1. The New Colonial World. By 1900 Liberalism was an outworn creed. But yet it had not failed, any more than the Culture System failed. Just as the Culture System, created by the genius of Van den Bosch to meet the needs of 1830, was swept away by the forces which it called into existence, so was it with the Liberal System, originating in the needs of 1870. It released forces, moral and material, creating a new colonial world, which teemed with problems that on Liberal principles were insoluble.

In this new world the balance of economic power in Java no longer lay with Government but with private capital. In 1870 the few wealthy planters were isolated individuals, but in 1900 the far larger and far wealthier non-official community was directed by a few powerful corporations which could easily take common action to protect their interests; the economic structure was no longer individualist but capitalist. Colonial capital had furnished a Governor-General in s'Jacob (1881–84) and a Colonial Minister in Cremer (1897–1901), and it dominated the whole administration, from the Council of India to the village headman. In 1870 the planters looked to the States-General for support against the Indian Government, but in 1900 colonial capital, closely linked up with capital at home, was impatient of control by the States-General; except for the check of public opinion in the States-General it was all-powerful.