Holy Roman Empire

Chapter 520: Scheming (Bonus Chapter)

Chapter 520: Scheming (Bonus Chapter)

Developing South Africa was also one of Austria’s measures to cope with the agricultural crisis, with the newly created jobs providing a solution for bankrupt farmers and preventing a wave of unemployment.

The European public had always been deeply interested in gold, and in this era, gold mining was seen as the quickest way to get rich. If one was lucky enough, they could strike it rich.

Among the first Austrian immigrants who made it big in Africa, five out of ten did so through gold mining, and another two out of the remaining five made their fortunes by providing services to gold miners.

In this era, every colonial power was desperate for immigrants, and to stand out in the competition, effective propaganda was essential.

A beautiful promise was a must, but whether people could actually find gold and get rich once they arrived? Franz could confidently say that 99% of them would not.

There’s a joke that goes: two brothers went looking for gold, only to realize when they got there that they had no idea how to prospect.

This joke reflects reality. Unless it’s an open-pit gold mine with particularly high gold content that’s visible to the naked eye, ordinary people wouldn’t recognize it even if they stumbled upon it.

Now that gold has been discovered, who knows how many prospecting teams are going to operate in South Africa? Even the domestic elites are organizing their own teams, and most of the gold mines will likely end up in their hands.

If it weren’t for the Austrian government setting up a gold-buying program, allowing ordinary people to sell their gold directly to the government, those who discovered gold might not have the means to mine it and could even find themselves in danger of losing their lives.

While everyone else was eagerly searching for gold, Franz took a more laid-back approach. While others were trying to strike it rich, he was investing in farms and plantations.

This experience proved that time travelers aren’t omniscient. A point on the map could translate to several thousand square kilometers on the ground, and a slight deviation could mean being off by hundreds of kilometers.

Whether or not you could find gold depended entirely on luck. While South Africa’s gold deposits were extensive, they weren’t so vast as to cover tens of thousands of square kilometers.

Relying on theoretical knowledge to find gold was not much different from relying on luck. Famous gold mining locations in later eras hadn’t even been named yet.

Even if the names appeared, after Franz’s butterfly effect, only God knew how big the error would be.

Given that, he figured it was better to take it easy. Gold miners might not always make money, but those providing support services certainly would.

Investing in nearby farms and plantations to sell essential goods like bread, cheese, fruits, vegetables, and meat products will definitely not lose money.

Despite the agricultural crisis causing a significant drop in agricultural product prices in various regions, this doesn’t heavily impact inland Africa.

While grain can be imported, items like cheese, fruits, vegetables, and fresh meat products can’t all be brought in from elsewhere. Although canned food had already appeared, not many people could stand eating it every day.

And who knows? Maybe you’ll get lucky, and there could be a gold mine beneath the farm. Who can say for sure? When Franz established royal plantations in West Africa, minerals were discovered beneath them more than once.

The same was even more true in South Africa, where gold mines appeared in clusters. Buying land near a gold mine is a sure bet—if there’s gold, you strike it rich; if not, you still make a small profit.

The news of large gold deposits being discovered in South Africa is still circulating within small circles, while the outside world remains consumed by the panic of the agricultural crisis.

In Berlin, the Prussian government grew anxious after the agricultural crisis erupted. This was a matter of self-interest and couldn’t be taken lightly.

At some point, Austria had become the agricultural trendsetter in Europe, and William I kept a close eye on the Austrian government.

Watching as the Austrian government enacted a fallow law, restricted increases in grain planting areas, and called on other countries to reduce production, William I felt even more troubled.

Reducing grain production isn’t just a matter of issuing a decree. It involves a wide range of interests, and crucially, it affects the interests of the Junker aristocrats in agriculture.

Times have changed. Prussia used to be a grain-importing country and didn’t have to worry about these issues, but now they have become a grain exporter.

If the Russians were the most aggressive in land reclamation, with Austria following closely behind, then the Kingdom of Prussia ranked third. In recent years, the arable land area in Prussia has also increased by half.

Everyone is highly motivated to grow grain, and land that was once wasted in Russian hands is now being efficiently utilized by the Junker aristocrats.

Now, the problem has arisen: grain production capacity has exceeded demand. And this isn’t just a minor surplus—according to data released by the Austrian Ministry of Agriculture, Europe’s grain production capacity exceeds demand by over 21%.

Regardless of how much grain production capacity is in surplus, grain-importing countries are unlikely to reduce their production. The need to cut production mainly falls on grain-exporting countries.

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Even if some of this grain is wasted for various reasons, the amount of production that needs to be reduced, when distributed among the countries, is still significant.

The main culprit behind this situation is the Russians. Based on the estimated agricultural land area in Russia, if all the grain produced there could be exported, even if other agricultural exporting countries stopped exporting grain altogether, Europe still wouldn’t face a shortage.

The reality is harsh—the international market is simply too small.

As agricultural populations increase in various countries, the amount of cultivated land continues to grow, and with improvements in agricultural technology, grain production is steadily rising. However, the market’s growth rate is nowhere near fast enough to keep up.

Take France, for example. Due to the increase in domestic grain production, its expected grain imports this year will drop by 2%.

These figures are all published by the Austrian Ministry of Agriculture, which releases such data annually. Its reputation for accuracy is well-established, and William I has no doubts about it.

This isn’t the first time Austria has called for a collective reduction in grain production capacity. Since 1870, the Austrian Ministry of Agriculture has been issuing warnings about grain overproduction.

However, these warnings have had no effect. Even Austria itself hasn’t managed to reduce its production capacity, let alone other countries.

“The agricultural crisis is truly here, and the Austrians have already taken concrete steps to cut production. The reason I’ve called everyone together today is to discuss whether we should follow suit.”

Deep down, William I agrees with the need to reduce grain production capacity. If the market isn’t restored to normal, no one will be having a good time.

“Your Majesty, Austria is the world’s largest agricultural exporter, and with the outbreak of the agricultural crisis, they have been hit the hardest.

Their current move to reduce production is actually out of necessity. The prices on the international grain market have collapsed, and now the more they export, the more they lose.

On the surface, it seems that the Anglo-Russian agreement triggered this agricultural crisis, but in reality, Russian grain has only just begun to enter the international market. The real cause of the price collapse was Austria’s dumping activities earlier this year.

According to the information we’ve gathered, as of now, Austria has offloaded about 34.2 million tons of agricultural products onto the international market, of which over 30 million tons were grain alone.

This amount already exceeds 81% of their total transactions on the international grain market in 1871. If the Austrian government doesn’t restore its strategic reserves and start purchasing grain from the market in the second half of the year, prices will continue to plummet.

While it may seem like they’re just trying to block the Russians from re-entering the international market, in reality, it’s an excuse to drag everyone down with them.

If no action is taken, international grain prices will continue to lower for the next two to three years. During this time, the more grain you sell, the more you lose, and if you don’t sell it, you can’t recoup your funds.

We only hold a 6.6% share of international grain exports, so even if we reduce our production capacity, it won’t change the situation. Unless the Russians agree to reduce production as well, this crisis won’t end anytime soon.

The immediate priority is to protect the domestic market. I recommend reducing or eliminating agricultural taxes and export duties on agricultural products, while simultaneously raising import tariffs on agricultural goods. If necessary, we could follow Austria’s lead and implement a minimum grain purchase price to ensure farmers’ income.”

Moltke’s opinion is very clear: the government should not interfere with people’s freedom to cultivate. The reasoning is simple: if Prussia reduces production while the Russians do not, they would just be doing the enemy a favor.

“Prime Minister, raising import tariffs on agricultural products is easy, but we must consider the ripple effects.

Prussian-Polish relations are at a critical juncture. If we raise import tariffs on agricultural products now, what will the Poles think?

If they retaliate by raising import tariffs on our industrial goods, then the agricultural crisis could spread to industry as well.

Let’s not forget that our financial situation is already very dire. If we go down this path, this year’s budget deficit will increase significantly. It may not be long before we have to declare bankruptcy.”

It wasn’t that Graumann was unwilling to protect agriculture. The problem was that as the Minister of Finance, he was acutely aware of how precarious Prussia’s finances were.

Simply reducing or eliminating agricultural taxes and export duties on agricultural products would already result in a decrease of 56 million marks in Prussia’s revenue, which was extremely risky.

If Prussia were to raise import tariffs on agricultural products, leading Poland to raise import tariffs on Prussian industrial goods in retaliation, Prussia’s fragile industrial and commercial sectors would also suffer a severe blow.

This could trigger a chain reaction, potentially leading to an industrial crisis, with losses that would far exceed the initial impact.

Prussia didn’t have colonial markets to offload its excess products, and it couldn’t compete internationally against the British, French, and Austrian industries. The Polish market was therefore vital to Prussia.

Moltke smiled calmly and explained nonchalantly, “It’s not that serious. The Poles wouldn’t dare to confront us directly.

It’s easy to deal with them. All we need to do is stir up the radical Polish groups, get them to make territorial demands on Austria, and then we can step in to clean up the mess.

After offending two powerful neighbors, what choice would the Polish government have?”

This explanation left Graumann speechless. There was no denying it. Poland wasn’t a normal country at the moment, as it was already in turmoil internally.

This tactic might not work on other countries—no one else would be so reckless—but Poland was an exception. They were indeed capable of such actions.