Eugen Philippovich von Philippsberg · 1915
Philippovich’s wartime pamphlet argues that a German–Austro-Hungarian economic and customs association is not a patriotic fantasy but a practicable, historically prepared, and strategically necessary project. Written in the Mitteleuropa moment of 1915, it presents the war’s isolation of the Central Powers as the occasion to revive a nineteenth-century plan repeatedly blocked by politics rather than economics. The second preface states the thesis with programmatic brevity:
eine Zolleinigung möglich ist.
English translation: a customs union is possible.
The work’s first sections reconstruct Austrian trade policy as late-unified and long constrained by prohibitions, internal customs lines, and protectionist interests. Against this inertia Philippovich sets Metternich’s efforts toward freer German trade and especially Bruck’s plans of the early 1850s. Bruck’s staged path—abolition of prohibitions, stepwise reductions of internal duties, common commercial representation, and eventual customs unity—becomes Philippovich’s model. The failed negotiations with Prussia are read not as proof of impracticability but as a lost historical opening, captured in Schäffle’s retrospective judgment:
Die Einigung war ein deutsches Interesse allerersten Ranges.
English translation: The unification was a German interest of the very first rank.
This history gives the pamphlet its argumentative structure. Bismarck’s objections about different consumption habits, administration, and revenue distribution are treated as secondary rationalizations; the real obstacle was Prussia’s wish to command the Zollverein without Austria. After the 1870s, both empires turned toward autonomous protective tariffs, especially under agricultural pressure. Philippovich condenses this change into a formula:
Nationale wirtschaftliche Autarkie wurde das Schlagwort.
English translation: National economic autarky became the watchword.
Yet he is not a simple free-trader. His central conceptual move is to separate the ideal of a large common economic space from the immediate abolition of all internal protection. A Zollverband must enlarge markets and coordinate external policy, but Austrian industry, weaker in capital, freight conditions, taxation, and domestic purchasing power, needs transition. Hence union is possible only as gradual convergence.
The statistical middle of the pamphlet supports this developmental argument. Philippovich shows Austria-Hungary’s rising coal and iron production, factory numbers, bank capital, savings, transport, and communications, while admitting that Germany remains wealthier and more productive. He stresses latent strengths: Alpine water power, technical education, Kunstgewerbe, specialized manufactures, and artistic small industry. Austrian backwardness is therefore not natural but institutional; wider markets and legal reform could release capacities already present.
The trade analysis makes the asymmetry sharper. Since the 1906 commercial treaty, imports from Germany have grown strongly, while Austro-Hungarian exports—especially agrarian ones—have weakened as domestic consumption rises and yields lag behind Germany. In industrial goods Austria-Hungary carries large deficits in metals, machinery, instruments, chemicals, paper, leather, rubber, and textiles. This imbalance is precisely why Philippovich rejects any one-sided liberalization:
nicht die Rede davon sein, daß wir neue Erleichterungen bieten, ohne einen Ersatz zu finden.
English translation: there can be no question of our offering new concessions without obtaining some compensation in return.
The proposed “Ersatz” is an institutional architecture: a common external tariff where the two schedules already approximate one another; moderate agricultural protection; temporary intermediate duties for vulnerable Austrian industries; tariff calculation preferably in Mark; and harmonization of company, exchange, administrative, and commercial law. War removes former treaty constraints, especially most-favored-nation limitations:
Durch den Krieg ist jedem Staat seine Freiheit wiedergegeben
English translation: Through the war, every state has had its freedom restored to it.
The final argument is geopolitical. Philippovich imagines a Central European economic area from the Adriatic to the North Sea, perhaps widened further, capable of resisting British-led isolation and redirecting capital, production, and trade toward the Balkans and the Orient. Scale is his governing economic category:
Je größer der Raum, je größer die Bevölkerung, desto leichter wird eine Vervielfältigung der Produktions- und Abgrenzungsmöglichkeiten.
English translation: The greater the territory and the greater the population, the more readily can the possibilities of production and of specialization be multiplied.
The pamphlet combines wartime strategy, historical memory, and institutional economics. Philippovich’s union is presented as a mechanism for reform, specialization, and resilience: German mass production and Austrian finer manufactures, German capital and Austro-Hungarian developmental space, common external strength and staged internal adjustment. Customs union is meant to produce not only freer trade but also
die Anregung zu solchen Änderungen.
English translation: the impulse toward such changes.
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