NOVPUBInternationally, the situation was constantly changing, and Franz was no longer paying much attention, as he was now focused on the list of price changes for the first quarter.
Logically, during times of war, the prices of essentials like food would inevitably increase, especially when the European Continent’s leading original grain exporting country was embroiled in the conflict.
Due to the war, since last year, the total amount of grain exported by the Russian Empire had drastically decreased, with the amount flowing into Austria reduced by one quarter.
Undoubtedly, this deficit had been offset by an increase in grain production in Austria itself.
Although potassium fertilizer had only just begun to be promoted last year, and it was not yet widely used by the general populace, Austria had state-owned farms!
In fact, the number of government-controlled state-owned farms had been continuously decreasing. Due to management costs, many small and medium-sized farms had been leased to individuals.
No matter how much they were reduced, the land area occupied by state-owned farms was still significant. Calculating only the European part, the area occupied by state-owned farms was already less than five percent of the arable land area, but when including other regions, it was a different story.
For example, the Asia Minor Peninsula, apart from noble estates and land granted for military services, the rest of the arable land essentially belonged to state-owned farms.
It was not Franz’s preference to have so many state-owned farms; it was a necessity of reality. If the government did not arrange for people to take over, the farmland left by the Ottomans would have fallen into disuse.
Selling them to the private sector was out of the question, as it would weaken the allure of land granted for military services, shaking the foundation of Austria.
Apart from the initial land redemption and the period when new colonies were being established, the best way for ordinary people to acquire land was through land granted for military services.
Don’t ask why, for who would know there was another European war waiting, and preparations had to be made in advance.
If there were not enough rewards, why would soldiers risk their lives? Without stockpiling enough land, what would be used to reward soldiers after the war?
The European Continent was now densely populated, with hardly any unowned land left, and war spoils were not to be relied upon.
In this context, even though Franz knew that the operating costs of state-owned farms were high, he had no choice but to grit his teeth and accept it.
If the losses were truly unsustainable, the farms could still be contracted out to individuals for management. As long as the land remained state property, it would not affect its future use as rewards for individuals.
In fact, the large farm plan by the French government was also inspired by Austria.
Seeing a bunch of farms in the hands of the Austrian Government, they followed suit. However, they were unaware that Austrian farms were also barely sustaining themselves.
Because they were supported by supplemental processing enterprises, from an external viewpoint, Austrian farms appeared to be operating well, annually turning in profits to the government.
Essentially, the profits were contributed by enterprises affiliated with the farms. Most of the farms themselves could only break even; direct profit-makers were a rare few.
Since they were not publicly traded companies, the financial statements of state enterprises were also confidential; only total profits were disclosed to the public, with the specific business structure and asset allocation remaining utterly unknown to the outside world.
For Napoleon IV, all these were encouraging data.
If someone suggested emulating this model, then they might as well follow suit, as there was no reason why something the Austrian Government could manage couldn’t be achieved by France.
How could the Emperor, cloistered deep within the royal court, possibly know if the lower bureaucrats didn’t report the full details?
Especially after the trip to Algeria, Napoleon IV directly attributed all problems to — bureaucratic negligence and corruption.
Although the state-owned farms had substantial land, the area cultivated for grains was not extensive, and their real significance was still their stimulating effect.
The world never lacked for clever people; the government was promoting potassium fertilizer, and state-owned farms were using it on a large scale, naturally spurring some to take risks.
Especially government officials, who were the first to accept potassium fertilizer and use it on their own lands.
As a result, last year, Austria’s grain production capacity had increased substantially.
The final increase was not three percent as estimated by the department of agriculture, but six point seven percent.
Of course, this also included increased arable land area, bringing additional grain production capacity.
Do not underestimate this three point seven percent discrepancy; with Austria’s base level of grain production capacity, it represented the annual food supply for several million people.
Together with the agricultural plans of England and France, increased grain production in the colonies reduced the need for grain imports.
The end result was that the Russians reduced their grain exports, and international grain market prices did not increase but instead decreased.
If the drop in grain prices could be accepted, then the decline in the prices of textiles, steel, and various other commodities was puzzling to Franz.
This was a time of war, with the major powers of England and France engaged in fierce battles; how could strategic commodity prices possibly fall?
Holding the document in his hand, Franz asked incredulously, "Are you sure this price list isn’t mistaken?"
Economy Minister Reinhardt said, "Your Majesty, we have confirmed this multiple times, and the statistics are indeed the average prices for the first quarter.
Not only have domestic prices not increased, but actually all of Europe is the same. Aside from a surge in prices at the beginning of last year’s war, the prices in the first quarter have returned to rational levels."
The Anglo-Russian War had less impact on the European economy than we had anticipated, especially in terms of demand for materials, which was much less than we had planned.
Setting aside the British, who could rely on domestic production, the Russians’ import volume was insufficient. The economic department analyzed that there were mainly two reasons: 𝒏𝙤𝒗𝙥𝒖𝒃.𝙘𝙤𝒎
First, the Tsarist Government had prepared for the war in advance, and many materials were purchased before the war, which our export trade list from last year can prove;
Second, the consumption of materials on the Afghanistan battlefield was much less than we had anticipated.
I consulted with the general staff, and they mentioned that the reduction in the Russian Army’s material consumption was partly due to the terrain in Afghanistan, which was not favorable for the deployment of heavy weapons; another part was the incompetence of the British Army, which failed to engage in a battle of equals.
This answer left Franz speechless. When the intensity of the conflict is low, naturally, the consumption of materials is not high.
The highest consumption would have been for food, but the Russians did not lack it and did not need to import it. The British could procure it from India, so there was no need to transport it from Europe.
Upon receiving the news of the outbreak of the Anglo-Russian War, capitalists all over Europe loosened their restraints and expanded capacity, hoping to earn a big score.
Unfortunately, as capacities increased, the strategic materials imported by the two belligerents fell short of expectations, leading to a tragedy.
In the era of free trade, whether it’s goods, once the supply on the market exceeds demand, a slide in prices becomes inevitable.
If it were not for the ongoing Anglo-Russian War, which kept the market’s confidence from collapsing, the situation would have been even more severe.
With a sigh, Franz said helplessly, "Given the timing, the next economic crisis is rapidly approaching.
The capitalists all fantasized that the Anglo-Russian War would be grander than the Prusso-Russian War, each rushing to profit from the war.
The current situation is quite clear; no matter how much the Anglo-Russian War escalates, it cannot involve battles featuring millions of troops.
If the current situation does not change, I fear this Anglo-Russian War will be the spark for overcapacity in European countries."
Each instance of overcapacity represents a capitalist’s miscalculation of market expectations. If one is smart, there is still a chance to cut losses now. If it continues until the end of the Anglo-Russian War, that could truly lead to disaster.
Franz knew this, yet he had no intention of interfering. It was a thankless task that, apart from attracting hatred and blame, would bring no other benefits.
Foreign Minister Weisenberg said, "Overcapacity is a minor issue, merely a reshuffling of the industry; biting the bullet would see us through.
The trouble is the recent continuous small actions by England, France, and Russia. Especially the British, who keep creating friction between us and the French.
If it happened once or twice, so be it, but if it occurs frequently, our relationship with the French can hardly withstand such a test.
Especially recently, the British Government even hinted, albeit very subtly, that as long as we abandon our support for the Russians, they would support our unification of the Germany Region.
If things are as I suspect, the British probably made similar promises to the French, and possibly even more generous ones."
It’s not just the relationship between France and Austria at stake; the relationships between any two countries could hardly endure prolonged agitation.
Knowing this to be British scheming, the contradictions between France and Austria are inherent and insoluble.
No matter how much the governments of France and Austria try to suppress it, resentment builds up. Over time, these contradictions are bound to erupt.
Prime Minister Carl shook his head, "The core of the problem isn’t on our side; the key is what the French think.
If the French yield to temptation and accept the British proposal, then a war in Europe would become inevitable."
According to the original plan, proceeding methodically, the unification of the Germany Region by Austria was only a matter of time, and the Vienna Government could naturally resist the temptation to take risks.
But it was different for France; the strategy of Central Europe now concerned whether France could further progress.
If unable to expand into Central Europe, this period would mark the peak of the French era, and from here, they could only decline.
In fact, France had already begun to decline. Looking worldwide, the era when France had the highest international status and the strongest comparative strength was between 1870 and 1881. Experience tales at freewebnovel
With the gunshot of the Paris Revolution, France was once again severely weakened, and it was just now recovering.
Compared to England and Austria, France had directly wasted eight years. If the energy issue continues unresolved, the future situation will worsen.
Under these circumstances, if the French Government refuses to fall without a fight, taking a risk is only a matter of time.
Franz frowned and slowly said, "We must consider this situation and accelerate our preparations for war to avoid being caught off-guard.
Strengthen surveillance of the French Government, and the moment we notice any sign of their war preparations, we must immediately report it."
Austria’s preparation for war had already started, but to keep it secret, they had been very subtle in their actions.
After all, now was not the best time for a decisive battle, as Austria had not yet reached its limits, and its national strength was still rapidly growing.
