Agricultural Tax Reduction Act

"Your Majesty, forgive my bluntness, but our people no longer have the funds to buy our government bonds." Hearing Carlo's proposal, Primo gave a bitter smile and reminded him.

"No, Mr. Prime Minister, our government bonds are not intended for ordinary civilians." Carlo shook his head and explained with a smile: "

We can issue bonds similar to education bonds, using interest rates higher than the banks' to attract capitalists and factory owners to buy them.

The scale of issuance need not be set too high either. Perhaps 10 million Pesetas would be enough for our initial educational needs.

These bonds will be used one hundred percent for education reform. Not only can this reduce the number of illiterate people in our country, it will also benefit factories that require a certain foundation of knowledge from their workers.

Once our first batch of bonds is repaid on schedule, issuing such bonds afterward will become much easier. At least for us right now, this is a more reliable method than borrowing money, and it will leave the government burdened with less interest."

Capitalists pursued profit. Since government bond interest was higher than bank interest, it would certainly attract some capitalists to purchase them.

If specific special-purpose bonds were issued exclusively for reforms such as education, it would also put the capitalists buying those bonds much more at ease.

After all, one of the capitalists' concerns was what the government would do with the funds. Investing in an industry like education was certainly far better than the government and nobles squandering it. At the very least, capitalists would not have to worry that the government would lack sufficient funds to repay the bonds in the future.

"We can give it a try." After pondering for a long time, Primo finally nodded and decided to try it.

The first batch of government bonds did not need to be issued in great numbers. They could be used to test whether this method could raise funds for the government.

It would naturally be excellent if they could raise funds. Even if they could not, the government would not suffer any great losses.

After deliberation by the Cabinet Government, they unanimously decided to set the first issuance of education bonds at 8 million Pesetas, or 307,000 pounds.

Although the sum was not much, it could be used to establish a number of literacy classes specifically meant to wipe out illiteracy. The literacy classes did not even require complete school facilities. They only needed to find a house, set out a few desks and benches, prepare some books, and teach Spaniards basic primary-school knowledge.

As soon as news that the government was issuing education bonds spread, it immediately caused a sensation across Spain.

Quite a few Spaniards were still willing to see the government's efforts in education. At the very least, it proved that the current Kingdom Government valued commoners more than it had during Isabella's time.

Even farmers were willing to see the nation invest in education. Even if they themselves could not enjoy the benefits brought by education reform, that did not mean their children would be unable to.

But support was one thing; very few people were willing to buy education bonds.

Although the first issuance amounted to only 8 million Pesetas, after two days, only 200,000 had been sold—not even 10,000 pounds' worth.

Carlo, who realized this was a good opportunity, naturally would not let it slip through his fingers. On the third day of the bond issuance, Carlo publicly announced that he would subscribe to 3 million Pesetas' worth of education bonds.

Three million Pesetas' worth of bonds was not actually much, only a little over a hundred thousand pounds and not even half of this bond issuance.

But Carlo's act of personally subscribing to government bonds as king carried a different meaning for Spaniards.

Although they would not support Carlo simply because of such a small matter, many Spaniards' impressions of him improved, and they were willing to give him sufficient time to show his qualities as an excellent monarch.

At the very least, Carlo had already shown a side vastly different from Queen Isabella's, and the Spaniards had also grown patient with him.

After Carlo took the lead, the capitalists finally began moving more frequently.

After roughly another week, more than half of the 8 million Pesetas' worth of bonds had finally been sold, and the government had obtained the initial funds needed to advance education reform.

By mid-September 1869, numerous literacy classes had sprung up across Madrid like bamboo shoots after a spring rain, adopting voluntary enrollment and free instruction.

As long as they were citizens of Spain, they could enroll in a literacy class and study. Book fees and tuition were both free, but they had to attend at least one literacy class each week.

The literacy classes had also taken the actual circumstances of ordinary people into consideration. In Spain in 1869, there were no specific limits on working hours.

In other words, if Spaniards encountered unscrupulous capitalists or factory owners, their working hours never fell below twelve hours a day and could even reach thirteen or fourteen.

Forget about two days off each week—even taking leave when sick was difficult, because capitalists were unwilling to let workers' leave reduce factory output and ultimately slow their own rate of making money.

As for workplace injuries, such things had nothing to do with this era either. Forget being injured at one's post; even dying at one's post would not earn a single penny in compensation.

The dazzling array of welfare policies in later generations had all been fought for by workers and laborers around the world through a long process of oppression and resistance.

The literacy campaign within the education reform was proceeding with great fanfare, and it had a considerable impact on Spain.

After all, it was a free literacy campaign, so Spaniards were highly willing to participate in the literacy classes. Carlo had also put a little scheme of his own into the classes: Spain's literacy classes would use only the Spanish language, not the dazzling variety of regional languages such as the Catalan language.

The purpose was also to reduce the sense of division between Spain's regions and Spain itself. To assimilate a people, one should begin with language. In Spain, people had to speak Spanish; this was extremely important.

The good news was that modern Spain had remained unified for several hundred years, and most of the public did not reject a whole and complete Spain.

The regional separatists and nationalists were still a small minority, and they could not have much impact on Spain's unity.

While the literacy campaign continued, Primo also launched reforms in agriculture.

Although the Spanish government's fiscal revenue was not high, this could not stop Primo from lowering agricultural taxes.

On September 27, 1869, while Spaniards were still talking animatedly about the literacy campaign, the Spanish Cabinet Government submitted a brand-new "Agricultural Tax Reduction Act" at a new session of the House of Representatives.

This bill caused an even greater sensation in Spain than the literacy campaign, because the overwhelming majority of Spain's population worked in agriculture, and tax cuts offered them tangible benefits.

As expected, the House of Representatives passed the bill by a vote exceeding 70 percent, and the Cabinet Government also announced that tax reductions would begin in 1870, tangibly increasing the incomes of the agricultural population.

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