In tracing Indian developments in the second half of the nineteenth century it is important to balance carefully the Indian and British sides of the scales. And the British side was not British only, but European and western as well, for in much of their activity the British were harbingers of general western culture rather than the purveyors of Anglo-Saxondom. In the past there has been a tendency to regard the significant features of Victorian India as the completion of the British dominion, and the gradual spread of British administrative techniques and public works, of western cultural ideas and western humane values. The groups who secured the decision to introduce western institutions into India believed that Indian institutions were effete and Indian traditional ideas inferior if not positively harmful. They looked to a gradual replacement of things Indian by things European, though they did not all clothe their expectation in the vivid imagery of Macaulay. The first school of writers on British India were fascinated by the spectacle of the rise of British power, the most striking and lasting, as they believed, in the long procession of Indian empire. There followed, with James Mill's History as a bridge, those who thought that the true significance of British Indian history consisted in the introduction of western institutions. Both schools were absorbed in the British raj; while the first emphasised the raj, the second emphasised the British. Neither, along with most contemporary administrators, thought that India herself had much to offer towards her own future.

At the half-way mark of the Victorian era Britain held an undisputed position as the greatest power in the world. Her economic, political and social institutions rested on firm foundations, and served as models for old and new states both in Europe and overseas. The empire controlled by Britain included large areas in Africa, America, Asia, and Australasia; British sea-power dominated the oceans; British trade spanned the globe; and Britain had long been recognised as the financial and industrial centre of the world. While in some particulars this picture changed before the end of Queen Victoria's reign, British influence and power were still immense, and the British empire of 1901 was vastly larger and richer than that of 1870.

Throughout the eventful closing decades of the nineteenth century Britain played a leading part in all aspects of world affairs. She pioneered in fields of science and technology; she promoted the development of communications by land and sea and furthered the Europeanisation of Africa, Asia, and Oceania; her capital and entrepreneurial and technical skills helped to unlock the resources of far-away lands; her cultural, economic, political and social institutions were planted in regions throughout the world. The period witnessed a large diaspora of British peoples and the unpremeditated role of Britain as a builder of nations.

In 1870 the leading British statesmen believed that Britain was sated territorially. But in the next thirty years Benjamin Disraeli and Joseph Chamberlain urged expansion of the empire. Both were converts to this cause. In the 1860's Disraeli had advised abandoning British outposts in West Africa; in the early 1880's Chamberlain had fought imperialism.

A period inaugurated by Karl Marx's Das Kapital (1867), Charles Darwin's The Descent of Man (1871), Clerk Maxwell's Electricity and Magnetism (1873) and Friedrich Nietzsche's The Birth of Tragedy (1872) was unlikely to be devoid of intellectual ferment. The men who exerted the largest influence on social, political and religious thought during the last three decades of the nineteenth century were Marx and Darwin: but the nature of this influence was greatly affected by the changing character of scientific and social thought in general, and by the repercussions of scientific ideas upon social thought. It was also profoundly affected by the rapidly changing condition of society and government, a condition brought about by scientific inventions, industrial expansion and new forms of social and political organisation. In no other period is intellectual history more inseparable from economic and political history—an inevitable consequence of the conquests of science in both thought and action. Under the impact of Marxism and Darwinism on the one hand, of unusually fast-moving social change on the other, adherents of older political philosophies and social faiths had to modify their arguments and outlooks. Utilitarianism, idealism and positivism continued as operative schools of thought. But they survived within a new context of philosophical and religious beliefs, amid a new ethos and new material conditions: and this context coloured their whole development.

Marx's analysis of economic forces in Das Kapital was designed to be the massive underpinning of the political doctrines which he and his collaborator, Friedrich Engels, had propounded since they issued the Communist Manifesto in 1848. As the avowed ‘continuation’ of Marx's Critique of Political Economy (1859), Das Kapital presented detailed evidence of the working of the laws of dialectical materialism.

After the final triumph of Italian and German nationalism in 1870 the Danubian lands and the Balkan Peninsula remained the one considerable area of unsatisfied nationalist aspirations in Europe. These aspirations provided the most considerable threat to the multinational empires of Austria-Hungary and Turkey. Yet in both cases the dynasty, in spite of recent challenges, was still sustained by a tradition of inevitability; both had existed for so long, and in spite of the declining glamour of the imperial or any other embracing role each could still ask with some plausibility what was to be put in its place. The question in the international field found a ready answer from the new Germany, which was soon to tell Russia that Austria-Hungary was a European necessity, and from Great Britain, which was still making the same extravagant claim for Turkey; and if Russian views were divided they were not pressed to the limit. At home, many could still not conceive of life without emperor or sultan. Echoing Palacký, Prince Charles Schwarzenberg asked the Young Czech extremists in 1891, ‘what will you do with your country, which is too small to stand alone?’ and in 1897 the Young Turk exile Murat Bey said that the ruling dynasty must remain at the head of the empire, for without it Turkish power had no existence. Nevertheless, the chance of survival for both Habsburg and Ottoman came to depend less and less on past glory or present convenience and more and more on two conditions: the international stalemate after 1878 and the hostilities which divided the national minorities and which postponed and confused their challenge to the state.

Science and technology were far more closely related between 1870 and 1900 than in any earlier period. In the last three decades of the nineteenth century there were few branches of industry that were not affected by new scientific discoveries, although this is by no means the same as saying that traditional empirical methods were entirely or even largely ousted. Empiricism remained dominant in many industries; in some it remains so to the present day; but after 1870 we can clearly see the beginnings of the scientific industry of the twentieth century. The changed outlook is naturally more apparent in the new industries—such as the electrical industry—that originated wholly in scientific discovery than in those, already long established, in which the application of science resulted to a great extent in improving old processes rather than in creating quite new ones.

While the close relationship between science and technology within this period is evident, it is in many instances exceedingly difficult to distinguish cause from effect. Sometimes a purely scientific discovery, resulting from research with no practical objective in mind, was of such obvious practical importance that its commercial development followed almost as a matter of course. The development of the dyestuffs industry was a conspicuous example: the first coal-tar dye was the result of an unsuccessful—and, as we now know, wholly misguided—attempt to synthesise quinine. Other scientific discoveries, however, became significant primarily because contemporary conditions favoured their application; in different circumstances their historical significance might have been slight, or have been apparent at a much later date.

At the end of the seventh decade of the nineteenth century two generations had passed since the continental American colonies of Spain and Portugal had won their independence. During these years these new states had maintained their independence, expanded their commercial and cultural relations with Europe and progressed toward political stability. The half-dozen larger Spanish American units, roughly coincident with the colonial viceroyalties and captaincies-general which had emerged from the struggle against the mother-country, had split into sixteen separate republics, and within each of these national feeling had grown and increasingly justified a political map which at the outset had not set off really separate peoples from each other. Portuguese America, in contrast, had successfully weathered centrifugal tendencies, and in 1870 the empire of Brazil was the largest, the most powerful, and the most stable state in Latin America. In the West Indies, the political pattern remained colonial: Cuba and Puerto Rico remained under Spanish control; the lesser Antilles were subject to their various European metropolises; and isolated Haiti and the precariously sovereign Dominican Republic alone represented the republican principle in the Caribbean.

After 1870 the chief source of changes in this area was the unprecedented development of its connections with the outside world. Expanding industry in Europe and in the United States required ever larger amounts of raw materials such as hides, cotton, and wool; the new chemical and electrical industries required more and more rubber, copper, zinc, lead, and other metals. New concentrations of urban population also needed increasing amounts of imported food: sugar, wheat, meat, coffee, and cacao.

In the first place and for a long time the increasing pressure for expanasion in the Pacific and China areas which was so prominent a feature of the last third of the nineteenth century did not come from the European governments. Before 1894 it came almost entirely from Asian governments and their foreign advisers or from European settlers and officials in Australia and New Zealand, the Pacific islands and Asia. For special reasons the latter received strong official support from Europe for a brief period between 1882 and 1885; but apart from this the European governments remained reluctant to extend their responsibilities and their rivalries to this area until the last few years of the century.

Among the earliest problems to arise in the area were those created by the expansion of European trade and settlement in some of the Pacific islands. Clashes between Europeans and between Europeans and natives were becoming serious as early as 1870 in consequence of the growth of trade and plantation agriculture, the improvement of communications and the effect of these developments in dislocating native social and political systems. In Fiji the British Colonial Office had already rejected, twelve years before, a suggestion from the British settlers, who were also afraid of annexation by France, that these problems should be solved by annexation by Great Britain. It had felt reluctant to risk a quarrel with France. Since then the number of settlers, predominantly British, engaged in trade and cotton production had continued to grow despite the lack of effective government and increasing disorder.

By 1870 it was plain that in the great area, at once a crossroads and a frontier, which is bounded by the waters of the Mediterranean, of the Red Sea, of the Arabian and Indian Oceans, of the Persian Gulf, and by those of the Caspian and the Black Seas, the influence of the European powers was becoming ever more widely extended.

The capitals of St Petersburg, Paris, and London, rather than those of Constantinople, Cairo, or Teheran, had of course long been the centres wherein Near and Middle Eastern policies were decided. If something unforeseen, something spontaneous and native to the area, actually happened, then steps had at once to be taken in those centres to bring the consequences of any such ‘untoward events’ under control. One concert of Europe had, in 1840–1, curbed one such disturber of the Levantine peace, the ambitious Mehemet Ali of Egypt. Another concert had, in 1854–6, taken the measure of a more formidable innovator, someone who was not supposed to be a native of the area at all—Tsar Nicholas I of Russia. In 1856, too, the British had sent gunboats into the Persian Gulf to stop the Shah of Persia from absconding with his Afghan neighbour's property of Herat. The existence of peculiar ‘spheres of interest’ was mutually recognised by the powers: it was their expansion that was objected to. No one went to the assistance of the Circassian leader Shamil in the Caucasus, or to that of Sher Ali in Kabul, of the Bey in Tunis, or of Ahmed Arabi in Egypt, although there have been causes worse.

The summer of the year 1870 in China saw two events which taken together have been recognised as marking the failure of the movement known to Chinese historians as the T'ung Chih Restoration, the rally of the dynasty which followed the successful suppression of the great T'ai P'ing Rebellion (1850–64). On 7 July 1870 the British Under-Secretary for Foreign Affairs announced in the House of Commons that the government had decided not to ratify the Alcock Convention, an instrument which the British Minister to China, Sir Rutherford Alcock, and the Chinese plenipotentiaries had signed in Peking on 23 October of the previous year. On 21 June there had occurred in the treaty port of Tientsin a violent anti-foreign outbreak, in which several lives were lost, known as the ‘Tientsin Massacre’. The rejection of the Alcock Convention marked the failure of the foreign policy associated with the T'ung Chih Restoration; the Tientsin massacre equally emphasised the triumph of reactionary forces opposed to the cautious programme of modernisation which the Restoration statesmen had pursued. Both events were the product of popular ill-informed chauvinism, in the one case inspired by the pretensions and greed of the European merchant community in China, in the other by the ignorance, pride and xenophobia of the Chinese people.

The British government had yielded against their better judgement to the clamour raised by the merchants of Shanghai and other ports in China, an agitation directed not merely against the fact that the stillborn Alcock Convention made some modest changes in the treaty relations between the two countries in favour of China, but even more against the policy which inspired the author of this diplomatic initiative.

The literature of the late nineteenth century shows unmistakable symptoms of decadence. What is decaying is a literary tradition which dates back to the Renaissance, when its basic genres, its conventions for representing the world and giving a valid picture of human experience, were laid down anew. The tradition was largely founded on a belief that the artistic imagination truly mirrors nature, and this belief persisted through all later changes in theme and expression. The great distinction between realism and romanticism, which accounts for most of the major variations in the literature of the earlier nineteenth century, still did not break the tradition. It rather enriched it with a subtler sense of the difference between the world as mirrored in poetry and the world as mirrored in prose, and indicated a fuller awareness of the interesting role played by specifically subjective adventures in thought and feeling. Confidence in the power of art to reflect the true sense and shape of these richer possibilities remained unshaken. Towards the end of the century, however, the reliability, indeed the responsibility, of the imagination in discovering the way things ‘really’ are and in knowing what they mean began to be seriously questioned. It seemed possible to write about anything in almost any way, to enjoy literally almost any number of views, but this gain in literary scope and freedom was accompanied by a loss of creative certainty about the true image and status of man. Amidst the bewildering assortment of styles and schools, which sprang up at this period, it is possible to find only one common feature; the search for an authentic form of expression.

Since the nineteenth century began, the Europeans had been strengthening their hold over those parts of the world selected during the era of mercantilism. Australasia, India, South-east Asia, above all the Americas—they were either temperate regions peopled with white immigrants or tropical countries already under white rule. Step by step the mode of white expansion had altered: liberalism and industrial growth shifted the emphasis away from colonies of formal empire to regions of informal influence. But whatever the form it had taken, the groundwork of European imperialism had been truly laid long before the cartographical exercises in partition at the end of the century. Africa was the last continent to win the interest of the strategists of expansion; it seemed to them that here they were scraping the bottom of the barrel.

Dividing Africa was easy enough for the Europeans. They did it at that moment in history when their lead over the other continents was at its longest. Economic growth and technical innovation gave them invincible assurance and force. Their culture and political organisation gave them a carrying power to match their iron ships and high-velocity guns. That Europe had the capacity to subjugate Africa was self-evident; but had her rulers any firm wish to do so?

Twenty years were enough to see the continent carved into symmetries devised by the geometers of diplomacy. By the end of the century only Morocco and Ethiopia were still independent, and their turn was coming. But the statesmen who drew the new frontier lines did not do so because they wanted to rule and develop these countries. Bismarck and Ferry, Gladstone and Salisbury, had no solid belief in African empire; indeed they sneered at the movement as something of a farce.

It is impossible to understand the following pages if it is not first realised that the French in 1871 were dominated by memories of the peculiarly eventful three-quarters of a century since 1789. The peasants, who remained by far the largest social group, only slowly absorbed new ideas. They still feared the re-establishment of an aristocratic and clerical regime that would reimpose feudal dues and tithes on them; conversely, they had acquired a very acute sense of their property rights and, particularly since 1848, it had become easy to rouse in them an irrational fear of ‘the Reds’ or the partageux (redistributionists), by whom they meant the politically more advanced town-dwellers who would come and take away their land or at least their savings (kept in the famous woollen stockings). Undoubtedly the landed nobility, still very important in certain regions, and the upper middle class did not dream of challenging, yet again, either the freedoms proclaimed in 1789 or even the civil equality consecrated by the Code Napoléon; but they remembered with dread the Terror of 1793–4, the rising which brought in the July Monarchy, the February Revolution of 1848 and the rising of June 1848. They consequently refused all compromise with the new ideas and the popular aspirations of the nouvelles couches, in which they were incapable of seeing anything other than purely destructive forces. As for the convinced republicans (industrial workers, artisans, and many in commerce and the liberal professions), their ideal was 1793: the Constitution of the Year One, which had provided for a very liberal, very democratic, very decentralised regime, but also the supremacy of the convention and the great committees ; in other words an all-powerful assembly acknowledging no limit to its power.

It is convenient to regard 1868 as marking a turning-point in the modern history of Japan. In January of that year a group of new leaders seized power in the then imperial capital of Kyoto, men who became, despite subsequent shifts in both policy and personnel, responsible for initiating changes which revolutionised the country's political, economic and social institutions and eventually raised it to a high level of international power and prestige.

Since the beginning of the seventeenth century government had been in the hands of a line of feudal rulers, the Tokugawa family. As shogun, nominally the emperor's military deputies, they had possessed the hereditary de facto authority of monarchs, exercising direct control over their own enormous domains and effectively subordinating the lords of the great feudal territories into which the rest of the country was divided. They sought, with remarkable success, to preserve their power by preventing change. After about 1640 Japan was by their decree almost entirely cut off from contact with the rest of the world, while at home political relationships were frozen in their seventeenth-century form, rigid social distinctions developed and were enforced for all classes of the population, and attempts were made to inhibit even economic change.

It was in its economic aspects that this policy was least successful. By the eighteenth century domestic commerce had expanded and the feudal class, the samurai, for the most part resident in castle-towns, had become accustomed to a higher standard of living. They had not, however, secured a commensurate increase in revenue or income. As a result, both domain governments and individual samurai became steadily more indebted to city rice-brokers and financiers.

By the time of the Civil War the first American expansive drive was over. The most obvious objectives of manifest destiny had been achieved, and the frontiers of the United States were logically satisfying. The country stretched from sea to sea. To the north lay Canada, a region which, it could be argued, must some day inevitably fall to the United States, but whose accession it was neither necessary nor desirable to hasten. To the south lay Mexico, arid and uninviting, and peopled by men whose stock, language, religion and traditions were suspect to most Americans.

Within the United States itself there was ample land to occupy the energies of a vigorous people. Even before the Civil War manifest destiny and the lure of the West had not been the only impulse to expansion. Competition between North and South for the control of the West, as a source of both economic and political strength, had been as important in determining the urgency of the rush to the Pacific. The genuine expansionists had hoped to divert Americans from their sectional quarrel by invoking the imperial dream; but their failure to do so did not slow an advance which the quarrel itself turned into a race. When the Civil War was won and lost, the most obvious goal of expansion had been achieved and the most impelling motive of expansion removed.

The Franco-German War of 1870–1 completed the political movement which had aimed at bringing the unity of a national state to both Italians and Germans. In both cases the state had had to gain control over a national revolutionary movement which had come to grief when it opposed the states in 1848. In Italy this movement had done more than in Germany towards consolidating the nation into a whole; but in Germany too, led politically by middle-class liberals, it had supplied the chief stimulus in the great cause, even though representatives of the liberal movement had been denied any appreciable share in the actual foundation of the empire. At decisive moments in his trial of strength with Austria even Bismarck had not hesitated to employ national revolution as a political means; in 1866, if arms had not brought quick results, he would have mobilised it with a call to the Germans—as also to the Czechs, Magyars and other nationalities—within the Habsburg monarchy. But the rapid and complete victory of Königgrätz meant that diplomatic and military activity largely obscured the share that national revolution had had in the founding of the empire. This had been precisely Bismarck's design: he meant to make use of liberal and democratic leanings only in so far as they helped him to overcome the conservative and particularist forces opposing him in Germany. The less Bismarck needed popular support, the more he could and indeed had to consider the principalities which in Germany, unlike in Italy, remained a constituent element of the national state.

Before the Peace of Westphalia Italy was an organic part of a vast network of European interests. It was the centre of the Catholic Counter-Reformation and one of the main bases of Spanish imperialism. Spanish-Catholic political interests were connected with widespread economic interests in which the shipping, banks, industry and merchants of Genoa, Milan, Tuscany, Naples and Sicily played an important part. The Peace of Westphalia maimed Spanish imperialism and halted the Counter-Reformation. As an indirect result, Italy was relegated to the margins of European history and confined to a very minor place among the countries of Europe. Thus the Peace of Westphalia was also a date of fundamental importance in the history of Italy, although its effects came to be seen only with the passage of time. It did not at once terminate the conflicts in which the peninsula and its States were involved, the war between France and Spain and the War of Candia between Venice and the Turks; nor did it change the political map of Italy, the essential features of which were settled by the Peace of Cateau-Cambrésis (1559) and modified in some details by subsequent events, in particular by the Treaty of Cherasco (1631).

Spain remained mistress of her traditional domains, Milan, Naples, Sicily and Sardinia. By means of a series of strategic points she retained control of the Tyrrhenian Sea, which was vital to imperial communications, and of the States along its coast. The Genoese republic, with its own territories of Liguria and Corsica, continued to be a pawn of Spanish policy; it was watched over by the strategic strongholds of the Marquisate of Finale (on the Ligurian coast and under direct Spanish rule) and of the Lunigiana valley (between the Po valley and the Tyrrhenian, an area dotted with fiefs of the Malaspina family, who were theoretically vassals of the Empire, but in practice dependants of the Spanish governor at Milan).

Sultan Mehmed IV who ascended the throne in 1648 inherited a vast empire which had been conquered by the sword of his ancestors and stretched over three continents. In Europe the frontier of the Ottoman Empire was a mere eighty miles from Vienna; in North Africa only Morocco did not belong to it; it included Upper Egypt and extended to Aden; the Black Sea and the Red Sea were Turkish lakes; in the east it stretched to the shores of the Caspian and of the Persian Gulf. It is impossible to give the exact figure of its population, but in the seventeenth century it amounted to approximately 25 or 30 millions. The Turks, although the dominant race, were only a minority. Probably the Muslims —Turks, Arabs, Kurds, Bosnians, Albanians, Circassians, Crimean Tatars and Turkic peoples of the Caucasus—were stronger than the Christians—Greeks, Serbs, Hungarians, Bulgars, Wallachians and Moldavians. Outstanding among the Turks of this period were the famous historian, geographer and bibliographer Kâtib Tchelebi (1609– 57) and the renowned traveller Evliya Tchelebi (1611–78), who described the cities, customs and peoples of the Ottoman Empire in his huge ten volumes. Its heart was the city of Constantinople (Istanbul), the seat of the military and administrative institutions of the empire, the centre of commerce and culture as well as amusement and pleasures. It was inhabited by more than half a million people, Muslims, Christians and Jews, all living side by side for centuries, observing their own customs. The city contained the palace of the sultans, the Serail, the splendid mosques of Sultan Ahmed, Suleymaniye, Bayezid, Selimiye and Sultan Mehmed the Conqueror, many Medresse's (colleges), libraries, public baths, hospitals, inns and food distribution centres, maintained by pious endowments.

The period between 1648 and 1688 was one of acute crisis for Spain: demographic, economic, social, political and spiritual. In 1648 the economic depression of the seventeenth century was in one of its most serious phases, while by 1688 recovery was already perceptible, especially in the eastern parts. This change, which reflected the general European development, operated also in demography, with a rise in population on the coasts, and stability or even decline in the interior. This was also a period during which the outlying areas, especially Catalonia, asserted themselves, and centralising tendencies suffered a setback. When the Catalan rising was put down in 1652, Philip IV (1621–65), instead of imposing the full authority of the absolute monarchy, re-established the special position of Catalonia. This was in accordance with the new legalism which can be noticed in the Spanish State of Philip IV and Charles II (1665–1700) and parallel with the demographic and economic importance of the periphery.

In the international sphere, the Peace of Westphalia marked the collapse of the Spanish plan for a Habsburg hegemony. Spain abdicated her position as a great power and withdrew within herself. She was concerned only with defending her colonies, and especially her own territory, from the imperialism of Louis XIV, while Charles II's lack of an heir drew the covetous eyes of all western Europe towards Spain. This change had a powerful effect on intellectual life, stimulating meditation on the meaning of Spanish history, and rousing controversy between those who welcomed new ideas and those who remained faithful to the spirit of the sixteenth century.

It is sometimes said that the landmarks of political history, such as those which serve to delimit the period to which this volume is devoted, have little or no relevance to economic history. This is a half-truth. And it is especially mischievous if it leads to the supposition that the economic history of nations can somehow be written without reference to the actions of governments, as though economic life existed in a vacuum, emptied of political contamination. It remains true that in certain aspects of economic life political events and personalities made no real mark. In the day-to-day or year-to-year life of English husbandman or Spanish peasant it mattered little then that Charles of England should lose his head or Charles of Spain his empire. In the forty years between the Peace of Westphalia and the English Revolution, no innovation significantly altered costs, output, or methods of production in any of the main economic activities of Europe. It was not always for want of effort: what science does today, the State tried vainly to stimulate then. This is not to say that economic life remained wholly static; it is simply to stress both that continuity and change have to be carefully balanced, and that if at certain levels a slow evolution paid little heed to the explosions of political history, at others those explosions were real enough. And for all the inventions of ingenious men, there is no set of historical laws to guide us.

The first section of this chapter consists of a broad survey of the main trends in population, agriculture, industry, trade, and finance. Here the impact of State policy is virtually ignored. The second section examines the nature of certain economic and social problems as they presented themselves to the governments of the time, and the efforts made to solve those problems.