Budgetary Crisis and German History

Right now, the House of Representatives is blocking a stimulus Bill which Republicans say will help prevent the Coronavirus from further damaging the economy. This is not the only time in recent history when Congress has failed to pass a spending bill. Readers will remember the several government shutdowns of last year. Stepping back from the controversy surrounding this and previous congressional crises, I think that this is a good opportunity to write about a time in German history when a similar thing occurred. Prussia, the predecessor to the modern German state, entered the second half of the 19th century with great political division. On one side were the Conservatives who supported the monarchy and wanted to strengthen the military and on the other were the Liberals who, while not necessarily anti military, opposed the monarchy and wanted military and political reforms that would decrease royal power. In 1862, the conflict between the two sides came to a head when the liberal legislature refused to approve King Wilhelm’s budget for the year and the King refused to make concessions to sway them. Prussia was thus left without military funding. To understand how bad this was for Prussia, one must understand how important the army was to Prussia. The military was integral to the Prussian national idea and was a critical aspect of Prussian life. Prussia has been described as “an army with a country”, and if the army was not funded Prussia would suffer a crisis of conscience as well as one of geopolitical standing. Realizing the severity of the situation, the King Wilhelm called Otto von Bismark, a staunch monarchist, back from his position as ambassador to Russia and made him Minister-President of Prussia.

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Otto von Bismarck picture years after the 1862 Budget Crisis. Image Source Encyclopedia Britannica.

Bismarck soon came up with the ingenious, if dubiously legal, solution of simply using the last year’s budget in place of a new one. The legislature could do nothing but protest, and the 1861 budget would be continuously renewed as year after year the legislature refused to approve a new budget. The crisis was thus averted, but the issue of the budget would only really be resolved by the Austro-Prussian War of 1866. Prussia’s victory in that war created such a tide of support for Bismarck and the Monarchy that the Conservative Party won the elections that year and retroactively approved the use of the 1861 budget. Although Bismarck’s tactics may have been expedient, I think we can all agree that it is better in the long run that no President is able to use such tactics to go around opposition and institute his will against the wishes of Congress.

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