The crash of 1873 and the subsequent depression began the gradual dissolution of Bismarck's alliance with the National Liberals that had begun after his triumphs of 1866. In the late 1870s, Bismarck began negotiations with the economically protectionist Conservative Party and Center Party toward the formation of a new government coalition. Conservative electoral gains and National Liberal losses in 1879 brought a conservative coalition to power. Bismarck then abandoned his former allies in the National Liberal Party and put in place a system of tariffs that benefited the landed gentry of eastern Prussia--threatened by imports of cheaper grains from Russia and the United States--and industrialists who were afraid to compete with cheaper foreign manufactured goods and who believed they needed more time to establish themselves.

Bismarck's alliance with the Prussian landowning class and powerful industrialists and the parties representing their interests had profound social effects. From that point on, conservative groups had the upper hand in German society. The German middle class began to imitate its conservative social superiors rather than attempt to impose its own liberal, middle-class values on Germany. The prestige of the military became so great that many middle-class males sought to enhance their social standing by becoming officers in the reserves. The middle classes also became more susceptible to the nationalistic clamor for colonies and "a place in the sun" that was to become ever more virulent in the next few decades.

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Source: U.S. Library of Congress