New Imperialism

New Imperialism is the expansionist foreign economic policy seen amongst the more powerful of the European nation-states, between the Franco-Prussian War and World War I, during the late-Victorian Era, also known as, "The Era of Empire for Empire's Sake". During this period, Europe added almost 23,000,000 km² (20% of Earth's land area) to its collection of overseas colonial possessions, with the focus of this period being that of colonizing Africa.

Scholars debate the causes and ramifications of this period of colonialism, most notably, the relationship this period might have to the First World War.

Readers should also become familiar with the earlier eras of European imperialism. (See: mercantilism, free-trade colonialism)

Pax Britannica

In those years, between the Congress of Vienna and the Franco-Prussian War, Britain became known as, "the workshop of the world", being the world's most advanced industrial nation. Following the defeat of Napoleon, British goods were produced so cheaply that they could often undersell, locally manufactured, goods in almost any other market. At this time, Britian was supplying half the manufactured goods of such nations as Germany, France, Belgium, and the United States.

The decline of Pax Britannica, was made possible by changes economics and the balance of power, such as the breakdown of the Concert of Europe and the establishment of nation-states in Germany and Italy. As France, Germany, and the United States, increasingly became industrial powers, Britain's comparative advantages began to decline.

See also: Pax Britannica

Loss of Britain's Comparative Advantage

German textiles and metal industries had, by the beginning of the Franco-Prussian War, surpassed those of Britain and usurped British manufactures within their own domestic market. Meanwhile, Britain was growing incapable of dominating its captive markets, such as India, and was likewise witnessing market depletion in the industrializing regions of central Europe, Latin America, and China. Britain had lost, and would continue to lose, much of its comparative advantage. Britain’s share of world trade fell from 25%, in 1880, to 16% in 1913, to 12% by 1948.

The Long Depression

The abovementioned problems coincided with the ‘Long Depression’ of 1873-1896, which had followed fifteen years of economic instability. Business, after 1873, suffered from lengthy periods of falling profits. During this period, production often exceeded domestic demand. The capitalists, being powerful political forces, urged the nation towards securing new markets in Africa.

The Second Industrial Revolution led increasingly efficient machines, along with monopolistic mass-production, resulting in greatly expanded output and lowered production costs. As a result, production often exceeded domestic demand. People, such as [[Joseph Chamberlain, concluded that profits were falling because, "too much capital was chasing too few markets". He argued that formal imperialism was necessary for Britain because of the relative decline of the British share of the world’s export trade and the rise of German, American, and French economic competition.

Technology and Innovation

New techonologies also played an important role during this era. The development of steam ships greatly decreased transportation costs and made previously unviable markets, in Africa, of great economic interest. New techniques, especially that of mass production, reduced production costs, further increasing the potentials for profit.

The African Power Vacuum

The continent of Africa was also largely unclaimed by nation-states of significant military power. Most of this region consisted of territories claimed by the ‘dying nations’ (i), (Spain, Portugal, the Netherlands, and the Ottoman Empire), none of which were significant powers by the begining of the twentieth century. As a result, the major European powers felt that the entire continent was open to colonization. This led to what is known as, "the scramble for Africa".

Increasing Competition

As mentioned, by the end of the Franco-Prussian War, Britain was no longer the world's sole modern, industrialized nation. Germany, Italy, and France were no longer as embroiled in continental concerns and domestic disputes, as they were prior to the Franco-Prussian War. The industrial nations began to enter an era of aggressive national rivalry, particularly in regards to trade and colonialism, this era is the that of the New Imperialism.

Continental political developments of the late 19th century, rendered imperial competition feasible, in spite of Britain’s centuries of naval superiority. As unification of Germany, by the Prussian "Garrison State", proceeded, the Germans began to compete against the British, for control of foreign markets, notably in southern Africa. The rise of Napoleon III and the Third Republic also rendered France more capable of challenging Britain’s global preeminence. Likewise, Italy became interested in securing African markets.

Many European statesmen and industrialists wanted to accelerate the rise of formal colonialism, securing colonies before they strictly needed them. Their reasoning was that markets might soon become glutted, and a nation’s economic survival depend on its being able to offload its surplus products elsewhere.

British Strategic Expansions

For Britain, the 1869 completion of the Suez Canal, prompted the strengthening of control over Egypt. Battles over the Nile headwaters caused Britain to expand in Sudan, and the close proximity of Russia's expanding empire, to India, triggered wars in Afghanistan. Rhodes and Milner advocated a “Cape to Cairo” empire, which would link, by rail, the Suez Canal to the mineral rich regions of southern Africa. Though hampered by the German conquest of Tanganyika, Rhodes continued to lobby on behalf of a vast British empire, in East Africa.

Social Darwinism

Racism and Social Darwinism were terms sometimes used to describe the so-called "mission of civilization", that is, the practice of spreading republican government and capitalist economics. Human rights issues were much the same during this era as they had been during the conquest of the Americas.

Causes of New Imperialism, the Breakdown of Bax Britannica

Breakdown of the Concert of Europe

The Long Depression

Britain's Increased Competition

The Amalgamation of industry

Pro-imperialist industrialists, however, like the ex-liberal Joseph Chamberlain, never represented a majority in Britain’s Parliament, not even in Commons. Joseph Chamberlain, thus, to no avail, in staunchly free-trade Great Britain argued on behalf of a grand imperial Zollverein, or customs union. This campaign failed in the 1890s and for another forty years afterwards until the premiership of his infamous son, Neville. But the fact that imperial jingoism and formal empire caught on given the limited political influence of bourgeois industrialists like Chamberlain indicates the role of surplus capital accumulated by finance in encouraging New Imperialism in a highly industrialized country like Britain.

Long-term economic trends led Britain, and to a lesser extent other industrializing nations following a similar course of development, such as the United States and Germany, to be more receptive to the desires of prospective overseas investment. This is the case even in Britain with an industrial sector arguably declining due to the rise of finance.

Amalgamation of industry and banks, through their connection with industry, enabled finance to exert a great deal of control over the British economy and politics. During the period of “cut-throat” competition of the mid-Victorian era, produces became aware of the advantages of consolidation, in the forms of larger corporations, but also of mergers and alliances of separate firms, such as mass-production, lobbying power, and efficient union busting. To create and operate such industrial cartels required larger sums than the manufacturer could ordinarily provide, resulting in a new capitalist stage of development.

Just as industrial capitalism had replaced mercantilism and commercial capitalism in the eighteenth century, finance capitalism supplanted industrial capitalism in the late nineteenth century.

By the 1870s, London financial houses thus achieved an unprecedented control of industry, contributing to an increasing concerns among elite policymakers regarding British ‘protection’ of overseas investments—particularly those in the securities of foreign governments and in foreign-government-backed development activities such as railroads. Although it had been official British policy for years to support such investments, with the large expansion of these investments after about 1860 and with the economic and political instability of many areas of high investment (such as Egypt), calls upon the government for methodical protection became increasingly pronounced in the years leading up to the Crystal Palace Speech. After the more gentlemanly service sector of the economy (banking, insurance, shipping) became more prominent—possibly at the expense of manufacturing—the influence of London’s financial interest began rising precipitously. The ‘cleaner’ financial sector probably had an effect the decisions taken by Britain’s disproportionately aristocratic bureaucrats and parliamentarians . Late-Victorian political leaders, most of whom were stockholders , “shared a common culture with the financial class.”

This prompted imperial critic J.A. Hobson to conclude that finance was manipulating events to its own profit. Contemporary historians, such as Bernard Porter, P.J. Cain, A.G Hopkins do not downplay the influence of ‘the City’s’ financial interests either, but contest Hobson’s conspiratorial overtones and ‘reductionisms’. Nevertheless, they often acted as repositories of the surplus capital accumulated by a monopolistic system and they were therefore the prime movers in the drive for imperial expansion, their problem being to find fields for the investment of capital.

Social Views

New social views of colonialism also arrised. Rationalized by Rudyard Kipling-style racism and Social Darwinism in predominately Protestant empires and the paternalistic (but republican and progressive) French-style “mission of civilization”, was attractive to many European statesmen. Riding the sentiments of the late nineteenth century Romantic Age, imperialism inculcated the masses with ‘glorious’ neo-aristocratic virtues and helped instill broad, nationalist sentiments.