Introduction
“Citizens! A new life is beginning. People and the state are getting their independence. A new page has opened in history. Let’s congratulate each other” (Donanma Mecmûası, September 14, 1914).
What the Navy Journal (Donanma Mecmûası), the official organ of the Society for the Ottoman Navy, heralded was the unilateral abolition of capitulations by the Ottoman government on September 9, 1914. The reason for celebration was the accelerated integration of the Ottoman Empire—with its complex population and diverse geography—into the world economy, in which Western European countries had a leading role throughout the nineteenth century. As the Ottoman Empire exported raw materials to Western countries and imported manufactured commodities from them, non-Muslim merchants and businessmen of the empire prospered, benefitting from their intermediary position between foreign powers and the Ottoman Empire. Largely relying on the support of foreigners and having an advantageous position generated by several privileges (e.g., tax exemptions and capitulations), non-Muslim minorities dominated business activities in the empire, and Muslim merchants fell behind their non-Muslim counterparts (Quataert Reference Quataert2000, 129).
According to Turkish-Ottoman historiography, the dominance of the non-Muslims in commercial activities continued until the Constitutional Revolution of 1908, led by the Committee of Union and Progress (İttihâd ve Terakkî Cemiyeti; hereafter CUP), the governing party of the Second Constitutional Era of the Ottoman Empire (1908–1918). In their attempts to close the gap between Muslims and non-Muslims in economic affairs, the CUP leaders began to apply a set of nationalist and protectionist economic policies. 1908–1918 soon became known in Ottoman history as the period of National Economy (Millî İktisâd Dönemi).
What differed national economy from liberal economy in the late Ottoman context was the massive intervention of the government in the economic sphere through the formation of new companies, the enactment of laws, as well as the close collaboration between the CUP cadre and local interest groups all around the empire. As a result, many economic organizations, including artisan associations (esnaf cemiyetleri), were created by and subordinated to the CUP directly. Although there were some Unionist leaders, such as Minister of Finance Mehmed Câvid Bey, who were proponents of a liberal economy, the CUP leadership became vehemently protectionist during the First World War. Its anti-laissez-faire stance notwithstanding, the economic nationalism of the CUP was not against capitalism (Ağır and Gökatalay Reference Ağır, Gökatalay, Koyuncu, Mıhcı and Yeldan2017).
According to historians of modern Turkey, the national economy program consisted of four doctrines: ending foreign control of the Ottoman economy, eliminating non-Muslims from the economic sphere, creating a national (i.e., Turkish-Muslim) bourgeoisie class, and achieving national industrialization as well as capital accumulation. According to these scholars, national economy practices were successful at eliminating non-Muslims and nationalizing business class in the Ottoman Empire, a process that was maintained during the republican period as well (Ahmad Reference Ahmad, Okyar and İnalcik1980, 329–350; Keyder Reference Keyder1981, 39; Ahmad Reference Ahmad1993, 22; Buğra Reference Buğra1994, 98; Hanioğlu Reference Hanioğlu2008, 161; Boratav Reference Boratav2008, 23).
As a challenge to such received argument, this study seeks to shed light on the differences between the national economy rhetoric of the CUP leaders and the actual operation of the economy. With the help of a detailed and nuanced archival-based study, I want to show not only the implementation but also the centrality of the economic nationalism of the CUP. In other words, the article does not refute the argument that economically nationalist policies were pursued during that time period. Instead, it argues that there were more nuanced practices than pure economic nationalism, with CUP policies being largely driven by various pragmatic concerns.
The empirical backbone of my argument consists of many hitherto unexamined archival documents that were collected from Ankara Üniversitesi Türk İnkılap Tarihi Enstitüsü Arşivi (The Archives of the Ankara University Institute of Turkish Revolution History; hereafter TİTEA) and Başbakanlık Osmanlı Arşivleri (Prime Ministry’s Ottoman Archives; hereafter BOA) in addition to the official journal of the Society, Donanma Mecmûası (the Navy Journal).
To reconsider economic nationalism of the CUP with the help of these primary sources, a general survey of the existing secondary literature on the economic nationalism will be given in the next section. Later, the economic power of the Society, as well as its relations with political authorities, will be explored to show that the particular case of the Society can provide an opportunity to better comprehend economic policies of the CUP. In the next sections, I will discuss whether or not the economic decisions of the Society were driven by nationalist motivations.
Economic Nationalism of the CUP in the Literature
The formulation of economic policies of the Second Constitutional Period and its wide popularity among historians resulted from three trends in the Ottoman/Turkish historiography. The first one emerged from studies revolving around pivotal figures of the period. These key protagonists were regarded as having contributed to the development of the general intellectual disposition in which Turkish nationalism began to emerge among small groups of educated middle classes (Tachau Reference Tachau1963; Berkes Reference Berkes1975, 342–344; Kushner Reference Kushner1977; Aral Reference Aral1992). Focusing on the nationalist intellectuals such as Ziya Gökalp (Heyd Reference Heyd1950; Berkes 1950; Parla Reference Parla1985), Yusuf Akçura (Georgeon Reference Georgeon1981), Munis Tekinalp (Landau Reference Landau1984), and Parvus Efendi (Alexander Parvus) (Zeman and Scharlau Reference Zeman and Scharlau1965), historians of modern Turkey sought the origin of Turkish nationalism in the writings of the period.
In addition to these nationalist intellectuals, historians examined nationalist societies and associations such as Türk Ocakları (the Turkish Hearths) (Üstel Reference Üstel1997), Türk Derneği (the Turkish Association), and Türk Yurdu Cemiyeti (the Association for the Turkish Homeland), as well as nationalist publications of the period such as Genç Kalemler (the Young Pens) (Parlatır and Çetin 1999; Belge Reference Belge, Kerslake, Öktem and Robins2010), İktisâdiyât Mecmûası (the Journal of Economics), Türk Yurdu (the Turkish Homeland), and Ulûm-ı İktisâdiye ve İçtimâiye Mecmûası (the Journal of Economic and Social Sciences). Furthermore, scholars argued that CUP intellectuals and leaders were inspired by Friedrich List, a German political economist and a promoter of the German historical school that favored state intervention in economic affairs (Ahmad Reference Ahmad and Kent1984, 22; Çavdar Reference Çavdar2003, 89; Bloxham Reference Bloxham2005, 63–65; Çayla 2007, 152–153; Üngör and Polatel Reference Üngör and Polatel2011, 28). As such, many studies of the CUP have focused on the intellectual atmosphere of the period.
Second, although there had been studies that mentioned the economic nationalism of the CUP (Ahmad Reference Ahmad1969; Eldem Reference Eldem1970; Akşin Reference Akşin1980, 150–154), Feroz Ahmad’s “Vanguard of a Nascent Bourgeoisie” (1980) increased the popularity of the “national economy” among English-writing academics. Regarding Turkish-writing academics, the same effect was done by Zafer Toprak’s in-depth book Türkiye’de ‘Millî İktisat’ (1908–1918) (‘National Economy’ in Turkey (1908–1918)) (1982) and his other studies (Toprak Reference Toprak1995a, Reference Toprak1995b, Reference Toprak2003), all of which provided an excellent account of economic policies and intellectual environment of the period. Subsequent scholarship corroborated Ahmad and Toprak’s convincing assessment (Dumont Reference Dumont and Landau1984, 40–41; Buğra Reference Buğra1994, 39–41; Göçek Reference Göçek1996, 110; Aksakal Reference Aksakal2008, 26; Zürcher Reference Zürcher2010, 48–49).
Third, and more recently, the emphasis on political and economic nationalism of the CUP regained its popularity following the studies on Ottoman Christians. According to these studies, the CUP cadre aimed to eliminate non-Muslims groups from the economic sphere and tried to Turkify, Islamize, and nationalize the Ottoman economy long before the First World War (Dündar Reference Dündar2001, 32–33; Roshwald Reference Roshwald2001, 108; Aktar Reference Aktar and Hirschon2003, 79–95; Bloxham Reference Bloxham2005, 63–65; Kaiser Reference Kaiser, Farschid, Kropp and Dähne2006, 49–71; Dündar Reference Dündar2008, 61; Gingeras Reference Gingeras2009, 36–46; Üngör and Polatel Reference Üngör and Polatel2011). To support their arguments, these scholars used the confiscation of properties of non-Muslims after 1915 as a reference point (Kouymjian Reference Kouymjian, Kimenyi and Scott2001, 301–319; Akçam Reference Akçam2012, 82–83; Onaran Reference Onaran2013a, Reference Onaran2013b).
In this study, I will not enter directly into this controversial historical arena, nor will I downplay or ignore tragedies that took place during the First World War. Rather, I will show that political, economic, and intellectual developments of the Second Constitutional Period could have easily moved in different directions. In other words, what happened during the war years did not necessarily mean that economic policies of the prewar years were completely based on economic nationalism.
As Zafer Toprak—the main reference point of most of the scholars who claimed that the CUP adopted economic nationalism—rightfully asserted, the CUP remained Ottomanist rather than Turkish nationalist and pan-Turkist, particularly in economic affairs. Likewise, Toprak argued that there was no aim of Turkification in the minds of the Unionists (Toprak Reference Toprak2006, 14–22). Sharing Toprak’s analyses, I argue that the economic policies of the CUP were “national” mostly in the sense that they were not only patriotic but also empire-wide policies. They, at the same time, aimed to decrease the dependence of the Ottoman economy on the foreign powers. The discrimination against non-Muslim Ottomans of some Unionist leaders notwithstanding, the economic nationalism of the CUP was primarily a set of pragmatic and anti-imperialist policies rather than a dogmatic program that targeted solely non-Muslims.
Why the Society for the Ottoman Navy?
The first reason for choosing the Society for the Ottoman Navy to reconsider the economic nationalism of the CUP was its “national” character. The Society was founded on July 19, 1909, with the name of Donanma-yî Osmanî Muâvenet-i Millîye (the Ottoman Navy National Support Association) (TİTEA 7-31-223-21). The epithet “millîye” (national) in the name of the Society reflected the patriotic spirit of the time, as many other societies, associations, companies, and banks of the period, too, included “millî” or “millîye” words in their titles. Moreover, the Society had close ties with the other patriotic organizations of the period such as Türk Ocakları (the Turkish Hearths), one of the most influential intellectual societies of the period. Members of such national organizations, such as Abidin Daver, Ömer Seyfettin, and Yunus Nadi, wrote articles for Donanma Mecmûası, the official journal of the Society (Çakmaktepe Reference Çakmaktepe2002). The Society also worked together with other Ottoman patriotic organizations, such as Müdâfaa-i Millîye Cemiyeti (the Society of National Defense), an organization that was founded in Istanbul in 1913, in the Anatolian provinces (TİTEA 7-47-225-4, November 9, 1909; TİTEA 7-420-225-13, February 9, 1913; TİTEA 7-421-225-17, February 12, 1913; TİTEA 7-625-224-14, September 29, 1914).
The support to the Society was not limited to these organizations. Since its start and as a charitable organization, the Society was able to gain public approval. It opened hundreds of branches all around the empire. Political authorities, too, supported the Society. Particularly in its first years, it was the mayors and governors with the notifications of the Ministry of Internal Affairs who spearheaded the establishment of the local branches outside the capital, and the high-ranking bureaucrats were among the benefactors.Footnote 1 With the support of political elites as well as the public, the Society soon emerged as a powerful political and social agent in the Ottoman public sphere.
The second reason for choosing the Society for the Ottoman Navy as a case study is its close ties with the CUP. Although political elites and governmental organizations supported the activities of the society from the very beginning, there had been tension between the Society and the Ottoman government in the pre-1913 period when the ideological rift between the Unionists and Liberals was constantly growing. The government rejected several proposals of the Society, including the demand to take a share from entrance cards to the Chamber of Deputies (Donanma Mecmûası, August 1911). A letter sent by the governorate of Istanbul to the branch of the Society in Üsküdar, Istanbul on April 15, 1911, was indicative of the growing power struggle within the Ottoman political elite. The governorate claimed that the members of the Society expounded the Unionist doctrines in their meetings. The governorate warned the members of the Society to stop their involvement in political activities and wanted them to have a “nonpartisan stance” (TİTEA, 9-82-294-36, April 15, 1911). Some of the deputies were also resentful of the close identification of the Society with the CUP. They came forward with a proposal to assign the Society to Zirâat Bankası (the Agriculture Bank), a government-owned bank founded in 1863. The administration of the Society naturally acted against such a proposal (TİTEA 8-3-231-23).
As primary sources confirm, the Ottoman government was correct to complain about the relation between the Society and the CUP. Indeed, the Society and the CUP used the same building in Üsküdar after 1913 (TİTEA 9-831-290-16, December 16, 1914). What is more, the Unionists across the empire committed themselves to collect money for the Society (TİTEA 7-123-225-18, May 17, 1910; TİTEA 7-142-225-16, July 17, 1910; TİTEA 7-175-227-4, October 24, 1910; TİTEA 7-182-205-20, November 22, 1910; TİTEA 7-272-224-20, August 22, 1911; TİTEA, 7-490-225-15, December 16, 1913). Most striking of all, senior figures of the CUP—including Mehmed Talât Pasha and Ahmed Cemâl Pasha—were also members of the Society's board of administration (Özçelik Reference Özçelik2000, 237).
The uneasy relationship of the Society with the Ottoman government ended with the Raid on the Sublime Porte (Bâb-ı Âli Baskını) on January 23, 1913. On that day, a CUP-backed military coup ousted all other political parties and the one-party rule of the CUP began. Even though the Unionist leaders closed most of the societies and associations that had been founded after 1908, the Society for the Ottoman Navy was one of the few organizations that continued to operate. It served toward further consolidation of the Unionist power (Özbek Reference Özbek2007, 797).
The rise of the Unionists paralleled the consolidation of the Society. The Unionist government, for example, issued a temporary law in December 1913 that forced all the Ottoman civil servants to donate their one month’s salary in installments to the Society. The law was put into practice all around the empire (TİTEA, 9-26-281-22, March 14, 1910; TİTEA, 9-38-283-19, April 26, 1910; TİTEA, 9-41-283-21, May 4, 1910; TİTEA, 9-60-281-10, October 27, 1910; TİTEA, 9-111-283-22, October 2, 1911). 71,329,757.3 of Ottoman Kuruş was collected due to this specific law (Özçelik Reference Özçelik2000, 199–202). This amount of money was nearly 20% of the incomes of the Society from 1909 to 1919. As such, the obvious link between the Society and the CUP allows an examination of the economic policies of the Unionists through the case of the Society.
The final reason for choosing the Society for the Ottoman Navy as a case study is its enormous economic power. Just to give an idea about the economic power of the Society, the government revenue for the year 1915–1916 was Ottoman Lira (OL) 26,836,448.08 (Güran Reference Güran2003, 9, 167) while the revenue of the Society for the decade that it operated was nearly OL 35,338,246 (Özçelik Reference Özçelik2000, 199–202). Namely, the Society controlled economic sources more than the Ottoman government could do in a single year. Even though the Society was founded as a charity organization, it gradually and increasingly enhanced its economic power.
Despite its economic power that excelled even those of leading companies and banks, the principal goal of the society was to collect funds from both Ottomans and non-Ottomans to support the Ottoman Navy, such as the purchase of new ships and ammunition (TİTEA, 7-31-223-21). The Society had sources of revenue other than the vast amount of donation that the Society collected all over the world.Footnote 2 One of them was its right to distribute economic concessions, such as those of rolling papers, matches, and quarries.
The Society, for example, tried to acquire the concessions for the mines, such as that of mineral water in Adapazarı and in Kayseri (TİTEA 8-109-241-3, June 27, 1910), in İzmir (TİTEA 7-364-207-18, May 16, 1912), and antimony in Balıkesir (TİTEA 8-135-255-35, August 11, 1910). Although the efforts of the society to gain such concessions were not very successful at the beginning, it became able to do so after the CUP declared itself the only political party in the Ottoman Empire in 1913. As an example, the Society applied to the government to get the right to distribute the concession of a quicksilver mine in Aydın on May 27, 1912 (TİTEA, 7-368-207-9, May 27, 1912), and it managed to get it after 1913 (TİTEA, 7-848-191-15, December 4, 1916). In short, although the Society was not purely a profit-maximizing organization, it acted as an economic entity from the formation of its first nucleus in 1909, with the mining sector being in the first place. As the society affected the distribution of resources, it also acquired concessions, like companies.
Aside from the concession of mines, another means by which the Society attempted to raise its revenue was the right to distribute the concession of rolling papers, which the Society had previously bought from private companies and entrepreneurs. After signing a contract with the sellers, the Society received a certain share from the sale of these rolling papers at a market-determined price. According to the contract, the sellers were not allowed to sell rolling papers and matches other than those of the Society; otherwise, they would have to pay compensation (TİTEA, 7-41-210-4; September 30, 1909). In fact, the Society earned 9,101,987.15 Ottoman Kuruş from the sale of rolling papers, which represented 2.58% of the total income of the Society during the decade that followed its formation in 1909. As a final point, the Society engaged in agricultural activities in the state-owned lands (Özçelik Reference Özçelik2000, 190).
The Society, thus, became both an empire-wide government-affiliated revenue collector and an investor in many economic sectors throughout the time. Functioning as a semi-governmental agency, the Society contributed not only to the process of revenue-raising via distributing concession but also the process of procurement through buying and acquiring military equipment and supplies for the Ottoman Navy. Despite its characteristic as a civic association, the Society also grew into an economic agent that controlled huge sums of money and sources. Having the power to redistribute various concessions and cultivating unclaimed lands, the Society interacted with a variety of Ottoman and foreign economic agents. Choosing to whom such concessions would be given, the Society emerged as an important decision-maker in the economic sphere during the late Ottoman Empire. Even though the Society was not a profit-seeking company but a charitable organization, its economic actions were well suited to an exploration of whether the economic activities of the Society went parallel with the Unionist economic nationalist rhetoric.
The Society and Foreign Capital
According to historians of the late Ottoman Empire, the first doctrine of the economic nationalism of the CUP aimed to put an end to the dependence of the Ottoman economy on foreign powers (Issawi Reference Issawi1982, 9; Toprak Reference Toprak1995a, 73). Şükrü Hanioğlu, for example, claimed that even before the CUP came to power in 1908, it “took an extremely anti-Western and anti-imperialist stand” (2001, 178–181). Concerning the relations with foreign capital, Ottoman foreign policy affected the connections between the Society and foreign firms. The Society did business with almost all European powers, including France and Great Britain, prior to 1913. For instance, in 1910, the Society purchased cannons and torpedoes from a British company (the Maxim-Vickers Gun Company) (TİTEA, 8-103-247-4, June 15, 1910; TİTEA, 8-235-252-25, June 11, 1911). With the British and French support given to the Balkan countries during the Balkan Wars of 1912–1913, as well as the Ottoman entrance to the First World War against the Allies in 1914, however, the Society cut off its connections with companies from the Allied powers. At the same time, the wartime partnership of the Ottoman Empire with the Central Powers led the Society to have closer ties with German and Austro-Hungarian firms. Such a shift from Great Britain and France to the German Empire and Austria-Hungary was the result of the change in the export partners of the Ottoman Empire: from 1911–1912 to 1916–1917, the export share of the German Empire and Austria-Hungary increased from 6.1% to 73.1% and from 13.9% to 22.3%, respectively (Eldem Reference Eldem1970, 120; Eldem Reference Eldem1994, 70). The change in the foreign partners that the Society did business with was as a result of the circumstances created by the international system.
The concession for stamps that the Society gave was a relevant example of this pragmatism. While a British company—Bradbury Wilkinson End Company Limited—took the concession to sell stamps on February 19, 1914 (TİTEA 7-531-209-10, February 19, 1914), with the advent of the First World War, the Society gave the same concession to a German firm (Özçelik Reference Özçelik2000, 216). Therefore, the attitudes of the Society toward foreign capital did not change during the course of the Society. The only thing that changed was the origin of the foreign companies with which the Society did business, which was the result of the alteration of the international context rather than an ideological change.
In addition, although some members of the Society shared the national economy rhetoric of some of the Unionist intellectuals and leaders, such rhetoric did not always translate into the policy realm. A letter written by Captain Ali Rıza Nuri, a military man and a member of the Society, to the center of the Society on November 3, 1910, exemplified such a difference between nationalist aims and actual practices. Ali Rıza Nuri complained that the Society distributed concessions for the lottery to foreign entrepreneurs. He urged the Society to stop capital flight from the Ottoman Empire to foreign countries by giving such concessions to Ottomans instead of to foreigners (TİTEA 8-162-238-7, November 3, 1910). Despite his proposal, Ali Rıza Nuri did not detail how an Ottoman investor could actualize such a project.
After two years, two German citizens (Messieurs Molling and Schirokaver) attempted to obtain the concession of the lottery from the Society on behalf of their company. Unlike Ali Rıza Nuri, they came with a well-prepared and detailed project. To persuade the Society, they argued that they afforded a higher priority to the interest of the Society even than that of their own company. To buttress their argument, they mentioned their experience of the business in Germany that they had done for a very long time without any problem. They further pointed to the necessity for massive sums of capital to start a lottery business because such a risky business would lead the company to suffer a serious amount of loss in the first years, and it would become profitable only after a couple of years (TİTEA 8-306-238-11, September 10, 1912). Compared to the idealistic proposal of Ali Nuri Rıza, Messieurs Molling and Schirokaver came forward with a more feasible and realistic proposal not only because of their previous experiences but also due to the capital and guarantee that their company provided.
Likewise, the Society gave another concession of the lottery initially to Derviş Beyzâde Necmi Bey, a Muslim entrepreneur who had migrated from Servia, Greece. Upon Necmi Bey’s death, the Society gave the concession of lottery to a Belgian entrepreneur (BOA, BEO, 4129-309602, December 29, 1912). As this case shows, although it was a Muslim merchant who held the concession first, a foreign businessman could easily obtain the same concession. Hence, at least with respect to the concession for the lottery, what came first was the interest of the Society, while it did not care about the origin of the people and firms that held the concessions.
The transfer of such concessions from Muslim Ottomans to foreigners needs to be seen not as something unique to the Society for the Ottoman Navy. Similar examples from other economic agents can also be found. For example, Nemlizâdes, a wealthy Muslim family in the Black Sea region with strong political affiliations, devoted considerable effort to acquire economic concessions from the government in the late Ottoman Empire. When they were able to do so, they could not benefit from the concession to do business because, despite being “Muslim Great Merchants,” they lacked adequate sources. As a result, the concession was transferred to a foreign enterprise (Cora Reference Cora2013, 1–29).
Indeed, the rule of Sultan Abdülhamid II (1876–1909) was “the golden age of foreign economic concessions” in the Ottoman Empire (Fleet Reference Fleet2015, 343). In this period, the Ottoman government distributed numerous economic concessions to Western banks and firms. There was no structural change in the attitude of the Ottoman governments of the Second Constitutional Period to foreign concessionaires (Fleet Reference Fleet2015, 352). Therefore, the concessions that were given by the Society for the Ottoman Navy to foreigners were not inconsistent with the official policies of the time.
In addition to purchases of military equipment and concessions, another dimension of the relations between the Society and foreigners was about the medals sold by the Society. The positive public perception of the Society and its close affiliation with the CUP made such medals of symbolic significance more attractive to the foreign investors who wanted to do business in the Ottoman Empire. People from Great Britain purchased these medals and donated to the Society prior to 1913. For example, Talât Bey, a member of the assembly of Ottoman Company Şirket-i Hayriye, wanted the Society to give a thanks letter to Herbert Rowell, a manager in the British Company Leslie & Co. Ltd, for his donation (TİTEA 8-200-254-27, January 31, 1911). With the Ottoman-British hostility, however, only citizens of the Central Powers tried to buy the medals of the Society after 1913 (TİTEA 7-843-192-2, March 17, 1916; BOA, İ..DUİT, 74-67, November 28, 1916; BOA, İ..DUİT, 74-69, December 8, 1916; BOA, İ..DUİT, 74-95, May 25, 1918; TİTEA 7-797-198-6, August 18, 1918).
Due to its economic and political prestige, the Society turned into a channel to obtain concessions by the foreigners and the affiliation with the Society mattered for foreigners. From the perspective of the Society, giving medals to and earning money from foreigners generated capital. Instead of taking an action against foreign powers and countries, the Society looked for the ways to improve its revenue. Before and during the First World War, international context determined all the aspects of the economic relations of the Society with the foreigners.
The Society and Non-Muslim Ottomans
Scholars of modern Turkey have argued that the second doctrine of the economic nationalism of the CUP was to eliminate non-Muslim Ottomans, the so-called collaborators of imperialism, from the economic sphere (Zürcher Reference Zürcher2005, 13–26). Regarding its relations with non-Muslim Ottomans, the Society adopted a similarly pragmatic approach. It is claimed that the affiliation of the non-Muslims with the Society remained very limited compared to that of Muslims. Gök argues that the reason for the disinterest of the non-Muslims in the Society was related to the demographic composition of the Ottoman Empire (Gök Reference Gök2008, 84). These claims, however, could be true only for the post-1915 period. Before that, non-Muslims participated in the Society in several ways, exemplified by the ethnoreligious composition of a committee of merchants that was formed within the body of the Society on February 23, 1910. Out of the fifteen members, only six members were Muslim (Özçelik Reference Özçelik2000, 45). At the same time, many non-Muslim communities all over the empire donated money to the Society (TİTEA, 7-126-206-18, May 22, 1910; TİTEA, 7-178-208-11, November 9, 1910; TİTEA, 8-202-253-11, February 11, 1911).
Non-Muslim participation was also encouraged by the Society’s active effort to involve them. For instance, the governorate of Edirne demanded the center to send the charter of the Society in Bulgarian and Greek to Edirne (TİTEA, 7-62-223-13, January 16, 1910). Likewise, the Bakırköy branch of the Society published Armenian, Greek, and Hebrew (most probably, meaning Ladino) versions of announcements of the Society (TİTEA 7-254-223-8, June 17, 1911). The motivation behind such actions was the desire of the Society to collect as much money as it could.
Besides, and more importantly, the multidimensional relationship between the CUP and different ethnic groups determined the degree of the cooperation between the Society and non-Muslim Ottomans. For example, some Ottoman Greeks might have problems with the Society. As Özçelik (Reference Özçelik2000, 218) claimed, Greek merchants and grocers did not want to sell the rolling papers of the Society. Such statements, however, did not mean that the Society had no relations with Ottoman Greeks. Instead, both the Society and Ottoman Greeks interacted with each other as a result of their mutual interest. As a relevant example, Aristovlos Efendi, the owner of a printing house in Galata, published the Charter of the Association in Greek (TİTEA 9-23-286-7, February 16, 1910). Another example was Kosteropulo Yorgi Efendi, a banker and a member of the administration of the branch of the Society in Trabzon (Donanma Mecmûası, April 1911). Even after June 1917, when the Kingdom of Greece joined the First World War on the side of the Allies, the Society maintained its relations with Ottoman Greeks. For example, the Society gave a medal to Diyonis Efendi, an Ottoman Greek and the owner of a restaurant in Galata, Istanbul, for his donation to the Society (BOA, İ..DUİT, 74-105, September 20, 1918). Therefore, even though the economic actions of the Society might imperil the material interests of certain Ottoman Greeks, the Society recognized the common interest of the Society and Ottoman Greeks in many cases.
The existence of such common benefits was especially true for Ottoman Jews. Compared to the Ottoman Greeks and Armenians, Ottoman Jews had relatively strong relations with the Society. The heads of the Jewish community, for example, sent letters to the Society by exalting its activities (Özçelik Reference Özçelik2000, 207–209). The Society ordered the printing of Donanma Mecmûası to Fratelli Haim, an Ottoman Jew and the owner of a printing house in Istanbul (TİTEA, 7-74-210-1, March 1, 1910). Ottoman Jews also donated to the Society from all around the empire (TİTEA, 7-186-205-10, December 8, 1910; TİTEA, 7-828-193-9, September 30, 1913; TİTEA, 7-659-193-15, January 30, 1915). In this regard, a key point to remember is that the CUP cadres had closer relations with Jewish groups than Ottoman Greeks (Ahmad Reference Ahmad1986, 39–40; Ahmad Reference Ahmad2014, 100). Consistent with the CUP’s approach toward the Jews, the Society was on good terms with the Ottoman Jews.
Nonetheless, irrespective of religious affiliation, every non-Muslim Ottoman could be easily affiliated with the Society. In addition to membership and donations, the concessions that the Society gave to non-Muslim Ottomans became an integral part of the relations between the Society and non-Muslims. One example was Nişan Süzenciyan, an Ottoman Armenian. After gaining the concession from the Society, Süzenciyan asked for the permission of the Society to bring music boxes and weighing machines from the United States (TİTEA, 8-83-255-56, April 7, 1910). Taking these examples into account, there seems little reason to think that the Society had always a negative attitude towards the non-Muslims. Quite the contrary, despite the Balkan Wars, mass migrations of non-Muslims from the empire, and massive massacres of Ottoman Christians, non-Muslims maintained their affiliation with the Society.
Besides, even if some of the members of the Society were not quite free from anti-non-Muslim bias, a foreign or a Muslim businessman who held concession that the Society provided could easily have non-Muslim partners. The case of Henry Cohn was an indicator of such possibility. As a German citizen who took concession for the rolling papers and matchboxes from the Society (TİTEA 7-83-210-5, March 19, 1910), Henry Cohn formed a limited partnership with two non-Muslim Ottomans, Lastaris and Dimitris (TİTEA 7-101-202-1, August 12, 1910). As such, in search for local networks, foreign investors naturally turned to Ottomans—Muslim or non-Muslim—and there was no obstacle for foreign entrepreneurs who obtained concessions from the Society to have non-Muslim partners. If they agreed to pay money to the Society, it did not oppose such partnerships, nor did it want foreign investors to do business only with Muslim Ottomans, whose economic relations with the Society will be examined in the next section.
The Society and Muslim Entrepreneurship
In their examination of the economic policies of the CUP, scholars have pointed to the attempts of the Unionist leadership to create a national, namely Muslim, bourgeoisie from esnâf (artisans). Accordingly, these scholars have argued that Muslim business groups prospered throughout the Second Constitutional Period under the tutelage of the Unionist leadership. The rationale for this drew from the CUP leaders’ mistrust of the Greek and Armenian business classes, who were assumed to act in partnership with foreign powers. Muslim business groups, in turn, supported the CUP both in Istanbul and in the Anatolian provinces (Keyder Reference Keyder1987, 59–61; Toprak Reference Toprak, Thobie and Kancal1994, 263).
It is true that certain Unionist leaders, such as Kara Kemal, formed strong relations with Muslim artisans, especially in Istanbul, to create business classes. Society’s attitude toward Muslim businesses, however, were not guided by this motivation. The relations of Society with wealthy merchants and local elites went well whereas small business owners and grocers might easily have problems with the Society and complained about business activities of the Society. These complaints reflected the conflict of interest between traditional craftsmen/tradesmen and the Society.
Such complaints were closely linked to the decisions that the Society made. For example, during its first congress of the Society on July 19, 1910, the administration of the Society decided to do business related to short-sea shipping around the docks of Galata, Istanbul (Donanma Mecmûası, August 1910). Artisans and fishermen whose shops were in this region were categorically against the decision of the Society. The reason for their objection was that shopkeepers would run up heavy losses due to the fishing activities of the Society. For them, the decision of the society that “relied on the goodwill of patriotic people” would eventually lead to the bankruptcy of artisans and fisherman. And, more interestingly, they referred to the reign of Sultan Abdülhamid II, which they called “devr-i istibdâd” (the period of autocracy). They claimed that when Şirket-i Hayriye (the Auspicious Company), an Ottoman joint-stock company that was founded in 1851, attempted to operate ships around the mentioned docks even Sultan Abdülhamid II did not allow that company to do so (TİTEA 8-131-254-32, 1, August 6, 1910).
Artisans and fishermen from Galata were not the only groups who claimed to be damaged due to the Society’s activities. A group of artisans from Istanbul, too, complained about Selanikli Kibar Ali, a seller of the rolling papers of the Society. They claimed that they were not allowed to sell rolling papers other than those of the Society, and only a certain amount of people held the concession to sell such rolling papers (BOA, BEO, 3902-292584, May 7, 1911; BOA, BEO, 3907-293021, May 23, 1911). The Istanbul Chamber of Commerce and Industry (TİTEA 7-113-202-2, April 28, 1910), as well as merchants and artisans from both Istanbul and provinces came with similar complaints (BOA, BEO, 3907-293021, May 23, 1911). As such, some of the activities of the Society were at the expense of Muslim artisans and merchants. The Society did not necessarily want to help Muslim merchants and artisans prosper, nor did it try to create a national bourgeoisie from them. Rather, the society was primarily interested in raising its revenues and funds.
This revenue-orientation at the expense of Muslim artisans did not alarm the CUP cadres. On the one hand, the CUP leaders were in collaboration with artisans and craftsmen. On the other hand, the modernizing agenda of the CUP was inevitably damaging the economic power of traditional commercial groups. The traditional business methods in the Ottoman Empire had already eroded since monopolies on domestic trade were abolished in 1838, a development that accelerated the market capitalization and financialization of the Ottoman economy (Ağır Reference Ağır2018, 153). Consequently, it is not unexpected that artisans and craftsmen, who sought to maintain traditional patterns of economic relations, could easily complain about the decisions of a CUP-affiliated society that opted for a rapid economic growth.
While some economic activities of the Society might be inimical to artisans, the Society had direct and strong contacts with eşrâf (urban notables) and âyân (rural notables) in the provinces. Some of the notables became even the chairmen of the local branches of the society, or they became members of the Central Committee of the Society (Donanma Mecmûası, August 1910, 481–483).Footnote 3 The difference in the attitudes of the Society towards artisans and elites laid in the capital that the latter had. To be more exact, only a small portion of Muslim Ottomans had the required capital to obtain concessions from the Society, whereas most of the Muslim artisans and small business owners could not afford to gain such concessions.
Indeed, even the sectors in which these wealthy Muslim groups did business were those that needed relatively less amount of capital, such as rolling papers and matches. This is exemplified by Falcızâdes, a notable family of Trabzon. Falcızâdes had strong connections with the CUP. Falcızâde Mahmut Mazhar Bey, for example, served as a deputy for Trabzon twice for Meclis-i Mebusân (The Chamber of Deputies of the Ottoman Empire) (Güneş Reference Güneş1997, 57). Hasan Tahsin and Mehmed Âgâh, members of the same family and local merchants in Trabzon, applied for the concession of rolling papers. After accepting their offer, the Society drew up a contract with them (TİTEA, 7-43-203-10, October 18, 1909). As such, Muslim groups who did business with the Society were either wealthy merchants or local notables. They acquired concessions for operating businesses that required relatively little capital, whereas concessions that required larger amounts of investment, such as mining, were acquired by foreigners.
Besides, the lack of capital forced Muslim merchants to have foreign partners. Even though it was the Muslim Ottomans who got the concession from the Society, they searched for foreign partners who had capital. For example, the Society gave the concession of game machines to Serdarzâde Hasan, an Ottoman Muslim merchant, with the condition that he would share a certain portion of his profit with the Society. Serdarzâde Hasan had two foreign partners, B. Schweiker (an Austrian) and Boutel (a Frenchman) who could help him to bring game machines from abroad (TİTEA 8-51-253-12, January 4, 1910). In addition to the lack of capital accumulation, concession-holder Muslims had to buy raw materials or machines from abroad, even if they managed to get the concessions, such as by importing game machines from European countries.Footnote 4
In short, even if some Muslim merchants were able to obtain concessions, they did not have enough sources to run business with their own resources. For most of the Muslim merchants, thus, it was not easy to operate their jobs without having external support and foreign partners. In this regard, too, the Society was not interested in the origins of people with whom the concession-holders had a partnership. Instead, regardless of the ethnoreligious background of the people who got the concession, Muslim or non-Muslim, the Society looked to raising its revenue.
The Society, Joint-stock Companies, and Industrialization
Scholars of the Ottoman Empire have drawn attention to the establishment of joint-stock companies and banks by the encouragement of the CUP cadres in order to achieve national industrialization and capital accumulation (Issawi Reference Issawi1982, 159, 179; Buğra Reference Buğra1994; Çetinkaya Reference Çetinkaya2004, 383; Hanioğlu Reference Hanioğlu2008). In line with their economic nationalism and in collaboration with local elites, the CUP leaders founded “national” banks all around Anatolia, such as Millî Aydın Bankası (1914), Karaman Millî Bankası (1915), Kayseri Millî İktisât Anonim Şirketi (1916), and Manisa Bağcılar Bankası (1917). Historians of the late Ottoman Empire emphasized the crucial role of these banks in the formation of capitalist development and national economy in modern Turkey. By bringing many local investors together and pooling resources, these banks were able to minimize risks to the investors and to foster entrepreneurial activities.
Despite their primary place in the economic nationalism of the CUP, the Society for the Ottoman Navy did not have relations with most of the CUP-sponsored national banks. Instead, the Society did business mainly with foreign financial institutions. In the first charter of the Society, for example, the Society designated Bank-ı Osmanî (the Ottoman Bank), founded by a group of British and French investors in 1863, as the primary bank of the Society (TİTEA, 7-31-223-21, Article 24). Later, the Society worked with German Banks, such as Deutsche Bank, and Austro-Hungarian banks, such as Wiener-Bank (TİTEA, 8-599-248-12, April 19, 1910). For instance, the Society transferred money for battleships Barbaros Hayreddin and Turgut Reis through the Deutsche Bank (BOA, BEO, 4117-308764, November 27, 1912). The Society also did business with Türkiye Millî Bankası (the National Bank of Turkey) (TİTEA 8-158-256-17, October 6, 1910), which was founded by a group of British businessmen led by Sir Ernest Cassel in 1909 (Ökçün Reference Ökçün1973, 5–6). As such, the Society had business with foreign banks whose origin was Britain, France, and Germany rather than “national” banks.
The only “national” bank with which the Society worked together was the National Credit Bank (İtibâr-ı Millî Bankası), founded in 1917 with the initial capital of OL 4,000,000, the second-biggest founder of which was the Society (Özçelik, Reference Özçelik2000, 204). Indeed, a brief examination of İtibâr-ı Millî Bankası and its relation with the Society can reflect the centrality of economic nationalism in the CUP period. Mehmed Câvid Bey, Minister of the Treasury and a chief actor for the economic policies of the CUP, was the initiator of this company. Before 1914, there was no Ottoman central bank, and the Ottoman Bank, which was under the control of European capital, functioned as the central bank of the empire. The CUP cadre aimed to make İtibâr-ı Millî Bankası the central bank of the Ottoman Empire in the future. According to article 47 of its founding charter, the first assembly of the bank comprised of Mehmed Câvid Bey, Hüseyin Câhid Bey (deputy for Istanbul and the editor-in-chief of pro-CUP Tanin), Tevfik Bey (a merchant from Thessalonica), Sason Efendi (Ezechiel Sasson) (deputy for Baghdad and a Jewish merchant), Mehmed Abud Efendi (a merchant who migrated to Istanbul from Syria and the head of the Istanbul Chamber of Commerce and Industry), Mahmud Nedim Bey, and Mustafa Şeref Bey (İtibâr-ı Millî Bankası - Nizamnâme-i Esâsî 1332, 11). As such, İtibâr-ı Millî Bankası was “millî” (national) in the sense that its founders and administrators were from all around the empire, with various ethnic and religious origins.
More importantly, according to the charter of the bank (article 48), the general director of the bank had to be an Ottoman citizen. For the first ten years, however, a foreigner could be chosen as the general director (İtibâr-ı Millî Bankası - Nizamnâme-i Esâsî 1332, 14). In effect, the first general director of the bank was Victor Veill, a subject-citizen of the Austro-Hungarian Empire. Therefore, the only national bank that the Society did business was İtibâr-ı Millî Bankası, a national bank with “non-Turkish,” “non-Muslim,” and “non-Ottoman” founders and managers.Footnote 5 While the society’s relation to İtibâr-ı Millî Bankası reflects the nationalist concerns of the CUP government, it would be worth noting that the Society worked extensively with foreign banks and had no relation with other national banks that the CUP leaders contributed to their establishment.
The reasons for such absence are not difficult to discern. The national banks of the period operated with a very limited amount of capital and had no external connections. To transfer money to buy ships and ammunition for the Ottoman Navy and to import raw materials and machines from European countries, the Society had to work with foreign banks. As a result, as one of its most essential economic activities, the banks that the Society worked with changed in line with its pragmatic purposes, rather than according to a strict nationalist doctrine.
Much the same can be said for the contribution of the Society to “national” industrialization. As explained above, although the Society was established for charitable purposes, its income was based on a variety of economic activities in addition to donations. The Society collected large sums of money from the public and transferred this money into the public institutions. In effect, the Society bought only a couple of ships and very little ammunition for the Navy. That is to say, the Society had vast amounts of money which were partially transferred to the Navy. To be more precise, the Society spent 196,440,809.23 Ottoman Kuruş for military equipment and battleships, which was nearly 65 % of its all expenditures from 1909 to 1919. The rest of its income was either spent on other activities such as salaries of the employees or deposited in a bank (Özçelik Reference Özçelik2000, 199–202). Although the Society attempted to found a joint-stock company whose main sector would be transportation with its revenue (TİTEA 8-238-254-9, June 15, 1911), it failed to achieve such attempts.
Moreover, even though some members of the Society shared the nationalist rhetoric of the CUP by emphasizing the primacy of industry for economic development of the empire (Donanma Mecmûası, July 1912), the Society was mainly interested in commercial activities and had close ties with Ottoman and foreign “commercial” classes instead of “industrial” ones. In its annual meeting in 1910, for example, the Society decided to form a committee of merchants within the Society and there were seven merchants in the central administration of the Society (Donanma Mecmûası, August 1910). Likewise, merchants were chairman of the branches in the provinces (Donanma Mecmûası, August 1911; Donanma Mecmûası, June 1912). Therefore, even though the Society had lots of money that it could have devoted to industrial investments, its economic activities took place only in non-industrial sectors. In short, the Society did not use its excessive power for industrialization, which was assumed one of the doctrines of the nationalist economic agenda. Instead of risk-bearing and long-term industrializing goals, the Society invested in sectors that would yield short-term gains.
Conclusion
This study has undertaken a revision of the economic nationalism of the CUP, reconsidering the centrality of economic nationalism in the light of archival material based on a case study of the Society for the Ottoman Navy, not only a charitable organization with international connections but also a major economic, semi-governmental power that had strong connections with the CUP. The historical studies of the period have suggested that, by adopting an economically nationalist program, the CUP leaders aimed at the independence of the Ottoman economy from European powers, the elimination of non-Muslims from the economic sphere, the creation of a national—namely, a Muslim—capitalist class, and the realization of a national industrialization via the establishment of national banks and joint-stock companies in every corner of the empire.
There is no doubt that the CUP leaders and the CUP-affiliated Society for the Ottoman Navy aimed to decrease the dependence of Ottoman economy on foreign powers. It is also true that some Unionist intellectuals and leaders did not remain completely impartial with respect to their approach to non-Muslim Ottomans. Indeed, the First World War saw not only forceful migrations of many Ottoman Christians from the empire but also government-backed massacres of hundreds of thousands of Ottoman Armenians. In other words, showing the implementation of economic nationalism is not to say that Muslims and non-Muslims always happily lived together during the CUP rule.
Nonetheless, telling history backward with the knowledge of the end might disable a better understanding of the past. Prior to the First World War, for example, the Unionist leadership tried to conciliate non-Muslim Christians, including Ottoman Arabs, Armenians, and Greeks (Kayalı Reference Kayalı1997, 139; Kechriotis Reference Kechriotis2009, 207–222; Kerimoğlu 2009, 90–93), even if it ultimately failed. Nonetheless, economic nationalism was not the only concern of the CUP cadres. The Society for the Ottoman Navy shows that raising capital through foreign and non-Muslim involvement was still an acceptable—and even a desirable—objective for the CUP government.
As this study has suggested, the economic nationalism of the CUP was shaped by the political context of the period. Whatever rhetoric was employed by the Unionist intellectuals and politicians, any analysis of the economic nationalism of the Second Constitutional Period must consider the role that the war conditions played in shaping economic policies. Throughout the period in which the Society was effective, the Ottoman Empire entered into a series of wars, such as the Turco-Italian War of 1911–12, the Balkan Wars of 1912–13, and the First World War in 1914–18. The war conditions and its financial exigencies affected the economic decision-making process of the ruling elites (Pamuk Reference Pamuk, Broadberry and Harrison2005, 131). In an environment where the empire lost its manpower and territories, foreign investment and capital inflows naturally decreased. Most of the government sources were spent on the army. Thus, it was not surprising that the CUP implemented bargaining and adaptive, rather than uncompromising and static, economic policies. In conclusion, showing the economically pragmatic aspects of the CUP leadership, this paper aims to point to a need for the revision of the literature on the economic policies of the period.
Acknowledgments.
I owe all the anonymous reviewers a debt of gratitude for their very careful reading of my draft and their priceless advice. I also thank Seven Ağır, Hasan Kayalı, Nir Shafir, and Gözde Emen for their invaluable comments on the draft.
Disclosure.
Author has nothing to disclose.
