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18-August-1921
''They invited Vasyl… But not us… This has to be a fucking joke'' I said, throwing the newspaper hard onto the table before folding my arms and letting out a grunt of annoyance.
''What the hell are you complaining about, Karl? We hardly have a navy that would warrant your taking offense at not being invited to sign a naval arms limitation treaty. Ha, ha, ha… We do not even have a naval officer to handle such matters, and you want them to invite us'' said Manstein, laughing as he watched my reaction.
''Ukraine has no ships either… But they invited them. I don't know whether you understand why it bothers me. It is a political snub from the Americans. They must still resent what we did to their representatives… And the beating I gave their troops in France'' I said, putting my boots on my desk as I settled into my chair.
''But Ukraine does have the capacity to build large warships. Remember, it controls several shipyards capable of building a battleship and launching it within a couple of years, so inviting them is understandable. Here in the duchy… Well, we have a shipyard that builds large vessels, but they are merchant ships. We have no industry devoted to naval warship construction. Besides, the Americans do not even recognize us as a state. They trade with us, but politically, we are pariahs to them'' said Manstein, shaking his head without losing his smile.
''That is true. After all, those Ukrainian shipyards supplied the guns we mounted on vehicles to harass the British at sea'' I said, taking out several account books to see whether we had any funds left available in the budget.
''You are not thinking of building a ship just because of this, are you?'' asked Manstein, raising his chin as he looked at me.
''No… Not a chance. You know how expensive it is to build a single battleship of any decent size, let alone a larger one with more heavy guns. Especially when we can send them to the bottom with a couple of the Red Baron's aircraft. If he keeps making progress with his naval bombers, we will soon have the means to sink those costly investments, so I don't care'' I said, lowering my boots from the desk and sitting properly again before folding my arms.
''What we could do is get a little more out of the Chicago operation and expand its activities. While the Americans try to humiliate us by excluding us from the treaty, we could get more people drunk than ever before. We could order our men to put all the liquor they have in storage up for sale, or increase production, something along those lines'' said Manstein, closing his eyes as he reclined in his chair.
''There is no need. Why ruin an operation that is running perfectly and making us money over a matter of pride? If they want to hold their damned ceremony and ignore us, there is nothing to be done. We have another matter to settle, and with luck, we can turn the situation to our advantage'' I said, examining a map I had taken from the cabinet.
''What is the plan?'' asked Manstein, stretching a little and moving his neck.
''I don't know how feasible it would be, but I wanted to use the extraordinary revenue we will earn from food sales to offer to buy French Somaliland from the French, their African colony by the Gulf of Aden'' I said, looking at the map of the region.
''And what for? Colonies are an unnecessary expense, and I hardly think they would sell it to you anyway… It serves as a supply station for their voyages to Madagascar and Indochina. However badly they need money, I doubt they would part with a colony that allows them to maintain communications with the rest of their empire'' said Manstein, rising and leaning over the table to examine the map with me.
''Precisely for that reason. Suppose they sell it to us… I don't know whether it has mineral deposits or other resources we could exploit, but if it becomes a colony of the duchy, we can send troops there, along with ships loaded with military supplies. That would make our sabotage operations in Africa easier and give us a port of our own on the way to India. Unfortunately, with the British controlling Kuwait and the Persian Gulf routes, reaching India is no simple matter, and that is where we ought to establish our largest operation'' I said, looking at the map.
''It would be better to sound out the British and see whether they would be willing to sell us some territory. If I remember correctly, the French wanted to put you on trial for war crimes, so I doubt they would welcome a proposal from you. Perhaps the British would be more willing to hear you out'' said Manstein, pointing to other ports.
''Yes, perhaps. It is a damned nuisance that they have seized the entire coast and left us scarcely anywhere we can use to reach Asia. It would be the best place to strike at them; that is where we could do them real harm. But for now, there does not seem to be much we can do about it'' I said, folding the map and putting it away.
''A real shame. Were you not supposed to meet with a Russian diplomat today?'' asked Manstein, narrowing one eye as he remained beside me.
''Yes. We have to sell food to the Russians. They are not yet suffering widespread shortages because they are gathering what they managed to save of the harvest, but it should not last them until next year's harvest, especially if they set aside the grain needed for the next sowing instead of eating it'' I said, scratching my head.
''I thought we did not want to cooperate with the Russians'' said Manstein.
''Yes, but we do not want another Bolshevik revolution because the new tsar cannot give his people bread, either. Those bastards have already caused enough shit without us allowing another civil war to break out, one that could give rise to a state with no interest in preserving our relations and that decides to invade us despite the marriage tie'' I said with a grimace.
''A fair point. But no machinery or anything of the sort. That is where we must draw the line: preventing widespread famine and chaos without giving them more help than necessary. We would be shooting ourselves in the foot if we helped them rebuild their industry'' said Manstein, looking at me seriously.
''Of course. Why would I help them rebuild their industry? That is precisely why we do not sell them steel. Let them manage with the few steelworks they still have available. The Ukrainian works were the most important in the Russian steel industry'' I said, rising to leave for the meeting.
''Good, I merely wanted to be certain. Ah, by the way, Guderian's report is ready. He has written a thesis of several pages on the employment of panzers and mechanized forces. If you wish to read it, I will have it ready for your return'' said Manstein, pointing to a pile of documents on his desk.
''I will give it a quick read as soon as I can'' I replied before leaving Riga's government palace.
I had to board a train for Pskov, the nearest meeting place our two states had been able to agree upon. Our principal task there would be to establish what we would receive in exchange for the food and in what quantities. The Russians must have been rather worried about the famine to resort to that maneuver. They needed our help, but they also wanted to avoid losing face within their own ruling circles, so they had contrived to make it appear that I had taken the initiative in establishing contact.
Of course, the meeting would not take place within the city. We still had much work to do in Pskov, where most of the population remained Russian. Although we maintained a considerable military and police presence, I had no intention of exposing myself to some fanatic shooting me with a pistol that had escaped confiscation or throwing an explosive left over from the war. It was preferable to meet in the countryside, near the railroad, so I could return easily.
I had to wait until shortly after four in the afternoon for the Russian delegation to appear. We knew they were on their way because the border guards had notified us as soon as they crossed the frontier.
''Greetings. We have been expecting you'' I said from my chair as I watched the Russian diplomats climb out of their armored vehicle.
''We thought there would be a building, not merely a few tables and chairs'' one of them remarked as he surveyed the site, surrounded by nothing but vegetation and a good number of my guards.
''This will be brief. You have come for something very specific, and I already have the prices prepared'' I said, showing them a list of the amounts I intended to charge for the food.
''We have not even begun negotiating, and you have already settled your demands?'' asked another diplomat as the delegation approached and took their seats, as did my own representatives, who would put whatever I agreed to in writing.
''Beggars cannot be choosers'' I said with a smile, listening to the envoys' angry breathing and the creaking of several leather gloves as their owners clenched their fists.
''Show me the prices'' said the diplomat, forcing a smile that scarcely concealed his anger.
''Of course. A surcharge of 30% over the prices established in our treaty, if you pay in Swiss francs. It is the most stable currency we can find on the market'' I said, handing the clipboard to the Russian envoys, who began removing the sheets and examining the figures.
''Russia does not have sufficient reserves of that currency'' replied one of the diplomats without looking up from the documents.
''Well… Then it will have to be German marks, pounds sterling, or American dollars. Those are the other currencies we are willing to accept, given the prevailing monetary chaos. Naturally, the prices would be different'' I said, signaling one of my diplomats to hand them the other documents.
''The surcharge here is 50%'' one of the Russians pointed out.
''Naturally. I assume a greater risk when accepting less stable currencies'' I replied.
''Our reserves of those currencies are not particularly abundant either'' interjected the third Russian diplomat as he reviewed the prices.
''And how do you intend to pay? Because I will not accept Russian rubles… I believe they are scarcely worth more than the paper your banknotes are printed on or the metal your coins are minted from'' I said with a grimace as I watched their expressions.
''His Majesty the Tsar has considered paying in raw materials. However, the gold from the Ural mines and the silver are earmarked for strengthening the national currency, so we would have to resort to other materials'' explained the first diplomat, bringing his hands together.
''What a difficult situation. Raw materials are not exactly what I am looking for. I had hoped to obtain some gold to increase my bank's reserves. I assume you would have no objection to our setting the payment in rubles at twice the base prices, then converting that sum into its equivalent in raw materials'' I proposed, interested in discovering how much I could squeeze out of Russia's need for food.
''We can consider a surcharge of 70% over the base prices, with the amount expressed in rubles and allocated to the purchase of Russian raw materials'' replied the diplomat heading the delegation.
''Eighty percent. And I would like to acquire a stake in some Russian mines'' I said, looking at him seriously.
''Nyet. No acquiring stakes in Russian industry. Raw materials only'' the head of the delegation refused.
''Then I will settle for the 80% surcharge. I am interested in platinum. Since you do not use it as a monetary reserve, I assume you can put it to other purposes. Precious stones as well: rough amethysts and emeralds, uncut, so the price will be lower. Copper, above all; I need a great deal of copper for certain projects. The furs could serve for making clothing, and the timber would allow us to reduce logging in our own forests while we establish a system of rotational harvesting and reforestation'' I said, handing them the list of products that interested me.
''Very well… We will present the agreed prices to the tsar and inform you once he has determined the quantities he wishes to purchase. In the meantime, we ask that you make the necessary preparations for the shipments'' said the head of the delegation as he prepared to sign.
''We have trains ready to carry large shipments, but… There is the matter of the track gauge, is there not? Unless I am mistaken, our networks use different gauges. In addition to everything else, we will have to arrange for the goods to be transferred from one train to another. We cannot simply send them directly from one station to the next'' I said, raising the question that had just occurred to me.
''We have the connection between Pskov and St. Petersburg. We can arrange those operations at Pskov station once the stretch of track severed some time ago has been repaired. If we act quickly, we could restore the line within a few weeks'' replied the head of the Russian delegation.
''Good. For the time being, we will repair that railroad line'' I said, nodding as I was already thinking about using the precious stones to foster a luxury goods industry and the various uses we could find for the copper we would receive.
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