The spring breeze of reform swept across the British Isles, yet Britain itself showed no signs of renewal. It wasn’t that reform was impossible; the real question was how to reform. The country’s economy had been steadily declining, stirring anxiety among the British. The elites all knew that Britain had reached a crossroads and that social reform was no longer optional. Even so, despite the economic troubles, Britain still stood at its peak. In Europe, people didn’t really believe in the saying “prosperity leads to decline.” If one were to flip through British history, there had really only ever been this one golden age of glory. If not for the rise of the Holy Roman Empire putting pressure on them, most Britons wouldn’t even have developed the slightest sense of crisis. In truth, even now, the British didn’t feel much urgency. They simply didn’t believe that the mighty British Empire could ever fall. Who could blame them? The Holy Roman Empire had been far too well-behaved. Even when it rolled out its so-called “super battleships,” they only sailed out for show and then quietly returned to port. The highly-anticipated arms race everyone had expected never happened. Since the Austrian government didn’t bother to keep up, Britain itself soon lost interest. After all, the Royal Navy still had a mountain of old warships lying around. If they really started another “shipbuilding frenzy,” those old vessels would have to be scrapped overnight. But the landlords’ coffers weren’t bottomless. With the domestic economy in decline, the government’s revenues were shrinking instead of growing, and every penny in the budget had to be spent carefully. Still, with the Channel as their shield and the Royal Navy holding the advantage, few people felt any real fear. Without external pressure, the people couldn’t unite internally either. After all, reform is a double-edged sword; some gain, others lose. Those already sitting on piles of privilege were never going to give up their benefits willingly. And thus, conflict was inevitable. From the very moment the curtain of reform was lifted, the British Parliament plunged into a chorus of endless bickering. In these times, the British government’s power was still very limited. It wasn’t just Parliament that kept it in check; above it stood the King himself. As the monarch who sought to restore the glory of the British crown, King Edward VII was no mere figurehead. The cabinet government couldn’t just do as it pleased since that was simply impossible. With the Conservatives holding strong influence and so many internal constraints within the government, Campbell’s administration could hardly push reform at any meaningful pace. For a great power, reform was something that should be taken slowly, not rushed. Moving at a slower pace was fine as the real danger lay in moving too fast. But for private enterprises, it was a completely different story. Traditional industries were still doing all right. They had built-in defenses and established markets, so even under pressure, they could manage to survive. The ones truly suffering were the emerging industries. Limited by Britain’s small domestic market and burdened by a late start, they were already at a disadvantage. Before they could fully develop, foreign competitors had already arrived at their doorstep. The most striking examples were the machinery and automobile industries. Many companies in those sectors had either gone bankrupt or were teetering on the edge. ... Stepping out of the government office building, McCall’s cheerful expression had vanished without a trace. As the owner of Britain’s leading high-end machine tool manufacturer, one would expect him to be living quite comfortably. Reality, however, was the exact opposite. Having misjudged the direction of the Second Industrial Revolution, McCall’s factory had focused solely on traditional areas of production. It wasn’t just him. Nearly all British machine tool manufacturers had thrown themselves into steam engine technology, without ever investing in the emerging field of electrical power. With the widespread adoption of electricity, electromechanical systems rose rapidly and soon took the dominant position in industrial production. Once you fall behind, every step afterward only widens the gap. By the time McCall finally realized what had happened, his competitors’ products had already flooded the British Isles. With their superior performance and lower operating costs, they quickly seized a large share of the market right out of his hands. Thanks to the conservative nature of British capital, which wasn’t diligent about upgrading equipment, and the fact that the steam engine still had some merit and hadn’t been completely phased out, McCall’s factory managed to survive. However, as powerful competitors aggressively muscled their way in, a huge chunk of their orders was snatched away. Their overseas market, in particular, was almost entirely lost. With their market share dwindling, the British machine tool enterprise, which had chosen the wrong path, was forced into a brutal, life-or-death price war. Even the industry leaders were no exception. After all, they were merely the ‘big dogs’ of Britain, not the world. Compared to their international peers, McCall’s company was already lagging in overall technology. Switching tracks sounded simple, but trying to thrive in a new lane was far from easy. To survive, McCall had no choice but to seek help from the government. Forget all the talk about ‘free economy’ and ‘opposing government market interference’—those were slogans shouted when convenient. Now that they were no longer needed, they were naturally tossed aside. As the leader of a ‘high-tech’ industry, one always retains certain privileges. Regardless of whether its technology had fallen behind international rivals, McCall’s machine tool factory was still the ‘top player’ domestically. If the British government wished to prevent the entire high-end machine tool sector from falling into the hands of competitors, it had to support domestic enterprises. For the sake of his own vital interests, the young McCall who once championed free trade had now become a staunch supporter of ‘trade barriers.’ There was no alternative as without extraordinary measures, they simply could not win against their competitors through normal commercial competition. Even if McCall ruthlessly increased the research and development budget by fifty thousand pounds, it still paled in comparison to the massive investment of his rivals. Already lagging in technology and lacking sufficient investment in research and development, hoping to rely on a technical breakthrough to crush the competition was clearly nothing but a pipe dream. It wasn’t impossible to continue increasing the investment but McCall was first and foremost a capitalist. For a capitalist profit is everything. As long as they could make money, surpassing their rivals wasn’t strictly necessary. If they poured in unlimited capital they might catch up technologically but the return on investment would be absolutely shameful. If they couldn’t make money, being number one in the world was meaningless. Investors demanded only one thing from a company which was that it makes money. There was only one metric for judging an excellent company: was the profit large enough? McCall was long past his idealistic youth he certainly wasn’t going to ‘go all in’ with his entire net worth just for a title. Rather than competing in research and development, it was better to engage in political public relations directly blocking the competitors outside the nation’s gates. Relying solely on the domestic market might not allow his company to reap a massive fortune, but it could at least guarantee long-term profitability. Given enough time, McCall believed his company would surely catch up and then they could go back to fighting their international rivals for market share. As for how long this would take, no one knew. Perhaps three or five years or maybe twenty or thirty, but hope at least always remained. … No matter how dramatically the situation changed, as long as life went on, there was never a shortage of banquets. Leaving Government Street, McCall drove a luxury sedan produced in the Holy Roman Empire out toward the suburbs. His destination was a manor named ‘Petel.’ Tonight, a banquet organized by business magnates was being held there and as an important member of the industrial and commercial sector, McCall had been invited. Although he had arrived early, the manor was already bustling with activity. Clearly, he wasn’t the only one with the same idea. No one could pinpoint when a “banquet” ceased to be a simple feast. For the most part, those in attendance now arrived with their own distinct agendas. Stepping into the hall, McCall quickly located his small circle. He, too, had once been the focus of such events with a crowd of flatterers following him wherever he went. Alas, good times never last. With the intensifying competition in the machine tool industry, the machine tool enterprises’ say in the market was constantly decreasing. The bygone era where production orders were scheduled years in advance and you had to rely on personal connections just to get your hands on the goods has long since vanished, never to return. For the sake of his company’s survival, McCall had no choice but to swallow his pride, actively participate in social networking events, and diligently maintain his relationships with clients. Of course, that alone was not enough. Capital chases profit and if the product quality was lacking, even the best personal ties were useless. One crucial factor that allowed him to maintain his current foundation was the fact that they all belonged to the same consortium and had a certain percentage of cross-shareholding. They were fundamentally a community of shared interests. When the price-performance ratio of products was comparable, everyone was naturally more willing to use their own people’s products. If they couldn’t compete on performance, they could only engage in a price war. What was originally a highly profitable machine tool industry had recently been driven down to a mere cabbage price. The pure machine tool business was now losing money on every unit sold. If it weren’t for the after-sales service still turning a profit, McCall’s machine tool company could already consider shutting down. He briefly raised his wine glass, clinked it against the newcomer’s, and asked with a micro-smile, “Byron, it’s been a long time since I’ve seen you. How have you been doing lately?” No matter how immense his inner pressure was, McCall always showed boundless enthusiasm towards his clients. It was precisely this proactive marketing attitude that allowed McCall to crush his domestic counterparts and firmly secure the throne as the segmented market leader. The middle-aged man shook his head, replying with a bitter smile, “Terrible. Those damn Austrians are like money-grubbing rats, constantly seizing our wealth. Since they launched their new model last year, I haven’t had a single day of peace. To be honest with you, I’ve already conducted three rounds of layoffs since the beginning of the year.” This is certainly no secret. Just look at the brands of cars running all over the streets, and you’ll know exactly the kind of life the British automotive companies are living. The fundamental characteristic of industrialization is this: the more identical products you manufacture, the lower the unit production cost becomes. The start of Britain’s automotive industry was certainly not late. In fact, one could say it was quite early. As far back as 1680, the famous British scientist Isaac Newton conceived of the jet-powered automobile concept. Although the jet car was never successfully built, the idea of the automobile was put forth. In 1804, the British engineer Richard Trevithick created the world’s first steam-powered road vehicle, officially kicking off the prologue of the British automotive industry. Sadly, they started as a Master but ended up being played into the Bronze tier. The history of subsequent automotive development shifted away from Britain, first to France, and then to the Holy Roman Empire. A steam-powered car was still a car. Despite its inconveniences, it held significant value in specific scenarios, leading to small-scale production. Logically speaking, British automotive enterprises, with their deep industrial heritage, should not have fallen behind. The crucial issue, however, lay with the Second Industrial Revolution. Missing the wave of the Second Industrial Revolution meant they failed to keep up with internal combustion engine technology. This made the engine the single largest weakness of the British automotive industry. Since their own domestic engines couldn’t keep up in performance, they were forced to import from overseas. In the current era of free trade, they could buy whatever they wanted anyway. However, having the core technology constrained by others meant paying a price was inevitable. The most direct consequence was the rise in production costs. If it were only the expensive engines, it might be tolerable since they could just earn a little less profit. The problem is that Britain’s automotive production capacity is extremely low, and the output of spare parts is also not high. Producing less naturally drove the costs up. Most domestically produced spare parts are not only more expensive than imported ones, but their performance simply cannot keep up. Supporting domestic production is out of the question as capital chases profit, so companies naturally buy what offers the best value. The direct consequence of this is that British automotive manufacturing firms have essentially been reduced to car assembly factories. Apart from carrying the name of an automobile producer and having a car badge, their work could be done by any outside repair shop. As technology advanced, information became increasingly transparent. After realizing this, more and more auto repair shops started crossing boundaries, intensifying the market competition. Domestic competition was already fierce, but they never expected international competitors to charge in as well. Relying on their performance advantage, many brands from the Holy Roman Empire quickly established a firm foothold. The high-end brands were the first to fall. A glance at the cars parked in the manor shows they are almost all imported vehicles. Even Byron, the car manufacturer himself, drives an import. There is no helping it as their own products genuinely lag in performance. When personal safety is concerned, everyone knows how to choose. Losing the high-end market was not such a terrible blow, as sales there were never huge to begin with. Before the mass influx of imported cars, the main mode of transport for Britain’s upper class was still the horse-drawn carriage. The situation is different now. A massive quantity of cheap cars is also pouring in. Assembly factories without core technology naturally cannot have an easy time, and large amounts of market share have been squeezed out. To keep his company afloat, Byron had no choice but to opt for layoffs and production cuts. Yet, these measures could only provide a temporary fix; they were far from enough to survive the crisis. Since the client was having a tough time, McCall naturally couldn’t bring up the issue of orders. In a sense, they were all in the same boat now. If they wanted to live comfortably again, the only way was to first crush the free trade system and rely on tariff barriers to protect the market. “Be optimistic, my friend, things will get better. These difficulties are only temporary, and the main issue is the free trade system. If we didn’t have this system, we could raise tariffs to protect our market and win time for our enterprises to develop. That’s exactly what the Austrians did back in the day. Without implementing a trade barrier policy, there’s no way they could have become the world’s number one industrial power they are today.” Lying is also a skill. For a qualified capitalist, it is the most basic survival ability. Although McCall himself didn’t believe that trade protection could enable British industry to truly catch up, he absolutely could not show weakness in spirit. Raising his wine glass for a clink, Byron drank it down in one gulp, and then, speaking with shared outrage, he said, “My friend, you are absolutely right. It is all the fault of that evil Free Trade Agreement. If it weren’t for that treaty, Britain’s wealth wouldn’t be plundered by others. For the sake of Britain, we must correct this mistake. We absolutely cannot let this damned treaty continue to poison the future of Britain...”
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