Prussia free trade agreement

Chris's reviews for other UCSB Hist 133 courses (with biographical info):

Introduction

During the 19th century the German region saw a number of sweeping changes that dramatically changed the traditional political landscape. The power of their unified French neighbor was clearly demonstrated during the French Revolution and Napoleonic Wars. �The defeat of Napoleon and the following peace of the Congress of Vienna in 1815 saw a return to the status quo. In France a new monarch was instated to rule over a people and nation with its lands intact. While many of the German minor states were consolidated during the French Revolutionary period, the German region remained highly divided.

Germany was thought to consist of three parts; Austria to the South, Prussia to the North, and the "Third Germany" in the West. This Third Germany consisted of a number of smaller states and a few medium sized ones that had been reorganized during the Napoleonic Wars. Nominal leadership over the numerous German states previously had rested with the crown of the Holy Roman Empire, dominated by Austria's Habsburg rulers, but the Empire had ended in 1806 when Francis I of Austria abdicated following his defeat by Napoleon.

By the end of the Napoleonic Wars Austria had reversed its fortune. It was once again one of the premier European powers, and seemed to be the leading state in Germany. Austria's prince Metternich led the Congress of Vienna, which redrew the post-Napoleonic map of Europe, and the 1815 Peace of Paris saw Austria securing territory in northern Italy and southeastern Europe. A German Confederation, the Deutscher Bund, was created as the successor of the Holy Roman Empire, and this saw Austrian presidency over its only central institution, the Federal Assembly (Bundesversammlung). While Austria's conservative leaders resisted liberalism and nationalism throughout the 19th century, Austria still appeared to be the leading German state. When German liberalism came to a head in the 1848 revolutions, the Frankfurt Parliament saw the need to create a Provisional Central Power (Provisorische Zentralgewalt), a transitional government that had Archduke Johann of Austria as its regent. After the failure of the Frankfurt Parliament, Austria's rival Prussia initiated a federation of German states in the Erfurt Union. This initiative was dealt a fatal blow in 1852 as Austria forced Prussia to abandon its plans in the Punctation of Olm�tz, and return to the revived German Confederation under Austrian leadership.

Yet sixteen years later Prussia would defeat Austria during the Deutscher Krieg and the Austrian-led German Confederation was replaced with a Prussian-led North German Confederation, from which Austria was excluded altogether. How was it that Austria's centuries of German leadership were so quickly circumvented by the smaller Prussia? A major factor in this shift was the Congress of Vienna, which caused Prussia to gain territory in the Rhineland and Ruhr Valley. This caused a shift in the direction of Prussia's focus and placed it in a geographic and political position to take leadership in the defense against France, while giving it the economic incentive to challenge Austria's indirect control over Germany through customs unions. Ultimately, this would result in binding the states of the Third Germany to Prussia, both for protection against external threats and due to economic dependency.

This paper uses a number of secondary sources to provide background information regarding the events in questions. The primary books used include: The Foundation of the German Empire: Select Documents by Helmut B�hme, Austria, Prussia and Germany, 1806-1871 by John Breuilly, The Frankfurt Parliament 1848-1849 by Frank Eyck, The 1848 Revolutions in German-Speaking Europe by Hans Hahn, Midcentury Revolution: 1848 Society and Revolution in France and Germany by Robert Lougee, Revolution and Counter-Revolution, or Germany in 1848 by Karl Marx, and The Struggle for Mastery in Germany, 1779-1850 by Brendan Simms. These books contain descriptions and details of the events in question, and with the exception of Marx, which was written in the 1850s, contain quotations and excerpts of material written during the time period.

Primary documents include a number of letters, speeches, reports by government ministers or diplomats, as well as excerpts from treaties and constitutions. These documents were drawn from the books by Helmut B�hme, John Breuilly, and Frank Eyck. The former two works contain large compilations of documents from the 19th Century. These documents are used and analyzed throughout the paper to provide primary support for the interpretations made. The three maps were provided by the websites as cited, other information from these websites was not used in this paper.

Section 1: Congress of Vienna

In 1815 the Allied states had defeated Napoleon I of France and liberated central Europe. While the various German states were no longer bound to French national policies or trade systems, the effect of the Napoleonic Wars had been profound. Napoleon had reorganized the smaller German states into the Confederation of the Rhine, which he used as a base to recruit soldiers and materials for his war efforts. Many of the German minor states had been combined, and four German states had become kingdoms (Bavaria, Hanover, Saxony, and W�rttemberg).

While the Napoleonic era had seen the rise of these medium states, it also had seen the end of the traditional organization of German unity. In 1806 Napoleon forced Francis I of Austria to abdicate the Imperial Crown of the Holy Roman Empire. The dissolution of the Empire was largely symbolic, as Imperial power had eroded over the centuries, but it was still the historic institution of pan-German governance.[1] When the Congress of Vienna met in 1815 these changes were but a number of the issues that needed to be addressed. Russia had played a decisive role in the victory over Napoleon and received territories in Poland for its efforts. Prussia had previously held some of these Polish lands and in compensation would obtain more territory in Germany, including land on both sides of the Rhine. Prussia also sought to obtain Saxony, which had fought alongside France until the disastrous Battle of Nations in 1813, although this conflicted with Austria's intentions for indirect control of the region. Following Austrian diplomatic efforts that received French and British support, Prussia was forced to settle for the northern half of Saxony, with the south remaining an independent state.� For its part, Austria would re-obtain Tyrol, which had been lost to Bavaria during the Napoleonic Wars, make gains in the Balkans, and in Italy by receiving Lombardy and Venetia. However, Austria did not reestablish its control over Belgium and the former Austrian Netherlands.[2]

Above: Europe between the French Revolutionary and Napoleonic Eras (Austrian Netherlands already occupied by France). Bolded black boarder is the boundary of the Holy Roman Empire

Below: Europe after the Congress of Vienna. Bolded black border is boundary of Deutscher Bund.

This reorganization of Germany had a number of consequences, though not all of them would be apparent at the time. First, Prussia shed much of its Polish holdings, while obtaining more territory in Germany, and thus became a more demographically German state. Second, the lands it did receive, particularly those along the Rhine River and Ruhr valley, would later become economic powerhouses focused on trade and industry. Additionally, the acquisition of these lands placed Prussia at the front line of defense against France. In contrast, Austria gained no new German lands and in fact lost Belgium while obtaining territory in the Balkans and Italy. Thus the Austrian Empire, already a multi-ethic state, became proportionately less German, and in shedding its Belgian holdings removed itself from having a direct military interest in defending against France.[3]

One of the major developments of the Congress of Vienna was the creation of the German Confederation, the Deutscher Bund. Austria had dominated the Holy Roman Empire, and it would now chair the Bund's Federal Assembly. The Bund was created to coordinate Austria, Prussia and the "Third Germany" in order to protect against external threats, as stated in Article 2: "The purpose of the Bund is the maintenance of the external and internal security of Germany," and again in Article 11: "All members of the Bund promise to defend Germany as a whole and every individual state against any attack"[4]While the Bund had a proportionate voting arrangement to prevent a simple Austrian-Prussian majority, its stated purpose was well in line with Austria's foreign policy of maintaining an indirect control of the German states. This was made more apparent in the Vienna Final Act of 1820 which stressed the right of the Bund to intervene in the affairs of the member states:

When in a Bund state internal order is threatened through the disobedience of subjects and there is fear of the spread of insurrectionary movements. then the Bund is obliged to provide assistance as quickly as possible in order to restore order. If in such cases the government is clearly unable to repress such insurrections by itself and also is unable to call upon the Bund for assistance, the Bund is still obliged to intervene. [5]

The last sentence is of particular importance as it states the right of the Bund to intervene in the affairs of a member state without the expressed request of at state. In this the Bund could be used to police its member states and provide a bulwark against revolutionary sentiments.

Thus was the situation in Germany following the Congress of Vienna. The Deutscher Bund had replaced the Holy Roman Empire, and was under Austrian leadership. Austria had made some gains in Italy and the Balkans, but had lost the Austrian Netherlands. In turn, Prussia acquired territory on both sides of the Rhineland, as well as strengthening its position by obtaining part of Saxony. In the years to come, the Rhineland region would prove to be important in the development of Prussia's role within Germany.

Section 2: The Third Germany's Perception and the Rhine Crisis

With the exception of Great Britain, Austria had remained at war with France during the revolutionary period for a longer time than any other state. Between this and the Habsburgs' historic claim on the Imperial Crown, many German liberals had looked to Austria in their hope for the creation of a German nation-state. One such early liberal was Paul Pfizer, who stated in 1832, "Following Germany's first reawakening in the war of liberation it was first Austria one hoped and wished. would place itself at the head of Germany and lead Germans to unity."

However, the rulers of Austria were decidedly conservative and the liberals' goal of a German nation-state conflicted with Austria's foreign policy goals of indirect control over the region. Those with liberal sentiments soon concluded that Prussia would need to be the driving power for German unity. As Pfizer continues, "Since then German hopes turned to Prussia. However, the dominant party in Prussia wished to know nothing of freedom. They are quite happy to follow in the wake of Austria." Pfizer concluded: "In order to complete the rebuilding of Germany on the basis of equality. Austria needs to be excluded from the Confederation or its German territory conquered for the Confederation"[6] These sentiments, stated in 1832, would become the focal point of discussion in the attempts to create a German nation in 1848. In the early 1830s however, they show an indication that Germans were increasingly turning to Prussia for German leadership.

Foreign observers who noted that Prussia's prestige and influence was rising echoed this sentiment. In 1836 British diplomat William Russell reported, "the Power of Prussia over Germany, in fact of obtaining the ascendancy formerly in the hands of Austria, which has been declining since the Treaty of Vienna, and now depends solely upon the influence of Tradition." [7] Russell noted that if Prussia carefully managed its commercial unions and guided public opinion it could become the leader of the Confederation. However, he stated that the actions of the Prussian government were detrimental to this, particularly in foreign affairs, specifying the alliance with Russia that concerned the smaller German states. Russell ended by mentioning Prussia's advantage in military preparation stating, "No Nation is in a better state to repel aggression than Prussia." [8]

Russell's analysis in 1836 would prove to be prophetic. Indeed Austria's claims to German leadership were predominately grounded in its historic legacy, and the lasting influence that this tradition held throughout Germany. Prussia's position within the Deutscher Bund would grow in the coming years and the Third Germany increasingly looked to Prussia to fill the roles that Austria had historically held. And while Prussia's policies in 1836 were not that of the leading German state, within fifteen years it would do exactly as Russell had predicted, using their economic strength to bind the Third Germany to them through custom unions. In the meantime, Russell's observations regarding Prussia's military preparedness would be demonstrated by the end of the decade.

An international situation had developed in 1840 in the Middle East. A number of European powers, including Britain, Russia, Austria and Prussia, had intervened on the behalf of the Ottoman Empire, which was threatened by the ambitions of French-backed Syria. In an attempt to recover from this loss of prestige, France began to make noise regarding annexing the lands on the west bank of the Rhine. This set off a frenzy of activity throughout Germany as liberalism swelled and a number of nationalist songs quickly spread throughout the region.[9]

While liberals throughout Germany sang songs of protecting the Rhine, the South German states were well aware that their combined strength was no match for France. Austria had long sought to check the expansion of France, but by 1840 their position had changed. Austria's premier statesman, Prince Metternich, had no desire to provoke France and would not intervene. Instead Austria waited for cooler heads to prevail in Paris.[10]

Prussia's reaction came in stark contrast to this, as it quickly put its Western fortresses on alert and placed the state on war footing. Prussia mobilized nearly two hundred thousand men in preparation for hostilities. The difference in Austria and Prussia's reactions was not lost on the Rhineland states. France was once again threatening the Third Germany and Prussia alone moved to defend them. Lord Beauvale, a British diplomat in Vienna, noted the attitude of the South German states:

The frontier States of the Confederation have for some time past been addressing themselves to this Court upon the threatening aspect of France. Their language has been that of resistance to French aggression and of complain at the inaction of Austria. It is Prussia which takes the lead, and to Her all Germany looks in case active measures should become necessary.[11]

In this report, Lord Beauvale summarizes the situation during the Rhine Crisis: Austria's inaction and Prussia's readiness caused the South German states to look to Prussia for protection. Another British diplomat, William Russell, stationed in Berlin, elaborated on this by stating, "In former days the defence of Southern Germany was confided to Austria. This Power has, either willingly or from negligence. allowed her influence amongst the Southern States to diminish" Russell then notes that these states "have made known to Prussia that they cannot trust their safety to the supineness and slow military movements of Austria--that in case of French Invasion they hope to be aided by Prussia."[12] While Russell stated that the decline of Austrian influence in South Germany is either willing or from negligence, it is more likely that this was caused by Austria's Hungarian cabinet, which would be less willing to go to war for the protection of South Germany. Yet regardless of the reasons, in western and southern Germany it was becoming clear that Prussia and not Austria would be their protectors against France.[13]

Eventually France backed down and war was avoided. However, the Rhine Crisis left lasting impressions throughout Germany. The smaller German states on the boarder were forced to accept that they would be unable to defend themselves against France while acting independently. Additionally, as Lord Beauvale and Russell reported, the inaction of Austria meant that these states would have to look elsewhere for protection, and that Prussia's speedy response ensured that the Third Germany would depend on it for support. By reneging its historic role as the protector of western Germany, the military facet of Austria's claim to German leadership was dealt a serious blow. It was now Prussia that the Third German states would come to depend on to protect them from external threats.

Section 3: Mid-century Revolutions and the Victory and Defeat of the Liberals

The Rhine Crisis had demonstrated that independent action by the Third Germany was not a prudent course. Yet, as the threat of France subsided, these states were still far from being ready to surrender their sovereignty and attach themselves to a larger nation. However, the liberal sentiments stirred up by the foreign danger did not subside. The hopes of German liberals to create a German nation-state remained, and would threaten to sweep away the old order by the end of the decade.

By 1847 the entrenched conservative forces throughout Germany had been weakened by military concerns the decade had brought. Expanding militaries consumed higher proportions of the national budgets. In Prussia, the need to construct additional railways forced King Frederick William to summon the United Diet to approve new taxes. In Austria, the Hungarian gentry had prevented the Habsburgs from obtaining a proportional share of Hungary's revenue, and Austria had become dependent on international banking to finance its expenses. Increasing expenditures eventually forced Austria to convene the estates-general in March to approve more funding to combat an uprising in Italy.[14]

Thus, when revolts broke out across Germany in March of 1848, the conservative forces were in poor position to offer significant resistance. The concerns of the revolutionaries were numerous, but the most pressing issue was the creation of a German nation. This issue itself was highly problematic. The more left-wing German democrats wanted radical changes including the "demand [for] a popular state administration. Self-government of the people will replace the over-government of bureaucrats," and for the "abolition of all privileges. Respect for a free citizen is the only right and due of all."[15] These democrats argued for the new German nation to be a republic based on popular vote. However, the majority of the parliamentarians were German liberals, who sought a compromise with the monarchy that would include reforms and most importantly, a constitution.[16]

This raised another question; a constitution with which monarchy? And more to the point, what would be the territorial boundaries of the new state? One of the solutions put forth was that of the kleindeutsch position, which called for the exclusion of Austria. Writing in 1851, Karl Marx noted the disposition of the middle classes throughout the Third Germany:

It is a fact, which now will not any longer be contested, that the nucleus of those Constitutionalists of Central Germany. long before 1848 contemplated a plan which, with little modification, they in 1849 proposed. They intended a complete exclusion of Austria from the German Confederation, the establishment of a new Confederation, with a new fundamental law, and with a Federal Parliament, under the protection of Prussia[17]

Those supporting the kleindeutsch solution, without Austria, would have placed the new Germany under Prussian leadership. In contrast to this idea was the Gro�deutsch solution, which included German Austria, and possibly other regions associated with Germany such as Bohemia. While the Gro�deutsch solution would have resulted in a larger complete Germany, it would mean more complications.[18]

As the Frankfurt Parliament continued other problems arose. One such concern regarded enacting the decisions of the Parliament. Until the constitution was completed and accepted, any enforcement of decisions had to be left to the individual states. In order to address this, the Assembly created a Provisional Central Government that was to last until the completion of the constitution. This office was to be ruled by the Vicar of the Empire over Germany, who would appoint his own ministers, and was not responsible to the Parliament. [19] The Assembly voted overwhelming to give this office to the younger brother of the Emperor of Austria, Archduke Johann. The selection of an Austrian was in part due to the reverence of the Habsburg dynasty and its longstanding control over the imperial crown the Holy Roman Empire. Additionally, the Archduke had some liberal sympathies, and had been an opponent of Austria's archconservative Metternich. His election was also a concession towards the ideas of Gro�deutsch.[20]

However, Austria would reestablish control at the end of 1848 and into 1849. With the Habsburg Empire secure any hopes of the Gro�deutsch approach were gone. In December of 1848 the President of the National Assembly, Heinrich von Gagern, pushed for the kleindeutsch solution:

Gagern noted that the inclusion of Austria would lead to additional revolutions and not be in the best interest of the German state. Furthermore, the German Austrians had little desire to be separated from the rest of the Empire. The result would have to be a kleindeutsch solution with Austria having special relations with the German state.[24]

For its part, Austria was not inclined to support the creation of a national state. Austrian Prime Minister Prince Schwarzenberg gave Austria's position, stating that:

The formation of a unified state seems to the cabinet to be impracticable for Austria, and undesirable for Germany. We will say it once more--Austria and Germany will not have their development furthered in any way by these proposals but rather weakened and discredited, and both will be hurt deep down in their political being, perhaps incurably.[25]

Here Schwarzenberg reiterates not only the problems of including or excluding Austria, but also warns that the creation of a German nation would be detrimental to Germany itself.

The mid-century revolutions underscored the positions of Austria and Prussia. In voting to make Archduke Johann the head of the Provisional Central Government, the National Assembly expressed support for the Gro�deutsch solution and maintaining Austria as a part of Germany. This was further supported by the provisions of the Imperial Constitution, which would have allowed for the inclusion of Austria, provided it was further separated from its non-German possessions. While the Austrian Empire's non-German holdings were a point of contention, Prussia's position was beyond doubt. Marx's remarks on the attitudes of the Third Germany, President Gagern's embrace of the keindeutsch solution, and the offering of the Imperial Crown to Frederick William demonstrated that Prussia would be the focal point of the proposed German state. The attitudes of the two states, shown through Prime Minister Schwarzenberg and Frederick William's statements highlights the divergent paths of these two states. For Austria the proposed German state was unacceptable in principle, as it would be detrimental to Austria's development. For Prussia it was unacceptable simply because it was conceived in treason.

Section 4: Aftermath of the Revolutions

In rejecting the crown offered by the Frankfurt Parliament, the King of Prussia was rejecting the decision of parliamentarian liberals, not the notion of a Prussian dominated German union. The legitimate crown of the German nation was one that Frederick William regarded as a "diadem by divine right, which makes him who bears it the highest authority in Germany. that crown one can accept if one feels one has the strength for it, and if one's own duties allow it."[27] On the same day that Frederick William rejected the parliamentary crown, Prussia moved to create a federal state, independent of the National Assembly, and invited other German governments to Berlin for a conference on the matter.

The result of this was the Erfurt Union, which embraced a kleindeutsh solution centered around Prussia and incorporating the Third Germany. The Erfurt Constitution thus stipulated that this German Empire would consist of the territories of the former Bund with the relationship between the Empire and Austria to be settled at a later time. It would be ruled by an Imperial President at the head of a college of Princes, and the office of President was bound to the Prussian crown.[28] Thus the Erfurt Union was a conservative version of the constitution drawn up by the Frankfurt Parliament.[29]

Austria's reaction came swiftly. By 1849 Austria had regained control over its constituent countries, and was able to persuade the southern kingdoms of Bavaria and W�rttemberg to refrain from joining the Union. Instead Austria demanded that the Bund be reformed with the old Federal Diet under Austrian presidency. Direct confrontation occurred in Hesse-Cassel in 1850 after a government ministry sided with Prussia while the Grand Duke sided with Austria. Troops from both sides were sent to maintain order and Prime Minister Schwarzenberg made it clear that Austria was ready to go to war over the issue. As Prussia was not yet willing to risk a direct confrontation with Austria, it agreed to remove its troops and to abandon the Union policy in the Punctuation of Olm�tz.[30]

While Prussia did not feel strong enough for a military showdown with Austria, the two states did engage in an economic duel. Bringing the states of the Third Germany into their sphere of influence was essential, and this could be accomplished by binding the smaller states to Prussia or Austria economically. �This would determine whether a Prussian kleindeutsh state would be possible, or whether Austria would return as the leader over a loosely bound German Confederation.

The Expansion of the Zollverein. By the 1850s it included the majority of the Bund, excluding Austria. �(source: Zum.de atlas; image)

Prussia had led the Zollverein, a German Customs Union, since 1834. By 1850 it included the majority of the smaller German states but excluded Austria. The Prime Minister of Austria believed that Prussia would need to be reduced to a second-class state in order for Austria to establish control over Germany and to regain its position as the leading power. To accomplish this, Prussia's economic advantage needed to be broken, and to this end Austria proposed a Customs Union with the Zollverein. In a letter to Austrian Emperor Francis Joseph, Prime Minister Schwarzenberg wrote that:

Among the most effective means available to Your Majesty's Government towards the assertion and permanent increase of its influence throughout Germany, must be reckoned its active participation in fostering her common economic interests.

Schwarzenberg continued, stating that this would result in "effectually and worthily maintaining her political position as the first Power in the Germanic Confederation."[31] Austria would therefore focus its energies during the early 1850s on attempting to break Prussia's economic influence.

The Zollverein was due to expire in 1852, and Austria could not allow it to be renewed without their proposed Customs Union being secure. Austria's Minister of Trade reported that "Such a renewal would bind all the German states for twelve years longer to Prussia's will"[32]. To Austria this was an unacceptable outcome and highlighted the importance of the Customs Union. A memorandum stated dramatically "This Customs Union is a matter of life and death to Austria. If the Customs Union as Austria seeks it is achieved, Prussia's influence will be utterly and completely broken. "[33]

In 1852 Prussia suddenly dissolved the Zollverein, leaving the medium states facing a major decision. They could attempt to find a path with Austria or independently with the Third Germany, or they could join the new Zollverein on Prussia's terms:

The strength of Prussia's position against the seven states, who are petitioning her about the Zollverein, is made clear by her threat that, unless they conclude and sign the renewal and enlargement of the Zollverein within fourteen days, she will negotiate no further with them. That means: 'You need the Zollverein; I do not; if I am to be good enough to grant it to you, then sign my terms.'[36]

In this Prussia demonstrated the extent of its economic strength. It had locked out its trading partners and would not grant them reentry unless they accepted Prussia's terms. While the medium states initially balked, they eventually capitulated, resigning themselves to Prussia's terms.[37]

Despite their intentions to maintain political independence, the Third Germany was bound to Prussia by economic necessity. This was the source of Prussian power throughout the early 1850s, as political setbacks could not deter its ever-increasing economic influence. Prussia would remain "obliged, quite decisively, to prefer a north-German, but independent, Zollverein to a great Customs Union dependent upon Austria."[40] In doing so, and with the support of the Third Germany, the Customs Union was eventually abandoned.

Prussia took the initiative following the 1848 revolutions hoping to create a Prussian dominated Germany through the Erfurt Union. When this failed it would turn to the strength of their economy, and the impact of their Rhineland possessions on German trade, to secure their authority over the Third Germany. Prime Minister Schwarzenberg's concerns regarding economics influencing politics led Austria to challenge Prussia on the economic front. However Prussia was simply to well established. Their movements towards free trade, which Austria could not match, were prosperous for both Prussia and the Third Germany. Moreover, Prussia's position on the Rhine River ensured that even larger states such as W�rttemberg would be unable to go against Prussia's economic policies.

Section 5: Prussia's view of Austria

Prussia had held a longstanding admiration for Austria, and the achievements of its Habsburg monarchs. As Prussian strength grew, Austria was seen as a worthy rival and equal in German politics. Prussia increasingly saw herself as having a unique mission to unify Germany. German lands lay between the Russian Empire and France, and Prussia's holdings were on the border of both of these powers. Prussia's very position made such unification desirable.

When Austria forced Prussia to abandon the Erfurt Union it came as a major blow to Prussian ambitions and prestige. Yet Prussia absorbed this. Speaking to the Prussian Landtag regarding the Olm�tz agreement, Otto von Bismarck stated that war was not a solution, as Prussia's interests and security were not threatened. He noted in December 1850: "It is a peculiar unity which creates a separate league against our fellow Germans to the south. I do not understand why we should allow this. I recognize in Austria the representative and heir to an ancient German power which has often and gloriously wielded the German sword."[41] Prussia might grumble, but it would accept the defeat and move on with securing its interests.

Austria's attempts to weaken the Prussian control over the Zollverein caused Prussia to view Austria as a threat. In doing this Austria had attacked not only Prussia's influence over the northern states, but the security of its economy. Regarding the Customs Union, Prussia noted that it was willing to give up the Erfurt Union, but that Prussia "[could] never comply with the Austrian demands in commercial policy without denying the whole political position she has up to now held, and without consenting to her own 'mediatization'."[42] This 'mediatization' referred to the absorption of smaller states into the Holy Roman Empire, and expressed Prussia's concern that the Customs Union would significantly damage the foundation of its state.

By the middle of the 1850s, Austria once more faced military involvements in Italy and then again during the Crimean War. The economic burden of this led it to push once again for higher tariffs throughout the Bund. In 1856, four years after stating that Austria was no threat, Bismarck's tone was substantially different:

Vienna's policy has made Germany suddenly too small for us both. We have. a great number of conflicting interests, which neither of us can give up, without renouncing the mission in which each believes for itself; they are, therefore, conflicts which cannot be peacefully unraveled by diplomatic correspondence. I do not intend by this reasoning to reach the conclusion that we should immediately direct our policy to bringing about the decision between Austria and ourselves. I only wish to express my conviction that we shall be obliged, sooner or later, to fight Austria for our existence and that it does not lie in our power to evade the fight"[43]

Bismarck was now convinced that Austria's policies had threatened the survival of Prussia. He would go on to state that supporting Austria would be costly to Prussia and without any gain. Should Prussia take a policy of "co-operation with Austria to put through alteration to the Germanic Confederation in our favour, we should fare as we did in 1815. Every deceit would be practiced, now as then, in order to prevent Prussia from reaching a higher standing in Germany."[44]

The change in Bismarck's attitude is mirrored by the concerns expressed in the Consitutionelle Zeitung. Austria's economic challenge was a threat to Prussian security. The Zollverein had been the natural progression of Prussia's economic strength and the weight of the Rhineland territories on the Third Germany. By opposing Prussia's economic policy, Austria was opposing Prussia's position within Germany.

Austria had long been the most powerful state in Germany and in most respects, such as size and population, and remained so until the establishment of the German Empire in 1871. While at times challenged by its various ethnic components and the wide range of areas it deemed necessary for military control, it was able to consistently recover and maintain its position as a major power throughout the first half of the 19th century. Prussia in contrast was a more recent arrival as a major power. While it carried with it prestige from the victories of Frederick the Great, at the end of the Napoleonic Wars its strength was not comparable to that of Austria�s. The Congress of Vienna and the territorial changes that followed it would change this.

Austria's gains from the Congress of Vienna made it a proportionately less German state. Austria's increasing decentralization, and the concessions to the Hungarian portion of the Empire ensured that it would not able to quickly react to every event on the periphery of the Bund. Thus while Prussia was becoming a new protector of Germany, Austria�s role as the traditional protector was declining. Finally, the difficulties of including Austria and the various non-German holdings of the Habsburgs were demonstrated to be nearly imsurmountable during the 1848 revolutions.

Prussia had traditionally been a state whose ambitions lay in the east, with its hopes of gaining land in Poland. The territorial changes of the Congress of Vienna caused Prussia to look west, gaining economically strategic Rhineland possessions and becoming a more demographically German state. By giving Prussia a border with France, Prussia was forced to take direct interest in the defense of its borderlands. Its military preparations and quick actions brought the admiration of the Third Germany, which increasingly looked towards Prussia for protection against external threats.

The Rhineland regions that Prussia obtained became some of the richest lands in Germany, and control of the Rhine made it a major player in regard to trade. While Austria saw its economy saddled with debt and stagnation, Prussia emerged as a dynamic economic power. Prussia was able to use its economic base to bring the smaller German states under Prussian influence, drawing them closer through the use of trade unions. �

Through the acquisitions of the Congress of Vienna, Prussia obtained the base it needed to position itself as the leading state within Germany. The smaller German states became increasingly dependent on Prussia's economy, and Prussia replaced Austria as the foremost German player in foreign affairs. In the end, Austria's attempts to reestablish control only served to make Prussia aware of the obstacle Austria played regarding the increase of Prussian power and the eventual formation of a German Empire. Bismarck's conviction that Prussia must fight Austria for its survival would carry through, and in the decade that followed his 1856 speech, Prussia would forcibly remove Austria from having any control or influence over the German region.

[1] John Breuilly, Austria, Prussia and Germany, 1806-1871 (London: Longman, 2002), pg 21-22