《1855 American Tycoon》Chapter 20: Direction in Crisis (Part 1)
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After Scrooge finished his analysis of the origin of the crisis, both Rockefeller and Clark were silent. After a while, Rockefeller said.
"Scrooge, I don't know what the problem with your line of reasoning is, but there is a problem. If you want to say so, the vicious circle of economic crisis should be more and more serious, human history is so long, we should have been in such a vicious circle in the end ah."
The first time I saw this, I asked my teacher when I was in junior high school, and now I can take the answer directly from him.
"Most of the time in history, human production is not mainly used as a commodity exchange, but self-sufficient to meet their own living needs. In this era, most people were like Robinson, who did not have to worry about selling his food when he had a good harvest. Because his food was not intended to be sold. But the modern era is different, most of the modern production is for exchange. The things produced are commodities, so the situation is naturally different."
"But we've been through many economic crises since the modern era, so why has there been a recovery each time, instead of a cycle of getting worse and worse, and finally a complete end?" Rockefeller was not convinced.
"That's because economic crises are not without solutions. At least, for the moment, there are two ways to solve it." Scrooge smiled, he was waiting for this question.
"First, the vicious cycle is internal to the system. If we can get new purchasing power from outside the system, the problem can be mitigated. This is a general principle, and then there are two specific solutions. The first is to rely on God's help. Do you remember the economic crisis of 1847 and the discovery of gold in San Fransisco in 1848?"
"Well, I remember the frenzy, when some of the ships in North America, as soon as they docked, couldn't leave again the next day because more than half of the sailors were missing - they all went to San Fransisco to look for gold. I've personally seen several of these ships, and some of them simply ran away with their captains later on." Thinking of the story, Clark smiled.
"Well, this gold mine and the one in Melbourne, all shallow buried, panning for gold is difficult, and are in no man's land, who can come to panning for gold. A large number of people who originally lost the ability to consume here panned for gold, and suddenly had the purchasing power again, and then the unsold goods can be sold again. It was as if God had hired them and paid them a good wage, helping us to solve the problem of lack of demand. So the economic crisis of 1847 was naturally solved." Scrooge smiled at this point.
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"Thank God!" Rockefeller reverently drew a cross on his chest.
"God bless America." Scrooge and Clark followed suit and drew a cross.
"But what about this crisis? Do we have to rely on God to give us another gold mine?" Clark asked after the cross was drawn.
"God has given us a bigger gold mine," Scrooge said.
"Where is it?" Clark asked immediately as if he could not wait to run for the gold.
"For the world, the biggest gold mine is in the East. For the United States, the largest gold mines are in the West and the South." Scrooge said without moving a muscle.
"Can you make it clearer?" Rockefeller said, "I can't keep up with your thinking."
"Well, let's look back. From the 15th century onward, Europeans acquired untold amounts of gold and silver from the Americas through colonial means. Can any of you tell me where all this gold and silver went?"
Clark thought for a moment and said, "You mean the gold and silver went to the East? Well, yes, through the silk and porcelain, and tea trade, China alone has received an unknown amount of gold and silver from the West. I see, now they have gold in their hands, and if they can sell them the surplus unsold goods, the problem will be temporarily solved."
"Not bad!" Scrooge nodded appreciatively, "But the Orientals are no fools, and they certainly know what the consequences will be if European goods are allowed to flow into the country. Their handicraft workshops are completely unable to compete with modern industry and will almost certainly close down. The artisans will lose their jobs. Well, the consequences. The collapse of the textile industry in Kolkata, India, at the end of the last century is a ready example. In the words of the British themselves, 'the bones of the textile workers turned the whole plain of India white'. Secondly, the West couldn't allow these Eastern countries to continue their natural economy of self-sufficiency. Such an economic model meant that they did not need to buy any goods from outside. To sell their goods, the destruction of their natural economies became a necessity. And this is only by violence. In the last century, the British destroyed India, they ruled India directly, using violence to break up the natural economy of the Indians, making India a source of raw materials and a market for British goods. By monopolizing such a large market with hundreds of millions of people, Britain grew to become the dominant power in the world. Of course, the economic crisis was not extinguished, it was just passed on to India. Anyway, it is the Indians who are in bad luck. Well, the Bengal famine of 1770 starved 10 million people to death at once."
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"God! That's terrible!" Rockefeller drew a cross on his chest again, then let out a long breath and said, "It's a good thing it was only the evil heathens who starved to death."
"The newspapers not long ago mentioned that the British were still having some conflicts with China in the East." Scrooge said, "Now that such a crisis has occurred, I'm sure it won't be long before Britain starts a new war against China to further open up the Chinese market."
"But isn't this a crisis in the United States? What has Britain got to do with it?" Rockefeller asked.
"Over the years, we have been building railroads, but where are most of the steel and other things we use to build railroads, and where are most of the trains that run on our railroads made? Are they made in the United States? Once our economy is in trouble, we won't have money to build new railroads, we won't have money to buy new trains, which means less demand for Britain. In this way, the crisis in the United States will become a crisis for Britain." Scrooge replied, "To get out of the crisis, Britain had to expand to the East."
"What about us in the United States? We do not have the maritime power of England to expand to the East. What can we do?"
"We can expand to the West, where there are large tracts of land, and the development of those lands will always bring demand. Also, we have the South." Scrooge said his voice a little cold when he spoke of the South.
Later history books full of conscience often interpret the Civil War as a just war to free black slaves. But having traveled to this era, and having studied the economy of this era, Scrooge was sure that the so-called emancipation of the black slaves was just a grand excuse. The capitalists of the North were no more noble than the slave owners of the South, and they did not care about the lives of the Negroes. If they were so kind, they would not have allowed their factory workers to work in worse conditions than the niggers in the southern plantations. As Marx said, capitalists will take risks when they have 50 percent of the profits, dare to trample all the laws of the earth when they have 100 percent of the profits, and risk the gallows when they have 300 percent of the profits. To understand their behavior, one must and can only consider it from the point of view of how to make a profit.
Unlike the medieval homesteaders, their economic model was not a self-sufficient homestead, but a market-oriented commercial agriculture. However, their interests did not coincide with those of the northern capitalists. For them, if European tariffs were kept low, it would be more profitable to buy agricultural products - grain, cotton, whatever - to Europe than to sell them to the North. So, the United States under the Democrats of the Virginia dynasty kept the door open to European industrial goods in exchange for opening the European market to American agricultural products. This approach, of course, allowed Southern planters to make a lot of money, but it came at the expense of the North. In a sense, the interests of the planters in the southern United States were more consistent with those of the British, who were the economic vassals of the United Kingdom.
For the North, the use of tariffs to protect its industries, especially manufacturing, was the most common method for a nation just starting in the industry. The demand from the expansion to the west should have fed the North's manufacturing industry, but with the Southern Beltway Party, which had long controlled the federal government, the North's manufacturing industry was completely under the pressure of the great European industries. To develop, take off, and make money, the Northern industries, especially the manufacturing industries, had to be defeated by these Beltway parties. In this sense, it is not unreasonable to call the Civil War America's Second War of Independence.
"The United States, with the entire North American continent at its disposal, will always find new demand, but to protect industry - the only industry that can provide enough jobs for so many immigrants each year - it must raise tariffs and drive European industry out. This conflicted with the interests of the South. Machiavelli said: 'To deprive someone of his money is even more hateful than to kill his parents. Now, if the North wants to get rich, it must raise tariffs, at the expense of the South, and if the South wants to get rich, it must keep tariffs low, at the expense of the North. Such a problem cannot be solved by negotiation, he can only solve it by war. I dare say that in a short time, the United States will start a civil war." Scrooge said firmly.
Rockefeller opened his mouth as if he wanted to say something, however, he ended up saying nothing. Instead, Clark said, "Scrooge, you should be president."
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