Holy Roman Empire - Chapter 178

Chapter 178: Chapter 65, War Loans

Translator: 549690339

The Greek people were pulled in, but Franz didn’t take it seriously at all. The main actors of this Near East war were the Russians, while Austria was just a bystander, at most throwing a few stones at the already-fallen Ottoman Empire.

Even though the two countries had declared war, there was actually a lot of room for maneuver on both sides. Austria only occupied two of its vassal states and then stopped, keeping the conflict within a controllable range.

The decrepit Sultan Government was actually quite tolerant, but it had previously overestimated its own strength, and Austria needed this war, which led them to this point.

As for whether or not to smash the Ottoman Empire, Franz was indifferent. With the support of England and France, even at their worst, the Ottoman Empire could still preserve the Asia Minor Peninsula.

As for the Greek people, frankly, Franz held no expectations for them.

Geography dictated that their best choice was to cling to the British, and their lack of strength meant that the Ottomans needed only one hand to hold them down.

If they joined the alliance openly and declared war on the Ottoman Empire, then for political necessity, the responsible Franz and Nicholas I would certainly give them a hand.

Even if they were defeated on the battlefield, they would not be disadvantaged in post-war negotiations.

Sneaking into the fray does not qualify them as allies. If they win, that’s fine; Franz, being a man of his word, and the Austrian Government would definitely support their demands, and the Russians would likely fulfill their promises.

If they lose, they can only cry for themselves. It was all done by civilian militias, with no connection whatsoever to the Greece Government, and even less so with Austria and Russia. Franz remembered that historically, the Greek people had lost and were severely beaten by the Ottomans.

Compared to the Greek people, another Balkan minor country, Montenegro or Dveri’s Negoro, had a much firmer stance.

Originally, Archbishop Danilo wanted to be neutral. Montenegro, a small country with a population of less than 200,000, had waged war on the Ottoman Empire three times in 1821, 1829, and 1835, hoping to acquire a southern port, but all attempts ended in failure, and they had just begun to recover.

Archbishop Danilo was a member of the peace faction; surrounded by the Ottoman Empire on all sides, he feared they would collapse before receiving aid.

Unfortunately, the pro-Russian Montenegro people did not agree. A martial spirit is a common feature among all Balkan nations, and Montenegro was a particularly prominent example.

The Ottoman Empire had ruled the Balkan Peninsula for hundreds of years without being able to conquer the Montenegro Duchy, and the Sultan Government had grown impatient.

Not long ago, it had proposed a suggestion to the Montenegro government: if they ceased hostilities with the Ottoman Empire and recognized the Ottoman sovereignty, then the Sultan would grant Montenegro part of the territory of Herzegovina, a port in the Adriatic Sea region, and the city of Shkodër.

The stalwart Montenegro people decisively rejected this temptation. They preferred to fight and bleed for these lands rather than submit to the Ottomans.

The power of hatred had penetrated deep into the marrow of the Montenegro people, and now that the opportunity had presented itself with both Russia and Austria declaring war on the Ottoman Empire, how could they possibly be absent?

It should be noted that in the Crimean War, the pro-Russian Montenegro people were ready to participate.

However, Archbishop Danilo could see the situation clearly. He believed that the Russians were too far away, and should war break out, Montenegro would be in a dangerously isolated situation, so he chose neutrality.

For this, Archbishop Danilo nearly lost his position.

Now, there was no need to worry about being isolated, as they were not far from Austria’s Dalmatia Province, which left Archbishop Danilo with no choice but to agree.

In order to marry, Archbishop Danilo made a compromise. He agreed to support the war in exchange for everyone’s agreement to let him abdicate the archbishopric to someone else and crown himself “Grand Duke of Montenegro and Buda.”

As Russia’s traditional little brother, Montenegro Duchy was still well taken care of, with Russia intervening with Austria to provide them with support.

Of course, Franz wouldn’t reject such a small request from the Russian people. It was just weapons, equipment, and strategic materials, and as long as they were willing to pay, everything was negotiable.

At such times, the superiority of a state-owned enterprise became apparent. With a government order, the companies would start producing strategic materials ahead of time.

Considering the payment capabilities of Montenegro Duchy, Franz also very thoughtfully provided loan services to solve the urgent needs of his customers.

Providing loan services was a necessity, not just for Montenegro Duchy, but even Russian payment abilities were very limited.

They hadn’t completed their internal reforms yet, the wealth a feudal empire could accumulate was simply no match for capitalist countries.

The Tsarist Government didn’t anticipate intervention by England and France; now that the sea route was cut off, the strategic materials stored on the Ukrainian coast could only be transported by land. This clearly couldn’t guarantee the needs of the front-line troops, and they could only purchase from Austria nearby.

The military expenditure for the long-distance campaign to the Balkan Peninsula was much higher than historical campaigns in the Crimean region. Due to the corruption of the Tsarist Government, even without the Austrian Government inflating prices, the prices had already risen.

Franz couldn’t possibly stop Russian bureaucrats from making a fortune, could he?

In the end, it was win-win for everyone involved, and the only harm done was to the Russian central finances—after all, with their large household and business, they could withstand it, and if there was no money, they could just take out loans.

The Austrian Government was very willing to take this business; the loans were earmarked and could only be used to purchase Austrian goods, without the need to hand over real gold and silver. After all, lending to Russians for payment was always better than having them default on their debts.

Political loans were never simple; with attached commercial trade conditions, even if the Russian Government couldn’t pay back the loans, the Austrian Government wouldn’t lose.

Only the Central Bank had the strength to take on this business in Austria, for loans amounting to billions of shields were unachievable even for the few big commercial banks combined.

With a single command from Franz, the Austrian Central Bank set its printing presses in motion, gathering the first installment of funds in the shortest time possible.

Russians borrowed one billion shields, Montenegro Duchy borrowed five million shields, and the loan request from the Greek people was rejected by Franz.

The reason was that Austria couldn’t provide them with material aid; they didn’t border each other by land, and relying on sea routes to deliver goods was out of the question—what about the British?

Paying with real gold and silver? That was clearly not an option; the Austrian Government wasn’t a fool, could they really expect the Greece Government to repay?

Ever since the establishment of the Kingdom of Greek, their finances had depended on borrowing from their powerful backers; when had they ever cleared their debts?

After completing the loans to the Russians and Montenegro Duchy, this money flowed back into the Austrian market, stimulating Austria’s economic development.

After all, it was wartime and it was normal for prices to rise; as long as it wasn’t excessive, there wouldn’t be any major problems.

With the unification of South Germany, the market currency capacity increased, solving the problem of inflation.

As long as there was no capital outflow, and with the creation of social wealth on the rise, the increase in currency supply was a standard operation and did not lead to severe inflation.

As for the economic pains that would come with the market returning to normal after the war, weren’t there Russians to repay debts? As long as there was an influx of real gold and silver, any crisis could be readily solved.

By the way, this opportunity was used to further tighten the economic ties between Austria and Russia, using such economic interdependence to consolidate the alliance between the two countries.

French could influence the Tsarist Government by controlling Russian finance, and while Austria didn’t have the power to control Russian finance, surely some influence was still achievable?

Franz was very conscientious; the monthly interest rate on loans given to allies was merely 0.2%, without any unfair additional conditions.

It merely promoted economic exchanges among allies. After all, England and France had become enemies, so it wasn’t too much for Austria to encroach on their markets, was it?

At this point, even if England and France wanted to protest, they had no opportunity; from the moment their navies blockaded, they became enemies of the Tsarist Government.