Holy Roman Empire

Chapter 615: The Smart Ones

The impact of the economic crisis was even greater than Franz had anticipated. Due to the butterfly effect, global industrial output was significantly higher than in the same period in history, yet market demand hadn’t increased by much.

When the economic crisis hit, these hidden issues came to light. By the end of 1876, the economic crisis had crossed the ocean and spread to the Americas.

Ironically, it was the Southern plantation owners, not the Northern capitalists, who were hit first.

The downturn in the textile industry wasn’t unique to Austria. It was affecting all European countries. This led to a sharp decline in demand for cotton, causing the South’s cotton to pile up unsold for the first time on a large scale.

Although this seemed like an ordinary event, its implications were far-reaching. In the Confederate States, calls for developing their own cotton textile industry began to rise, and some even started taking action.

Southern plantation owners, in pursuit of greater profits, were no longer content to be mere raw material suppliers and began extending their reach into downstream industries.

Upon receiving the intelligence, Franz merely smiled. The Confederacy developing its own industry posed little impact on Austria. In some ways, it was even a positive development.

This trend would mean that the power disparity between the North and the South would gradually narrow. In recent years, European countries have tacitly limited immigration to the North to maintain this balance.

Even with this assistance, the balance only just held. The North still had a clear advantage.

Were it not for the deterrence of Britain, France, and Austria, which restrained the ambitions of Northern capitalists, a second civil war between the North and South might already have begun.

From Austria’s perspective, it was preferable for the Southern government to have some industrial capacity, allowing it to counterbalance the North, rather than relying solely on Europe’s support.

In case a major event in Europe ever left them unable to focus on the Americas, the South would at least need enough strength to defend itself.

Franz wasn’t worried about the military’s combat effectiveness. History had already proven that the Northern capitalists couldn’t defeat the Southern plantation owners. However, modern warfare now depended on industry and organizational capacity.

Among these, “industry” was the prerequisite. Without sufficient industrial capacity, ensuring a steady supply of weapons and ammunition would be impossible, and organizational strength would be meaningless.

Naturally, this development came with both benefits and drawbacks. While industrial development in the South would add a competitor to the international market, disrupting it, the first to suffer would undoubtedly be the British. After all, they were the dominant force in the textile industry.

The Austrian government had already bet on the Second Industrial Revolution, with its core industries transitioning to emerging sectors. In this regard, Austria was not afraid of competition.

It wasn’t just the Americans, even Britain and France lagged behind. The gap wasn’t in technology but in talent cultivation.

Even when new technologies were developed, Austria could industrialize them within months, while Britain and France required 2 to 3 years of preparation.

In Austria, you could find potential engineers walking down almost any street, whereas in Britain and France, this ratio was significantly lower.

As for the Confederate States, their education system was even more backward. The most suitable path for them now was to emulate European countries.

Initially, they could rely on pirating technologies to grow their industrial foundation. Once it reaches a certain scale, quantitative changes could lead to qualitative leaps, eventually paving the way for independent innovation.

This was the same path Austria initially took. However, it had the advantage of catching the wave of the Second Industrial Revolution, allowing it to leap forward and save considerable time. ?

…

“Immigration” was a hot topic in 1876, with the government heavily promoting the benefits of relocating to Africa and publicizing the high wages available there.

In a Vienna general store, the shopkeeper Lars was busy trying to dissuade his staff from considering immigration.

“Africa isn’t as wonderful as they make it sound,” he began, “There are venomous insects, dangerous beasts, and brutal, savage cannibal tribes. One misstep, and you could end up on a spit over a fire.

Don’t be fooled by how good it looks in the newspapers. If it were so easy to strike it rich, I’d already have moved there myself…”

After his long-winded speech, many of his employees started second-guessing their plans to emigrate. Everyone understood that while Africa might not be as bad as Lars described, it certainly wasn’t as idyllic as portrayed.

Even the newspapers never claimed that Africa was paradise. They mainly emphasized the “high wages” and “opportunities,” downplaying the risks.

Even up to now, Africa’s mortality rate was still higher than in Austria. Despite the dangerous conditions in domestic sweatshops, they couldn’t compare to the toll diseases took in Africa.

This information wasn’t a secret. Newspapers covered it, and the government even distributed a “Survival Handbook for Africa” outlining precautions and tips for staying alive.

All of this proved that Africa was no paradise and that making money required survival first.

Seeing that his audience was starting to waver, Lars nodded in satisfaction.

Vienna wasn’t an industrial city, so it felt a smaller impact from the economic crisis. Aside from a slight effect on the financial sector, other industries were mostly unaffected, and business at the general store was still holding up.

Unlike previous downturns, when cutting wages was an option, now Lars’ first concern was retaining his staff.

While being a shop assistant might seem like unskilled work, it wasn’t something just anyone could do.

First, good memory was essential. They had to know exactly where each item was so they could quickly locate products for customers.

Second, some basic literacy and numeracy skills were needed to keep the accounts in order.

Finally, they needed a sharp eye. In an era without surveillance cameras, spotting and catching shoplifters was crucial.

For someone with natural talent, it might take only a few days to master the job. For those lacking it, even years of training could still result in frequent mistakes.

Most shop assistants held lifetime positions, largely because hiring new staff posed risks. If someone incompetent or dishonest came on board, it could lead to significant losses for the owner.

Just as Lars was feeling pleased with his persuasive speech, a familiar voice interrupted.

“Mr. Lars, I’ve signed up to immigrate.”

Lars said, “It’s okay, Rennes. Even if you’ve signed up, you can still withdraw. Immigration is entirely voluntary so no one will force you.”

After a brief moment of silence, Rennes lowered his head, “I’m sorry, Mr. Lars. Thank you for looking after me, but I still want to go out and try my luck.”

Lars was fuming internally, but to maintain his gentlemanly demeanor in front of everyone, he suppressed his anger, “You’d better think this through. Once you take this step, it will be hard to turn back.”

Rennes kept his head down, seemingly too nervous to respond.

Seeing Rennes’ demeanor, Lars knew he had made up his mind. With a sigh, Lars feigned magnanimity and said, “Fine, since you’ve decided, go out and give it a shot!

If things don’t go well out there, you can always come back. This will always be your second home. May God bless you!”

Seeing the expressions of gratitude on everyone’s faces, Lars’ anger finally subsided. Losing Rennes might have been a setback, but he had won over the goodwill of the others.

Unlike factories where workers could be driven by the whip, a general store couldn’t be managed that way. Losing the trust of the staff could lead to significant losses, as any employee could sabotage the business if they wanted.

Lars had learned this lesson from observing countless failed businesses. Over time, he had grown his operation by avoiding those pitfalls.

Now, Lars owned five general stores across Vienna, all running smoothly thanks to his ability to perform such public displays of generosity. It was the cheapest way to earn loyalty.

The incident at the general store was just a small episode. Few people were leaving Vienna for immigration. The highest number of emigrants came from the highly industrialized Bohemia region, followed by Lombardy, Venetia, and Bavaria.

The main group of immigrants now consists of unemployed workers. Affected by the wave of unemployment, many people, after losing their jobs and sources of income, have no choice but to seek opportunities elsewhere.

The departure of unemployed workers hasn’t raised much concern. For many, they couldn’t be happier to see these people disappear entirely.

During every economic crisis, unemployed workers are the most unstable factor in society. With fewer of them around, public security has significantly improved.

But for capitalists, the situation is different. Watching large numbers of people emigrate has left many business owners deeply worried. If the workforce leaves, where will they find cheap labor?

Originally, many planned to use the economic crisis to suppress the recent rise in wages. Now, they wouldn’t dare to act on that thought.

They fear pushing workers too hard and causing their factories to empty out entirely. There are already cautionary tales about this, as covered in the newspapers.

For instance, the Desserlandier Machinery Factory in Bavaria failed to negotiate a labor dispute, leading to workers resigning or emigrating en masse.

The newly hired workers lacked the necessary skills, resulting in a high defect rate in production. This loss of product competitiveness eventually forced the factory to shut down.

There are plenty of similar stories of reckless decisions reported in the newspapers, including cases where promises of better wages were broken, prompting workers to strike again.

While such negative outcomes exist, there are also positive effects. Due to rising wages, the domestic market, which should have shrunk during the economic crisis, instead experienced unexpected growth.

Although some of the population has emigrated, the purchasing power of those remaining has increased. For the first time in Austria, the economic theory of “cultivating the market” has shown significant results.

Aside from industries heavily reliant on exports, most businesses focused on the domestic market had begun to gradually recover from the crisis by the end of 1876.