The foreign policy of the Confederation then began to take other directions. In 1864 the International Red Cross Committee was founded at Geneva on the initiative of Henry Dunant, Gustave Moynier and a certain number of Genevese citizens. The result of this was to give a humanitarian bias to Swiss neutrality in all subsequent wars, and to prepare the way for the international functions which the Confederation was later to perform. The first international office, dealing with telegraphs, was founded at Berne in 1865 ; and in 1872 Switzerland was the scene of the first attempt at international arbitration in the Alabama affair between Great Britain and the United States. (See ALABAMA ARBITRATION.) In the meantime there had been a recrudescence of internal political dissension. In 1866 a series of amendments to the Federal Constitution were rejected by popular vote, with the exception of one which conferred equal rights of citizenship on Jews. In the following years a number of cantons, including ZUrich, intro duced into their constitution the principle of direct democracy, or in other words the right of the nation to have laws adopted by the legislative bodies submitted to it for approval.
The two great international events of 1870, the Vatican Council and the Franco-Prussian War, led to a widespread movement in Switzerland in favour of the revision of the Constitution. The former was held to show the necessity for the State to protect it self against the excessive power of the Church, and the second the need for the reorganization of the army. A first revision scheme was rejected in 1872 by a Federalist coalition consisting of the Catholic cantons and the French-speaking cantons. Two years later, however, a second scheme, which met the objections of the French-speaking cantons and included stronger anti-Catholic pro visions, was adopted by the nation.
Except for a revolution in the canton of Ticino in 1890, in which the Catholic Government was forcibly overthrown by its radical opponents, the Swiss internal political situation has since that time been dominated by economic preoccupations and by a tend ency towards centralization. Throughout that period the radical party has had a majority in the Federal Assembly, and this fact has tended more and more to promote the transfer of the powers of the cantons on economic questions to the Confederation, espe cially since 1891, when the right of popular initiative on constitu tional questions was introduced. To mention only the principal instances, the monopoly of spirits was handed over to the Con federation in 1887, the power to enact legislation on social in surance in 1890, and the monopoly of issuing bank notes in 1891.
In 1898 the nation declared in favour of the purchase of the rail ways by the Confederation and the unification of civil and penal law. The National Bank was set up in 1906; in 1907 legislation was adopted increasing the powers of the Confederation in mili tary affairs, and the Federal chambers adopted the new civil code; in 1908 the nation decided to prohibit the manufacture and con sumption of absinthe ; in 1912 it voted for the Insurance Act, pro vision for which was made by the Constitution, but the first draft for which had been rejected in 1900 because it was considered to confer too much power on the State.
In the economic sphere, the period was characterized by a great increase in industrial and commercial activity due partly to the construction of railways and partly to the introduction of a pro tectionist system. The St. Gotthard tunnel was constructed in 188o and the line opened in 1882 ; the Simplon tunnel was opened in 1906 and the Loetschberg tunnel in 1913. An immense num ber of mountain railways were also built. A new customs tariff was adopted in 1884, and was modified not long after in the direc tion of increased protection. Another new customs tariff was adopted in 1891, with results of a twofold character ; in Switzer land itself it aroused the covetous instincts of some of the cantons, and a demand was put forward by popular initiative for the dis tribution of part of the customs receipts among the cantons. This initiative, which was known as the Beutezug or plundering expedi tion, was rejected by the nation in 1894. In the sphere of foreign politics, the raising of the tariff led to a customs war with France (1893-95), in which the advantage remained to a certain extent with Switzerland.
Switzerland has been involved in three other international dis putes, none of which have, however, been of great importance. The first was the Wohlgemuth affair in 1889, which arose out of the arrest on Swiss territory of an agent of the German political police. The second was the Silvestrelli affair in 1902. The dispute originated from the publication of anarchist articles in an Italian newspaper appearing in Switzerland ; it led to the temporary breach of diplomatic relations with Italy. The third dispute arose with Germany in connection with the St. Gotthard (Railway) Convention in 1909. The Swiss considered that the German Gov ernment had on that occasion abused its superior diplomatic posi tion, and a large section of public opinion was violently opposed to the ratification of the Convention. The Chambers, however, voted in favour of ratification, and a popular initiative was there fore instituted which led after the war, in 1921, to the introduc tion of an article into the Constitution according to which the ratification of long-term international treaties might optionally be submitted to a popular referendum.