Goats on Boats Affair

The Goats on Boats Affair was a series of linked crises in 891 broadly resulting from the manipulation of international trade by the Stratsky Foundation for Economics and Insurrection. It is widely considered to be Flandre's worst political blunder in recorded history—unless you're talking to Dr. Hanson, who tells me entropologists consider it second to the formation of the Disputatious Assembly of Sovereigns. But as entropology has yet to create any command narratives whatsoever, I feel we can safely ignore that perspective for the time being.

It is important to note that before the Affair began to unfold, the Panark Fleet was vying for dominance of global trade. The modern order of Iurezzan economic supremacy was still decades away: the Compass Republic had yet to assume its role as a manufacturing giant, while Flandre was still treating its oil stockpile as a strategic reserve rather than a commodity. With the encroach of ever more powerful naval technologies, maritime exports across the globe became increasingly feasible.

As countries' financial horizons expanded, Sovereigns became increasingly aware that traditional wisdom about trade no longer applied to a progressively more interconnected global economy. To navigate these new frontiers, most governments set up trade bureaus to assist them in deciding how to handle things like tariffs. With so much potential wealth to be gained, the vast majority of states saw no problem in sinking sizable fractions of their gross domestic product into shippable goods. The economists, meanwhile, kept inventing new and exciting ways to extract egregious quantities of wealth from ever more intricate trade schemes.

At the peak of this global boom, a team of economists working out of the National Academy of Velskyavo invented a currency exchange system that would allow merchants to increase their profits by routing them through the currencies of multiple nations. The lynchpin of this system was a "dummy" currency ostensibly backed by the Pseudocracy of Placeholden—which, as there was no actual country to back it, could appreciate indefinitely. The placegilder system was founded on the assumption that all parties involved were rational profit-seeking actors; thus, while the international economics community knew of ways to crash the value of placegilder, it was assumed that no one would be stupid enough to do so, as their own economy would become collateral damage in the process.

The Stratsky Foundation proved them wrong. But as placegilder crashed and burned, Flandre enacted a contingency plan to shunt the value of placegilder into livestock. Unfortunately, this plan relied on convincing every other state to adopt certain tariff practices, and at this time Flandre—not possessing the political clout they hold today—was seen as a weird paranoid nation on the fringe of the national stage. Tariffs on livestock were raised instead, and the Panark Fleet ended up overflowing with herds of goats they couldn't afford to unload. Making matters worse, Selestei responded by declaring war on livestock. With livestock in every country on the globe, the global community began to fear another War of Durun's Ass. But on the brink of a world war, Shaster sent in a crack diplomatic team with steak dinners, and peace was preserved until the eruption of the first Cetacean War in 920.

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Most Honored Pierce Milton