Letter to Wilhelm Liebknecht, December 1, 1885

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To Wilhelm Liebknecht in Berlin

London, December 1, 1885

Dear Liebknecht,

As regards Russia’s finances, see Kolb’s Statistik, 1875 ed., p. 499 et seq. The last loan shown therein is that of November 1873 for 15 million pounds. After that a further loan of 15 million pounds was raised with great difficulty in 1875, but the Russians were also advised by the bankers that this would be the last time, failing a guarantee by a representative assembly. For after provisional arrangements had been made in 1869 in respect of the funds appropriated for railway purposes, there were further borrowings:

1870 — 12 million pounds

1871 — 12 "

1872 — 15 "

1873 — 15 "

1875 — 15 "

i. e between 1870 and 1875, six years, 69 million pounds = 1,380 million marks. They now had to think up some new dodges. Hence, 1) an internal loan. Though this was in fact a forced loan, it proved an almost complete flop. For there was little capital available in the country and the government was therefore compelled to lend its own money (paper money) to itself so as to give the impression that the loan had nevertheless been over-subscribed. 2) The Transcaucasian Railway Loan of £8,904,200. This was raised (1880 or 1881?) abroad on the security of the Poti to Baku line, but most of it had to be expended on the construction of the line itself; hence the financial straits persisted. Throughout this time repeated approaches were made to the bankers, all of them in vain. Finally the Minister for Finance set off for the West in person — Paris, Berlin, Amsterdam; London was omitted from the itinerary as being quite hopeless. Everywhere he met with a rebuff; even Mendelssohn, the court banker in Berlin, is said to have asked for a parliamentary guarantee point-blank; in any case he, too, turned him away. The only remaining question was whether the Russian Duma ought to be convoked a year sooner or a year later; there was no other way out. Giers then visited Friedrichsruh and abased himself, whereupon Bismarck got hold of 15 million pounds for him in Germany, thereby postponing the evil day a little longer.

(One of the conclusions we may draw from the above is that Russia won’t be able to start a war without Bismarck’s permission, for it can only raise money under his protection and the 15 million have long since been frittered away. So if it starts a war after all, or seriously threatens to do so, Bismarck will be directly responsible.)

I don’t read The Economist, nor do I know where a run of them is to be found, for the many clubs have been the ruin of nearly all the readingrooms here. I shall ask Kautsky to try and see if he can lay his hands on the Economist, Statist, Bullionist and Money Market Review and make extracts for you.

Although your letter of 26 November was posted between 11 and 12 in the morning, it didn’t reach me until the morning of 28 November; moreover the gum had been tampered with, as you will see from the envelope which I return herewith. It ought to have arrived here on the evening of 27 November. A bible is surely placed on the altar for the sole purpose of being opened.

Your speech at the first budget reading was sent to me by Bebel from Dresden. It was very good; I’m only surprised that you had so few interruptions. After all, you did elicit the obligatory call to order.

Your

F.E.

The seal on this letter is a count’s coronet and the monogram JC intertwined.

The elections here are proceeding very nicely. It is the first time that the Irish in England have voted en masse for one side, and in fact for the Tories. They have thus shown the Liberals the extent to which they can decide the issue even in England. The 80 to 85 Home Rulers — Liverpool, too, has elected one — who occupy the same position here as the Centre Party does in the Reichstag can wreck any government. Parnell must now show what he really is.

Incidentally, a victory has also been won by the new Manchester School, that is, the theory of aggressive tariffs, although it is here even more absurd than in Germany, but after eight years of commercial stagnation the idea has taken possession of the young manufacturers. Then there is Gladstone’s opportunist weakness and the clumsy manner of Chamberlain, who first throws his weight about and then draws in his horns; this has called forth the cry: the Church in danger! Finally, Gladstone’s lamentable foreign policy. The Liberals profess to believe that the new county voters will vote for them. There is, indeed, no telling how these voters will act, but in order to obtain an absolute majority the Liberals would have to win 180 of the 300 still outstanding districts, and that will hardly happen. Parnell will almost certainly wield dictatorial powers in Great Britain and Ireland.