Holy Roman Empire

Chapter 209: Pretext for War (BONUS)

Chapter 209: Pretext for War (BONUS)

Following Franz’s order, Bavaria became lively.

Prime Minister Felix’s speeches in Munich still had some effect. The younger generation in Bavaria was mostly influenced, and every single one of them was contemplating how to unify Germany.

This line of thinking led to problems. Given their limited social experiences, they couldn’t thoroughly consider the issues, making it easy for them to take it to extremes.

If there wasn’t someone guiding the narrative, it might have been fine. Unfortunately, Franz, who was well-prepared, wouldn’t miss this opportunity.

Various experts and scholars jumped out to express their opinions, criticizing the ruling authorities in Bavaria for selfishly undermining German unification.

In the eyes of most people, rebuilding the Holy Roman Empire might not be the best choice, but it seemed to be the most suitable one. With the path of peaceful unification blocked, only forceful unification remained.

Perhaps some people aspired to achieve success in war, but this was definitely not going to be a civil war.

Influenced by Prime Minister Felix’s speech, these self-proclaimed elite students couldn’t bear it any longer. They believed they should do something for national unity and couldn’t just watch the government make a mess on things.

Protests and demonstrations, seen as meaningful activities, were considered by them as the best way to voice their opinions.

As intellectuals, even in their protests, they could find legal justifications. The former king, Ludwig I, had given a speech before abdicating, which became everyone’s rallying point.

(AN: Influenced by the French Revolution, Ludwig abdicated. To gain public support, he publicly stated: The royal family will dedicate itself to the unity of Germany.)

This was a political time bomb detonating in Maximilian II’s face. Even though there wasn’t an immutable law of primogeniture in Europe, the former king’s statements before abdicating still held some political weight.

Now everyone wanted the king to come forward and explain. The royal house vowed to strive for German unification, yet the current government was going against that. What explanation could they provide?

Not only the king but also the cabinet ministers faced questioning from the public. The people’s stance was clear: opposing the establishment of the Holy Roman Empire was fine, but you have to present a plan for German unity, right?

Regardless of its feasibility, at least it had to theoretically convince everyone and gain the approval of the majority.

Maximilian II anxiously asked, “What should we do now? The citizens outside are waiting for our response.”

They were not unprepared, just that their prior contingency plans were for handling unrest. The present problem was these people were not being unruly!

The crowd participating in the protests this time was of much higher quality than usual. It wasn’t just workers and students; there were also middle-class individuals, capitalists, sociologists, and even nobles participating.

With such broad coverage, it involved people of all walks of life in the Kingdom of Bavaria. Even if the Bavarian government suspected that this was organized by someone, without evidence, they didn’t dare to act recklessly.

The recent memory of the Great Revolution was still fresh, and everyone was cautious, afraid to stir up social unrest.

Prime Minister Karl von Abel replied: “Your Majesty, the best method now is to present a German unification proposal and try to convince the masses as much as possible.”

In reality, across the entire German territories, each state government was preparing its own unity plan. Since they wanted to oppose the rebuilding of the Holy Roman Empire, they naturally had to offer a new alternative.

Otherwise, as Felix criticized, they would be seen as “doing nothing productive, just opposing for the sake of opposing.”

“Prime Minister, do you have any ideas?” Maximilian II asked.

Karl von Abel replied: “Your Majesty, we can change the previous plan and simply give a new face to the Three-State Cabinet Plan.

The reason remains the same: there are too many states in Germany, and if everyone is involved in decision-making, it would lead to constant arguments.

The best choice is for Bavaria to represent the numerous small states, creating a balance with Austria and Prussia in the central government, jointly reigning this empire.

Of course, this proposal is unlikely to gain support from other states, but it is feasible to persuade the citizens. Bavaria can gain the maximum benefits from this.

As long as the Austrians can accept the formation of the Three-State Cabinet, we will support the rebuilding of the Holy Roman Empire.”

After hesitating for a moment, Maximilian II made up his mind and said, “Alright, let’s go with that.”

This approach would offend the small states, but it was a matter of weighing the pros and cons. Offending these small states would only result in a few protests. But if they couldn’t provide an explanation to the domestic population, it would affect their regime’s stability.

Since gaining the support of the great powers, the Bavarian government had become much bolder. If not for Prussia and Austria being too powerful, they would have considered forcefully unifying the numerous small states in Germany.

Moreover, this time, the Bavarian government had stood up for everyone, thwarting Austria’s plan for the Holy Roman Empire. Even if the slogans were a bit excessive now, it was likely that people would understand.

……

On March 4, 1853, the Crimean War was ignited by Britain and France, disrupting Russian deployments as soon as they attacked.

The British strategy was not wrong; the Russian government was truly struggling. With the addition of a new front, the logistical supply for Russian forces in the Balkan Peninsula completely fell on Austria.

To the surprise of the allied forces, the Russian troops involved in the Crimean War not only had low combat effectiveness but also possessed surprisingly poor weapons and equipment. They could be considered a poorly equipped army.

The Russian government was helpless in this situation. The elite forces of the Russian army were mostly deployed to the Balkans, or had gone to the Caucasus front. What remained were second-tier or reserve forces.

With insufficient training and inadequate equipment, the Russian forces suffered significant losses once the battle erupted. If it weren’t for the challenging terrain and climate of the Crimean War that disadvantaged the unaccustomed allied forces, the outcome might have already been decided.

Vienna

Finance Minister Karl said in a solemn tone, “Your Majesty, the Russians have once again applied for a loan from us. The sale of the Russian government’s bonds in the market is facing a cold reception, and the majority of investors are worried that they will default.”

Franz couldn’t be bothered to mock the Russians anymore. Their reputation had deteriorated to such an extent that hardly anyone trusted them. Even if they provided collateral, investors were concerned about potential defaults.

This wasn’t baseless worry; the Russians had a precedent. Not only did they default on regular debts, but even debts with collateral were subject to excuses for non-payment.

For example, if a mine was mortgaged, they could impose all sorts of chaotic taxes on that mine, forcing investors to withdraw.

Another example was when tax revenue was mortgaged, they might let the creditor collect it themselves, provided they could actually collect it.

……

The sins of the ancestors have come back to haunt Nicholas I. The harsh lessons of the past have left the capital markets wary of them.

Even though Nicholas I is making efforts to restore their reputation, it was proving futile. Without the efforts of several generations, their credit with the markets would be hard to restore.

Seeing that various European countries are issuing paper currency, while they continue to use gold and silver directly as currency, reflects not only the lack of credibility in international markets but also the domestic capital market’s skepticism towards the Russian government.

Franz, without hesitation, said, “Tell the Russians that our finances are also having difficulties, and we are unable to provide them with massive loans. I suggest they try the capital markets of neutral countries.”

He was afraid. Russia had already borrowed 202 million Austrian guilders from Austria, with 130 million in government loans and 72 million in private loans. Franz’s Royal Bank itself had provided a massive loan of 5 million.

Of course, government loans come with ultra-low interest rates. Meanwhile, private loans followed market rules. Dealing with a business partner with a bad reputation like the Russian government, a monthly interest rate below 0.7% was out of the question.

After deducting various fees, the interest that the Russians have to pay was, in reality, exceeding a 1% monthly interest rate.

Don’t think of this as usury. Even with such interest rates, there were very few financial consortiums willing to lend money to Russia.

High risk corresponds to high returns. If it weren’t for the stipulation that this money could only be used in Austria, these loans would never have been approved.

Some private loans come with additional conditions, such as specifying that the money is used to purchase products from a particular company, among other stipulations.

Naturally, the Russian government was keen on seeking loans from the Austrian government. Private loans not only have high interest rates but also come with a host of restrictions. The Russian government cannot tolerate such conditions.

Even if the Russians are backing up the loans, Franz doesn’t dare to print money recklessly. Who knows when the Near East War will end? What if it ends sooner than expected?

In that case, if Austria hasn’t accumulated enough capital and an economic crisis erupts, the Russians who received loans might turn into opportunists.

In the face of interests, precautions must be taken. Essentially, the Russians would have to import a certain amount of gold and silver into Austria to ensure that there won’t be currency devaluation before Franz is willing to lend them money.

Franz acknowledged that he was being quite conservative and was unfamiliar with economic issues. However, the needs of a country differ from those of a business; a country requires steady development rather than explosive growth.

Metternich spoke up, “Your Majesty, at this time, we need to stabilize our relations with Russia. We can help them sell a batch of bonds in an emergency. Tax season is approaching, and by then, Russia should be able to recover.”

It’s not easy to trick the Bavarian government. Austria has set up many traps for them, but they’ve managed to evade most of them.

For example, if the Bavarian government suppressed the protesters, Austria could use the persecution of nationalist activists by the Bavarian government as an excuse to intervene, accusing them of attempting to split Germany.

Without even the need of declaring war, Austrian troops could appear on the streets of Munich, and perhaps even be welcomed in.

Clearly, the Bavarians were not foolish. Even if they were unaware that Austria intended to act against them, they understood military crackdowns could destabilize their rule.

However, in avoiding this pit, they dug one for themselves. On the surface, offending these small states might not seem significant since they’re just shouting slogans at home.

However, Austria’s meddling changes the game. While the governments of these states may stay calm, the public cannot.

According to Austria’s plan, they were, after all, shareholders of the Holy Roman Empire, all being masters of their country. But according to Bavaria’s plan, they have become shareholders in name only, lacking decision-making qualifications and even being deprived of dividend rights.

It would be strange for them not to get upset in this situation. As long as they get upset at Bavaria, when Austria takes action against Bavaria, they will oppose intervention by their governments. The opposition of the ordinary people will undoubtedly make the governments of these small states hesitate.

If they don’t send troops to help immediately, the Kingdom of Bavaria won’t withstand the first wave. This would create a fait accompli of Austria annexing Bavaria, and by the time they decide to intervene, it would be already too late.

Without the Kingdom of Bavaria, these small states would have to face Austria directly. Their strength is limited, and they simply don’t have the power to resist Austria. With morale weakened, the subsequent issues become easier to handle.

Although these Germanic states may seem inconspicuous individually, if they unite, their strength is not to be underestimated.

They could mobilize three to four hundred thousand troops, and there was still the Kingdom of Prussia. If they can’t quickly defeat them one by one, once they fall into a stalemate, the entire plan would fail.

Therefore, political deception is crucial. Even if they don’t completely fool the governments of these countries, as long as they hesitate for a moment and let Austria crush Bavaria, the overall situation would be decided.

On the surface, it appears that the Austrian government is currently dominated by the advocates of peaceful unification, followed closely by those opposing Germanic unification. As for the voices advocating military unification of Germany, they are practically nonexistent unless it was at the lower levels.

From a political analysis, no matter how you look at it, the Austrian government lacks both the motivation and the conditions to take military action.

To some extent, politicians’ political stances can influence a country’s decisions, much like when Lincoln, an advocate for abolition of slavery, was elected, leading to the outbreak of the American Civil War.

If the Austrian government were dominated by warmongers, the German states would be on high alert, much like how everyone is wary of the Kingdom of Prussia now.

Even though their strength may not match Austria’s, their prime ministers are all military figures, classic hardliners who give off a threatening aura.

Franz readily agreed, “Alright, let’s help the Russians withstand this wave. They’ll probably start collecting war taxes again, so the Russian government shouldn’t be short of money this year.”

War taxes are a unique type of tax in Europe. Before the modern era, monarchs usually funded their wars through war taxes.

Even though Austria also has war taxes, Franz wouldn’t collect them unless absolutely necessary. Once he collects the money, it means they can’t afford to lose the war; otherwise, the consequences would be severe.

Marshal Radetzky reminded, “Your Majesty, it’s time to create a pretext for war. The process of dividing and weakening the German states has reached this point; pushing further might be counterproductive.”

After some thought, Franz said, “Proceed according to the plan!”