This result was not achieved by domestic interference only. The King did not shrink from tariff wars with Austria and Saxony, nor from much toil to procure commercial treaties. It often appeared, however, that there were spheres in which statecraft, even when practised by a Frederick, could accomplish little.
“When at that time a new republic arose across the ocean,” writes Professor Koser, “King Frederick made haste to enter into commercial relations with it, in order to exchange cloth, woollen stuffs, and linen, iron goods and porcelain, for rice, indigo, and Virginian tobacco. The ‘most favoured nation’ treaty of 10 September, 1785, between Prussia and the United States of America fulfilled, it is true, few of the expectations which both parties formed of it, for the English, who from a seafaring and capitalist point of view were more competent, long continued to be the commercial intermediaries between those renegade colonies and the Old World.”
In the course of his efforts the King endeavoured at different times to supplant Hamburg, to ruin Danzig, and to make Silesia an impenetrable barrier between Polish wool-growers and their customers in Saxony. It was a peculiar feature of Prussia that her straggling frontiers were crossed by many roads and rivers which connected foreign states. The Hohenzollern laboured to turn this fact to account and to favour Prussian merchants by hampering foreigners with enormous tolls. The result was that commerce was compelled to avoid the borders of his dominions.
Frederick was indefatigable in inciting his subjects to take up new enterprises as well as in striving to procure for them advantages abroad. As a rule, however, the commercial companies which he formed either decayed or relapsed into the position of State undertakings. It may be surmised that what might have been possible to the Frederick and the Prussia of 1740 had been rendered well-nigh impossible by the changes in both which a generation of militarism had produced. The system of despotic command and automatic obedience was fatal to the growth of a class of self-reliant merchants, and the King complained bitterly that neither individuals nor corporations would act with enlightened patriotism in developing the commerce of Prussia. Able advisers of the Crown, indeed, did something to atone for this lack of initiative. Thanks to the talent of Hagen, the Bank, which was established in 1765, survived its early perils and became serviceable to Prussian trade. The Marine Commercial Company also outlived many of Frederick’s semi-official creations.
It is perhaps in the sphere of taxation that Frederick’s unflinching autocracy is most remarkably displayed. He claimed not only to regulate the consumption of his people according to his own standard of propriety, but also to select agents to enforce his rules without the smallest consideration for their feelings. Frederick wished to make existence easier for the poor, especially for the soldier. He therefore abolished the tax on grain, but subjected meat, beer, and wine to progressive imposts. Every Prussian was forced to buy from the State a fixed quantity of inferior salt at a price equal to four times its cost of production. The King’s delight in coffee did not make him blind to the fact that the State would gain more profit if his subjects were forced to abandon it in favour of Prussian beer. Accordingly in 1781 coffee became, like salt and tobacco, a monopoly of State and a tax of 250 per cent. upon its value was imposed. Frederick strove to refute the remonstrances of the Pomeranian gentry with the words: “His Majesty’s high person was reared in youth on beer-soup, therefore the people in that part can equally well be reared on beer-soup; it is much more wholesome than coffee.” The people, however, seem to have mitigated the inconvenience to which they were put by their King in part by brewing decoctions of herbs, but chiefly by smuggling. It has been estimated that no less than two-thirds of the coffee which they used was contraband. It boded ill for the State when to knock one of the King’s spies on the head excited none of the odium of murder.
The measure which most of all estranged the hearts of the Prussians from their King dates, however, from the year 1766, when Frederick resolved to introduce the French system of farming out the indirect taxes, or Regie. Not the system alone, but also the chief agents who carried it into effect, were brought from France. The lessee-in-chief, de Launay, exercised great influence over the King, who accepted his opinion as to the possibilities of taxation in preference to that of his Prussian commissioners.
The people, as was natural, detested an innovation which both wounded their Teutonic sensibilities and raised the price of food. De Launay and his assistants were caricatured as marching behind beasts laden with rackets, foils, and fiddles, to avenge the shame of Rossbach on the inhabitants of Berlin. Patriots might well chafe at the thought that a new and foreign department was introduced into the General Directory itself, and that whereas a Prussian minister was paid only 4000 thalers a year, each of the four chief Frenchmen received 15,000. Less than ten per cent. of the 2000 tax-gatherers were foreigners, but the Germans were insulted at being deemed fit for the lower grades alone.
Their murmurs, however, were powerless to alter the purpose of the King. The innovation, indeed, was not recommended by conspicuous success. Though it simplified the fiscal administration, a large proportion of the returns was still swallowed up by expenses of collection. On a review of the twenty years, 1766–1786, the proceeds of the Regie seem to have been in no wise augmented by de Launay’s hated invasion. Yet Frederick adhered to his plan, kept the taxes high, administered the funds of the State in secret, and crowned all by bringing coffee under the control of the French. To his fiscal measures more than to all else was it due that the State which he had exalted drew a deep breath of relief when he died.
