1636 The Kremlin Games – Snippet 15

1636 The Kremlin Games – Snippet 15

Chapter 14

Ivan Nikitich Odoevskii didn’t look like a book worm. He was tall and as richly dressed as a prince and a member of the boyar Duma ought to be. He rode, he was a skilled falconer, but he did love to read. He read anything. Account books. Treatises. Stories. Anything he could get his hands on. His fierce black beard was twitching and his blue eyes squinted as he thought. “It’s complicated, Patriarch. Yes, the up-timers use paper money, but their system is a tortured mix of the government and . . . well, anarchy.”


“They have something called federal reserve banks . . .” Vladimir had sent several tracts on economics — not very detailed or all that complete — back to Moscow, which had arrived about the time Boris had gotten back to Grantville. Along with them had come a very rough outline of what Vladimir thought might work for a banking system in Russia. That outline would have the great families issue money, having bought the right from the Czar’s Bank or the Gorchakov Bank. With some vague limitations based on how much their property was worth. Going from those tracts on up-time economics, Ivan Nikitich explained his understanding of how the future economic system worked.

Patriarch Filaret was a man of no mean intellect, but his eyes were glazing over within a paragraph. He tried to follow the salient points for a while, but finally gave up. “Enough. Can we use it, Ivan Nikitich? Can we use it?”

Ivan Nikitich sighed like the wind gusting from the north. “Yes. But it is dangerous. The tracts made that clear, even if I could only understand one word in three without talking to that idiot Bernie.” Ivan Nikitich snorted. “And only one word in two after talking to him. The danger is more than the simple temptation to print ever more and more as it loses its value. That’s a danger, true enough. It is made worse by the fact that failing to print enough can hurt the nation even more. That is one thing the excerpts young Vladimir sent taught me. Half of Russia’s troubles are caused by not enough cash.”

“You needed a tract from the future to tell you Russia is not a wealthy nation?” Filaret snorted in exasperation.

“No!” Ivan Nikitich almost shouted, then visibly got hold of himself. “Patriarch, what I needed the writings from the future to tell me was that Russia is a wealthy nation. A wealthy nation with what the up-timers call a ‘cash flow problem.’ That Russia has everything it needs to have a booming economy, except the economy.”

Filaret glared a bit. “Speak sense!”

Ivan Nikitich sighed. “We have grain. We have timber. We have pitch, not to mention furs of all sorts. We have rivers that in summer give us clear roads from China and India to the Baltic Sea. In hard winter, the sleighs are more efficient than wagons are. What we lack is a means of tying all those things together. Much of our trade is just that. A peasant trades a bushel of grain to another peasant for bit of cloth. It happens that way because neither peasant has any money. Did you know that over ninety percent of the up-timers’ purchases were made with money? Everything from their homes to a piece of candy for their children. Everyone had money, even the very poor. That — along with their transportation system — made the manufacturing of goods in one place to be sold in another much more practical.”

Ivan Nikitich spoke with passion. He even stood and began pacing the room. “The raw materials are here. The trade routes are here, mostly. Even the skills are here. Every peasant in Holy Rus spends half the year at some craft because you can’t farm ice.” Ivan Nikitich shook his head. “The only thing really missing is some practical means of letting the people in one place buy the products from the people in another place. Buy them, Patriarch, not trade for them. Because barter simply won’t work for what we need. The things we must have are: Money, ways of transferring money from one place to another without bandits robbing the caravan, banks where bureau men and even peasants can save money or get loans. As I said — everything we need for an economic boom except an economy.”

“What you’re saying is we’re rich in goods but not in money?”

Ivan Nikitich nodded. “What we need is money and the writings of the up-timers explain how to do that without silver or gold. The idea, as I understand it, is to have just a little more money available than there is product for it to buy. That encourages the peasants to work harder to get the last bit. It’s like hanging a carrot in front of a mule. Too close and he eats it. Too far and he gives up. Russia’s carrot is hanging off the mule’s ass.”

“So, you think Vladimir is right.” The Odoevskii didn’t get along all that well with the Gorchakov family. If Ivan Nikitich could find a way to say Vladimir’s report was wrong, he would.

“No, absolutely not,” Ivan Nikitich said by reflex. Then he laughed. “Well, perhaps a little bit. The way the boy proposes to go about it is all wrong. We are not some barbarous western nation. It will need to be the Czar’s Bank and all the little banks part of the Czar’s Bank. The Gorchakov boy’s proposal will just make the Gorchakov family richer than they already are.”

Filaret gave the Boyar of the Exchequer a look.

“Very well. The Gorchakov family and many others,” Ivan Nikitich conceded. “But the czar should reap a greater benefit if the government owns all the banks, not just the Czar’s Bank.”

Filaret considered. “What bureau would control the Czar’s Bank?” He gave Ivan Nikitich another hard look.

Ivan Nikitich gave him back look for look. “The bureau of the exchequer is the obvious choice,” he acknowledged.

In some ways Filaret really preferred Vladimir’s plan. As chaotic as it was, it had the advantage of not putting the power of a central bank in the hands of one of the great families. On the other hand, having the Romanov family in charge of the central bank would strengthen them considerably.


The discussion continued for several hours that night and then broadened over the next several days. Eventually, it included every member of the Boyar Duma cabinet and many members of the Assembly of the Land. It was pointed out that the institution of this system would probably mean fewer taxes would be needed, at least for now. Which made it quite popular. There was much support among the great houses and monasteries for Vladimir’s plan but the deti boyars, the service nobility, and the merchants hated it. Both because of the extra power it would give the great houses and monasteries if they could print their own money and because of the difficulty they could see clearly in determining how much this house’s ruble would be worth versus that monastery’s ruble. That pitted the great houses against the service nobility. Not an uncommon occurrence. But while everyone was fighting over which way to do it, the whether to do it got decided by default.

The czar, at his father’s urging, came down on the side of the service nobility. The money would be issued by the Czar’s Bank. All banks in Russia would be branches of the Czar’s Bank. Which, by the way, would offer nice jobs for lots of the service nobility. Something that didn’t make it into the general discussion was the fact that more money would make it easier for serfs to buy out of their bonds to the land. Not that that mattered much. Every year for the last decade and more had had a decree from the czar that the serfs couldn’t leave that year, even if they had paid off their debt.


Fedor Ivanovich Sheremetev, leaned over to his friend and chief henchman, Colonel Leontii Shuvalov, as the debate went on. “It was good that the note from Vladimir arrived in time to prevent the patriarch from dragging us into war with Poland, but the notion that they are truly from the future disturbs me.”

“I’m not entirely comfortable with it myself, My Lord, but facts are facts and Bernie is real. The stuff he brought from Germany is real.”

“And the knowledge,” Sheremetev grumbled. “Slavery and serfdom were both banned in their world. It will give our serfs ideas. There are too many new ideas coming out of Germany these days and they will spread faster with this outlander from the future here. The Gorchakovs are really just puffed-up merchants, even if they did hold their land independently before it was absorbed by Muscovy. Why did Filaret give them the patent on these new inventions?”

He knew why Filaret had done it. It was precisely because the Gorchakovs were just puffed-up merchants with little connection to the factions in the great families. He shrugged. “Who knows? Maybe it won’t amount to much. Games and rumors are all that have come from that dacha of theirs in the months he’s been here.”


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14 Responses to 1636 The Kremlin Games – Snippet 15

  1. dave o says:

    Coming to Russia soon: John Lawovitch and the South Sea Bubble.

  2. Willem Meijer says:

    We have rivers that in summer give us clear roads from China and India to the Baltic Sea. ????????

    When I was in secondary school one of te things pointed out to us in geography class was that all the rivers in Siberia run from south to north, into the Arctic Sea. There is no easy route over rivers from west to east, you have to go up side-streams, and then haul your goods to a stream going into the next river system. This was used as an example how dificult it was for the Soviets to develop Siberia, and their interest in the sea route through the Arctic Sea (up to and including nuclear ice breakers). Perhaps the rivers work differently for the Czar. Oh no, I remember: the Czarist régime started to build the TransSiberian railroad, to have a good connection to the far east.

    They do have a good connection from north to south in the European part of Russia, connecting the Baltic to Constantinopel / Istambul.

  3. Stan Leghorn says:

    @2 All the trade that goes down the Silk Road goes either thru Persia to the Ottomans or to the Caspian sea. Once it hits the Caspian, there are several rivers running north which can be used to get to the rivers running into either the Baltic or Black seas. The rivers work for the level of trade that exists at this time, the Czar and Soviets were attempting to move thousands of times more goods. The Trans Siberian railroad was being built to go AROUND the Silk road, putting all the tranfer fees into the autocrat’s pocket.

  4. david carlson says:

    Every year for the last decade and more had had a decree from the czar that the serfs couldn’t leave that year, even if they had paid off their debt.>/i>

    economic slavery – somehow I think this is going to be a target of Grantsville….

  5. david carlson says:

    i hate closing tags wrong

  6. Doug Lampert says:

    @4, If the serfs WERE allowed to buy off their land it would be economic slavery. With the serfs not being allowed to buy off it’s simply slavery (but not chattel slavery as the slaves are still tied to the land rather than being an independent sellable good).

    It’s the worst of all possible worlds. An enterprising serf has little reason to work harder and none at all to save, he can’t really benefit or make anything of himself in an economic sense. But on the other hand an owner can’t buy or sell slaves for factory work or transportation related industries or for anything but farming and other purely local work and hence has even less incentive than a normal slave-owner to look for labor efficiencies.

    Even if Russia gets a working currency and economy it won’t help much while any substantial portion of the population is land-bound serfs, the benefits of a working modern economy are heavily dependent on getting much of the workforce off the farm and into other types of production. Chattel or economic slaves can go into factory production (not as efficiently as free workers, but the lower worker costs can potentially make up for this from the owner’s point of view), but serfs are a lot more limited, they stay where they are, which means no factories larger than a single village’s labor surplus can support.

    Our budding Russian economist above dreams of banks where even serfs can save and invest, and he’s right that that is a big deal, it’s how you raise the capital to help push everything else. But why SHOULD a serf save or invest when the result is that he’s still basically a slave?

  7. dave o says:

    As I tried to suggest in #1. introducing a paper currency in a society like Russia’s has a few problems. I referred to John Law, who introduced one in France in the early 18th century, and the South Sea bubble, the same in England, slightly later. In both cases, the idea was sound enough. In both cases, the currencies were gamed by the rich and powerful, and eventually collapsed and caused huge damage. I see absolutely no reason to believe that Russia’s R&P are less likely to play games. Rather the opposite.

    Not to mention that if the paper currency shows any sign of success, it will be a windfall for forgers. Probably western Europeans, even Poles can do a better job engraving than the Russians. See N Korea for a modern example of a country with an active forgery industry.

  8. ET1swaw says:

    @2 Willem Meijer: They have the Volkhov which feeds into Lake Ladoga and the Volga and other tributaries which also feed into Lake Ladoga through the Svir and Lake Onega and the Luga which flows into the Gulf of Finland. There is also a water connection from the White Sea to Lake Onega. The big problem is that the terminal ends at the Baltic, the Caspian, and the Black Sea all belong to someone else. The Swedes own Ingria and Swedish Karelia (and Swedish Livonia/Swedish Estonia which border the Narva) which takes the Neva (and all subsequent Lake Ladoga/Onega connections), the Narva (and Lake Piepus, etc.), and the Luga off the board. The Ottomans own the Black Sea entirely (even the PLC, which separates the Ottomans and Muscovy in most locations, does not border the Black Sea). And the Ottomans and Safavids share the Caspian.
    And Muscovy ATT is barely over the Urals and just starting to develop Siberia. IIRC they haven’t reached the Pacific yet either in their expansion.

    @6 Doug Lampert: And second serfdom hadn’t even reached its later nadir in OTL! Social class climbing was still possible. And while they are restricted to the lands they are tied to, various levels of serfdom existed internal to their environment.

    @7 dave o: NTM that currency forgery is canon in 163x-verse already.

  9. vikingted says:

    when one says “is canon” what does that mean?

  10. Drak Bibliophile says:

    Vikingted, “is canon” means that an event, item etc has been mentioned in one of the books/stores or has been mentioned as existing by Eric Flint.

  11. Bret Hooper says:

    @9-10 vikingted & Drak: Oooh! I thought a ‘canonized character’ was someone who had been shredded by grapeshot!

  12. Stan Leghorn says:

    Allowing the possibility of a serf buying his way out at all makes the system potentially workable. All the Czar needs to do is NOT make the decree prventing it. With that as an incentive, and the new farm tools, productivity should increase. Just out of curiosity, would an introduction of share-cropping be a step up from outright serfdom? Serfs who are “free” but without any other way to make a living could be induced to keep working the land IF they have a piece of the pie. ESPECIALLY one that expands based on their output. It would get past the resistance to new tools as anything that makes more would help everyone involved, and not JUST the land owner.

  13. robert says:

    @8 Just because someone else “owns” the terminal points of a water route does not make it impossible to ship to or through it. The Rhine has been a water route for some centuries. Treaties and trade are possible between relatively friendly nations. Or not unfriendly nations, anyway.

  14. dave o says:

    #12 Stan: Except for the fact that the Czar is dependent on the nobility to run the kingdom for him. Not to mention, to staying alive. Considering that Russia is just leaving the time of troubles, he has to be very cautious lest a pretender, backed by the nobility, or a large fraction of them dethrones him. I can imagine a few, very few, of the nobility supporting any kind of emancipation of the serfs. But most will view it as upsetting the entire social order. And resist it with all of their power.

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