One Man’s Meat Is Another Man’s Poison Part 1
If Ovoli Had A Bank
Cavour awoke in a cold sweat. He was probably sweating already in the heat of late summer. Turin wasn’t as hot as many Italian cities were this time of year, but August is August. The day before, the Rothschilds sent the government their latest assessment of the Italian state debt. The amount was staggering to say the least. The interest alone would consume forty percent of the national budget, and his options would be severely limited until revenues increased or the debt was paid off.
“In Sardinia,” Camillo thought, “we had the common sense not to waste a year’s revenue on baroque monuments and solid gold chamber pots. Goddamn that canaglio Garibaldi for giving me that fantastic, bleeding, pus-filled sore called the Kingdom of the Two Sicilies. Ouch. The bagna cauda is getting to the fantastic, pus-filled sore in my stomach.” The Piedmontese government was fairly responsible in fiscal matters, and the Count was able to finance large public projects such as the excellent Sardinian rail system and the government could afford large subsidies of strategic infrastructure. The new kingdom was in dire need of such infrastructure. In the south, illiteracy was widespread, industry was woefully underdeveloped, the poor soil led to low crop yields, and railroads were nearly nonexistent. The Prime Minister faced a paradox. The debt load made financing of new infrastructure and public programs difficult. The absence of government assistance to the Neapolitans was already making life hard for the government, and the result was rebellion among the people and resistance from the southern latifundists. These obstacles would suck even more money out of the budget to pay for the suppression of the southerners and the proliferation of anti-government societies.
The Rothschild’s report to the Chamber of Deputies had to be disclosed by the end of the week, and the Prime Minister needed a plan to lighten the debt’s load on his nation’s back. He looked at the clock-it was one in the morning, August 17th 1861. He would get to work; there was always time for sleep after he had a solid plan. Cavour walked to his study.
Camillo jumped up from his sofa and did a quick jig that he learned on a trip to Dublin. He figured it out, and he had a plan. A jubilant Count pulled out his copy of the speech drafted by Alexander Hamilton when he proposed a national bank for the United States of America.
Cavour was an admirer of Alexander Hamilton and a follower of Hamiltonian economics. Cavour had advocated free trade, centralism, and government subsidies of strategic infrastructure in the Piedmontese Parliament, and his policies had helped him form a key alliance with Great Britain, promote foreign investment and industrial growth, and help farmers utilize modern technology. As part of his economic plan, Cavour had tried twice to establish a national bank, but it had failed both times in the Chamber of Deputies. A national bank would provide the government with the capital for public projects and to refinance existing debt.
The Conte di Cavour was grinning like an idiot. A fortunate advantage of being the Prime Minister was that not as many people would tell him that to his face. If he could scare Parliament into approving a national bank, the debt would be a long-term advantage, and he would finally get one of his personal concerns through Parliament. The Count dug up his old bills for the creation of a Piedmontese National Bank and began drafting a bill for an Italian one.
Cavour’s plan was to issue fifty thousand shares of the bank of an amount to be determined in committee, a subscription of one tenth of the bank’s capital from the Italian government, restrictions on a Director’s eligibility, and a seven percent return to shareholders. The rest of the bill consisted of various regulations, government privileges and errata. Cavour finished the revision, wrote an outline of the speech he was going to make in the Chamber, prepared his ulcer tonic, and went to bed just before four thirty.
The next day, Cavour presented his bill to the Chamber of Deputies shortly after he made a rather bombastic presentation of the national debt. After the presentation of the debt, Cavour stood at the same podium he had used for nearly nine years.
“Fellow Deputies, and representatives of the People of Italy, our Nation has suffered greatly to achieve its current greatness. The blood of Italy’s finest men was spilt throwing off the yoke of foreign oppression. The Italian lands of Venetia, Trent, Dalmatia, and Rome are occupied. These tragedies will live with us for years to come. However, the deaths of our patriots will be remembered and honored. Fortunately, our lands will be recovered. Sadly, there is another casualty of our great national struggle which hangs like a noose around our neck.”
“The debts incurred by our nation during its noble effort remain a testament to our subservience. Foreign banks hold a leash to our neck, and these bankers are able to restrain our labors for the Italian people. As I stated before, the interest of our debt consumes and devours two-fifths of the government’s revenues. If we do not act, we will have lost the independence that the brave soldiers of the Kingdom lived and died for. If we do not act, we will be unable to continue the resurgence and recovery of Italian territory whose people yearn for a voice. If we do not act, the Kingdom of Italy will forever remain a bondservant to the oppression of Viennese and Parisian interests now concerned only by their interest in our interest payments.”
“The Italian people have endured much, but as the Savior said, ‘My yoke is light and my burden easy.’ My government has proposed a bill to create a national bank for the Kingdom of Italy. Fifty thousand shares will be issued and only Italians will be permitted to direct the bank. Money will be raised from all over the nation to finance our final struggle of independence, the struggle against debt and poverty. The funds of the national bank will allow the government to pay off the national debt more quickly, and most importantly, provide public capital. The bank will allow further production of public works, aid to the Italian people, and much needed military refitting. The infrastructure and monetary stability we can provide to the Italian people will give Italians the tools they need to industrialize and achieve true economic independence. Honorable Deputies, in the name of the Italian people, give them their independence!”
As Camillo Benso, Conte di Cavour stepped off the podium, he nodded to his supporters and those applauding him. As he assessed the crowd, he saw a secure response from the northern deputies, and quite a few latifundists, north and south were applauding as well. In his office that afternoon, his assistant told him that it appeared as if the bill would pass. Over the next few days, he heard that the sheer size of the debt, previously thought to be simply large, had convinced many that a national bank was the only palatable solution. Small comments about further government subsidies and infrastructure construction had won over many of the landowners originally against the bill.
On August 25th, Cavour was present at the Chamber of Deputies for the vote. The bill passed with a significant, but not overwhelming majority. Shares were immediately issued, and almost all of the wealthy deputies were among the first to purchase them. By the end of September, every share was gone.
Cavour sat down to a plate of ovoli salad at Violetto. The bright orange mushrooms signified the beginning of fall, and their sharp and smoky taste was acceptable to Cavour’s palate. His old friend, Giuseppe Verdi joined him. Verdi had entered overt politics through Cavour’s urging, and they had a mutual admiration for each other. After some commenting on the ovoli, Verdi asked Cavour, “So, do you really think that this bank thing is going to work?” Cavour leaned back in his chair and put forth his hands. “The landowners stopped me twice from getting it started, and God only knows what we could have done or what we could have avoided if the bill was passed earlier. By the way, what did you think of my speech?” Verdi put down the Nebbiolo he had been enjoying (Verdi preferred the sweet taste of a young Nebbiolo to the musty Bariolo Camillo insisted on drinking) and quickly prepared a response. “Well, it sounded a bit forced. You can only make so many gaudy productions concerning the people and the ‘National Struggle.’ I’m honestly sorry to say this, but as a friend I must tell you that it gets old fast.” Cavour burst out in a chuckle. “That, my friend, is why I never go to your operettas.”
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