The years between 1890 and the early 19th
century saw rapid growth in Germany’s industrial capacity and export volume exceeding those of Britain. The exports required commercial shipping. Germany felt it should have an ocean-going Navy in order to protect their shipping fleet in a possible war with England. The British Navy was able to shift the propulsion of their battleships from coal to oil, giving them higher speed and longer range of action. England already had early access to oil from Persia (Iran) through the partly British Government owned Anglo-Persian Oil Company.
At that time, Germany had no sources of oil even though in 1901, a German discovered oil in what is now northern Iraq, but there was no easy access to it. Realizing that transporting oil by sea could be easily interdicted by the British Navy, the German Government decided to try a land route using a railroad. Such a rail link already was planned in 1872 and suggested a 3,000 mile route from Germany, via Serbia and Bulgaria to Turkey and from there to Bagdad (Iraq). This was a project very much opposed by Britain since such a rail line would tend to encroach into their area of interest.
While this was a costly enterprise, the German Government made sure that banks extended the required credit. The Turks, then an ally of Germany, agreed to build their section and in 1896 completed a section from Konya in central Turkey to Ankara. There remains the most difficult portion which required crossing the Taurus Mountains into Iraq. By 1915 the line was completed in four sections and there was only 300 miles to go. But then war had started.
While Turkey was no problem for Germany being an Ally, the railroad had to cross Eastern Europe as well. After starting in Germany, the line had to cross the then county of Serbia and then pass via Bulgaria on to Turkey. While Bulgaria could be bought off, the problem was Serbia, which refused, egged-on by Russia who saw the Bagdad rail a threat to their encroachment to Persia (Iran). This posed a serious dilemma for Germany after having already spent a fortune on the railroad.
What to do?
A solution to this problem seemed to offer itself after the June 28, 1914, assassination of Archduke Ferdinand of Austria by Serbian nationalists. Austria, an ally of Germany, immediately blamed the Serbian Government for being behind the assassination and demanded satisfaction enforced by an ultimatum. Austria declared war on Serbia when no satisfactory response was received. In response, Russia, a close supporter of Serbia, then declared war on Austria. This in turn caused Germany to declare war on Russia due to treaty obligations. France now declared war on Germany under the terms of a mutual assistance pact with Russia. Finally Britain joined the fray under previous secret arrangements with the French government.
The rest, as they say, is history.
PS. One must realize, that the whole middle-east area including the Arabian Peninsula was part of the Turkish Empire prior to 1914. Turkey did not mind selling oil to the Anglo-Persian Oil Company as long as they got 11 percent to 14 percent “tariffs.” During WWI, the British solved the problem of the tariffs their way, by marching troops into the middle-east and throwing the Turks out.
As to my economic forecast for 2019, we will see pretty much the same trends as in 2019. Economic growth still depends pretty much on excess Federal Government spending (deficit) of between 3 percent to 4 percent, resulting in a GDP increase of around 3 percent followed by inflation of 3 percent. This shows that U.S. production and consumption is fairly balanced.
A FINAL WORD: We finally see a debate in the Senate worrying about the Chinese-Russian axis. Some Senators even question that it may have been a mistake to start a Cold War with Russia. This brings back my blog of February 1, 2018 ("Trump was right to seek Russian Rapprochement") stating that President Trump wanted close relations with Russia in order to prevent a Chinese-Russian alliance. Unfortunately he was shot down by Mueller and his allies.
Hans Baumann is a licensed engineer in four states and a member of Sigma Xi, the Scientific Research Society. He is an adviser to the dean of the University of New Hampshire Business School. Dr. Baumann has published manuals on valves and was a contributor to many works including the "Instrument Engineers' Handbook" and the "Control Valves Handbook." He has also published several books on business management and German history, including "Hitler's Escape," which suggests that Adolf Hitler did not commit suicide and survived World War II. In his latest book, "Atomic Irony" he proves that the Hirshoma Atom Bomb contained captured German Uranium. For more of his reports, Go Here Now.