The Short-Lived German Free Trade Movement

In even the most reasonably-informed accounts of classical liberalism, those that eschew the inclusion of the likes of Mill and Rousseau, the spotlight almost invariably falls on Britain and France—on the likes of Adam Smith, Richard Cobden, Frédéric Bastiat, and Benjamin Constant. Yet the German tradition of liberalism—so often overshadowed by the rise of Bismarckian statism, Marxism, and social democracy—played a critical role in shaping the transnational liberal movement of the 19th century. In Raico’s telling, two of the key figures who stand out in this story are John Prince Smith, the English-born but Berlin-based champion of free trade, and Eugene Richter, the sharp-tongued liberal parliamentarian who fought to the bitter end against the tides of socialism and statism in Wilhelmine Germany.

Together, Smith and Richter embody the path not taken in modern German political development. Their example shows that within Germany there was once a vibrant current of classical liberal thought—rooted in free trade, individual liberty, and hostility to state overreach—that, though ultimately defeated, left a legacy that still resonates with the Austro-libertarian school today.

John Prince Smith and the Birth of German Free Trade Liberalism

Ralph Raico’s essay “John Prince Smith and the German Free Trade Movement” restores to memory a man largely forgotten even in his own adopted country. Smith, an English émigré who settled in Berlin in the early 19th century, became the intellectual nucleus of the German free trade school. Like Cobden and Bastiat in Britain and France, Smith argued with passion and precision against tariffs, guild restrictions, and mercantilist privileges that strangled economic life.

Smith’s influence extended beyond the lecture hall. He helped found the Congress of German Economists (Volkswirtschaftlicher Kongress), an institution that spread free trade ideas among Germany’s educated classes. He also inspired younger liberals who would later serve in parliament and fight against protectionist policies. Raico emphasizes that Smith’s achievement lay not only in adapting English classical economics for German audiences but also in embedding it in the broader European liberal tradition. His advocacy tied Germany into the international liberal network of the 1840s and 1850s—a moment when free trade seemed poised to become the governing principle of civilized states.

Eugene Richter and the Liberal Rearguard

By the late 19th century, however, German liberalism was in retreat. Bismarck’s unification of Germany in 1871—though celebrated by many liberals at the time—paved the way for an aggressive expansion of state power. The so-called “liberal era” of the 1860s gave way to Bismarck’s Realpolitik, protectionist tariffs, and the beginnings of the modern welfare state. It was in this hostile climate that Eugene Richter rose to prominence.

Richter, profiled by Ralph Raico in the penultimate chapter of his Classical Liberalism and the Austrian School, represented perhaps the last great defender of uncompromising liberalism in German politics. Leader of the Progressive People’s Party (Fortschrittspartei) and later the Free-Minded Party, he was relentless in opposing protectionist tariffs, state socialism, colonial adventures, and militarism. His parliamentary speeches, sharp wit, and unflinching adherence to principle earned him both admiration and enmity.

Richter’s 1891 novel Pictures of the Socialistic Future stands as one of the most prescient anti-socialist tracts of the nineteenth century. Anticipating the disasters of central planning decades before they materialized, the book uses satire to depict everyday life under a socialist regime. Shortages, bureaucracy, political repression, and the crushing of individual initiative—all appear in his fictional Germany; a chilling forecast later vindicated by the totalitarian experiments of the 20th century.

The Road Not Taken

Taken together, Smith and Richter represent two moments in German liberalism, representing its hopeful birth and its embattled defense. Smith’s project was optimistic, internationalist, and reformist. He believed in the power of economic truth and the possibility of persuading governments to embrace free trade. Richter, by contrast, was a voice of resistance in an age when liberalism had lost its ascendancy. Where Smith had sought to shape the development of German liberalism, Richter fought to preserve its embers against encroaching collectivism.

What unites them is a consistent emphasis on property rights, economic liberty, and suspicion of the state. Both were animated by the conviction that prosperity and human flourishing depended, not on bureaucratic direction or military conquest, but on the voluntary exchanges of free individuals. This core insight places them firmly within the classical liberal tradition alongside their better-known Anglo-French contemporaries.

The defeat of Smith and Richter’s liberalism in Germany was not inevitable. As Raico and other revisionist historians have argued, there was a genuine alternative path open to German political development in the 19th century. Had the liberal movement triumphed—had free trade, constitutionalism, and limited government become the pillars of German unity—European and world history might have unfolded very differently.

For today’s readers, revisiting Smith and Richter is more than an antiquarian exercise. Their example demonstrates that liberalism was once a transnational movement, not confined to England or America. It also highlights the perennial struggle between those who would limit the state and those who would expand it in the name of progress or security. In the end, Smith’s free trade economics and Richter’s anti-socialist warnings converge into a single message: liberty requires eternal vigilance.