Holy Roman Empire - Chapter 106

Chapter 106: Chapter 106: The Debtor is the Uncle

Cʘntinue reading on ΒƟXN0VEL.ϹʘM

Translator: 549690339

Vienna

Prime Minister Felix said worriedly, “Your Highness, the Hungarian rebellion has ended. However, there is a portion of the nobility who did not participate in the rebellion but had their lands taken away during the chaos.

(vitag.Init = window.vitag.Init || []).push(function(){viAPItag.display(“vi_765923973”)})

If we follow the previously issued ‘Land Redemption Act,’ now the Austrian Government is obligated to pay a total of 23.7 billion shields in land redemption money.”

(1 shield = 11.69 grams of silver)

“How can it be so much?” Franz asked in surprise.

One must know that after this rebellion, nearly seven-tenths of the Hungarian nobility were finished, including those who have ‘collected their boxed lunches’ and those stripped of their titles due to their involvement in the rebellion.

Felix explained, “Your Highness, several major Hungarian families did not participate in the rebellion, and nearly half of this redemption money is to be paid to them.

Besides, there are also some enlightened members of the domestic nobility willing to give up their lands who require payment of redemption money.

In addition, there are loyal nobles in the Italian Area who also had their lands taken away during the turmoil.

All these add up to an initial estimate of 23.7 billion shields for land redemption money, and the number will increase if more people continue to give up their lands.”

Franz rubbed his forehead. To encourage nobles to give up their lands, the redemption money was assessed at market value. If converted, this is equivalent to 550 million taels of silver.

Obviously, this amount is not something the Austrian Government can provide at once, even though the government has a substantial amount of assets due to confiscation.

But these real estate assets aren’t the same as cash; they cannot be liquidated in the short term, and the Austrian Government is still poor.

(vitag.Init = window.vitag.Init || []).push(function(){viAPItag.display(“vi_765923973”)})

According to the ‘Land Redemption Act,’ the land redemption money paid by peasants is collected by the government, which is responsible for compensating the nobles who give up their lands directly.

This massive debt has now landed on the Austrian Government. Franz could not possibly pay off this enormous debt all at once, and defaulting was even less of an option as it would affect government credibility.

Franz asked with concern, “How much land redemption money can we collect each year?”

Prime Minister Felix thought for a moment and said, “Around 180 million shields.”

This 180 million shields is not just from these lands but also includes a large amount of land confiscated by the government and lands of nobles with no heirs.

If it were just these lands, drawing redemption money at a thirty percent yield ratio would at most amount to forty to fifty million Rhine shields.

After calculating, Franz helplessly realized that farming indeed was not a profitable business; even without considering the cost of capital and time, it would take at least a decade or two to break even.

The land redemption money collected by the government is likely insufficient to cover the interest cost of the capital.

Franz thought for a moment and said, “Let’s go with installment payments. Make the situation clear to the nobles, tell them about our difficulties, and ask for their understanding.

First, pay half of the redemption money to the enlightened nobles within the country who are willing to give up their lands voluntarily, and pay off the rest in installments over the next twenty years.

For the major noble families in the Hungarian Region, tell them that the government will overlook their minor actions during the rebellion, but as a penalty, the payment of their land redemption money will be extended to forty years in installments.

(vitag.Init = window.vitag.Init || []).push(function(){viAPItag.display(“vi_765923973”)})

For those who still have a hold over us, just give a warning, extending their payment period for redemption money is no problem. For those completely uninvolved, proceed according to the voluntary land forfeiture arrangement!”

Franz finally experienced what it’s like—the debtor is king.

After a revolution, Austria’s internal interest groups had also been reshuffled. These nobles forced into land redemption naturally belong to the losers.

With money in the hands of the Austrian Government and the lands in the hands of the peasants, they truly have no choice.

Previously, the Austrian Government feared them because each major noble family possessed vast lands, serfs, and many dependent small and medium-sized nobles, capable of raising an army of thousands, even tens of thousands, at any time.

Now, this situation has changed; serfs have gained their freedom, beyond their control, and the dependent small and medium nobles have been severely hit.

A toothless tiger has only its might left. That they were not completely annihilated is because Franz, as a beneficiary, did not wish to break the rules.

“Yes, Your Highness!” replied Prime Minister Felix.

In tackling local power factions, both the Austrian Cabinet and Franz were on the same page.

The so-called installment payments didn’t include a penny of interest. Paying over forty years, in reality, isn’t even enough to cover the interest.

Even with installment payments, when exactly the money will be received remains unknown. As long as it’s paid within the promised deadline, it’s not considered a default.

(vitag.Init = window.vitag.Init || []).push(function(){viAPItag.display(“vi_765923973”)})

The specifics would depend on whether these nobles are wise. If they agree to cooperate with the government, everything will be negotiable, and the Austrian Government will repay the money as soon as possible.

If they continue to foolishly oppose the government, it’s doubtful they’ll see that money in their lifetimes.

Not everyone was optimistic; Metternich sat with a worried frown and after a long hesitation, hesitantly said, “Your Highness, so many nobles suddenly without lands, losing their source of income, it won’t be easy for them to transition.

If we can’t provide them with a way out, they may become a social issue in the future.”

This was a practical issue; it was impossible for all the nobles to become capitalists, and businesses could fail as well. A blind transition would most likely lead to them losing a significant amount of money.

Don’t expect these people to become workers, humbly working in factories after bankruptcy.

A more likely outcome is that after bankruptcy, they would join the revolutionary forces, attempting to disrupt social order and redistribute social wealth.

Minister of Education Count Leo thought for a moment and said, “Our Ministry of Education can hire some nobles as language teachers, most of whom are qualified, but this would require higher salaries and benefits!”

The same position would pay differently between nobles and commoners; don’t find this strange—it’s a common situation on the European Continent.

“That is just a drop in the bucket. Nobles without ambition might accept the position of a teacher, but the vast majority of nobles will not give up their status to become rural educators!” Felix shook his head.

Archduke Louis suggested, “How about we establish colonies? Let them go overseas to colonize; it will keep them from causing trouble at home?”

During the Metternich Era, Austria did not establish overseas colonies—not to say that Austria lacked the ability to establish colonies.

As one of the top four nations in the world, it wouldn’t be difficult to obtain a colonial territory overseas, should the government decide to act.

Witnessing England and France seizing land overseas, and even smaller countries like the Netherlands and Portugal owning colonies, how could Austrian nobility not be envious?