Planned Economy

After dismissing the cabinet, Ferdinand shouted toward the door, "Butler Karl, tell our people to come over for a meeting."

"Right away, Your Highness!" the old butler Karl replied in a booming voice.

Half an hour later, Ferdinand gathered everyone together and said, "Gentlemen, please sit down. You all came with me from the Austro-Hungarian Empire to Bulgaria, so you should already be familiar with the situation."

"Bulgaria is only a small country, and it won't be easy to develop and grow stronger. Right now, I need your help." Ferdinand finished speaking and looked at the people below him.

"Your Highness, it is our honor to serve you!" Franz and the others said in unison.

Ferdinand was pleased with their response and said with a smile, "All right, enough talk. First, let's expand our businesses here. Bulgaria's market may be small right now, but there's little competition, too!"

"But Your Highness, Bulgaria's terrible transportation infrastructure will make it hard for our products to compete internationally!" Welian said gloomily.

"Oh, Mr. Welian, I know it'll be difficult. That's why I have you all! You can focus on the Balkan market. At home, Greece, Serbia, and Turkey are all good options!" Ferdinand understood Welian's concerns and made his suggestion.

"All right, Your Highness, I understand. If that's all, it shouldn't be too difficult. But they're all poor, so the profits won't be very high!" Welian reminded him.

"Of course, I know that. As for the international market, don't we still have factories in Austria-Hungary? Your focus is still over there. The main competition for the flour mills here is small family workshops and poor transportation!" Ferdinand said, somewhat frustrated.

After speaking, Ferdinand glanced around at the others and said, "You don't have any problems, do you?"

Seeing everyone fall silent, Ferdinand said in frustration, "Looks like we'll have to build roads first! I'll get the cabinet to draw up a railway plan as soon as possible and issue government bonds."

Although he had been prepared for it, Ferdinand still felt frustrated. He was at a loss over what Bulgaria's future path should be.

He considered it. The high-end route. How do we take the high-end route? Internal combustion engines, cars, airplanes, tanks, and the like are still a long way off. Bulgaria can't make any of those things.

Even if we did make them, we might be able to sell them at home, but once we went abroad, companies from other countries would beat us to a pulp. Our industrial foundations are far too weak!

For now, we should just focus on steadily building things up. There's no getting around our weak industrial base. We'll have to strengthen it bit by bit, with government support.

I should convince that bunch of immature cabinet members first. No, I'd better just use big data. Young people don't have much patience. We can introduce a Five-Year Plan and use a planned economy. It'll suit their tastes, and right now Bulgaria doesn't have any capitalists to oppose it.

In the spring of 1887, a breeze swept through the Sofia Royal Palace.

The grass, asleep through the long winter, had now awakened and stubbornly pushed its way above the ground. Though only a hint of tender green was visible, it brimmed with life.

After five months of investigation, the cabinet concluded that Bulgaria was poor in natural resources. The industrial plan they had submitted earlier had long since been tossed into the Mediterranean Sea.

"All right, everyone, cheer up! There are ways to make up for a lack of natural resources." Ferdinand offered them some reassurance.

"Your Highness, are you planning to start a war?" Stambolov asked, his eyes lighting up.

Ferdinand thought, No wonder Bulgarians are called the Prussians of the Balkans. They really do love war. Just look at this cabinet. No wonder that, with a population of just over four million, they mobilized more than 1.2 million troops in history!

He rolled his eyes and said, "No. We don't have the strength to wage war right now! Bulgaria may lack mineral resources, but its geographical position is quite favorable, and the people support the government. I plan to introduce a planned economy and reduce unnecessary waste of resources."

"Planned economy?" Everyone looked at him, baffled.

"That's right, a planned economy. You may not quite understand what that means, so I'll put it simply."

"Take railways, for example. We could plan to build a thousand kilometers of railway within five years to improve transportation in Bulgaria. If private capital isn't enough, the government can issue bonds to fund construction."

"A thousand kilometers of railway, built in Bulgaria within five years?" Clinton, the transportation minister, asked incredulously.

"That's right," the Grand Duke said with a smile.

"Then I support it," Clinton declared at once.

"That's just one part of it. The plan covers all of Bulgaria's major industries," Ferdinand said confidently. Judging by everyone's reactions, he already knew how it would go.

"All right, quiet down. Wait until I'm finished before we discuss it!" Ferdinand waved for them to settle down.

"This is my preliminary proposal. You can take a look." With that, Ferdinand handed them a booklet titled Bulgaria Five-Year Plan.

First, prioritize the development of agriculture, hire agricultural experts, and vigorously promote advanced farming techniques. Increase total agricultural output by 30 percent within five years and raise farmers' incomes;

Second, the railway plan: build a thousand kilometers of railway nationwide within five years to improve transportation. Fund the project by having the government issue railway bonds;

Third, the military: 1. Establish a basic armaments factory and achieve domestic production of small arms in five years; 2. reorganize the national army within five years and introduce a reserve system and compulsory military service; 3. establish a national defense university;

Fourth, industry: encourage the development of heavy industry. Given Bulgaria's shortage of resources, provide support to key industries such as steel mills, machinery factories, and arms manufacturers, exempt them from taxes, and give domestic products priority when conditions are equal;

Fifth, education: 1. establish literacy classes in factories and villages, and encourage young students to teach the public during their holidays, focusing mainly on basic legal education. Bring the illiteracy rate below 15 percent within five years; 2. establish a public comprehensive university, temporarily offering only science and engineering courses because of the current exceptional circumstances; 3. build three teacher-training colleges to prepare teachers and lay the groundwork for future compulsory education.

"These five measures are the core of this Five-Year Plan. You could also call it the Five-Five Plan. Feel free to offer additions or raise any objections," Ferdinand said confidently.

"Your Highness, can we really achieve this? It clearly goes against the laws of the market!" Michael, the minister of economy, asked uncertainly.

"Of course we can. Don't pay any attention to that damn market theory. It's nothing but propaganda cooked up by capitalists who've taken their money. It's all meant to fool people! Have some confidence. You're all Bulgaria's finest, and you can definitely do it. You might even exceed the targets!" the Grand Duke encouraged them.

"Your Highness, how will we fund this? Given Bulgaria's revenues, it'll be difficult to accomplish," said Stambolov, the prime minister.

"The railway plan will account for most of the spending. We can issue railway bonds and set the interest rate a little higher to attract private investment. If that's still not enough, we can sell them abroad. Then we can repay the debt with railway revenue—at most, the government will have to chip in a little."

"I can invest in the arms factory myself. That'll save the government another expense."

"The remaining funding gap won't be large. Bulgaria's revenues should be enough to just barely cover it. At most, we can issue some more education bonds. Any other questions?" Ferdinand said readily.

"Your Highness, why are there no targets for steel or coal? Those are indispensable if the country is to grow strong!" Michael asked in confusion.

"It's simple. Bulgaria's coal reserves are too small. We can't defy the laws of nature and conjure up more! The iron deposits are in the Balkan Mountains, and until we have a railway, all the raw materials for a steel mill would have to be imported. We might as well import the steel directly!" Ferdinand explained.

"If no one has any other questions, then this is what we'll do. I'll leave the details to you to work out, and then you can submit the plan to the National Assembly for a vote!" Seeing that no one had anything else to say, Ferdinand announced his decision.