Holy Roman Empire

The overall situation wasn’t something small players like Mirko and Ferren could influence. Introducing cheap foreign labor wasn’t easy either. Aside from support from capitalists, everyone else opposed it.

The reason was simple: self-interest.

An influx of cheap foreign labor wouldn’t just disrupt the domestic wage system but also pose risks to social stability. When people’s immediate interests are threatened, opposition is inevitable.

On this issue, the Austrian government’s stance had always been firm. They were clear about priorities.

They wouldn’t sacrifice the foundation of the nation just to satisfy the interests of capitalists. Except for highly skilled talent, Austria was not welcoming to ordinary migrant workers.

From a national perspective, when domestic citizens earn income, the money stays within the country and continues to circulate. However, when foreign workers are paid, most of their earnings, after covering basic living expenses, flow out of the country.

This outflow of wealth is undoubtedly harmful to national development. Unless there’s a genuine labor shortage that can’t be filled domestically, no government would willingly welcome foreign workers.

Austria’s labor shortage was only a temporary issue caused by war. If capitalists stopped their blind expansion, this problem would disappear on its own.

Legally importing foreign workers was entirely different from hiring illegal laborers. The latter could be deported at any time, while the former had legally binding contracts and could not be dismissed so crudely.

If a large number of foreign workers were brought in and an economic crisis broke out after the war, Austria’s employment structure and wage system would collapse, creating a vicious cycle and worsening the crisis further.

The government had tried every possible way to curb the capitalists’ reckless expansion, yet it was ironically the labor shortage that finally managed to slow this momentum. This outcome carried a certain sense of irony.

In the face of profit, every difficulty could be overcome. If there wasn’t enough labor, then workers would simply be poached. After Christmas, Austria erupted into a fierce competition for talent.

To attract more workers, many companies offered unprecedented incentives, such as free meals, free accommodation…

Against this backdrop, labor disputes reported to the labor inspection department in 1880 reached a historic low, and class tensions visibly eased.

The rising cost of labor also pushed up overall business operating costs. However, in comparison to the scale of war, this was considered a minor issue that was hardly worth mentioning.

Amidst all the positive signs, the term “Golden Age” frequently appeared in newspapers. Many optimistically believed that this was yet another explosion of capitalist economic growth.

While the public was unaware of the looming risks, Franz could not afford to be complacent. This prosperity was driven by war, and once the war ended, it would no longer be sustainable.

As public income increased, prices also steadily rose. Once the war ended, this distorted form of prosperity was bound to collapse.

When the post-war economic bubble burst, the crisis of overproduction would emerge, market competition would become even more brutal, and corporate profits would plummet. ŔΆɴȫＢÊS̩

Given the nature of capitalists, when profits decline, cutting labor costs becomes an inevitable choice. Layoffs and wage reductions are the most common tools in their arsenal.

Incomes would decrease, yet prices would remain high. Life for the lower classes would become increasingly difficult with a crisis on the horizon.

If it weren’t for the colonies serving as a safety valve to relieve the incoming flood, Franz might not have been able to sleep at night. The mere thought of a terrifying wave of unemployment sent chills down his spine.

After much hesitation, Franz decided to intervene in the market proactively. However, government intervention in the market required finesse and direct interference would certainly not work.

Setting down the newspaper in his hand, Franz instructed the maid, “Notify the heads of the Ministry of Finance, the Banking Regulatory Department, and the National Bank to attend a meeting tomorrow afternoon.”

“Yes, Your Majesty.”

With that, the sound of “ring, ring, ring” echoed in the room as the maid picked up the nearby telephone and began dialing.

One had to admit, the telephone was one of humanity’s greatest inventions of the 19th century. Before its invention, notifying officials for a meeting required sending messengers, which would take at least half a day.

Now, with the telephone, the message was delivered in an instant. Of course, this was a privilege reserved for the Emperor. The telephone company had set up a dedicated line for him, with staff on standby 24 hours a day to ensure immediate connection.

In this era of manual switchboards, ordinary citizens had to patiently wait their turn to make a call. Waiting half an hour wasn’t unusual, and during peak hours, delays of 2–3 hours were considered normal.

With such a manually operated system, occasional errors were inevitable, such as the common issue of switchboard operators accidentally crossing lines.

Under the current monthly subscription model, telephone companies took no responsibility for delays caused by operator errors.

There was no way around it as it was a monopolistic service. In this era, telephones were considered cutting-edge technology, and telephone companies operated with absolute dominance. Customers could either accept the terms or simply not use the service.

No matter how flawed the service was, telephones were still far superior to telegrams. Being able to make a call directly from home was infinitely more convenient than traveling to a telegraph office to send a message.

For better service, you’d need to upgrade to VIP status. This was one of Franz’s ideas, borrowed from the “Penguin Empire (Tencent).” If you wanted higher call quality, you’d have to pay up.

With enough money, you could have uninterrupted service. Some packages even included dedicated 24/7 private lines. For those willing to pay for the luxury VIP package, connections were guaranteed within five minutes, barring exceptional circumstances.

As for ordinary users complaining about poor service quality, well, the telephone company could only apologize. In the era of manual switchboards, delivering consistent high-quality service was practically impossible.

It wasn’t the telephone company’s fault for offering tiered services. It was simply a matter of survival. Telephones were such a luxurious product that they were completely out of reach for ordinary people. Even most middle-class families couldn’t afford them.

As the newspapers often said, “If you want to know whether someone is wealthy, just check if they have a telephone at home.”

The wealthiest families were all VIP customers of telephone companies. Simply having a telephone installed was a mark of being at least middle-class.

The exorbitant connection fee of 500 guilders and a minimum monthly charge of 30 guilders effectively eliminated any possibility of access for ordinary citizens.

Don’t complain about the high prices. Due to the nationwide network expansion, telephone companies were still operating at a loss just to stay in the market.

If it weren’t for the drive to capture market share, telephones in Austria would likely be restricted to major cities, just as they were in many other European countries.

The exorbitant fees were essentially covering the costs of research, development, and infrastructure deployment. Monopoly operations were not only a reward for innovators but also a practical necessity.

Without core technology, companies had to pay hefty patent fees. Building the necessary infrastructure was extremely expensive and profit margins were far from promising. These factors combined made this an industry that ordinary companies could not afford to enter.

In a context of persistent financial losses and distant profitability, discussing anti-monopoly measures became little more than empty rhetoric.

It’s easy to criticize monopolies from a moral standpoint, but the real question remains: How do you solve the problem? Breaking up a monopoly is one thing, but what happens next?

If companies see no prospect of profit, they lose motivation. Without that drive, there will be no research, no innovation, and no adoption of new technologies. The consequences of such stagnation are far worse than a temporary monopoly.

Every era has its own unique characteristics, and the most suitable solution is often the best one. Claims that monopolies always hinder technological progress are only partially true. Historically, monopolies have also driven significant technological advancements.

This applies specifically to monopolies built on technological innovation. Companies that achieved market dominance through superior technology, rather than manipulation or suppression, operated under a different dynamic.

Even in later generations, monopolistic corporations remained widespread because they relied on their technological edge. Their competitors simply failed to keep up and ultimately lost in the race for markets.

Stifling technological progress for the sake of eliminating monopolies makes little sense. Halting advancement while waiting for competitors to catch up is not a viable strategy.

The potential side effects of monopolies were not Franz’s concern at the moment. You can’t stop eating just because there’s a risk of choking.

These dilemmas would be left for future generations to resolve. For now, the priority was clear: continue advancing technology and ensure Austria emerges victorious in this intensely competitive era.

…

Minister of Finance Karl said, “Your Majesty, we are currently in a period of rapid economic growth. Suddenly tightening monetary policy could easily cause market turmoil.”

Karl couldn’t help but worry. In an era of free-market economics, governments rarely intervene directly in markets, and officials weren’t well-versed in how to do so effectively.

Undertaking something unprecedented and highly consequential would naturally raise doubts in anyone’s mind.

Franz shook his head and argued, “We’re not directly tightening the money supply. We just need to regulate loan approvals and ensure the safety of depositors’ funds.”

The same action, framed differently, could yield entirely different results.

If the government crudely and forcibly ordered banks to tighten their lending, there would undoubtedly be strong backlash. However, if it intervened under the banner of regulating loan issuance, the situation would be much smoother.

The latter was already one of the government’s responsibilities. Protecting depositors’ funds carried an air of legitimacy and public trust and no one could openly oppose it.

In the process of regulating loan approvals, some incomplete or fraudulent loan applications would naturally fail to pass scrutiny.

These loans were often high-risk anyway. Blocking them not only effectively tightened the money supply but also safeguarded depositors’ funds.

The effects might not be immediately apparent, but when a crisis hits, every extra guilder of liquidity could become a lifeline for banks.

Franz had no desire to see widespread bank failures in Austria, which would ultimately force the government to clean up the mess, driving public finances deep into debt.

Banking Regulatory Chief Alex stated, “Your Majesty, we currently lack a solid legal foundation for this. The government hasn’t clearly defined its regulatory scope over commercial loans.

If we intervene blindly without a detailed framework, it could easily lead to abuses of power and severe consequences.”

Since the suppression of the March Revolution, the Austrian government had been working on legal reforms. Over the past thirty years, the legislative assembly had been busy, but they still hadn’t managed to fully refine the legal system.

Many issues were only addressed reactively, patching up loopholes after problems arose. Franz had grown used to this patchwork approach. Legal construction was inherently a process of continuous refinement, and achieving perfection in one step was simply unrealistic.

“This issue will be discussed with the legislative committee,” Franz said calmly.

“Your department will focus on gathering case studies and drafting a set of implementation guidelines as soon as possible.

Any shortcomings can be addressed later. Every loophole we close is one less problem to worry about. This is a long-term task, and we’ll handle it step by step.”

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