were set on an inevitable course of rapid decline.
There were successful ‘new’ industries of the
‘second’ industrial revolution, such as the chem-
ical and electrical industry. Britain was still, in
1914, immensely strong and wealthy because of
the continuing expansion of its traditional textile
industry and large coal reserves, the world domin-
ance of its mercantile marine, its investment
income from overseas and the reputation of the
insurance and banking institutions that made the
city of London the financial centre of the world.
But there was already in 1900 a doubt as to
whether Britain would move sufficiently fast in
changing conditions to maintain its leading
industrial place in the world.
Then industrialists felt doubts about the con-
tinuing cooperation of labour. The trade union
movement had revealed a new militancy which
posed a threat to industrial peace. The movement
was no longer dominated by the skilled artisans
sharing the values of the Victorian middle class.
The new unions of the poor working men,
formed in the last two decades of the nineteenth
century, looked to the state for decisive support,
for a redistribution of wealth.
The Labour political movement also emerged
during the last decade of the nineteenth century,
though the ultimate break between ‘Liberal’ and
‘Labour’ politics did not take place until after the
First World War. In 1900 the trade union move-
ment became convinced that involvement in par-
liamentary politics was now necessary if the
working man was to improve his standard of life.
The Labour Representation Committee, embrac-
ing a broad alliance of socialist parties and trade
unions, was formed in 1900. In the election later
that year two Labour candidates succeeded in win-
ning seats in the House of Commons. The
founders of the Labour movement were practical
men who realised that in the foreseeable future
Labour members would be in a minority. They
resolved accordingly that they would cooperate
with any party ready to help labour. In Britain, the
Labour Party was prepared to work within the par-
liamentary system, and turned its back on revolu-
tion and violence. In turn, it became accepted and
enjoyed the same freedom as other political parties.
The Conservatives, who were in power until the
close of 1905, followed cautious social-political
policies. A state system of primary and secondary
schools was introduced, partly because of the belief
that it was their better educational provisions that
were enabling America and Germany to overtake
Britain in industrial efficiency. When the Liberals
came to power in 1906 their attitude to social and
economic reforms was equally half-hearted, much
of the party still believing in self-help and a mini-
mum of state paternalism. The surprise of the new34 SOCIAL CHANGE AND NATIONAL RIVALRY IN EUROPE, 1900–14
Value of exports (US$ millions, 1913 prices)1899 1913
Manufactures All exports Manufactures All exports
Britain 479 912 624 969
Germany 437 691 925 1,285
US 272 1,366 535 1,850Population (millions)1880 1900 1910 1920 1930
Britain* 35.6 44.3 45.0 46.9 45.8
Germany 45.2 56.4 64.9 59.2 64.3
US 50.2 89.4 92.0 118.1 138.4* Including Ireland and Northern Ireland respectively.