I'm the Dauphin in France

Chapter 1299 Paying Off War Dividends
The elite 6th Grenadier Regiment of the 1st Army marched past the square in neat twelve ranks, glancing sideways at the reviewing stand and shouting: "Long live His Majesty the King! Glory to France!"

After the sound of the waves subsided, Berthier cautiously said, "Your Highness, Mr. Godan's suggestion is to change the pension to be paid in installments over three years, with a 3% interest subsidy for the soldiers."

More than 80 million francs is a huge sum of money that could give the French treasury a headache. After the second military reform in France, the standard of compensation for veterans was already the highest in Europe, which is the price that must be paid to build a strong military.

Joseph immediately frowned and asked, "Has the compensation plan been announced?"

"Not yet, Your Highness. The Ministry of Finance needs some time to finalize the budget, and only then can the General Staff come up with a concrete plan."

Joseph breathed a sigh of relief. Fortunately, it hadn't been announced yet; such a thing would be a disaster that would shake the very foundation of the army!
He looked at Emmanu standing behind him: "Has Minister Godan arrived?"

The latter hurriedly replied, "He's on the viewing platform at the back, Your Highness."

French cabinet ministers would certainly not be absent from such a national celebration.

"Invite him over."

"Yes, Your Highness."

Before long, the Finance Minister approached Joseph and bowed, saying, "Your Highness."

Joseph gestured for him to sit down beside him and asked directly, "Can the national treasury come up with 8 million francs right now?"

Gaudin glanced at Berthier, then nodded and said, "Yes, Your Highness, the Ministry of Finance has 9300 million francs in its books."

"Then why are soldiers' pensions not being paid in full?"

“Your Highness, if this money is distributed, then the construction of the railway to Lyon will not be able to begin this year, and the repairs of many bridges and water conservancy facilities will also have to be suspended.”

Seeing the Crown Prince frown, Godan quickly added, "Moreover, the Ministry of Finance will soon face an expenditure of 1700 million francs, which can only be drawn from the pension fund..."

Joseph raised his hand to interrupt him: "What could be more important than soldiers' compensation?"

Godan said somewhat nervously, "Your Highness, the troops conscripted this time will likely all return home within three months. At that time, more than 20 soldiers will face retirement, which will require a large sum of severance pay."

“I have discussed with General Berthier that even if one-third of the soldiers accept ‘land compensation’ and the demobilization of some soldiers is postponed until next year, 1700 million francs will still need to be paid by the end of this year.”

Joseph couldn't help but rub his forehead.

Yes, France has never mobilized such a large number of troops in its history, and the financial pressure is indeed unimaginable.

He believed that if he issued a call to action, the vast majority of soldiers would choose to forgo their severance pay, and even their survivor's benefits. But that would mean countless French families would be burdened with an extremely heavy debt, and some might even starve to death as a result.

Workers in this era practically lived on their wages, just enough to buy bread. Soldiers who had fought on the battlefield for months might not be able to find work when they returned, and their families would immediately run out of food.

Joseph then noticed the severance pay figures and immediately looked at Berthier, asking, "How much is the severance pay for each soldier?"

"110 francs, Your Highness. If they accept land compensation, it will be 60 francs."

Joseph couldn't help but say, "That's too low."

“Your Highness, this is enough for them to live on for three or four months,” the Chief of the General Staff argued. “Seventy percent of British soldiers only receive land compensation, and the rest receive at most £3… Moreover, our severance pay is guaranteed to be absolutely not embezzled by officers.”

Joseph knew that the so-called "land compensation" was actually similar to exile. For example, Britain would compensate with land in Canada or Australia, and Russia would even compensate with land in Central Siberia.

He shook his head; this kind of thing should never be about comparing who's worse.

However, even at the current severance pay standard, it would still require 17 million. Adding the 82 million in compensation, it would amount to nearly 100 million francs.

Although war reparations could be used to make up for the shortfall in the future, it has put enormous pressure on France's finances at present.

Moreover, after France's victory in the war, it was bound to enter a period of rapid development, which would require a huge amount of funds, whether for building railways or new factories.

Oh, and the navy is waiting for money to build a steam-powered fleet, which is an even bigger money-devouring behemoth...

Joseph couldn't help but sigh again. From the moment he took control of France until now, he had never stopped fighting with money.

How can I make a sum of money in a short period of time?
He fell into deep thought. The only ways to quickly raise money were through loans, issuing bonds, or selling assets.

The first option must be ruled out, as the French Reserve Bank has already been emptied of loans.

Issuing bonds... They've issued several rounds of government bonds in France and Italy before, but it's unlikely they'll raise much money.

As for selling assets, that's an option to consider only when things get really tough.

He went back to the first two options. If he could provide some collateral, perhaps he could secure the funds.

France's biggest interest right now is victory in the war, but that can't be mortgaged.

However, realizing the benefits of war will take at least three or four years. This includes factors such as increased public confidence, increased attractiveness to investors, and greater dominance in the international order…

It's no wonder that Napoleon chose to plunder occupied territories directly in history, and now even he can't resist wanting to go to Vienna and loot it.

Wait a minute, Joseph suddenly thought of something, "war dividends," "Vienna"...

How did later financial geniuses operate? They used financial derivatives, packaged and refinanced them, and even managed to profit from subprime loans.

They could easily package the "war dividends" as collateral and invest them in the financial market!
He roughly outlined the plan and said to Godan, "You should immediately issue a batch of government bonds, totaling... 150 million francs, with an interest rate of around 4%."

“Well,” the finance minister hesitated, “you know, we issued several batches of government bonds before the war, and now it’s probably difficult for either Italy or the Netherlands to sell many…”

Joseph smiled and said, "We'll sell in Austria, oh, and also Prussia, Saxony, Cologne, the whole of Germany."

Godan shook his head again: "Your Highness, most of these countries previously had financial cooperation with Britain, so I'm not sure about their willingness to buy bonds. As for Austria, they wouldn't even allow our national bonds to enter."

Joseph immediately said, "We'll use the war reparations from Austria and Prussia as collateral. With a direct discount of 6% on the bills, plus interest, such a high return will surely attract funds."

"The bonds are bearer bonds, can be purchased using florins, and can be redeemed at any bank in France upon maturity. This means that even if the Austrian government prohibits them, they will still be purchased privately through various channels."

(P.S.: There will be a bonus chapter for monthly pass subscribers on the 1st of next month. Please reserve one monthly pass for subscription at the beginning of the month. Thank you for your support.)
(End of this chapter)