
attempt to justify the system in a Memorandum submitted to the Reichstag.
The arguments were torn to shreds by the Association of German Millers
in a counter Memorandum. See " Kolnische Zeitung," May 31, 1910.

t Wurm, I.e., p. 133.

IO

so far from being benefited, will only suffer from them.
. . . Farms up to 12 hectares* have no corn to sell at all,
but have in most cases to buy corn themselves. In the
best of cases farms above six hectares will, if the soil is
favourable, be in a position to meet the demand of the
owner and his family for corn. The number of farms
below 12 hectares amounts to some four millions, that is,
76 per cent, of all farms. Taking three and half persons
per farm, we find that a population of something like
15 millions will derive no benefit from an increase of
corn duties — nay, they will, with few exceptions, directly
suffer through an increased cost of their living."

This was the opinion of an Imperial Chancellor, him-
self one of the largest landowners in Germany, and there
can be no doubt that it was rather optimistic than other-
wise. It is generally believed t that only farmers hold-
ing more than 100 hectares can and do grow corn for sale,
which for milling or export purposes must be of uniform
quality and offered in large quantities ; farmers holding
between 20 and 100 hectares do not grow it regularly,
and those holding less than 20 hectares may be said not
to grow it at all or grow it only for their own consump-
tion. The distribution of landed property in Germany
was, however, according to the last census of 1907, as
follows (in hectares) :

No.

Per cent

Below 2

3.378,509

- 58.7

From 2 to 5

1,006,277

... !S.5

From 5 to 20 ...

1,065,539

... 18.5

From 20 to 100 ...

262,191

4.4

Above 100

23,566

O.9

The first two classes of farmers who certainly do not
grow any corn at all, but have to buy it for their con-
sumption, form over 77 per cent, of the total number of
landed proprietors. They are directly damaged by the

* The hectare is equal to 2.47 acres,
t Janssen, I.e., pp. 67-68.

II

corn duties and the consequent high prices. The next
class, those farming between five and 20 hectares, may
not suffer from the duties, but they do not derive any
benefit from them, and they form 18.5 per cent, of the
whole. It thus appears that the high duties on corn have
only benefited something like 5 per cent, of the "total
number of farmers in Germany, those being the largest
proprietors — the so-called big peasants (Grossbauern) and
the feudal landlords, the Junkers. "Welfare of the Father-
land " indeed.

But if the small farmers do not grow corn, perhaps
they grow something else on which they benefit by Pro-
tection ? No doubt they do. They breed live stock for
slaughter and dairy purposes, which pursuit still forms
the main agricultural occupation in Germany. Accord-
ing to official statistics, which some regard as rather an
under-estimate,* 40.6 per cent, of the net revenue yielded
by agriculture comes from cattle rearing and the dairy
industry, as against 26.4 per cent, which is derived from
the sale of corn. It is at the same time a pursuit in which
the small farmer engages to a much greater extent than
the large landowner. To take the figures of the last
census in Prussia, we find t that whereas on the large
farms of 100 hectares and over the number of cattle raised
was one per 4.2 hectares and that of pigs was one per
7.54 hectares, on the middle-sized farms the corresponding
figures were one per 1.9 and 1.89 hectares respectively.
Only in sheep raising, which, of course, requires exten-
sive pastures and is only possible on large estates, the
farms of 100 hectares and over show a preponderance over
the smaller sized, the ratio of sheep being one per 2.4
hectares on the former, as against one per 9.6 hectares
on the latter.

* Gothein, I.e., p. 9; cf. Janssen, I.e., p. 42.

t " Korrespondenz des Deutschen Bauernbundes " in "Frankfurter
Zeitung," July 8, 1910.

12

At the same time the prices of live stock and meat
have risen considerably. The following shows the move-
ment of prices of the chief animals in Berlin in marks per
ioo kilo, slaughtering weight :*

Cattle.

rigs.

Calves.

Sheep.

1886-90

104.04

98.07

98.06

101.04

1891-95 ..

116.07

102.06

107.04

101.00

1896-1900 ..

... 114.07

98.66

119.04

107.02

1900-05

... 127.03

m.03

13509

126.06

1906

... 147.07

133.08

162.07

15707

1907 ..

146.06

no.03

163.04

M903

1908

139.00

116.03

156.06

140.07

1909

131.06

13303

156-07

141.05

For reasons which will be mentioned below the move-
ment of prices of meat has not been, and, indeed, could
not be, so uniform as that of the prices of corn, but the
general rise since the middle of the 'eighties is unmistak-
able, and the jump in 1906 is especially very notable. It
would thus appear at first glance that the small farmer,
who, as we said, is for the most part a cattle and pig
rearer, must have done, under Protection, very well. But
that is only "at first glance," as he himself soon found
out. After the first flush of enthusiasm in 1906, which
made him vote at the elections of January, 1907, for the
Junkers and other Protectionists, the small farmer began
to perceive that the high prices of cattle and pigs did not
go by themselves, but were accompanied, shadow-like, by
high prices of other articles, which went far to neutralise
the advantages from the high meat prices. There were,
first of all, the high prices for fodder. By the new Tariff
of 1906 the duty on maize was suddenly raised from 16 to
30 marks, that on fodder rye from 35 to 50 marks, that
on beans from 15 to 20 marks per ton, and so on, with
the sole exception of barley, the duty on which, for fodder
purposes, was reduced from 20 to 13 marks per ton. These
duties render imported fodder absolutely inaccessible to

* Reports on Frankfort for 1907, p. 18 ; for 1908, p. 20.

*3

the small farmer, who has thus to rely exclusively on his
own production of these articles. Should the corn, hay,
and potato crops turn out satisfactorily, the small farmer
can, other things being equal, make a good profit out of
the sale of his cattle or pigs ; but when the crops fail, as
not infrequently happens, especially on small farms with
insufficiency of manure, the animals can no longer be
fed, and they are taken to market in poor condition and
there sold at almost any price. In such times there is
an overwhelming supply of young animals on the chief
markets, and the prices sink to a ruinous level. Should,
immediately afterwards, the prices rise again, the peasant
finds himself in a position of not having any more animals
to sell, in consequence of which he is unable to make use
of the improved condition of the market.* Thus — to take
an example from recent years t — in 1901 the prices for
pigs stood at a pretty high level of 46 to 47 marks per
100 kilos. In 1904, however, the potato crop turned out
very badly, being about 14 per cent, lower than in the
previous year. At once the small farmer, who could buy
no other fodder on account of the duty, was driven to
dispose of his pigs, and the prices sank to 33-34 marks.
In the course of 1905 the prices rose again to 44-49 marks,
but, the sties being now empty, it was only the big farmer
and the Junker, who had been able to withhold their pigs
from the market in the previous year, who got the benefit
of the high prices. Gradually, however, the peasant, too,
succeeded in rearing up a new supply of pigs, but by
the time he was beginning to make a good profit there
came the partial failure of the crops in 1907, together
with the crisis, which reduced the consumption of meat,
and he once more found himself with a vast number of
animals on his hands which he had to sell or else lose
altogether. The prices for pigs sank once more from

* Gothein, I.e., pp. 10-12.
t Janssen, I.e., pp. 98-104.

'4

54 to 60 marks per 100 kilos in September, 1906, to
29.30 — 32 marks in the autumn of 1907, and the poor
peasant had to lament the duties on fodder, which render
a steady course of production and sale impossible. This,
by the way, is the reason why the prices for cattle and
pigs do not move in a regular manner, but are subject
to violent fluctuations.

Along with the duties on fodder the small farmer has
only too often to lament the high duties on living animals
which he requires for rearing or breeding purposes. It
is largely the practice of the peasantry on the Eastern
frontier — in Posen, East and West Prussia, and in Upper
Silesia — to acquire young and lean animals and rear them
or fatten them, as the case may be, and afterwards re-sell
them. The high prices for live animals have rendered
this hitherto pretty safe business exceedingly speculative
and placed great difficulties in the way, especially of the
smaller farmer. It equally applies to cattle and pigs, and
still more so to horses, the breeding of which by the small
farmer has now been almost entirely abandoned, the duty
on horses amounting to 50-75 marks per head.

It is not otherwise with the improvement of the stock
which is of particular importance in the dairy industry.*
Dairy farming is still carried on by the small farmer to a
large extent, owing to the high prices for milk, butter,
and similar produce. But here, too, he has to contend
with ever-increasing difficulties. The climate of Germany
is generally dry, and with the gradual shrinkage (if
meadow land, consequent upon the extension of corn
culture (of which we shall yet have to say a word or two
below), the small farmer has to fall back more and more
upon the system of feeding his cattle in sheds. This has
a detrimental effect upon the cattle and renders the intro-
duction of new blood by foreign breeds indispensable.
But how can the small farmer afford foreign varieties

* Gothcin, I.e., p. 10.

*5

when the duty on all horned cattle amounts to 8 marks
per ioo kilos, of live weight, equal to at least 40 marks
per bullock or cow ? To this is added the embargo which
is laid on foreign cattle ostensibly for the purpose of safe-
guarding native breeds from contamination, but in reality
to exclude foreign competition.* No ruminant animals
may be imported from the United Kingdom, France,
Italy, Netherlands, Russia, America, Australia, and many
other countries, except, under certain conditions, from
Austria-Hungary and Denmark. As a consequence the
native race is left unimproved, and, with the exception of
certain districts, yields insufficient milk, and that of none
too high a quality .f

It is, of course, impossible, in the absence of statistical
data, to estimate even approximately the damage done to
the rearing of live stock and the dairy industry by the
dearness of fodder and the practical exclusion of foreign
breeds. Indirectly, however, the results are seen in the
exceedingly slow process of expansion of these particular
branches of agriculture, in spite of the growth of popula-
tion and the rapid urbanisation of Germany. We find,
for instance^ that while in the period between 1896 and
1906 the area under the chief corn plants increased by
360,625 hectares, and that under potatoes by 249,211
hectares, meadow land only extended by some 42,000
hectares. Likewise we find§ that, according to the census
of live stock in the German Empire on December 2, 1907,
only the number of pigs increased in the period between
1892 and 1907 in a substantial manner, namely, from
12. 1 to 22.1 millions, or 82 per cent., whereas the number

* Wurm, I.e., p. 143. Recently about forty head of German cattle,
carefully selected for the Argentine Exhibition, were rejected by the sanitary
authorities at Buenos Ayres as suffering from tuberculosis.

t Gothein, I.e., p. 10.

X Gothein, I.e., p. 8.

§ Journal of the Board of Agriculture, June, 1909, p. 214.

i6

of horses, including military, only increased from 3.8 to
4.3 millions, that is, 13 per cent., the number of cattle
from 17.5 to 20.6 millions, that is, 17 per cent., and the
number of sheep even fell from 13.5 to 7.7 millions. Con-
sidering that the raising of live stock is mainly the occupa-
tion of the small farmer and constitutes his chief source
of income, it is obvious that his business, except in the
pig-rearing branch, has not prospered much. It must,
moreover, be noticed that our statistical information does
not carry us further than the first year after the introduc-
tion of the new tariff. We shall have to wait for the next
census in order to be able to measure the full effect of the
"protective" duties on this particular branch of agri-
culture.

It is thus evident that the German small farmer is, after
all, not such a happy creature as one is generally apt to
infer from the high prices which obtain in Germany for
agricultural and dairy produce. That branch of agricul-
ture which is prosperous is the one from which he is almost
entirely excluded, and those branches in which he is pre-
eminently engaged are not prosperous at all.* To these
disadvantages of a producer must be added the general

* A striking corroboration of the arguments set out in the text is
contained in a pamphlet recently published by Baron Ferdinand von Pantz
on the effects of the Agrarian duties in Austria, another highly " protected "
country (" Die Hochschutzzollpolitik Hohenblums und der osterreichische
Bauernstand," Vienna, 1910). The author is himself a high Agrarian, and
the material contained in his pamphlet has been collected by the Austrian
Ministry of Agriculture. We quote the following conclusions of Baron
von Pantz from a review of his pamphlet in the " Frankfurter Zeitung "
of July 8, 1910 :

" It can be safely assumed that farms below 5.75 hectares are nowhere
able to sell corn or similar agricultural produce. In districts less favourable
to agriculture, those situated in the mountains or covered with woods, the
area of farms which have to purchase their corn is still larger. Even
farms of the extent of 50 to 100 hectares are obliged to purchase quantities
of corn and of fodder. The author, therefore, comes to the conclusion
that between 90 and 95 per cent, of the Austrian peasantry have no interest
in the high corn prices, but are, on the contrary, often directly damaged
by them. The harm consists not only in the enhancement of the cost of
living, but also in the rise of the costs of cattle production. Cattle rearing

17

disadvantages which he shares with other consumers, but
which, in his case, react on his position as a producer.
He has to pay enhanced prices not only for his clothing
and certain articles of his food, but also for his instruments
of production — for his ploughs and other agricultural im-
plements, for his horses and horses' harnesses, for his
farm utensils, for his paint and for his tar, for his bricks
and for his tiles — in short, for everything which he uses
in his life and work. To take but one apparently trivial
example.* Leather has to pay a duty according to weight.
The peasant, even if he be the most cultured person on
earth, must have for his field and farm work heavy boots.
These weigh in Germany not less than 3% lbs. This
carries with it a duty of is. 3d., as against 5d. which a
fashionable young lady has to pay on her pair of dancing
shoes. Such additional expenditure tells heavily on the
peasant's budget, and cannot easily be made good by the
high prices of corn which he does not sell, or by the prices
of meat, which constantly fluctuate, or by the good prices
for dairy produce which he cannot supply either in
adequate quantities or of adequate quality.

But the above are only the direct effects of Protection
working chiefly through the high prices for the auxiliary

requires a considerable amount of human labour, and the price of the
latter is raised by the increased cost of breadstuffs. Also the fodder
plants are expensive. In consequence of this the prices for cattle and corn
frequently exhibit a movement directly opposite to each other. Official
statistics show that high corn prices bring about low prices for cattle,
especially when the hay crop turns out unsatisfactorily. A high price for
corn compels the peasant to get rid of his cattle at all costs, whereby
cattle prices are forced to a low level. The author shows how, since the
increase of Agrarian duties, numerous peasant farms have been working
at a loss, and how, even in the Alpine districts, the standard of life
among the peasantry has been lowered. He asserts that the Alpine
peasantry is becoming, in consequence of the high agrarian duties,
pauperised and must soon, like a ripe fruit, fall into the lap of the
Social Democracy." Tout comme chea nous, may well a German reader
say on perusing these words.

* Janssen, I.e., p. 71.

i8

material of agricultural production. There are also some
indirect ways in which Protection works — more subtly,
it is true, but none the less powerfully. We shall single
out only one, but that one is already playing havoc with
the entire agricultural system of Germany. We mean
the way in which the protective duties, by increasing the
prices for agricultural produce, enhance almost to a pro-
hibitive extent the rents, and ultimately, through the
rents, drive the land values (which, of course, are nothing
but capitalised rents) to a tremendous height. A few in-
stances will suffice to illustrate this important movement.
In the course of 1909 and the present year a number of
leases of Prussian State Domains fell in and were renewed,
and the rents, according to a return made to the Prussian
Landtag, moved upwards in the following manner.* One
estate used to pay formerly 24.2 marks per hectare; now
it will pay 30.5 marks. The rent of another brought in
formerly 19.3 marks, and now it will amount to 28.7
marks. A third estate was held on lease in 1873 to 1891
at a rent of 108.9 marks per hectare; from 1891 to 1909 the
tenant paid 120.2 marks; and the new lease was granted
at 139 marks. Yet a fourth used to yield 84.4 marks per
hectare; now it will yield 113.3 marks. The other dayf
the same administration leased out two other domains;
one, which formerly yielded only 12,000 marks, was now
leased out for 25,100 marks, and the other, which hitherto
carried a rent of 13,000 marks, will now bring in 30,256
marks. Similarly with the purchase prices of land. A
nobleman's estate (Rittergut) was bought twelve years ago
for 270,000 marks. That was the time of Capri vi's era of
commercial treaties. In 1908, however, two years after
the introduction of the new tariff, it was sold for 500,000
marks, and at the beginning of the present year it was
sold once more for 750,000 marks. J Within a dozen years

* " Berliner Tageblatt," January 15, 1910.
t " Frankfurter Zeitung," July rj, iqio.
+ " Frankfurter Zeitung," July 19, 1910.

*9

the value of the estate has thus increased 200 per cent.
Similarly, an estate in Mecklenburg, recently acquired by
Prince Schaumburg-Lippe, was bought in 1890 by a
certain baron for 80,000 marks. He sold it a few years
afterwards for 200,000 marks, and now the prince has
bought it for 1,000,000 marks.* It is simply a case of
capitalisation of the Agrarian duties, and nothing more.
How, then, does the small farmer fare amidst this enormous
growth of land values ? It is evident that it is of no
advantage to him so long as he lives, because, should he
sell his land, he would cease to be an agriculturist and
lose his sole source of income. He is not like a large
landowner, who can sell his estate and, realising a good
sum, invest it in some more profitable undertaking. But
when he dies, what becomes of his land ? It cannot feed
his several sons, seeing that it only fed him alone with
great difficulty. It is the practicef in German peasant
families that one of the heirs should get the land and pay
out the others in cash. But if the land values are high,
the shares of the co-heirs will be equally high and will
entail on the new proprietor a correspondingly heavier
expenditure — in the majority of cases a debt just at the
beginning of his new career. This, in the best of cases,
when the land is the peasant's own. Should, however,
his land, or a portion of it, be rented, it stands to reason
that he has nothing to gain from the high land values,
but everything to lose. He can neither increase the size
of his farm nor, perhaps, retain his old one, and his
position will proportionately deteriorate. The growth of
land values, consequent upon the high protective duties,
is thus no help but a great hindrance to the development
of small estates and small farming.

It may, then, be asked, what is the evidence supplied
by statistics with regard to the movement of landed

* " Frankfurter Zeitung," June 8, 1910.
f Gothein, I.e., p. 14.

20

property in Germany and its distribution ? Do the small
farmers increase or decrease in number, and does the land,
owned or farmed by them, grow or contract? The latest
available data refer to the year 1907, and they compare
with those of the previous census as follows :

Fer cent, of total
cultivated
Size of Farms No. of Farms. area farmed,

(in hectares). 1895. 1907. 1895. 1907.

Below 2 ...
From 2 to 5
From 5 to 20
From 20 to 100
Above 100

3,236,367 3, 378.509 ••• 5-6 5-4

1,016,318 1,006,277 ... 10. 1 10.4

998,804 1,065,539 ... 29.9 32.7

281,767 262,191 ... 30.3 29.3

25,061 23,566 ... 24.1 22.2

This table seems to contradict all the inferences to
which we have been led by the foregoing discussion, and
to support the views of those who maintain that Protection
has been of great advantage to the small farmer. The
larger farms, from 20 hectares onwards, have decreased
both in number and in area; the middle-sized farms have
increased in both; and while the farms of between two
and five hectares have decreased in number and increased
in area, those below two hectares have increased in number
though decreased in area. On the whole, the table shows
a slight transference of the centre of gravity of German
agriculture from the larger to the smaller farms.

Yet we must not be too hasty in accepting this
apparently obvious conclusion. The "farms" below two
hectares do not count at all.* More than one-third of
them are below a quarter of an hectare, and they over-
whelmingly represent either kitchen gardens or potato
patches, placed at the disposal of factory workers by
industrial magnates, or of agricultural labourers by the
local landlord at a nominal rent, with a view to keeping
the men on the spot as "adscripti glebae," or in exchange
for services to be rendered at certain seasons. Their im-
portance, if any, consists in the fact that their increase

* Wurrn, I.e., pp. 151, 152.

21

has pro tanto diminished the area of the larger farms and
thus contributed to the apparent retrogression of the
figures in the last two lines of the table.

To some extent the same may be said of a consider-
able number of farms in the next class, since allotments
of two hectares are only suitable for keeping a few pigs
and growing a quantity of potatoes and other vegetables,
and are not infrequently given by the landlord to the
labourer as a "retaining fee" or as part of his wages.
But with reference to this and the next class we must bear
in mind the working of the famous Polish Expropriation
Acts since 1886, which have been instrumental, at a great
expense to the Prussian State, in breaking up a large
number of big estates in the provinces of Posen and West
Prussia and in artificially creating in their place a still
greater number of small farms.* From that date to the
end of 1909 the Prussian Government acquired 475 noble-
men's estates and 294 large peasant farms, forming a
total of 370,562 hectares, at a price of about .£17.5 millions.
The estates formed at least seven-eighths of this total
area, and averaged over 500 hectares each. Upon this
land more than 17,000 families have been settled, the
average size of the holdings, created during the recent
years, being about 12 hectares. f This vast number of
small farms artificially created will go a long way to
account for the increase of farms of the third class.

Lastly, it is to be observed that the return which we
are now discussing refers to the year 1907, when admit-
tedly the small farmers were still labouring under the big
Protectionist delusion and were acquiring and leasing land
in the expectation of still bigger profits in the future.
Considering the disappointment which is now spreading
in their ranks, one is entitled to assume that much of this
speculation has turned out since then a ghastly failure, and

* Gothein, I.e., pp. 7-8.

t The Times, April 12, 1910, " Prussia and the Poles."

22

will correspondingly reveal itself in the figures of the next
census.

Another insight into the agricultural situation in
Germany is afforded by the figures of the general popula-
tion census, which, however, also refer to the year 1907.
The following is the number of agricultural population,
according to the last three censuses, in the German
Empire, and its relation to the total population : *
1907 17,681,176 ... 28.6

1895 i8,Soi.433 ••■ 35-6

1882 19,225,455 ... 42.0

These figures, however, include persons engaged in
forestry and gardening, and those also to whom agricul-
ture is not the main pursuit or who are merely engaged
as domestic servants. Excluding these branches of agri-
cultural industry and all classes which are not directly
engaged in agriculture, we obtain a more favourable
picture, namely :

1907 9,581,802 ... 15.5

1895 7.841.858 ... 15.1

1882 8,267,549 ... 18.2

It would thus appear that the proper agricultural popu-
lation of the German Empire has, since the preceding
census, increased not only absolutely, but even relatively
to the whole population. But the significance of this is
wholly discounted by two facts. The first is that the
increase in the number of persons engaged in agriculture
is entirely due to the increase in the class of wage
labourers, while the class of independent farmers has,
on the contrary, decreased. In 1882 there were 2,288,033
independent farmers; in 1895, 2,568,725; and in 1907,
2,500,974. The number of agricultural labourers (in-
cluding a small fraction of salaried employes, such as
managers and clerks) was: 1882, 5,848,463; 1895,
5'723>967; !907> 7.382,553. Thus, between 1882 and 1895,
the period of comparative economic Liberalism, the

* " Stntistisches Jnhrbueh fur das Deutsche Reich," 1910.

23 .' ; . .',•

number of independent farmers increased, and then, in
the period of 1895-1907, which included two years of high
Protection, it fell again. One is justified in thinking that
when Protection will have had time to work another ten
years the census will exhibit a decrease in the number of
independent farmers fully commensurate with the increase
which took place in the twelve years of comparative free-
dom of exchange.

But there is yet another fact, full of significance, which
greatly detracts from the face value of the table quoted
above. This is, that the increase in the number of persons
engaged directly in agriculture proper is due to an
enormous increase of female labour. The figures of the
census show that whereas in 1882 the number of women
who were working in agriculture for wages was 2,251,860,
it only increased in the course of the following twelve
years to 2,388,148; and then, in the course of the next
twelve years jumped up by two millions, to 4,254,488.
This fact is most remarkable. It shows that there is no
longer any room in German agriculture for the small
man, working either as an independent farmer or even
as a labourer. He drifts into towns, leaving the women
to take his place. Protection, which has promised so
many blessings to the small farmer and the labourer, has
tremendously increased the process of rural depopulation
so far as the men — younger sons of the small farmer, for
the most part — are concerned.*

The shortness of time which has elapsed since the
coming into force of the last Protectionist Tariff does not
allow of any precise statement of facts, and all it is
possible to do is to observe the circumstantial evidence
and note the tendencies. That these latter are working
to an enormous extent in favour of the larger landlords,
especially the semi-feudal Junkers, is not denied even by
them. That they at the same time must be working largely

* Cf. Gothein, I.e., pp. 15-16.

*4

to the detriment of the smaller farmers is evident from
the widespread dissatisfaction which is now noticeable in
their ranks, and is fully corroborated by an analysis of
the conditions under which they have been placed by the
Tariff as well as by what indirect evidence it is possible
to collect. In the nature of things the peasants in
Germany, as elsewhere, belong to the least articulate
class of society, and they themselves would for ever re-
main the last source from which we are likely to hear a
clear account of their hardships and trials. It is just
possible that, instead of giving vent to their dissatisfac-
tion by voting for Social Democrats, as they do now,
they may one day not only go back to their previous
position, but even demand increased Protection as a
remedy for those very wounds which Protection has
already inflicted upon them. "You suffer," the Junkers,
who are after their own interests, may tell them yet, "you
suffer not from Protection, but from inadequate Protec-
tion, and if you want to prosper you must demand a further
increase of duties." There would, in view of the well-
known ignorance of the rustics, be nothing very wonder-
ful in their permitting themselves once more to be gulled
by these empty promises, and become once more Pro-
tectionists, and that with a vengeance. This, however,
would clearly prove nothing, and things being such as
they have been described in the foregoing pages, we may
confidently expect in a few years' time to see the baneful
effects of Protection exhibited in clear language in figures
directly bearing upon the subject. It is, at any rate,
obvious that the Protectionists have not made out their
case with regard to the alleged benefits which small farm-
ing derives from high duties on agricultural produce, and
those in our own countryside who are inclined to listen
to the specious promises of the Tariff Reformers on the
subject of agricultural revival through peasant proprietor-
ship will do well to think twice, and three times, before
they give them a favourable reply.

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