In an effort to compel the government to concede, the Prussian bourgeoisie organized a massive strike and market closure on November 7, 1881. This action thoroughly enraged Frederick III. After numerous unsuccessful negotiations, the Prussian government declared a nationwide state of emergency on November 10. Security brigades composed of retired military officers took over the duties of the police, blockaded key transportation routes, and sealed off all shops, warehouses, and factories owned by participating capitalists, with the government taking over the unified distribution of national resources. Subsequently, Frederick III ordered the resumption of factory production. Many retired officers transformed into factory managers. Lacking technical expertise and unsure of how to manage, they simply replicated military management methods. As long as someone was paying wages, ordinary workers didn’t care who the boss was. Strict management was not an issue, as long as the pay was adequate, everything was negotiable, and one by one, the factories began to reopen. From production to sales, everything was handled by the government. It appeared somewhat like a planned economy, and the capitalists were truly alarmed. Reality showed them that they might not be as indispensable as they thought. The country continued to function normally without them. Although many disturbances occurred in the process, this was only the initial stage, and changes could be made gradually later on. Now, it was too late for regrets. Having already torn off the veneer of civility, Frederick III naturally showed no mercy. Without the need for framing or false accusations, simply by revisiting past accounts, a large number of people were quickly imprisoned. Chancellor Leo von Caprivi said with a look of anxiety, “Your Majesty, we cannot continue like this, or there will be major chaos.” He had no objections to targeting the capitalists, as they were not on the same side anyway. But plans could not keep up with changes. Prior to this, no one had prepared for the military to take over the state. It was only later discovered that the police could not handle the capitalists, forcing the organization of security brigades with retired military personnel. After dealing with the capitalists, it was found that domestic order had collapsed. To restore social order, the government had to once again rely on the military’s power. It was originally said that the Kingdom of Prussia was a state owned by the military, meaning the military had significant influence and controlled the state at the upper political level. Now the situation has changed. The military’s influence at the top has been weakened, while its influence at the lower levels has greatly increased. Frederick III nodded helplessly, “Chancellor, everyone knows that the current situation in Prussia is not right, but the question is how to solve it? People have been arrested, homes have been confiscated, and factories have been seized. Now, to resume factory production, we simply cannot find enough management personnel in a short time. Besides having retired officers manage them, what other choices do we have? We certainly can’t release those parasites again to continue causing us trouble, can we?” It must be admitted that military-style management of factories can only serve as an emergency measure. Not long after its implementation, a series of problems erupted. After a moment of hesitation, Leo von Caprivi gritted his teeth and said, “Let’s organize an auction! There’s no way we can manage so many factories. We should sell off most of the smaller ones and retain only a few large factories, converting them into state-owned enterprises, following Austria’s management model.” The Prussian industrial sector was still in a state of a hundred schools of thought contending for supremacy, with over eighty percent of the nation’s factories employing fewer than a hundred people, and only a handful of large factories employing over ten thousand. The Kingdom of Prussia was a capitalist and militaristic state, not all capitalists had come out to oppose the government, and with the tables now turned, it was naturally impossible to round up all the capitalists. Theoretically, by selling off the confiscated small and medium-sized factories, the management problem could be solved. Frederick III slowly said, “That is indeed a solution.” Clearly, he was tempted. Despite the fact that the Kingdom of Prussia had resumed production, the output was truly lamentable, with productivity generally down by fifteen percent and the rate of defective products remaining high. Such enterprises, unless they operate in isolation, are doomed to fail once they enter international competition. The current calm in the market is supported by government credibility. The Prussian government took timely action to ensure the supply of goods and employment, and people trust the government’s ability to get things done. Minister of War von von Roschwalde proposed, “Your Majesty, if we dispose of so many factories at once, even if there are buyers, we probably won’t get a good price. Rather than that, why not directly allocate these factories to retired military personnel, offsetting their severance pay or pensions. Not only would the government reduce a significant expense, but the issue of employment placement could also be resolved in the process.” It was true that they wouldn’t get a good price. Most of the people in the Kingdom of Prussia with purchasing power were still locked up in prison. The remaining capitalists, even if they have money, are too frightened at this time to easily show their faces. Affected by the devaluation of the mark, the original standards for severance pay and pensions are clearly outdated. While the Prussian government dares to default on the capitalists’ money, they dare not discount the soldiers’ hard-earned money. Despite the Prussian government repeatedly raising the standards, they can’t keep up with the severe inflation, and continuing to increase them is unsustainable for the government. Frederick III asked with some doubt, “Will the soldiers accept this? You must know that the profitability of these small factories is quite mediocre. If their management skills are insufficient, it's easy to incur losses.” “Losses” here do not refer to losses under the capitalists’ management, but rather based on the recent performance under the Prussian government’s management. Minister of War von Roschwalde said with some uncertainty, “They should be able to accept it. We can set the factory prices lower and let them decide whether they want shares in the factories or cash. As for the management issues, I think the production aspect won’t be a big problem. Since they own the factories, they certainly won’t mess around. The trouble lies in sales, but the government can help solve that. We have an agreement with the British to pay off debts in kind, so we can use the products from these factories to offset the payments.” Frederick III fell into deep thought. The price issue concerned him, but after all, these were gains at no cost. If these small factories could be used to appease the military’s sentiments and get them to agree to the government’s reorganization plan, Frederick III wouldn’t mind giving them away for free. “Then let’s give it a try, but remember to coordinate well. Having dozens of shareholders in one factory, if not arranged properly, could easily lead to problems.” The previously delighted expression on von Roschwalde’s face vanished. He could already imagine how much work he would have ahead. No matter how much the factory prices are reduced, it’s not something a single soldier could afford unless a dozen or so died in battle, making multiple shareholders inevitable. When interests are involved, can everyone still be so harmonious? These are all issues he needs to resolve.
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