This is an intentional policy choice btw. You could just legislate the horseshoe company pays 90% of each displaced blacksmith decreasing by 5% per year.
That's also a way to create a new royalty class.
You should share your crystal ball that tells you the future so you can help leaders accurately predict changes in supply and demand curves so that they can make better policy choices.
And hey, almost a million blacksmiths displaced is a huge block of voters that any elected politician would be glad to capture! Although I struggle to recall any of the examples of something like this happening in the real-world history.