This chapter analyzes the forces pulling Germany into war in 1914 and how both the international republic of letters and the integrated world economy were shattered by it and the crippling blockade imposed by Britain. It also explores the work done by Hermann Schumacher, Max Sering, and Gustav Schmoller to rationalize wartime raw materials and the food supply, as well as their activity advocating for unrestricted submarine warfare. Despite strong prewar ties between Germany and the United States and active efforts to court American public opinion by Bernhard Dernburg in New York, the “war of words” was won easily by the Entente. The decision for unrestricted submarine warfare is set in the context of the failure of dreadnought deterrence and the tightening blockade, which had rendered much of the High Seas Fleet impotent and led to the loss of Germany's overseas colonies and bases. A growing rift emerged by 1916 between populist forces unleashed by Alfred Tirpitz and the “submarine professors,” on the one hand, and the Kaiser and government of Bethmann Hollweg, on the other, which now also included Karl Helfferich as Treasury Secretary.

With Bülow becoming chancellor in 1900, Schmoller and his students became advisors to the government in many capacities. The southward shift of German interest into the Yangtze valley advocated by Hermann Schumacher took concrete form during the suppression of the Boxer Rebellion, itself an outgrowth of Germany’s seizure of Kiaochow in 1897 and German railway construction in Shantung. The Boxer intervention led to strained relations with Britain and encouraged an Anglo-Japanese alliance around a common fear of Russia. These developments were also tied up with British anxieties about decline during and after the Boer War in which Germany began to play the role both as model and menace. The writings and activities of Schmoller and his students played an important role in these perceptions. The Bülow tariff of December 1902 likewise contributed to growing trade frictions with Britain that encouraged Joseph Chamberlain’s campaign for tariff reform and imperial federation and the coalescence of a German menace in the minds of many other British observers, misperceptions fed to an unusual degree by German naval propaganda and the rancorous debates over German tariffs.

This chapter focuses on the formal German response to the challenges of globalization and the new imperialism discussed in the previous chapters, culminating in Kaiser Wilhelm’s shift to “World Policy” and the bid to build a large battleship navy in 1897. The complex of ideas, interests, and personalities that shaped this policy are analyzed in depth, revealing that educated middle-class liberal opinion was much more decisive in this shift than is usually appreciated. Prominent in this process were the ideas and perceptions of Gustav Schmoller and his students. Schmoller knew Alfred Tirpitz and had the ear of Bernhard von Bülow, and Ernst von Halle and Hermann Schumacher were easily drawn into Tirpitz’s legislative campaign to significantly expand the German fleet on their return to Germany. They became part of a very sophisticated and effective naval propaganda effort that mobilized the German professoriate and culminated in passage of the first navy bill in April 1898 which dramatically increased the size of Germany’s battleship navy into a deterrent “risk fleet.”

Germany's naval leap in 1898 concided with the start of the Spanish-American War, revealing the limits of Germany’s diplomatic pull with its still tiny navy. Likewise, tensions with the Americans and British over Samoa demonstrated German weakness in the face of an increasingly aggressive United States aided and appeased by Great Britain. This chapter analyzes these developments, as well as the outbreak of the Boer War, during which the Royal Navy violated German neutral rights by abusing its command of the sea. These developments were important catalysts for naval enthusiasm in Germany, which Schmoller, von Halle, Schumacher, Sering and the other so-called fleet professors helped mobilize during the campaign for the second navy bill in 1899 and 1900. This activity centered on the Free Union for Naval Lectures which organized pro-naval speeches throughout Germany. Likewise, the Germany Navy League, which these men helped transform into a more populist mass organization, grew in size dramatically. This culminated in passage of the second navy bill in June 1900 and in Bernhard Bülow’s appointment as chancellor.

After a series of brutal and costly colonial wars in German Africa and legislative impasses in the Reichstag, Chancellor Bülow called new elections in 1906 to forge a stable legislative bloc of liberal and conservative parties. This chapter analyzes how Schmoller, Sering, and the other fleet professors mobilized for this election campaign to support the colonial reform program of the new Colonial Director Bernhard Dernburg as a new prong of “World Policy.” This campaign generated much new imperialist propaganda that would have a lasting impact in Germany. As the colonial crisis subsided, the Baghdad railroad faced new financial and political challenges that Karl Helfferich was called to surmount. Formal professor exchanges between the United States and Germany were initiated to help improve deteriorating relations with the United States, with Hermann Schumacher serving as the first Kaiser Wilhelm Professor to Columbia University from 1906 to 1907. The United States was now an imperial power, and Schumacher’s extensive travel through the country and to Cuba revealed its vast potential but also its challenges to Germany. Strong parallels were suggested with Russia, reinforcing more Eurasian aspirations for German “World Policy.”

This chapter explores how profoundly German perceptions of itself as a new industrial and aspiring colonial power were shaped by the United States, yet also how those perceptions changed as the United States came to be seen as a potential threat to Germany for the first time. After completing their studies under Gustav Schmoller in the late 1870s and investigating conditions in United States, Max Sering and Henry Farnam published works that shaped perceptions of the American frontier in Germany as a force defusing working class radicalism and as a distinctly colonial land of opportunity and upward mobility, animating German ambitions for overseas settler colonies and contiguous colonies in the Prussian east. Later in the 1890s Hermann Schumacher and Ernst von Halle were exposed to Sering and Schmoller’s teaching at Berlin University, travelling to the United States to investigate industrial trusts, cotton growing, and the American grain market during a time of growing American nativism, protectionism, and trustification.

This book intervenes into longstanding debates about Imperial Germany's peculiarity linked to its authoritarian traditions, the failure of liberalism, the domestic origins of its overseas imperialism, and its role in the outbreak of the First World War first sparked by the historian Fritz Fischer in the 1960s. It is also informed by debates about liberal imperialism in Britain, France, Germany, and the United States, as well as discussions on the origins of Nazism. The introduction questions Fischer’s interpretation by drawing on recent literature that has revealed the many common features of Western liberalism and liberal imperialism. The book explores the global influences shaping German “World Policy” by analyzing the extensive travel, writings, and activity of the economists Henry Farnam, Ernst von Halle, Karl Helfferich, Hermann Schumacher, and Max Sering, all of whom were taught by or closely associated with the economist Gustav Schmoller. These men were unusual because of their extensive travel and experiences overseas, their later influences on the policies of Bernhard von Bülow and Alfred Tirpitz, as well as their strong impact on Germany wartime policy.

In the 1890s, British imperial rivalry with France and Russia led to a naval arms race and growing international maritime insecurity, while wars, civil strife and trade frictions threatened German commercial interests in China, South America, and the Transvaal. Coinciding with the Transvaal and Venezuela Crises, American protectionism and Panamerican ambitions, long with a British backlash against German industrial exports emerged as threats for the first time. This chapter explores these developments by following the travels of Hermann Schumacher to East Asia in 1897 as part of a German commercial delegation and those of Ernst von Halle to the Caribbean and Venezuela in 1896 to inspect the recently completed Great Venezuela Railway, the largest German overseas investment at the time. Their observations, like those of Rathgen a decade earlier, heightened perceptions of German commercial, trade, and maritime vulnerability to American, British, and Russian "imperilaism," views that were disseminated in Germany in many publications that gained a wide readership.

This chapter analyzes the colonial reforms of Bernhard Dernburg that culminated in the founding of the Hamburg Colonial Institute in 1908, to which Karl Rathgen was appointed. It also explores the disappointments with tropical colonies drawn from the surveys spearheaded by Max Sering, the observations of Hermann Schumacher in Southeast Asia in 1911, and Karl Rathgen’s travels in the American south and Caribbean in 1913. Dernburg successfully pushed investments in railways to better connect the German colonies to the German and world economy, and he set strict limits on white settlers. Even so, ambitions for a German temperate zone settler colony never quite died, even as it would prove elusive. The German colonial gaze did shift eastward to the Russian Empire in these years, which Sering and Schumacher visited in 1912 to inspect “inner colonization” in the Ukraine. They returned impressed with what they saw and committed to improving Russo-German relations, but better relations were increasingly hostage to Foreign Office prejudices and the Balkan rivalries of Austria and Russia.

This chapter discusses the precarious status of Germany’s formal colonial empire and its tenuous hold in its spheres of interest in the Ottoman Empire, Japan, and Venezuela by 1905. It also explores how tensions during the Second Venezuela crisis, the Russo-Japanese War, and the Tangier crisis solidified British perceptions of German menace in need of containment. Germany’s formal colonies were a bitter disappointment in need of major reforms, while neglect and disengagement defined German relations with Japan. Meanwhile German investment in the Anatolian and Baghdad railroads in the Ottoman Empire generated new points of friction with Britain and Russia. A British-led Anglo-German intervention in Venezuela was perceived in the United States as a German provocation. Similarly, the Russo-Japanese War and Tangier crisis generated much British hostility toward Germany fueled by overblown fears of its navy that worked to bring about an Entente with France and agreement with Russia. Once again, a vast gulf separated the reality of Germany’s meagre capacities and its fragile finances from exaggerated images of menace often drawn from German naval propaganda.

The epilogue takes up the story of the men followed in the book after the calamity of World War II and the Holocaust, offering reflections on West Germany’s transformation into a peaceful democracy and its reintegration into the world economy enabled by the Bretton Woods System, the NATO alliance, and debt forgiveness. It concludes with observations about Fritz Fischer’s interpretation of the course of German history and the continued relevance of the German past for understanding the challenges of globalization in the twenty-first century.

Besides the United States, the other major site of German overseas engagement in the 1870s and 1880s was Japan. This chapter analyzes the imperial bridgehead created by German scholars sent to Japan as the country opened to the West and as the Meiji government sought to reform its administration, economy, law, military, schools and universities in the 1880s. Prominent among them was Karl Rathgen, who had studied under Schmoller in Strasbourg and came to Japan in 1882. Rathgen would spend the next eight years of his life in Japan, working to build the University of Tokyo, reform Japan’s legal code, and modernize its administration and economy. While in East Asia, Rathgen travelled widely and became witness to the fierce competition for weapons sales and industrial export markets in Japan and China between European and American competitors. He also became acutely aware of the precarious position of the German interests in Asia. As German policy shifted toward China in the 1890s and as Japan became more self-reliant, German-Japanese relations cooled. The First Sino-Japanese War in 1895 led to a rupture in relations and the construction of a Japanese “Yellow Peril.”