Father of France

Chapter 237 Pointing the Sword at Japan and South Korea
Although France is dissatisfied with the dollar's control over French production, there is not much France can do now. Its dependence on the dollar is real, not just because of the war. Even now, after the war ended, European countries, including France, still have a trade deficit with the United States.

The dollars borrowed by the United States through the Marshall Plan continued to flow back to the US because European industries had not yet recovered, while Europe was facing a severe dollar shortage crisis. This greatly troubled the United States.

The purpose of designing the Bretton Woods system was to encourage the flow of dollars out of the United States and into the world, bringing the United States unlimited wealth and control in the great cycle of international trade.

Whether people realize it or not, whether they do it willingly or unwillingly, as long as they hold US dollars, they are part of the financing of American industries, and this reality cannot be changed in the short term.

However, in order to get out of the quagmire as soon as possible, this step is unavoidable. Among European countries, France is the least willing, but it has no choice but to bow its head. Money is hard to earn and life is tough.

If you want to escape the dollar vortex as soon as possible, you have to earn as many dollars as possible in a short period of time. There's no other way, since the United States now has the power and influence to do so.

If Coman were British, he might actually be able to shorten this timeframe. After all, the British Commonwealth is a genuine entity that can be established independently, while France's colonies, at least for now, lack this foundation. It might be possible in the future, but it will take time.

The United States provides the world with two reserve assets: gold and the dollar, and binds them together at a fixed price of $35 per ounce of gold, with gold supply being slow and dollar growth being fast.

The underlying reason for the expansion of the US dollar is that when the dollar is exported to Germany, European countries will have to increase their own currency supply due to the increase in foreign exchange reserves; at the same time, they will automatically deposit the dollar back into the US banking system.

The US can then use the repatriated dollars to create new credit domestically, and this process can continue indefinitely.

This cycle was broken by De Gaulle in the future, so the United States chose oil as the binding force, and after the oil binding, it used commodities as the binding force. At that time, it was the turn of the great Eastern power to break the dollar cycle. In principle, it was similar to the reason why the Bretton Woods system could not be maintained.

Because of the Bretton Woods system, the value of the dollar and gold was fixed. The growth of the dollar would inevitably exceed that of gold, and maintaining a locked price between the dollar and gold would become an illusion that could not be sustained logically.

It must be said that France, this old-fashioned imperial power, still has some tricks up its sleeve. Its ambition to remain unchallenged has always existed. With this ambition, Corman felt that serving France wasn't too bad.

Regarding the issue of export earnings, Koman once again went to work with Gao Hua and others to conduct some research, and decided to join forces with the Bangkok Rice Exchange Center to target Japan and South Korea as the destinations for export earnings.

South Korea is the main destination because both South Korea and Japan are traditionally rice-based staples, while China is not. Many parts of China do not have the capacity to grow rice, so the north mainly eats wheat-based foods. Rice is the staple food in both South Korea and Japan.

In the 21st century, the diets of South Korea and Japan have undergone tremendous changes, largely due to the fact that the United States, which has long supported both countries, has wheat as its staple food.

It's impossible for the US to change the agricultural landscape of these two countries; Japan and South Korea can only eat whatever the US provides.

It was early 1948. Agricultural associations were a major problem in Japan and South Korea. Japan had just started legislation and it would be several years before they were officially established. South Korea didn't even have one.

South Korea's imports and exports are still largely in the hands of the wealthy elites, making the wealthy elites on the border a vulnerable link that is easy to breach.

"The most important thing for your families right now is to hold enough US dollars and make cash king. So the supplies you have are not the most important thing. Instead, the US dollars are more important, at least in the short term."

When Koeman mentioned the US dollar, he forced himself to remain nauseous and gave insincere advice to the Gao Hua team: "South Korea is currently supported by the United States and has hundreds of millions of US dollars in its hands, which is cash that you can try to acquire."

Before the outbreak of the Korean War, the United States did provide Syngman Rhee with a considerable amount of aid, amounting to approximately one hundred million US dollars annually if calculated separately.

How did Syngman Rhee spend this money? Of course, his greatest wish was to import American weapons and then head north with loyal South Korean troops to unify the Korean Peninsula.

However, the United States obviously wouldn't let him do that. The United States is well aware of the level of the South Korean army, which is no match for the North Korean army.

Therefore, the United States has adopted a certain degree of appeasement regarding the Korean Peninsula issue, prohibiting American arms dealers from selling heavy weapons to South Korea.

During Syngman Rhee's era, South Korea's main economic characteristic was a comprador economy, similar to that of the major Eastern power under Chiang Kai-shek's leadership. The biggest problem was feeding the Korean population, with food imports being the largest expense during this period. "This time in Saigon and Bangkok, don't talk about costs. Feed the Koreans, even if it means dumping them," Coman said coldly to the assembled elites. "This is also to help the free world resist Soviet expansion, and it's also to help France and yourselves accumulate as many US dollars as possible."

In this situation, a white man is holding a meeting with a group of people of different skin colors and civilizations in the far East. No one would believe it if you told them.

After Koeman finished explaining the general direction, Louis Dreyfus, the head of French Indochina who had accompanied him to Bangkok to establish the rice center, presented the action plan that he had previously discussed with Koeman. "We have learned that the Korean Chinese are mainly concentrated in the catering, retail and port industries, which is a natural advantage. With this advantage, as long as we follow Louis Dreyfus's plan, it will be easy to defeat an immature country. Now I will explain the specific strategies."

As Aikoda explained, the collaborative plan that brings together two of Asia's three major rice centers, Saigon and Bangkok, was officially unveiled.

Even though the franc had depreciated, its real exchange rate was still 30% overvalued. This wasn't a big problem within the French colonies, but it was a huge advantage in trade with countries that didn't recognize the franc, especially in trade with countries like South Korea that were controlled by the United States.

Leveraging its deep connections with French mainland and colonial networks, Louis Fouta dumped rice from Saigon and Bangkok into major Korean cities at prices 30% lower than the local market price.

This happens to be the period when the franc exchange rate is artificially high, because rice merchants in Saigon and Bangkok won't lose too much; they can just consider it transportation losses, which are bearable.

These finely processed, clean, and neatly arranged grains quickly won the hearts of urban and rural residents in South Korea.

The consequence was that local rice merchants and growers were caught off guard. Their brown rice and local varieties were not competitive in terms of price and appearance, and the grain in their warehouses began to pile up and mold.

South Korean farmers looked at their bountiful rice fields, but were unable to earn the income they would have received in previous years, their brows furrowed with deep worry.

However, most South Koreans don't feel the impact because South Korea's food self-sufficiency rate is already very low, and it needs food aid from the United States. A large portion of the financial aid is also used to purchase food.

This would actually consolidate Syngman Rhee's regime. What could a comprador government possibly rely on for its economy? There's no need to overestimate South Korea's potential countermeasures. All Syngman Rhee needed to do was secure dollar aid and then buy rice.

“Aikoda was referring to South Korea, but not just South Korea, but also Japan. I know that Chinese people and Japanese people have a history of conflict.”

Koman waited until Aikoda finished speaking before adding, "But doing this would bankrupt farmers in Japan and South Korea, and would greatly disrupt Japan's postwar recovery. To put it bluntly, even your country's current leaders are not as successful as you in dealing with Japan. Would you still object?"

"Sir, wherever the sword of Paris points, that's where we'll go." It's true what they say, compradors have a mutual respect for each other. After Coman's explanation, Guo Cheng immediately understood.

“If you can really do that, Paris will be happy, and you yourselves will be happy too.” Koeman’s gaze swept over Ikoda, and his eyes were now amiable as he looked at the Gao Huas.

These high school graduates who still retain Chinese education, although they are compradors, still harbor some national and personal grievances.

Otherwise, what merit or ability does Chang Gong possess? What level of contestant is he to have gained the support of overseas Chinese in Southeast Asia?
After a flurry of whispers and noise, almost all the Saigon officials present understood that Japan's situation was now largely the same as South Korea's. The US economic aid was essentially to prevent the Soviet system from influencing Japan, and industrial support was not being considered for the time being since the Korean War had not yet broken out.

Therefore, Japan and South Korea are the same; the United States provides direct financial aid, and Japan and South Korea use a large portion of it to purchase food to solve their own people's food problems.

This isn't just the case in Japan and South Korea; many European countries are in the same situation now. If it weren't for Coman's unwavering decision to go straight from overseas departments to French Indochina, France's food imports would have been central to the Marshall Plan.

Now that France has initially overcome similar problems, it is time to expand its influence and launch the first food war since the war, testing the waters on Japan and South Korea to see how it goes.

"Sir, I'm worried that the Americans might be dissatisfied with us later," Ikoda said with some concern after the briefing.

"The core of the United States in East Asia is not these two countries," Koeman said with a smile, trying to reassure her. "It's only 1948, after all. Chiang Kai-shek is quite deceptive."

(End of this chapter)