Chapter 254: Economic development

  Chapter 246 Economic Development

Overseas colonization is never an easy task, especially for a new colonial empire like Austria, there are so many things to learn.

The African continent in this era is not a good place to live, and the worst enemy is not the local natives, but rather the harsh natural environment.

Instead, the worst enemy is the harsh natural environment. The infestation of poisonous insects and beasts and the rampant diseases are the core factors restricting the colonization of the African continent by various countries, or else the African continent near at hand would have been divided up by all of us.

Frankly speaking, if it is not the quinine production technology has made a breakthrough, malaria this big problem has been initially solved, Franz really do not dare to venture into the African continent.

In order to be safe, all Austrian soldiers are in for to receive common sense hygiene education, personal hygiene, camp hygiene, all in strict accordance with the standard.

Even in order to avoid infection of local diseases, Franz even issued masks, soldiers were warned not to contact with the natives at will, but also prohibited and the locals to have sexual relations, marriage is non-existent.

No wonder Franz does not pay attention to, heavy taste of people in any era is not lacking, the military camp, not to mention, good thing that this batch of immigrants among the young women should be more, can solve this problem.

After more than three months of preparation, on April 28, 1854, the first Austrian colonial advance party departed from the port of Trieste.

With two second-class battleships as the core, five cruisers, plus more than ten ships of different sizes, the first step of colonization was taken with a regiment of infantry, aiming at Guinea.

This time the opponent is the indigenous tribes, the navy is only equivalent to a pulling exercise, no chance to fight the canoe level enemy, mainly the army on the battlefield.

Originally Franz was also prepared to form the Marines, but the result was the collective opposition of the Army and Navy, the Army was reluctant to weaken their voice in colonization activities, the Navy simply could not afford to raise.

This is no joke, Austria really did not have an adequate navy. It wanted to increase its funding, before proving the value of its existence.

Politics tends to be so realistic, how much value there is is how much funding is allocated.

If the overseas colonies can bring a lot of profit to the empire, then the navy can also be changed from a stepmother’s son to a real son.

Franz didn’t have a problem with it, it was the most sensible thing to do, venturing into expanding the navy without enough benefits was a complete waste of resources.

Instead of doing that, it would be better to put valuable funds into building the economy at home. This was despite the fact that the economic boom at home had not dissipated, and railroad stocks were on the verge of going sky high with the opening of several main lines.

If it were not for Franz’s insistence that duplication of railroads be prohibited, by now Austria’s railroads would have long since learned from Britain and the United States and begun to duplicate construction.

Of course, it is also because a railroad line only authorized to a company, only by the capital of the hot pursuit. What is the most profitable in this era, of course, is the monopoly.

Under this favorable news, the government forced a few cold routes attached under the quality routes, and everyone can accept it.

In order to attract foreign capital, including railroad transportation rates are freely determined by the market, whether this price will rise to the sky, Franz is not worried at all.

The market economy is definitely determined by the market environment, the price level in society are determined by supply and demand, the railroad freight rate is high or low certainly depends on the maximization of benefits.

Capitalists naturally know the trade-offs, now the railroad has just come out and traditional means of transportation to steal business, if there is no price advantage, what makes them grab customers?

To be able to save cost and time over traditional transportation means, that’s progress. Because the freight is too high, may affect the circulation of goods, but also to wait until after the completion of the railroad construction ah!

Right now all the Austrian railroad companies are in a state of pure investment, and the few main lines that are already open to traffic, although busy and profitable, are likewise a drop in the bucket.

These profits have been invested by the railroad company in the construction of new railroad lines, Franz is very clear, Austria’s several railroad companies from the establishment to the present, has never been a share of the dividend.

They have never made a profit, how can you let them reduce prices? If they really do, it is estimated that the railroads that are still in hot demand, immediately become unattended.

At this time, of course, the Vienna government will not come out to pull their leg. The promise of ten years of tax exemption has been honored, and by not charging any fees, the government is encouraging everyone to keep building railroads.

“Time is life, time is money.”

This slogan has become the motto of all the top executives of the Austrian railroad companies. The sooner the railroad is put into production and opened to traffic, the sooner it gains revenue.

As of now, all the routes opened to traffic in Austria have yet to disappoint, and in the context of free pricing, there are no loss-making routes, which greatly stimulates the nerves of some people.

I don’t know how many British and French capitalists, want to control the Austrian railroad network, monopoly operation. Then jumped into the wonderful illusion compiled by Franz, self-crushing.

Profits really do make people lose their minds, and everyone is frantically building railroad lines. Many people seem to think that now is the time to run a horse, one more possession of a railroad line, the future will be more a stable income.

Anyway, there is no such thing as a railroad bubble now, and with the monopoly operation, no one thinks it will lose money.

In this context, the monopoly of sand and gravel raw material supply Franz, naturally a big fortune, is expected by the end of this year, Austria’s total railroad mileage will exceed 10,000 kilometers.

Franz succeeded to the throne at the beginning of the Austrian national railroads together are less than three thousand kilometers, an average of more than 1,400 kilometers per year completed.

In this era, as long as the Americans across the ocean can be compared. Like Austria, the United States also broke out of the railroad investment boom, only because Austria diverted part of the funds over, not as crazy as in history.

The entire new Holy Roman Empire’s railroad mileage is more than twelve thousand kilometers, that’s right, just a few small German states have more than two thousand kilometers of railroad mileage.

Can’t say it’s crazy, historically the most active railroad construction in this era is the German region, in 1850 the total railroad mileage in Germany reached 5856 kilometers, which is more than twice as much as Austria in the same period.

If Franz had not pushed the Austrian railroad construction, now the fastest railroad construction in Europe is the German region, only the French can match them.

Of course, this is only Napoleon III era of France, in 1854 the total mileage of railroads in the German region is more than three thousand kilometers more than France.

From 1854 onwards, the French railroad began to grow rapidly, the Franco-Prussian War period of the total mileage of the French and German railroads, only a few hundred kilometers difference.

European major powers in the slowest railroad construction or the Russians, because of the Near East War, their railroad construction project almost stopped, to 1860 only 1626 kilometers.

Can be called the shame of the powers, Belgium and Spain are more than them, the same period of Britain, France and Germany have broken 10,000, is not an equivalent.

The country’s land area has become larger, when the railroad network plans naturally become larger. This does not need the government to promote, the private railroad company has been spontaneous action to run the horse enclosure.

Austria’s railroad line bidding is very interesting, that is, the faster the start of construction, the earlier the completion time the more likely to win the bid.

Anyway, the railroad line is free authorization, the railroad company must be in the promised period of time to start, complete, beyond the period of time to impose a fine, the seriousness of the government has the right to withdraw the right to build the road, early completion and incentives.

The test is everyone’s financial chain, Franz did not play any tricks, as long as the railroad company’s operation is good, can be completed on schedule there is no problem.

Once the chain of funds broke that would be a disaster, if not yet started construction is good, the big deal is to pay some fines, the unconstructed railroad line back.

If construction has already begun, or even half of the project has been completed, but there is no money to support the second half of the construction, then it will be a big loss.

All the investment goes down the drain, and the government takes over the rotten project and continues construction. Whether the railroad goes into bankruptcy and reorganizes, or just dies, is out of Franz’s mind.

Anyway, it’s all a phallic scheme, squarely in front of everyone, it’s not that the government is intentionally screwing people over, it’s clearly stated in the bidding notice.

All this risk, under the temptation of monopoly, everyone still defiantly pounced on it. British and French capital came in, Austria’s local capital also went in, speculators are scrambling to get a piece of the pie.

Because of the government to provide free labor relationship, this era of Austrian railroad construction costs were artificially low, on the surface of the financial statements of the railroad companies seem to be very good.

It can be said that Franz for the Austrian railroad construction is also a broken heart. It was impossible not to speed it up, because the new economic crisis was not even a few years away.

If not in the economic boom, the use of foreign capital to promote domestic railroad construction, the economic crisis broke out, the railroad bubble was detonated, the final bad project can only be taken over by the Austrian government.

How serious is Austria’s bubble economy? No one gave Franz an answer to this question, but there is one thing that can be seen, that is, on the economic growth rate.

The value of one hundred guilders of goods, was speculated to one thousand guilders, then the wealth is invisible increase of nine hundred guilders, the market can accept even if, once the market can not be accepted, fell back to the original price of one hundred guilders, the bubble in the increase of this nine hundred guilders was evaporated.

This is the reason why so much wealth can evaporate overnight in an economic crisis, essentially the bubble is burst, allowing the market to return to rationality. It’s only because of supply and demand that commodities often end up falling below their own value.

Right now the Austrian economy is growing at a very fast rate, in fact even if all industries in Austria were to stop, the economy would have to grow by at least one point per year just from the bubble on the stock market.

This era is different from later generations, the government administrative means to intervene in the market economy, to avoid the outbreak of a major economic crisis.

Nowadays, the market economy is completely allowed to develop naturally, and on average, there is a small economic crisis once every seven or eight years, and a big economic crisis once every few decades.

Each time a crisis breaks out, the total volume of industry tends to fall by twenty to thirty points, and more often than not, a decline of forty to fifty percent is not impossible.

Anyway, the bigger the bubble, the more violent the final decline, the more violent the rate of economic growth in the early stage, a bit like a roller coaster.

In 1854, the total mileage of railroads under construction in the new Holy Roman Empire was as high as 23,000 kilometers, and the situation of blind investment in railroads was already very serious.

However, Franz had no intention of stopping it, but instead was ready to push it up a notch in the background, wanting to make the market a little hotter.

The explosive mode of economic development is always desirable. All industries in Austria were growing explosively, and since the outbreak of the Near East War, the average annual growth rate of industry had exceeded fifteen percent, and the economic growth rate had also exceeded ten percent.

This figure might have been a point or two higher had it not been for the midway westward strategy. Rationality had long since ceased to exist; the market had gone crazy, almost to the point where it was profitable to invest in anything.

The Russians’ contribution here was huge, and from the outbreak of the Near East War, Austria entered an era of trade surpluses. And before that, Austria was almost in a permanent trade deficit.

Obviously, to the capital market to create “investment in anything to make money” this illusion of factors, is this sudden war in the Near East.

Because of the war, a large amount of cash from Russia into Austria, stimulating the economic market, many capitalists are blindly expanding production capacity, want to make a big profit before the end of the war.

The early opening of overseas colonies was also a means to divert the economic crisis at home, except that the African colonies were just getting started and played a negligible role in this upcoming economic crisis.

The last explanation, or can not understand, it is recommended to check the professional information, do not be confused by the chaotic Baidu information.

By the way, economic growth is multiplication, not addition. For example, the U.S. economy has grown nine times in forty years, if you want to calculate the addition of the average annual growth rate is 22.5%, which is very bullshit.

Of course, individual years up to, for example, the Civil War just ended, economic recovery growth. Roosevelt’s New Deal period also exceeded it.

The rate of economic growth, below the rate of population growth, is actually economic decline. Don’t look at such obviously bogus data.

If the world economy had been growing negatively for hundreds of years, the human race would have died out long ago in the annals of history.

For example, I wrote the economic growth rate of ten percent, if the calculation of the economic crisis after the fall, the base is the lowest point of the previous economic crisis, the previous year as the base, to the next economic crisis after the outbreak of the economic crisis, then the average growth rate down to only two or three percent, there is no way that the author is not a professional, but just a little research.

I have to write two or three percent, calculate the economic crisis after the fall, the final result is negative growth, do not be surprised, if it is not complicated, experts rely on what to eat?

(End of chapter)