Otto von Bismarck, "Founder" of the German Empire

Otto von Bismarck, born on April 1, 1815 at Sch?nhausen, is considered the founder of the German Empire. For nearly three decades he shaped the fortunes of Germany, from 1862 to 1873 as prime minister of Prussia and from 1871 to 1890 as Germany?s first Chancellor. On the occasion of the 100th anniversary of his death on July 30, 1898, German News remembers the great German statesman. Prince Otto von Bismarck, portrait

After reading law at the Universities of G?ttingen and Berlin, Otto von Bismarck entered Prussian service and became a judicial administrator at Aachen. Bismarck gained prominence in 1851 when he was chosen to represent Prussia in the Federal diet. In 1859 he was sent as ambassador to Russia, from where he was recalled in March 1862 to become ambassador to France. However, already after 6 months in September 1862, Bismarck returned to Berlin as prime minister of Prussia when he devoted himself to the task of uniting Germany. In the war of 1866 he succeeded in defeating Austria and excluding it altogether from Germany. Also the Franco-German War (1870-71) ended with Prussian success.

This victory instigated the kingdoms of Bavaria, W?rttemberg, Baden and Hesse to join the North German Alliance, an alliance of Prussia and 17 northern German states created by Bismarck in 1866, which led to the declaration of the German Empire (Deutsches Reich) in 1870 and the proclamation of King William I of Prussia as German Emperor in Versailles in 1871. The imperial constitution was declared in April 1871. Bismarck was appointed imperial chancellor. The chancellor of the Reich was not responsible to parliament but to the Emperor. The Reichstag, the imperial parliament, was convened by uni versal, equal, direct and secret elections. Next to the Emperor, it was the second most important institution. However, its political influence was limited to the area of legislation. It exerted only a very small influence over the formation of governments and government policy. Characteristic of the Reich was the ?government over the parties" and the restriction of the peoples? representation to a position in which it was only able to express a non-binding opinion on important political questions. The system was described at the time as a ?chancellor dictatorship". It was Bismarck as Imperial Chancellor who decided upon policy outlines and who proposed the appointment and dismissal of state secretaries who were in turn responsible for the administration of the ministries of the Reich.

Bismarck?s greatest achievements, however, were the administrative reforms, developing a common currency, a central bank, and a single code of commercial and civil law for Germany. Bismarck also became the first statesman in Europe to devise a comprehensive scheme of social security to counter the Social Democrats, offering workers insurance against accident, sickness and old age. In foreign affairs, he, as a master of alliances and counter-alliances, presided over the Congress of Berlin (1872) and this seemed to symbolise his paramount position as mediator between the then great powers such as Russia, Austria, France, Great Britain. An alliance with Austria-Hungary (1879) marked a new period of conservatism in Bismarck?s foreign policy. William I, German Emperor, 1871 and Prince Otto von Bismarck (painting by A. von Werner)

But by 1890 his policies began to come under attack. On March 18, 1890 two years after Emperor William II?s accession, Bismarck was forced to resign. His last years were devoted to composing his memoirs.

Germany became the first nation in the world to adopt an old-age social insurance program in 1889, designed by Germany's Chancellor, Otto von Bismarck. The idea was first put forward, at Bismarck's behest, in 1881 by Germany's Emperor, William the First, in a ground-breaking letter to the German Parliament. William wrote: ". . .those who are disabled from work by age and invalidity have a well-grounded claim to care from the state."

Bismarck was motivated to introduce social insurance in Germany both in order to promote the well-being of workers in order to keep the German economy operating at maximum efficiency, and to stave-off calls for more radical socialist alternatives. Despite his impeccable right-wing credentials, Bismarck would be called a socialist for introducing these programs, as would President Roosevelt 70 years later. In his own speech to the Reichstag during the 1881 debates, Bismarck would reply: "Call it socialism or whatever you like. It is the same to me."



The German system provided contributory retirement benefits and disability benefits as well. Participation was mandatory and contributions were taken from the employee, the employer and the government. Coupled with the workers' compensation program established in 1884 and the "sickness" insurance enacted the year before, this gave the Germans a comprehensive system of income security based on social insurance principles. (They would add unemployment insurance in 1927, making their system complete.)





One persistent myth about the German program is that it adopted age 65 as the standard retirement age because that was Bismarck's age. This myth is important because Germany was one of the models America looked to in designing its own Social Security plan; and the myth is that America adopted age 65 as the age for retirement benefits because this was the age adopted by Germany when they created their program. In fact, Germany initially set age 70 as the retirement age (and Bismarck himself was 74 at the time) and it was not until 27 years later (in 1916) that the age was lowered to 65. By that time, Bismarck had been dead for 18 years.