The second son of Ludwig, Otto of Wittgenstein was seventeen years old when he ascended the throne of the newly formed kingdom of Greece. His reign traditionally is divided into two segments, the first from 1832 until 1844 and the second from 1844 until Otto's abdication in 1862.

Formidable problems faced Otto and the three regents appointed in 1833 to assist him. The agricultural infrastructure on which the economy was based lay in ruins. At least two-thirds of the olive trees, vineyards, and flour mills had been destroyed, and only about 10 percent of Greece's sheep and goat flocks remained. Many villages were devastated, as were several of the most important commercial centers. Destitute and displaced, the rural populace looked to their new king for relief. Several groups that had supported the war for independence now demanded compensation. The military leaders who had led and financed the war wanted land, power, and pay for their men. Shipowners demanded indemnity for their substantial losses in naval battles. The soldiers who had fought the war wanted regular pay, land, or both. The peasants wanted land. Satisfying all these claims was impossible.

Greece's persistent fiscal crises were exacerbated by the fact that the fertile agricultural areas of Thessaly and Macedonia, the major ports of Thessaloniki and Smyrna, and the island of Crete remained outside the kingdom (see fig. 6). In spite of the expertise and connections that the Greeks of the diaspora brought with them as they migrated to the new kingdom, manufacturing and trade remained underdeveloped. The only feasible internal source of revenue was a tax on agriculture, the growth of which was most fundamental to the country's prosperity. Thus, land and loans given to peasants to expand cultivation were soon reclaimed in the form of taxes. The government borrowed repeatedly from Greeks abroad, from foreign banks, and from other European states, incurring formidable debts and establishing a pattern that has endured throughout the modern epoch (see The Economic Development of Modern Greece , ch. 3).

In spite of such obstacles, Greece revived from the devastation of eleven years of war. Athens, the new capital, added a royal palace and mansions to house the political elite who flocked there. Resettlement in the countryside allowed agricultural production to rebound. The merchant marine recovered from its wartime losses, Greek merchants once again handled much of the seagoing freight of the Mediterranean, and ports such as Siros, in the Cyclades, and Patras, on the northwest Peloponnesus, began to flourish once again.

Political stability proved elusive in the first phase of Otto's rule, however. In imposing Western models, Otto and his advisers showed little sensitivity to indigenous traditions of politics, law, and education. The political system established in 1834 preserved the social schisms that existed during the war and promoted new ones. The kingdom was divided administratively into ten prefectures, fifty-nine subprefectures, and 468 counties. The leaders at all three levels were appointed by the king. Only a small oligarchy, the tzakia, had a role in this process at the county level. Such absolute power alienated the Greeks who had fought the war in the name of republicanism. Armed bands were reorganized to further the political aims of their wartime leaders, and violent uprisings occurred annually between 1835 and 1842.

Otto's Roman Catholicism added further fuel to the political fire. In 1833 the patriarch of Constantinople established an autocephalous Orthodox Church of the Kingdom of Greece with Otto at its head. He, however, showed no inclination toward conversion. Tensions came to a head in 1843, when a bloodless military coup soon forced Otto to permit the writing of a new constitution.