The idea that Germany was an evolving parliamentary democracy before the First World War does not seem tenable to me. There was universal suffrage for Reichstag elections, popular involvement in politics with pressure groups, rising support for the SPD and some dissenting voices against an excessive Weltpolitik (Herero Uprising). But I think that the presence of these democratic factors created more tension by placing them into a predicament into which they couldn't operate effectively. The discretionary forces of the 1871 constitution reigned supreme, there was no principle of parliamentary sovereignty when the Chancellor could ignore Reichstag resolutions and was only responsible to the Kaiser. Considering that the Kaiser himself was highly militaristic and could direct the overall direction of policy, Germany was a very militaristic state before the First World War. The army was, in Bismarck's term, a "state within a state", responsible only to the Kaiser and capable of reactionary behaviour through its own arbitrary will (Zabern Affair, declarations of martial law). Spending on the army was unsustainable economically, but there was no way that the deficit could have been reduced because of conservative pressure which blocked proposals such as the introduction of a land tax. Popular involvement in politics was polarising society, through the increasing power of the trade unions or the increasing power of nationalist pressure groups like the Agarian League and the Navy League.
German militarism was entrenched in the constitution, in the Kaiser and the elites, and the barriers to peaceful constitutional change make Ferguson's notion of a benevolent Germany capable of creating a European Union look ridiculous.