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.”
“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.