At the end of Qin, I became a son of the plane

Chapter 413: Responses from all parties and large-scale infrastructure

Commercial production is completely different from small-scale peasant production by self-cultivating farmers. In a sense, this is the second economic crisis of the Han Dynasty. The first one occurred in agriculture. After Xu Fan captured Chang'an, the world was generally peaceful. The Han Dynasty carried out equal distribution of land, promoted formal agricultural tools, guano stones, and built new canals. The grain production capacity of the Han Dynasty skyrocketed, and the price of grain fell from 30 coins per stone to coins in just three years.

Although Xu Fan had once tried to maintain the price of grain beyond his ability, the final result was that even though the Han Dynasty had four strategic reserve granaries, they were still full, and the granaries in various counties were also full within two or three years. In the end, the Han Dynasty could only maintain a grain price of 50 coins per stone in Guanzhong.

The economic crisis was shared by people all over the world. Unsold grain was stored in their family granaries, and farmers' income quickly dropped to one-third of their original level.

But because even if the income was only one-third, it was still much better than that during the Qin Dynasty, farmers all over the world did not feel dissatisfied.

However, the commodity production model of the dynasty was different from the self-sufficient peasant economy. In order to produce these goods, the workshop owners of the Han Dynasty had to pay for the purchase of machinery, construction of factories, purchase of raw materials, and payment of salaries to craftsmen. The workshop owners' initial production costs were extremely huge.

They must earn back their investment and make a profit from sales. If they fail to do this, the workshop owner will definitely not be able to bear the loss and will go bankrupt immediately. Therefore, the sales link in economic production is described as a "thrilling jump".

But this "thrilling jump" had never shown its power because of the material scarcity in the feudal era, and people cannot form concepts about things they do not understand. Therefore, even with Xu Fan's repeated reminders, most workshop owners did not believe in such a thing as overcapacity.

Before overcapacity, the wealth of the entire society was relatively evenly distributed due to the equal distribution of land in the Han Dynasty. The economic situation was very good at that time, and the wealth in the hands of the people increased rapidly. As long as the goods could be produced, they would be sold immediately. The prosperous market made it even more difficult to understand the concept of overcapacity.

Once the goods are produced, they will be sold. This is almost the truth in the minds of Han workshop owners during this period.

But starting from May, the workshop owners in the Han Dynasty discovered that this leap was like an insurmountable chasm. They had already lowered the price of their cloth to close to the cost, but no one was willing to buy it.

These workshop owners wanted to sell their cloth to other counties, but what greeted them was an influx of goods like the sea. Compared with small counties with low production capacity, large textile counties like Sanchuan County, Chen County, Linzi County and other counties had long faced market saturation, and they unscrupulously poured their products around themselves.

No one in this era had experienced an economic crisis, and there was overcapacity. Their means of dealing with it were extremely clumsy. Even if they were about to go bankrupt, they were unwilling to sell the goods in their hands below cost price. In their hearts, they still hoped that there would be hope that the price of cloth could be raised.

But Xu Fan knew that cash was king at this time. When the economic crisis began to show its edge in May, he ordered the Shaofu warehouse to clear out all the remaining cloth. At that time, below the cost line, even if it was 20%, 30% or even 40% off, as long as someone dared to take over the goods, he would order the Shaofu's steward to sell them. As long as the guys could sell the goods, they would be heroes, regardless of any cost issues. At the same time, Xu Fan also ordered the Shaofu not to accept any arrears and to do his best to recover the accounts receivable.

At the Shaofu meeting, Xu Fan made it very clear to everyone, "Everyone must remember that cash is king during this period. Any workshop that wants to survive must sell off all inventory as soon as possible and collect all accounts receivable. Those who cannot do this will be eliminated by the market. The current economic crisis is also a test for you. The court will not give you any support. You have to survive on your own."

At this time, Xu Fan didn't even care about the local workshops. He gave them jobs, but they were unwilling to leave. It was no wonder that he didn't care about their lives. Anyway, this market was going to clear out a group of people who couldn't keep up with the market.

The workshops under the Shaofu were huge in scale. Once they lowered the price, it was still below cost, so the whole world began to wail.

June, Chang'an City, Zhaoli.

"Master Zhao, please think of a solution. We can't sell any of our cloth. The cloth in the warehouse is piled up like a mountain and now there's no more room. What should we do?"

The small workshops near Chang'an were the first to be hit. Although their textile costs were not high, they mainly relied on the advantages of being close to raw materials and the market. In terms of production efficiency, they were still not as efficient as the large workshops.

But now the Shaofu's workshops are dumping cloth below the cost line, and the price of hemp near Chang'an has fallen below 300 coins.

Such a price made it impossible for small workshops near Chang'an City to buy linen. Even if someone asked, they would only pay after the goods were delivered.

But the people of Zhaoli no longer dared to do so, as they had not received any payment for more than 6000 pieces of cloth they had sold outside.

Jiang Tao took his men to find the shop owner to settle the payment for the goods, but what greeted them were the wives and children crying around a corpse. Not only did they not get the money for the cloth, but they had to give some money to the wives and children of the shop owner.

Or if the shop is deserted, they can only helplessly report it to the government, but usually the government is unable to catch the person, and if they finally catch one or two, they will demand money but not their lives.

This forced the people of Zhaoli to sell cloth by paying for it in exchange for the goods. However, the consequence was that no one was interested in their cloth, and it filled up the warehouses of the textile factories.

Fusu said helplessly: "This matter has been reported in the monthly report. Now my Han Dynasty has suffered an economic crisis. There are too many workshops producing cloth, which has exceeded the needs of the people throughout the world. Even the emperor and the court can't solve this problem. What's the point of you asking me for help?"

Jiang Tao said: "Fusu, you know a lot and have more experience than us. You should give us some advice. We have to keep everyone alive."

Fusu said, "Since you can't make any money, stop the workshop. Don't plant sisal this year. Plant grain and beans instead. As long as we have grain, we won't starve to death. In this situation, saving lives is more important than making money. Chang'an City is full of workshop owners who have hanged themselves. Compared to them, I am extremely lucky."

Jiang Tao and his colleagues were indeed fortunate that although their textile workshop was not as efficient as the one in Chang'an, Zhao Li's workshop had much lower production costs than the ones in Chang'an City.

Their biggest investment was the early water-powered spinning wheels and looms. They grew the raw materials, silk and linen, themselves. The people in Zhaoli were owed three months' salary, but no one went to the workshop to ask for it because they were the owners of the workshop.

Without leverage, the most they have done now is not making any money, but they are not forced to commit suicide.

Fusu continued, "The cloth piled up in the warehouse will first be distributed as salary to the people who work at the market price, and the rest will be divided equally, with each person getting 10 pieces."

The people of Zhaoli discussed for a few more days and found that there was no better way than Fusu's method. The advantage of these village workshops over the county workshops was that the craftsmen were all farmers whose main occupation was farming. The land also provided them with a safety net so that they would not die if they had nothing to do.

So the people of Zhaoli distributed cloth according to the number of people, and each household had dozens of pieces of cloth, thus realizing the freedom of cloth.

Situations like Zhao Li's are happening in Guanzhong and even the whole world. The first to be unable to withstand this wave of economic crisis are the rural workshops. Of course, with the land as a guarantee, they are also the easiest to exit.

However, the owners of textile workshops in the Central Plains areas like Yingchuan County, Daliang, and Wei were in trouble. They were surrounded by the three major textile centers of the Han Dynasty. Coupled with the dumping of cloth by the Shaofu workshop, cloth rushed into their territories like three torrents, and defeated these small textile companies. Not to mention dumping, these textile factories in small places could not even keep their own nests.

As for the external market, sorry, there is no external market for the Han Dynasty. There is only a little external market in the Western Regions opened up by Ji Bu. This year, the princes of the Western Regions bought hundreds of thousands of pieces of silk in Guanzhong. The Silk Road has begun to take shape, which is a cause for celebration. But this amount is a drop in the bucket for the tens of millions of production capacity of the Han Dynasty.

Of course, the Han Dynasty also had vassal territories such as the Great Desert, Liaodong, Baiyue, Nanzhong, and Nanyang. The number of barbarians in these territories could not be said to be large, but there were still five or six million.

It’s a pity that these savages have no purchasing power. These markets are not useless, but it is difficult for them to even accommodate millions of pieces of cloth. For workshop owners, those without purchasing power cannot be considered human beings.

The entire Han market can be said to be fixed. Those workshop owners who listened to the advice were fine. They emptied their warehouses early and asked for payment for the goods. They can still hold on. After all, the financial industry is not developed in this era, and people don’t play with leverage. The workshops have a higher ability to withstand pressure. They stopped the workshops, dismissed the craftsmen, and then guarded the warehouses to survive this winter.

But there is still a group of people who do not even have the qualifications to survive. They are the workshop owners who opened textile factories in the past two years, especially those who opened the workshops within the past six months. In order to open workshops, they usually borrow money from money houses to build factories and purchase machinery.

These new small workshop owners were already heavily in debt and were anxious to produce goods to make money to pay off their debts. However, after the goods were produced, the market price was lower than their production price. The more goods they produced, the more they lost money. How could they pay off their debts when they made no money at all?

It just so happened that at this time the money houses that had lent them money also came to demand repayment. With such pressure from both inside and outside, they became the first batch of workshop owners to go bankrupt in the Han Dynasty. This wave of economic crisis killed countless entrepreneurs in the Han Dynasty.

Starting from July, the Luo River near Luoyang City became a holy place for bankrupt workshop owners to jump into the river, with the most number of jumps exceeding ten per day.

July 3rd, Luoyang City, beside the Luo River.

"Splash, splash, splash!" "Come and save them, someone else has jumped into the water." The people living near the Luo River suddenly found three people jumping off the bridge, floating in the water, and they shouted immediately.

At this time, a group of Luoyang County soldiers rushed out. They were wearing simple life jackets and dived into the water. They quickly swam towards the three people who jumped into the water, grabbed them, and swam back to the shore one by one. They patted their abdomens to make them spit out all the water they had choked on. This set of actions was already extremely familiar to them.

At this time, a soldier comforted them and said, "You are so young and you want to die like this. Are you worthy of your parents who raised you?"

People kept jumping into the Luo River near it, which had aroused Luoyang Magistrate Dianqing's high vigilance. He dispatched a garrison of Luoyang County soldiers to be stationed on both sides of the Luo River to prevent diving incidents. Dozens of people have been rescued in the past few days.

The young man who was rescued cried loudly, "Let us die. If we don't die, we will be a burden to our parents. It's not easy for our parents to raise us. Now we owe hundreds of thousands of debts. Do we have to ask them to pay it back?"

The average salary per capita in the Han Dynasty was less than a thousand coins. For a young man, owing a debt of hundreds of thousands was equivalent to falling into the abyss.

The people around looked at the three young men with sympathy. This kind of thing can be said to be everywhere in Luoyang City now. Luoyang is the commercial center of the world, and the local people have a business culture. This wave of economic crisis has caused great harm to Luoyang. There are too many people who are burdened with debts of tens of millions, and countless workshop owners have run away.

The village chief scolded, "You think you can just walk away like this? Those money houses have people with connections behind them. Your parents and relatives will still have to pay off your debts. And what is more difficult for parents to accept than debts is the death of their children."

"A debt of several hundred thousand is nothing. The court has already found a solution for you. You can go to Nanyang to cultivate the land. The court will arrange jobs for you according to your skills. The minimum salary in Nanyang can reach 1500 coins, which is more than twice that of the Han Dynasty. Half of your salary can be used to repay the debt and the other half to live on. It is enough."

Yes, this is what the Han Dynasty court thought of. Compared with the vast land of Han Dynasty, every Han citizen is extremely precious, not to mention being able to become a workshop owner. At least they can be considered the elite of Han Dynasty. It would be a huge waste to die like this. Therefore, the Money Supervisor of Han Dynasty ordered Song Yi to discuss with the money shop owners of Han Dynasty. Those workshop owners who could not repay their debts would suspend the interest and only repay the principal. The principal would be repaid with their salary in Southeast Asia. The court also gave them 3 coins as resettlement fee, which would be handed over to those money shops first to repay their debts.

The owner of the bank had no choice. Even if they forced the man to death, the bankrupt workshop owner would not be able to pay. Although the interest was suspended now, the court at least helped to give 3 yuan, and there was still a glimmer of hope to repay the principal.

When the three rescued young men heard this, there was a desire to survive in their eyes. They had died once and dared not die again. However, the huge debt was the biggest obstacle to their survival. Now the court helped them find a way out. Although this way out was extremely difficult, they had no choice.

This scene happened everywhere in the counties of the Han Dynasty. Those workshop owners who could not repay their debts had no choice but to sell themselves to the Han Dynasty court and go to Southeast Asia to work and pay off their debts. Many parents also went to Southeast Asia to help their children pay off their debts in advance. Thanks to this financial crisis, thousands of people from the Han Dynasty immigrated to Southeast Asia every month, and the number was still increasing rapidly.

Inside the Han Dynasty, in order to deeply educate the Han officials and the stewards of the Shaofu, Xu Fan clearly recorded the conditions of factories and the miserable conditions of workshop owners during the economic crisis in various places, and then compiled them for the Han officials and the stewards of the Shaofu to study.

It turns out that real torture is the best way to learn. With this real lesson, seeing the miserable conditions of the Han workshop owners, the Han officials and workshop managers were all shocked, especially those colleagues who did not obey the court's three lines of defense. It was even more difficult for them to empathize with the fate of their own people.

The court's punishment on them was extremely severe. The workshops that could no longer operate were directly bankrupted and liquidated, and all the craftsmen and managers were reallocated to the Han Dynasty's infrastructure industry, either to build roads and lay plaster, or to build city walls and lay bricks. More than ten years of hard work were lost in one day, which brought them enormous mental suffering, because without the emperor's advice, these people's fate would be theirs.

Of course, the local government is willing to take over the workshop's debts, and the imperial court doesn't care. As long as you are willing to bear the consequences, the imperial court is also happy to see one more workshop under its jurisdiction survive.

However, there are not many workshops that are truly supported by local government offices. This wave of economic crisis has almost caused the finances of local government offices to collapse. Their fiscal revenues have generally dropped by 30% to 50%. With the revenue falling so fast, local government offices cannot even support themselves, let alone support these money-losing goods.

The local Han officials were very pragmatic. When they found that they could not support these workshops, they took the initiative to ask the court to take over. The way the court took over was to directly liquidate the factories and sell the goods at a 50% discount. The factories were sold, and the money from the sale of the factories was returned to the local counties. The craftsmen were resettled in the infrastructure projects of the Han Dynasty, and other ways of resettlement would be considered after this wave of economic crisis.

But for local counties, this practice has caused them huge losses, and they have not even recovered one-tenth of their costs.

"Damn it, the imperial court is guarding us like thieves. We finally applied for a big project, but all the money is in commercial banks. We are not allowed to get involved at all."

After the economic crisis broke out, the imperial court announced a 100 billion yuan infrastructure plan to the whole world, including the construction of 2000 miles of tracks, the Yellow River Bridge, the renovation of the old city, the renovation of the city wall, etc.

This came as a huge surprise to the local Han officials, who had originally wanted to transfer some money to solve the crisis, but the court did not allow them to touch the money at all.

"It's my own fault for not listening to the emperor. I'm asking for trouble. I'm unwilling to listen to the court, which is why I'm in trouble today." The Han official couldn't help but smile bitterly.

The court was well prepared. Although this may not sound like a cliché, it gives people the feeling that before the economic crisis broke out, the court cleared out all the goods. As soon as the economic crisis broke out, the court raised 100 billion yuan for large infrastructure projects.

Even a silver mine was discovered on the Japanese island. It is said that 20 kilograms of silver and 2 kilograms of gold were dug in one year. Such a rich place gave the people of the world great confidence that the Han Dynasty could survive this crisis. The money for the court's large-scale infrastructure also came from this wealth.

"We still have to find a way to save a few workshops. Otherwise, if all the workshops below go bankrupt, what will happen to our future salaries? How can we guarantee our bonuses?"

"Don't do anything rash. The imperial court is holding us tight now. If we dare to act rashly, the imperial court will really arrest us."

When the local government runs out of money, they will definitely find a way out. The first people they target are farmers. They set up a miscellaneous fee and want to buy a sum of money from the farmers to guarantee their workshops.

But Xu Fan had long been on guard against them doing so. If any Han official dared to lay hands on the farmers, Xu Fan would simply cut off their hands.

In the months since the economic crisis broke out, the Han imperial censors have arrested thousands of Han officials. Every time such arrests are made, most of the officials in a county government are arrested, and government affairs are stagnant.

The Han reporters also went deep into the countryside to supervise these lawless Han officials.

There were also Han officials eyeing the Master's salary. Influenced by later generations, Xu Fan understood that universal education could only rely on the imperial court, which would be relatively fair.

Therefore, the construction of primary schools in local areas and the salaries of teachers were all funded by the Han court and did not go through the hands of the local governments at all.

But now the local Han officials could hardly protect themselves, so they naturally set their eyes on the money. Several Han officials embezzled the Master's salary, resulting in the Master not receiving any salary for half a year.

But these teachers were not to be trifled with. Their network of connections spread throughout the Han newspaper industry. As long as they found a reporter to complain, the matter would cause a sensation throughout the Han Dynasty, and the Han officials who intervened would be arrested directly. The Han court always dealt with such matters severely.

The court's strong measures made these Han officials no longer dare to act recklessly, and they could only watch the workshops that served as their own treasury go bankrupt one after another.

In August, in this hot summer, the economic crisis poured cold water on everyone. The price of cloth dropped lower and lower, and the lowest price of linen cloth had dropped to 200 coins. But even so, not many people were willing to buy it. First, people had a herd mentality and were willing to chase the rise and sell the fall. Even if the price of cloth kept falling, they were naturally willing to wait.

The second is the chain reaction caused by the economic crisis, which has led to a large number of craftsmen losing their jobs. They have no money and naturally cannot buy cloth.

The third reason is that there is too much cloth in the private sector, and the people’s spending power has been released, so they are no longer willing to buy cloth.

Affected by this wave of overcapacity in cloth production, other industries of the Han Dynasty were also affected, and a large number of workers lost their jobs. Fortunately, the Han court was well prepared for all this and had set up a re-employment department early on. They would take the initiative to tell the craftsmen that there were high-paying positions in Nanyang, and if they were willing to go, the court could arrange travel expenses.

If you don't want to go to Southeast Asia, the court has a large infrastructure project. In order to cope with this economic crisis, Prime Minister Xiao He expanded the original 1000-li track to 2000 li, including Luoyang City, Chen County, Nanyang County, Wu County and other wealthy counties. The court used Chang'an New City as a template to transform sewage facilities, sewer pipes, build drinking water channels, build cement roads, and build new neighborhoods.

Large-scale infrastructure projects were used to accommodate more and more people, and these large-scale infrastructure projects absorbed millions of craftsmen. They greatly maintained the stability of the Han Dynasty's economy and ensured that the entire Han Dynasty did not encounter major problems due to this economic crisis.

(End of this chapter)