Chapter 9: Arrival
As our now much divided procession arrived back in King’s Landing, my senses were assaulted. Medieval life smells; that was an inescapable truth. Animals shit in roads. Sewers were often open to the air. Washing and hygiene was considered strange. But holy shit did that city stink. The largest city in Westeros with somewhere between four and five hundred thousand inhabitants, the concentrated smell of humans living so close to each other, the piss and shit and rot and fish… it was fucking awful.
Togo looked up at me, whining, pleading for me to fix it with a spell. I couldn’t just block the scent, that would remove one of his most important senses. After a few moments, I figured out how to use a bit of Blue, White and Green to normalize the scent signal against the background. Patting Togo, I applied it to him, then gave it to Aethon too. I’d have to figure out how to make it into a permanent feature later; Ghost, Nymeria and Lady were all looking pretty miserable.
The crowds watching from the sides of the street shied away from our massive pets, the direwolves and Togo not pleased with the sound and chaos, growling and snapping at anyone who approached too close. As it sun sank and evening set in, we arrived at the huge bronze doors of the Red Keep. It had been a damned long journey, and I was glad it was over. Smaller than Winterfell, the Keep was still impressively tall and imposing.
We had just arrived when a well dressed servant came up to Lord Stark; apparently the Grand Maester had called a sudden meeting of the small council. As the Hand, Stark was requested to attend as soon as convenient.
“It would be convenient in the morning,” Ned growled, exhausted.
“Of course, my lord,” the servant replied, bowing. “I will convey your regrets.”
“Damn it. No. I will see them,” Lord Stark reconsidered. “I just need to change into something more suitable first.”
“Yes, my lord. You have Lord Arryn’s former rooms in the Tower of the Hand, if that’s acceptable. I will have your things brought there.”
“Thank you,” Ned replied, taking off his riding gloves. “It seems I’m needed urgently by the council,” he called out to Poole, his steward. “See my daughters find their rooms, and have Jory keep them there. Under no circumstances is Arya to go wandering about and getting up to mischief.” Poole bowed in response.
“Jon, why don’t you go with them, and see that your sisters don’t face any trouble,” I said. My packs held my two spare sets of rough and two sets of finer clothing.
Lord Stark wasn’t so lucky. “My wagons are still making their way through the city,” he admitted to the royal servant. “I will need appropriate clothing.”
“Of course, my lord,” the servant replied. I grabbed one of the servants, found my room, got changed, and was waiting for Ned at the bottom of the stairs with Togo. I decided to leave my bow behind, and immediately decided that I needed to prioritize figuring out some sort of Inventory spell. That would be awesome.
“Did you decide to be my escort then?” Ned asked me when he came down looking dog-tired. I patted him on the back, giving a burst of magically rejuvenating energy and he stood up straighter.
“Given the circumstances, my lord, I thought it wise for Togo and I to keep you company,” I answered.
“What a mess,” he said.
We got to the council chambers, and I took up a post by the wall. The people present seemed somewhat stunned by Togo, who was best described as holy fuck don’t eat me sized. As the meeting began, I got to put names to faces for the councilors. Renly, the Master of Laws, I knew already. The same for the absent Ser Barristan.
Varys, a fat, bald eunuch dressed in silks was the Master of Whisperers; I trusted him about as far as Arya could throw him, and his high voice was creepy as fuck.
Pycelle, the Grand Maester was an old man with a bald, spotted head. He had a long robe. Unlike Luwin’s choker, Pycelle’s chain of office was made of heavy links of chain speckled with jewels; it went down to his breast. His robe was red velvet with gold fastenings, denoting his support for the Lannisters.
Lord Peyr Baelish, a slight, middle aged man was the Master of Coin. He was a notorious whoremonger known as Littlefinger. Supposedly he had been friends once with Lady Catelyn, but had basically been kicked out after he fell in love with her and foolishly challenged Brandon Stark for her hand. Considering he had chosen a mockingbird for his sigil, a bird renowned for laying eggs in others nests, I didn’t trust him either.
He was, in fact, my prime suspect in Lord Arryn’s death outside of the Lannisters that Lysa Arryn had pointed the finger at. Between calling himself the mockingbird, his rumored relations with Lysa, and the fact that the Arryn’s seat was called the Eyrie, it was just too much coincidence not to investigate. But I would have to be careful; he had a reputation for being clever, and anyone who could build himself a financial empire backed by vice would be someone dangerous.
Lord Stannis Baratheon, the Master of ships was likewise not present, and after the councilors assured Lord Stark that it was common for the king to skip the sessions they began. Robert, it appeared, was most noted for his absence in ruling.
The orders they received had obviously been written by Robert while he was drunk. He ordered a Tourney, with prizes of forty thousand dragons to the champion of the joust, twenty thousand to the runner up, twenty thousand to the champion of the melee, and ten thousand to the winner of the archery.
Those prizes were nuts. A dragon was worth two hundred and ten silver stags, each of which was at the time worth fifty six copper pennies so a dragon was worth eleven thousand seven hundred and sixty pennies. The currency value was based partially on the value of the metal, so it varied, hence those obnoxious numbers.
A copper penny, for perspective, had about the same purchasing power as eighty US cents in 2017. You could get a loaf of hearty bread for three pennies. A knight’s horse was in the low single digit dragons. A lord’s ransom might be a hundred dragons. The prizes that Robert was offering was the equivalent to offering three hundred and seventy five million dollars to the jousting victor alone, with nearly a billion dollars of prizes all told.
I did a quick estimate as to how much the tournament could expect to earn the crown. Assuming an average of one hundred thousand people showed up for a month, and spent an average of one-hundred-fifty pennies a day on food, lodging, entertainment and services, that would bring about thirty-eight thousand dragons worth of coin into King’s Landing. The crown might be able to get a quarter of that in special taxes and fees, or nine and a half thousand dragons back.
I was drawn out of my thoughts of economics by what Baelish said next.
“I shall have to borrow the money. Normally I would go to the Lannisters; we owe the Lannisters some three million dragons already, after all, what matter another hundred thousand? But I doubt Lord Tywin would be so accommodating, given the recent circumstances.”
I could see Ned was just as stunned as I. “Are you claiming the Crown is three million gold in debt!?” Ned blurted out.
“The Crown is more than six million gold pieces in debt, Lord Stark. The Lannisters are our biggest creditor, but the Iron Bank of Braavos, Lord Tyrell, and a number of Tyroshi cartels have lent significant sums as well. Recently I’ve had to turn to the Faith,” Baelish explained.
That was really bad. Westeros had a population of something like forty to sixty million; split the difference at fifty million. The typical farming family of five or six likely made something like a half-dragon to a dragon over the poverty line. Call it a dragon to be generous. Between the local lord taking his cut for protection, stored food for the crazy-long Winter years, the over-lord taking his cut for more protection, and the general graft and corruption, I’d be surprised if the Crown saw a tenth of a dragon from that family. At an average family size of five between the fifty million citizens, and that works out to a yearly income of about a million dragons.
Robert probably saw about as many dragons again from his own, personally held lands as was normal under feudalism, for a grand total Crown income of two million dragons. Given the levels of interest common in medieval societies which could range from ten to twenty percent, and that the Crown actually had necessary expenditures, the Seven Kingdoms were in danger of just the interest on the debt eating up every spare copper. It also meant that Robert had managed to overspend by something like a quarter of his income every year he was in power.
Ned was flabbergasted. “Aerys Targaryen left a treasury overflowing with gold. How could you let this happen?”
Baelish gave a little Gallic shrug. “The Master of Coin finds the money. The Hand and the King spend it.”
“Are you serious!” I burst out at his attitude as the Kingdoms slid towards insolvency. Everyone turned to look at me, and I flushed. “My apologies, my lords.”
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“No, Ser Odysseus, I’m interested in what you were thinking to burst out like that,” Ned said, amused and likely hoping I had some clever insight to the situation.
“Thank you, my lord Hand,” I said. “Lord Baelish, may I ask how many dragons the Crown receives in income each year? On average?”
Baelish looked at me as if I was something he scraped off a shoe. “Well, that is difficult to say exactly, Ser Odysseus. The financial system is quite complicated and –“
“So would I be wildly incorrect in assuming that it’s on the order of two million dragons a year?” I interrupted.
Now I had everyone’s interest. “Not wildly so, no,” Baelish replied cautiously. “It’s closer to three million during Summer, one million during Winter.”
“And of that, the Crown has how much to spare after necessary expenses? A half million dragons? Less?”
“A little less, yes. About four hundred thousand dragons,” Baelish answered. He could sense the trap closing now, but my guesses were close enough after reading and talking to Luwin and going over the North’s tax situation that he couldn’t escape it.
“And the interest on the debt. What is it on average. One part in ten? Three in twenty?” I questioned.
“On average, closer to one part in eight,” he allowed. Twelve and a half percent of 6 million was…
“So you mean to tell me that the Crown already owes nearly seven hundred and fifty thousand dragons a year, just as interest on the debt? Is that counted in those necessary expenditures?” I asked. Everyone watching had dawning looks of horror.
“It does,” Baelish admitted. “And no, those expenses are not counted in the necessary expenditures. Typically Lord Lannister forgives the interest in return for certain political considerations, so it is difficult to predict.”
“Regardless,” I stated coldly. “Give that the Crown is currently facing the prospect of borrowing ever increasing sums just to meet the demands of the debt it already possesses, and considering that you, my lord, are the Master of Coin, did you not think to bring this to the King’s attention? Are you a traitor, corrupt or merely incompetent!?” I shouted.
“How dare you! Have a mind to whom you speak, Ser!” Baelish shouted, rising out of his seat then sitting down very quickly with a white face when Togo growled at him.
“I too am interested in hearing the answer to that question, Littlefinger,” Lord Stark ground out. Few things infuriated him more than this sort of obviously shady failure of a man’s duty. Given that this duty was to his friend and king, it was even worse.
“If you think it’s so easy, then let’s hear your solution, Ser Odysseus,” Baelish hissed.
“Once again changing the subject, my lord? That is suspicious,” I drawled.
“Damn you, Odysseus. And damn you too, Stark. I had thought to help you for the affection I bear your wife, but then you spit on my honor like this. I am neither a traitor, nor corrupt, nor incompetent, merely faced with an impossible task! You can try and fix this situation, get Robert to moderate his spending, and see how it goes. And then you can apologize to me, or you can find a new Master of Coin. Now, if you’ll excuse me, I have better places to be with more pleasant company,” he snarled, then stood and stalked towards the door.
“Should I…” I offered, prepared to take the man into custody on the spot.
“No, let him go,” Lord Stark ordered as Baelish stormed out.
“I had heard you had a way with people, Ser Odysseus,” Varys twittered and clapped his hands. “Bravo, bravo.”
“Well, now that you’ve succesfully chased our Master of Coin away, do you have any solutions, Ser Odysseus?” Pycelle asked sarcastically.
“The tournament, yes,” I announced. “The state of the Crown’s finances may be a more complicated matter, though I’m willing to give it a shot.”
“And for those who don’t know, Ser Odysseus is quite the shot. In fact, I think today may be the first time I’ve seen him without his bow to hand,” Renly added. “You know, if you’d just held your tongue and let things be I suspect that you could have won those ten thousand dragons.”
“Thank you, my lord,” I replied with a short bow. He had nicely implied that my actions were motivated by duty, not self-interest.
“You’re quite welcome,” Renly said with a grin.
“What is this plan of yours to fix the tournament, Ser?” Varys questioned.
“Well, the first part is to reduce the prize money to at most a tenth of what Robert initially wanted, a twentieth or less if he’ll go for it. I suspect he wants to have a grand tournament though, one that draws the most famous and skilled, and that takes grand prizes. Instead of money though he could offer land; I heard that the Whispers and Summerhall are without lords, and I am sure there are half a dozen other such keeps besides. The reduced prize money would suffice to hire workers to repair the lordly seats and attract people to work the land. That would reduce expenditure on the tournament to about ten thousand dragons.
“Then, we need but increase the income from the tournament. I would guess that given, say, sixty days for the word of the tourney to spread and attract competitors, and with a bit of management, we could attract as many as a hundred thousand visitors to the city. They’ll likely spend something around a half-silver a day on average, and if we’re clever about having a number of smaller melees, duels, wrestling bouts, races, competitions with staves and the like while dragging out the actual jousting and main events, we could likely drag things out for a month with a week in the middle for a grand fair.
“Special taxes of a fifth of the income from inns, brothels, and specially available booths for merchants and tradesmen near the campgrounds, fairgrounds and tourney grounds would likely allow us to actually receive a quarter to a third of the true profit. Add in a small fee to use designated campgrounds, another to enter the tourney, a tax on the ransom paid by the tourney losers to regain their arms, armor and horse, a tax on the gambling… The Crown may actually come out ahead, and should certainly recoup the majority of its expenses.”
Everyone was looking at me in awe. It wasn’t very complicated; I knew that event organizers did all of those things already in the modern era, but Westeros was less saturated with commercialization.
“By the Gods,” Renly laughed. “Perhaps he should be our Master of Coin!”
“I’m afraid I’m too unfamiliar with the way things are done here, my lord,” I replied. That and I wanted to work on magic and fighting, not become an economics advisor. “Though I’ll give what advice I can.”
Varys leaned forwards. “And what advice would that be?”
“Without having looked at the situation, it’s hard to say,” I replied. “Though the first thing I’d focus on was trimming the fat, the unnecessary expenditures, and reducing the debt burden. I’d try and refinance the loans, requesting lower interest levels. I’d also consider issuing public treasury bills and bonds.”
“And what are those?” Ned asked.
“They’re a type of government debt. The government might sell a bill, a document basically, that is worth a hundred silver starting a year from now, but it is sold for only ninety nine silver. It’s common for them to be auctioned publicly, so the interest rate is naturally competitive and as low as people are willing to accept,” I explained. “Bonds, on the other hand, pay an interest but a low one.”
“So, much the same as any other debt,” Varys asked frowning. “How would that help?”
“Well, not quite. Let’s say I want to borrow money from the Iron Bank. I get on a ship, sail to Braavos, and meet with a representative. They evaluate the risk I present, the amount that they think they can get out of me, and maximize their profit by charging an interest rate which is affected by both the perceived risk, my own need for the money, and other interest rates available elsewhere. Correct?”
“Yes, that is the way these things work,” Varys said dryly.
“Right. Bills and bonds reverse that order,” I replied. “Instead of my going to the Bank to borrow, the Crown invites representatives from all the banks to come and bid, and invites people from the noble houses and commons to do so as well. That keeps the interest rate as low as possible; with sufficient competition, it will be the smallest difference in value that anyone in that crowd can make a profit at. If we set the initial bid price so that the resulting interest is smaller than what we currently pay, and immediately use that money to pay our debt, we cannot lose.
“Similarly for the bond, instead of saying, “we need this money, we want the best interest you are willing to give,” we say “we are selling up to so many millions of dragons of debt at this interest rate, and you may take it or leave it.” If we begin by selling debt at a low interest and gradually raise it, with some maximum interest still lower than what we currently pay, again, we cannot lose money doing so.”
“What’s to stop people from doing this in general?” Renly asked bemused.
“Well, nothing. In my home, it was common for merchant companies to use such techniques to raise funds. But people tend to believe in a government, a country, much more than a company, so governments tend to get the best rates.”
“And how do you prevent someone from forging one of these documents?” Pycelle asked.
“A combination of methods,” I answered. “You can embed specific complex designs into the paper, watermarks, seals, fancy inks and signatures to start off. Then you can have each document be named and numbered. When the document holder comes to redeem it, it can be checked against a master list of names, numbers and associated values. Depending on if the bond-holder wants it to be transferrable or not, you can even require that their finger-prints match.”
“I can see how this would be useful,” Lord Stark said. “We already have some documents allowing the bearer to draw on monies without having to transport them, but they are rare and unique to each person that issues it. Something like this, backed by the Crown, could aid merchants even if there’s no interest at all.”
“Right,” I agreed. “That’s not unusual either, and would be a commodity or representative money. Basically, saying that if you took the note to the treasury they would exchange it for some defined amount of gold or silver or whatever. We actually used fiat money, which is basically state-issued money with no real value or conversion.”
“Wait, do you mean to tell me that people valued, what, pieces of parchment as if they were real gold?” Renly asked incredulously.
I laughed. “I had a hard time getting my head around it too. But if you think about what gold really represents, it isn’t that odd. After all, gold is pretty, but so are many things. Beyond that, it’s soft, heavy to carry, and rare. The reason gold is truly valuable is most of all that last part, its rarity. Combined with the fact it doesn’t tarnish, doesn’t rust away like iron, its rarity means that it’s a perfect item to denote value. But, if a set amount of a currency was circulated, and it was difficult to damage or lose as well, with a small amount added each year to replace that which was lost or destroyed, wouldn’t that serve the same purpose? That’s the logic, at least.”
“Still, I think I will keep to things with true value,” Renly replied.
“There can be problems with that though,” I warned. “About, oh, five hundred years ago or so there was a country, Spain, which was near my homeland. They, like everyone of that time, used the gold standard for their currency. Then, they found an unclaimed wilderness full of gold, nuggets the size of your fist in riverbeds for your taking. They brought it back home, and for a time Spain was rich! But then, the prices for things began to rise. With so much more gold available, it became worth so much less. And those sorts of economic shocks can be incredibly damaging. In Spain’s case, they went from the strongest kingdom in the region to one of the weakest over the course of a couple generations. And that is but one case of many I can think of.”
“How very interesting,” the Spider said in his high pitched voice. I restrained a shudder, it just creeped me out so much.
“Well. It is late, and I am weary from the road. I will speak to the king and relay Ser Odysseus’ plan in the morning, and we can reconvene in the afternoon to discuss the tourney. Is that agreeable?”
And with a chorus of assent, the first meeting of the small council under Ned’s leadership came to an end.
AN: Every time I wrote dragons for the coins I had to stop myself from using galleons. Clearly I have been reading too much HP fanfiction.