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Appendix II. Wang Mang's Economic Reforms

The economic changes made by Wang Mang constitute one of the very interesting experiments man has made with his social environment. In studying these reforms, we must recognize that they sprang from the Confucianism of that age. While Wang Mang was himself interested in changing government institutions---he liked nothing so much as to show his superiority by bringing about an improvement---yet the crucial test of any proposed change was whether it was classical, i.e., whether it had been practised or approved by some of the sages, as their deeds and sayings were recorded in the Classics and interpreted by the scholarly traditions of the time, handed down in the various schools. Wang Mang had moreover added certain books to the official Confucian canon: the Tso-chuan, the Chou Offices, the ancient text (since lost) of the Book of History, the lost chapters of that Book, etc. (99 A: 19a). The Chou Offices, for example, seems to have been prepared, in part at least, by idealistic Confucian antiquarians, who, consciously or unconsciously, wrote into the past their own conceptions of an ideal government. In these new canonical books there were naturally many traditions concerning economic matters. Wang Mang had acquired his popularity among the intelligentsia, which had brought him to the throne, by his complete conformity to Confucian ideals; when he ruled in person, he was then obligated to put into practise these Confucian ideals. Wang Mang was, first and foremost, a complete Confucian; the credit for his remarkable reforms must be given rather to the Confucian literati than to him.

Wang Mang was also a scheming courtier who wormed his way into power by clever intrigue. He came of a clan that had enriched itself, beyond all other clans, through imperial grants and through profiting from the perquisites of power. While Wang Mang himself held his acquisitive propensities severely in check, in order to appear liberal (99 A: 1b), yet at heart he was grasping and stingy (99 C: 1b). Hence he saw to it that his reforms benefited the throne. In his rule, he showed himself callous to the true interests of his people, with the result that their economic condition deteriorated, until, as a result of misgovernment, oppression, famine, banditry, and civil war, the population was reduced by half (24 B: 27a).

Such a result was however quite contrary to Confucian idealism, which was sympathetic with the people. To Confucians, it was axiomatic that all reforms which accord with the Classics will benefit the state and the people. Consequently, when any of Wang Mang's reforms brought discontent and economic disorganization, the conclusion was drawn that it was not really classical. Wang Mang did not follow classical precedents slavishly; he improved on them. The tradition was that King Wen had coined two denominations of money (24 B: n. 21.2), so Wang Mang instituted twenty-eight denominations (24 B: 23a), only later reducing them to two. Wang Mang found the word "controls (kuan)" in the Classics (24 B: 23b), whereupon he used this word as a justification for his monopolies; later, when these monopolies were seen to have oppressed the people, the term "controls" was interpreted otherwise and monopolies were held to be unclassical. As a result of Wang Mang's failure, Confucianism was not discarded by many intelligentsia, it was merely reinterpreted; the Later Han dynasty was at first more Confucian than the Former Han. But sceptical thinkers (even some members of Wang Mang's own clan, such as Wang Chi(7) [a distant cousin, cf. HHS, Mem. 9: 1a]) began now to be repelled by Confucianism and were attracted to Taoism, so that at this time there began the re-emergence of this doctrine after a century of almost total eclipse. Wang Mang's own grasping nature was an important reason for the failure of his reforms, in spite of their Confucian nature.

We shall consider his economic changes in the following order: (1) his monetary reforms, (2) his policy regarding land and slavery, (3) his monopolies and taxes, and (4) his attempt to speculate in staples and to loan money.

His monetary reforms came soon after he became Acting Emperor (A.D. 6). A tradition had been preserved that in Chou times, in order to compensate for fluctuations of prices, there had been two denominations of bronze coins, not merely one, as in Han times. (HS 24 B: 2b, 3a, 21a and n. 21.2). This tradition made varied coinage a Confucian practise, since a fundamental Confucian principle was the imitation of the ancient sages. Wang Mang accordingly coined four denominations of bronze coins, with the values of 1, 50, 500, and 5000 cash. The first two denominations were round cash; the latter two were in the form of knives. The fifty-cash coins had only 1/20 as much metal per cash as the one-cash coins, and the others were proportionately lighter (about 1/100 and 1/625 as much metal per cash as the one-cash coins), so that there was much profit for the government in this coinage. In its early years, the Han dynasty had experimented with depreciating the coinage, but there had arisen opposition to that practise, and, for the last century and a quarter, there had been no change in the weight of coins, so that the evil effects of this depreciation were probably not anticipated. One result was a great increase in counterfeiting.

In addition, Wang Mang "nationalized" all gold, that is, he permitted only vassal kings to possess actual gold, other nobles and people being required to bring their gold to the Emperor's wardrobe, where they were to be given its value in bronze cash. Pan Ku states that they were not given its full value. Very probably they were paid in light-weight knife-coins of high denominations. Thus Wang Mang made much profit out of manipulating coinage and gold.

When in A.D. 9, Wang Mang became titular emperor and established his own dynasty, he had to do away with the knife-coins, because the Chinese word for knife, 刀, forms part of the word Liu 劉, the surname of the Han dynasty. Since a change in currency was thus necessary, he first did away with the knife-coins, only two denominations remaining (A.D. 9), and later (A.D. 10), added other denominations to make twenty-eight in all. Sixteen of these were of bronze. The others, in gold, silver, tortoise-shells, and cowries, were not coined, so that this legislation amounted to fixing a price for these four articles.

An important motive in this bronze coinage was undoubtedly to make a profit for the government. We are informed concerning the weight and value of each denomination (24 B: 21a-23a). The light-weight fifty-cash pieces were retained, but the heavy one-cash pieces were replaced by new cash weighing only one-fifth as much as the former one-cash pieces. The higher denominations were in the shape of trousers-cash or spade-money. The weights of these bronze coins were so arranged that the one-cash pieces contained proportionately the largest amount of metal, each higher denomination containing proportionately less metal, until the highest denomination, that of a thousand cash, contained only 2.4% as much metal per cash as the one-cash pieces (cf. 24 B: n. 22.11). This coinage was thus an issue of metal fiat money. People who had previously used the heavy one-cash pieces would hardly want to give them up in exchange for the new light coins. In order to make the coins of large denominations circulate, Wang Mang ordered that all persons who passed the likin stations at the passes, fords, and elsewhere must show large spade-coins of high denominations along with their passports; officials who used the government posts or who entered the palaces, must also show spade-money in order to be admitted (99 B: 15a). Since cash were cast, instead of being struck, counterfeiting was easy and many people were driven to it in order to preserve their wealth. To stop counterfeiting, Wang Mang made the possession of copper and charcoal an offense (99 B: 7b). This law proved too drastic and was moreover ineffective; it was consequently abolished in A.D. 13 (99 B: 22a). When the people refused to use the new coins, Wang Mang issued an edict that all those possessing the older heavy cash would be executed or exiled. Pan Ku says that as a consequence farmers could not sell their produce nor merchants their goods, and the common people wept in the market-places and highways, while uncounted people and officials, even of the highest ranks, were sentenced for crime (24 B: 23a).

When we note that the mere possession of the heavy coins was made a crime, and that an informer was given half of the illicit wealth seized as a result of his information, we can well believe Pan Ku's statement. In order to maintain a semblance of authority over the coinage, Wang Mang had to abandon all but two denominations of these new coins, and retain only the light one-cash pieces and the fifty-cash pieces (24 B: 23b).

Some years later (A.D. 14), Wang Mang again changed the coinage. The light-weight one-cash pieces had probably so disarranged prices that there had been a loud clamor for the restoration of the previous heavy cash. The people had been paying taxes in the light cash, and the officials had probably found that taxes and their salaries (which were payable half in coin) did not yield as much value as previously. The former coinage was therefore abolished and the previous heavy one-cash pieces, weighing five times as much as the light one-cash pieces, were restored. But the light one-cash coins were not exchanged for the new heavy cash; they were merely dropped. The one-cash pieces in circulation were thus demonetized. An edict was issued which declared that the previous fifty-cash coins (weighing two and one-half times as much as the new large one-cash coins) were to be worth as much as one of the new one-cash pieces (24 B: 26b), i.e., the government would take a former fifty-cash coin in place of a new one-cash coin.

The people were given six years in which to make this change; after that time, possession of the former fifty-cash pieces was to be forbidden. The result may easily be imagined. A person who had any large amount of money in fifty-cash pieces and who used it in accordance with the law, lost 49/50 of his money. What he had in one-cash pieces became worth only so much metal. Few people could afford to make the exchange. By melting down cash, on the other hand, a person may have lost comparatively little, for cash were then probably worth approximately their weight in metal. All that was needed was new cash to use as models, clay for moulds, and a charcoal stove to melt the coins. It is not surprising that counterfeiting became ubiquitous. To stop it, people were grouped in lots of five families, who were responsible for each other; if one family was caught counterfeiting, all five families were punished. So many people, however, violated the law that the punishments could not be carried out. Wang Mang had to lighten the punishment for counterfeiting to enslavement of the counterfeiter to the government, together with his wife and children and those in his group of five families. These unfortunates were transported to the mint at the capital to work out their sentences. Pan Ku states that six or seven out of every ten died from the hardships and suffering (24 B: 26b).

There were also coined new twenty-five-cash pieces (in the shape of trousers-cash or spade-money), which contained one-fifth as much metal per cash as the new one-cash pieces. Thus the former principle was continued, of profiting by coining light-weight pieces of high denominations. Light-weight coins of high value would be a boon to anyone who must transport money, if their value could be maintained. But there is no evidence that the government did anything to maintain their value. The fact that the coins of high denominations in the second coinage were dropped and that the coins of high value in the third coinage were only twenty-five-cash pieces, instead of fifty-cash pieces as in the first coinage, would seem to indicate that the value of these coins was not maintained and that they depreciated in usage.

We must resort to inference in order to determine the precise economic effects upon Chinese society of Wang Mang's three changes in coinage and his nationalization of gold. The latter decree probably succeeded in mulcting the wealthy, especially the Han dynasty's nobility, who were the only persons likely to have possessed much gold. They needed gold for their yearly contribution to the throne (HFHD II, 126-128). Since Wang Mang allowed the highest nobles (the vassal kings) to retain their gold, he did not, even in A.D. 6, take gold completely out of circulation; the enactment of A.D. 10, which made gold one of the articles of currency, rescinded the prohibition against possessing gold.

At that time, gold was not coined, but circulated in the shape of square cakes an inch (0.9 in., Eng. meas.) on a side and weighing a catty (then 7.84 oz. troy, 244 g.; HFHD, I, 280). Such a catty of gold was worth ten thousand cash; imperial grants of gold were usually transmitted in terms of their equivalent in bronze cash. Ten catties of gold was the value of the property belonging to a median family (HS 4: 21a). By exchanging depreciated inlaid bronze knife-coins for actual gold, Wang Mang deprived all but his highest nobles of much of their wealth. His use of such knife-money in making grants saved him about 99.8% of the metal he would otherwise have disbursed. For the first three years after their gold had been taken away, the nobles probably did not feel the loss---they merely paid their annual required contribution in the form of gilded knife-money. When, however, in A.D. 9, these knife-coins were demonetized and suddenly became worth only their value in metal, the nobles found themselves mulcted and had to get rid of these knife-coins to show their loyalty to the new dynasty. Thus, by a clever trick, Wang Mang deprived the Han dynasty's nobility of much their wealth, before he dismissed them and set up his own nobility.

Wang Mang seems to have hoarded most of the gold he obtained. He was miserly, and failed to use his treasure, even in emergencies (cf. his payment to soldiers, 99 C: 25b). Pan Ku reports that when Wang Mang was finally killed, he still had much treasure. Ten thousand catties of gold made a chest and there were sixty chests of gold in the imperial apartments, as well as several chests in other offices of the palace, besides cash, silk, pearls, jade and valuables (99 C: 25a, b). This nationalization of gold seems merely to have withdrawn much of the empire's gold from circulation and to have concentrated it in the imperial palace. The nobles had been given depreciated bronze coins, nominally of the same value, but probably exchangeable in trade for far less, and these coins were soon demonetized, after which time gold was again allowed to circulate.

Sixty chests of gold, if all the chests were full, would be 146,400,000 grams or 4,706,867 oz. troy. There were also "several chests" in each of three other offices, so that the total amount, if correctly reported, must have been about 5,000,000 oz. of gold. Where did this huge amount of treasure come from? If the report is correct, it was a greater quantity than the entire visible stock of gold in Europe of the middle ages, which is estimated as not over 3,750,000 oz. 1

The reliability of this report concerning the gold is probably quite high. Pan Ku was too careful a historian to insert such a statement into his account if he had no documentary source for it. He had no motive in exaggerating Wang Mang's wealth. This statement probably came from the report to the Keng-shih Emperor made in A.D. 23 by the captors of Ch'ang-an. They may indeed have exaggerated their report of Wang Mang's wealth. "Sixty" is a round number and so may not be exact. But the captors would not have exaggerated very much, for they would be held accountable if any large amount of treasure was missing. The Wei-yang Palace, in which were located the inner apartments containing this large treasure, was burnt in the attack upon Wang Mang, but Pan Ku says specifically that the government treasuries were nevertheless maintained intact (99 C: 29a). Proof that Wang Mang had possessed a large amount of gold is also afforded by his betrothal present to the family of his second wife, nee Shih, which was 30,000 catties of actual gold or 235,343 oz. (7,320,000 g.; 99 C: 20a). 2 Thus Wang Mang must at one time have had about five million ounces of gold. China had never produced any large quantity of gold; 3 whence could he have obtained all this treasure?

It undoubtedly came to China in return for Chinese exports, the chief of which was silk. Gold has indeed a tendency to form hoards. Siberia was then the largest and nearest source of gold. Much of the gold possessed by ancient oriental empires seems to have come from this region. Parthia, Bactria, Sogdiana, and India produced little or no gold, although Bactria was famed in ancient times for its gold. 4 An abundance of golden articles has however been found in Scythian graves in South Russia and Siberia. In the fifth century, the Massagetae, who were northern neighbors of Bactria, had so much gold that they used it to make bits and trappings for their horses. 5 Probably most of this gold came from placer mining along the headwaters of Siberian rivers; even at the beginning of the present century, the main Siberian sources were the washings along the Lena and Amur. Possibly the Obi and Yenisei systems also furnished gold; new gold fields are said to have recently been discovered near the head waters of both rivers. Probably gold was obtained over a very large area; Siberia is today asserted to have larger amounts of gold than any other country. 6 There may also have been gold mines in the Urals and Altai, but mining was so laborious in comparison with washing that most of the gold probably came from the rivers. Anciently this supply must have seemed inexhaustible.

The Chinese probably obtained a goodly share of this Siberian gold by trade with their northern neighbors. Although these peoples did not wear silk, yet their leaders would want it as an article of luxury; other Chinese articles of luxury were likewise exported to these peoples. The Chinese traded actively with the Huns and other northern neighbors (except when they were at war with them) along the whole northern border, and (at least during the first century B.C.) Chinese envoys traveled regularly through much of southern Siberia, along with whom went merchants, who took advantage of the envoy's escort and probably paid his expenses.

Gold was also mined in Europe and possibly in Asia Minor. There were important gold mines in Transylvania, where the Romans obtained much gold. 7 Once silk became available, the Romans eagerly sought for it, just as they imported large quantities of Indian spices and other goods. In Wang Mang's time, the silk trade with Greek Asia and India via the Tarim basin had been actively carried on for some centuries. We know little of it before the time of Emperor Wu, but the fact that Chang Ch'ien reported conditions in Bactria shows that before the Chinese conquered the Tarim basin, trade was going on between the Greek orient and China. After that conquest, with the establishment of peace, trade doubtless increased several-fold. In 67 B.C., a Protector-General was established for the Western Frontier Regions and in 48 B.C. the army of the Mou-and-Chi Colonel was established there to maintain order.

At the same time, silk was becoming more and more popular in Rome. Julius Caesar (d. 44 B.C.) is reported to have possessed silken curtains, but the introduction of silk to Rome in quantities began only in the reign of Augustus (27 B.C.-A.D. 14) and may be traced to Marcus Antonius, who communicated with the Bactrians. Tiberius (A.D. 14-37) censured the wearing of silk by both sexes and forbad its wearing by men. Gaius (37-41) revived the wearing of silk, at least by the emperor. But clothing made wholly of silk was rare until Elagabalus (218-222) set the example, this material normally being woven into linen or woolen fabrics after importation. At the same time that they were using silk, the Romans were importing much larger quantities of goods from India; Pliny says that at the lowest computation, India, Seres, and Arabia drained from the Roman empire a hundred million sesterces (over five million dollars-worth) annually, more than half of which went to India. 8 Thus wealthy Romans began to use a certain amount of silk in the last century of the Former Han period; in the time of Wang Mang, sumptuary legislation was enacted against it, and in Later Han times its use became common among the wealthy.

Before silk became sought after in Rome, its use had probably become likewise popular in the kingdoms of central and western Asia and in India. As early as the time of Emperor Wu, traders were taking silk to India by sea (HS 28 Bii: 68b); this sea-borne trade seems however to have represented a drain of gold rather than an accession of it. There was also some trade to India via Yünnan and Burma. But these two routes can hardly have carried any large quantities of trade; the geographical obstacles were too great. The chief route of export was by way of the Tarim basin, which led into Sogdiana and Bactria, and thence to India or to the Mediterranean world.

It is doubtful whether there was much return trade to China in goods by this route. The road was so long and difficult that only goods which combined high value with small bulk would be profitable to carry. In Europe, silk was worth its weight in gold. Some jewels (including pearls from India) and a few Hellenistic works of art seem to have been all that the Chinese imported. But their appeal was limited, so that large quantities would hardly be carried to China. Hence the return trade was largely in gold, which alone, together with silk, fulfilled the conditions for profitable trade. Thus China may have drained the Hellenistic Euthydemids of gold in the first century B.C., just as in the time of Wang Mang the Roman use of silk threatened the Roman stock of gold. It is an interesting fact that, although gold was mined in Europe, in late antiquity, accumulated stocks of gold seem to have disappeared from that region. Much of this gold found its way to India, but some must have come to China. Large hoards of gold coins dating from Hellenistic and Roman times have been found in India, but finds of such coins are extremely rare in Chinese territory. Trade between the Roman empire and India went direct; that between the Roman empire and the Chinese seems only to have been carried by middlemen, until Later Han times. The Chinese were furthermore accustomed to using gold in the form of bullion squares, so that they melted down Greek and Roman coins. In China there was a customary ratio between gold and cash (10,000 cash to 1 catty of gold, 130 to 1). Wang Mang's stock of gold probably came chiefly from Siberia, somewhat from Hellenistic Asia and India, and some from Europe.

At the beginning of the Former Han period, gold seems to have been used in China freely in exchange; imperial grants were frequently in "actual gold." By the latter part of that period, actual gold seems to have been used much less frequently. Probably the opening of the copper mines in the lower Yangtze region and elsewhere had made bronze cash so plentiful that even large sums were transferred in the form of cash. In A.D. 3, Wang Mang was given 40,000,000 cash and 23,000,000 cash as betrothal presents for his daughter (99 A: 10a). With large quantities of cash available, it would have been natural that gold should have accumulated in the treasuries of the wealthy, who were chiefly the nobles. When Wang Mang demonetized gold, these nobles would have been especially careful to deliver up their stores of gold, in order to avoid the punishment (dismissal and confiscation) for retaining any of it. Thus Wang Mang probably secured much of the gold in China, which country had been draining gold from Asia and Europe.

The changes in the bronze coinage probably affected Han China much less than a similar depreciation would have done in modern times. China had already changed from a barter economy to a limited money economy. The land tax was still payable in kind, but money was exacted for the numerous other taxes. The salaries of officials were quoted in so many piculs of grain, and were paid, half in grain and half in money (HHS, Tr. 28: 14b, 15a). Poll-taxes, levied upon all adults and all children over their seventh year, were in cash. Artisans and professional men paid an income tax in money, (established by Wang Mang; 24 B: 24a, b). The Han satrapies each sent an annual accounting to the imperial government, and probably at the same time remitted a certain proportion of the taxes they had gathered. Nearer commanderies remitted at least a portion in the form of grain. We hear of corvée service for the transportation of grain and of a special canal to Ch'ang-an dug for its conveyance. Distant commanderies probably remitted cash or valuables. An effort seems to have been made to transport to the capital no more grain than was necessary to feed the people in that region. The capital region had been irrigated, and had been one of the most productive areas in the empire. Hence taxes could largely be remitted in money, which had been used to purchase grain in the capital area. Each city had its market-place (or bazaar); the capital had two. There was thus a large sum of money in circulation for purposes of taxation and trade.

The farmers probably used very little money. They stored their grain and used it themselves or sold small amounts in order to purchase articles in the markets. The farmers who possessed money were probably only those who had accumulated surplus wealth. The poorer people affected by Wang Mang's changes in coinage were chiefly those who were in debt. Interest rates were quite high. We have no way of knowing how many farmers were involved in debt, for we hear nothing of farm debts. Since merchants were prohibited from owning cultivated fields, they would hardly lend money on farm land, for they could not foreclose such a mortgage.

A real, though limited money economy was only a few centuries old in the China of Wang Mang's time, so that a mortgage system may have not yet developed. The only moneyed people besides merchants were nobles and officials. Some decades previously, the Grandee Secretary, Kung Yü, (d. 43 B.C.) had memorialized the throne that the court officials should not be allowed to buy or sell or to make money off the people, but this memorial had not been acted upon (HS 72: 14a). Hence some wealthy officials did actually engage in business, but that procedure was frowned upon and was not considered proper. There had been a long-standing prejudice and prohibition against merchants entering government positions.

The higher nobles undoubtedly considered it beneath their dignity to engage in business. Some of the wealthier ones however maintained "guests," i.e., persons of ability who came voluntarily to their house, became part of their household, receiving support from them, and in return executed various commissions for them. We hear of guests who gave clever advice, of others who wrote books for their host, of still others who avenged their host's feud, and even of guests who robbed for their host, bringing their booty into his house and being protected by him. Some nobles had guests who engaged in business for their hosts. But here again the aristrocratic prejudice against merchants probably prevented this carrying on of business by proxy from becoming a very common practise.

We hear of one wealthy merchant who sent his slaves out to conduct businesses (91: 10a), and of a wealthy family that lent money, but these loans were to other merchants or artisans (91: 9b). When Wang Mang established an office for making loans, his enactment implies that debts were incurred chiefly for the performing of religious sacrifices (especially burials) and for buying farm land or setting up businesses (24 B: 24b). In an emergency, a certain wealthy man made loans to those newly enfeoffed nobles who needed supplies for a military expedition against rebels (154 B.C.; he exacted a tenfold repayment; 91: 11b).

But nowhere do we hear of any extensive loans to farmers, except those made by the government in time of drought or calamity. The government would sometimes settle landless people on vacant or newly opened land, giving them seed, food, and oxen for plowing. They were expected to repay these debts, but this provision was frequently waived by an imperial act of grace. The only large farm debts may have been of this variety; but on such debts, the government, if it wished, doubtless found means whereby a change in coinage would not diminish its revenues. Wealthy land-owners probably exacted their rents in terms of grain, rather than money, as is still the case in rural China. Hence farmers (except the wealthy ones) were probably little affected by the depreciation of money.

Merchants and other wealthy persons (who were probably bureaucrats or their descendants) were the ones who felt the deprecations of the coinage, for they possessed most of the money not in the hands of the government. The policy of the Han dynasty was to discourage trade and foster agriculture in every possible manner. Trade was penalized drastically. Merchants were considered parasites and were compelled to pay larger taxes than farmers. They and their descendants were not ordinarily allowed to hold official positions.

How far the depreciations of the coinage actually deprived merchants of their wealth is difficult to determine. The extremely rich, settled merchants, who had large establishments, probably found it possible to melt down their cash promptly and recoin it into the new forms. They may even had made money by the change, just as did the government. Wealthy officials probably kept most of their property in the form of goods or jewels. Those who suffered were the smaller merchants and pedlars, who did not have facilities for counterfeiting, and whose small shops could easily be watched. The worst suffering was among the unfortunates who were caught counterfeiting; they were punished with their innocent neighbors who had failed to report the crime. The chief effect of the changes in coinage was probably the transfer of wealth from the smaller merchants to some rich merchants and especially to the government.

Wang Mang had incurred great expenses, and his income was inadequate for the government expenses. It was thus only natural that he should have depreciated the coinage in order to secure money. Government loans had not yet been thought of. The circumstances occasioning the monetary changes and the nature of the changes in the coinages were such that Wang Mang could hardly have had any genuine revolutionary policy in mind---his purpose was probably to make money for the government by a change in coinage which superficially had classical sanctions.

In his land policy, Wang Mang encountered similar difficulties. Population had increased considerably during the peaceful years of the Han dynasty. North China (then the only thickly populated part of the country) is a region of periodic droughts and floods; many poor farmers, unable to keep reserves enough to tide them over a drought, had been forced to sell their hand in bad years, in order to get food. It had been the policy of the Han government to maintain great granaries for famine relief, to make loans to the poor, and to settle landless refugees upon vacant lands. Nevertheless large holdings of land and tenancy had increased and had long been a problem, because tenants could scarcely accumulate the reserves necessary to tide them over a famine. A famine year inevitably produced great hordes of vagrants, who died on the roads and thronged into regions where there was food. Since the government levied poll-taxes upon adults and children over seven years of age, in addition to the land-tax, this vagrancy meant not only human suffering, but also a great loss of income to the government.

In the year that he took the throne (A.D. 9), Wang Mang reformed the tenure of land by establishing the ching 井 system (99 B: 8a, b; 24 A: 21a, b). 9 The Confucian tradition was that this system had been universal in Chou times in all flat regions, and that other types of terrain had been parcelled out proportionately (HS 24 A: 3a). According to this system, an area one li or about 1350 feet square (Eng. meas.). was divided into nine equal squares. One of the outer squares, containing 100 mou or about 4(1/2); acres, was given to each of eight families to cultivate for its own use. (For the size of the li and mou, cf. 99 A: n. 9.7.) Each family also cultivated one-ninth of the central square ((1/2) acre), the produce of which was to be paid to the government in lieu of taxes. The remaining ninth of the central square was reserved for houses and buildings. Thus the farmer paid as taxes only one-tenth of his produce, and paid it in kind, not in money. Land was moreover distributed according to the needs of the people, so that one household, containing five persons and one male worker, cultivated one unit. A youth received land in his twentieth year and returned it to the government in his sixtieth year. (Cf. Pan Ku's account, in HS 24 A: 2a ff.) 10

This ching system looks excellent on paper; but its practical difficulties make doubtful its use without changes over any large area. Land cannot always be divided into exact squares; streams, hills, and roads interfere with such a division. Five acres could not support a family except on the best soil; Pan Ku, in describing this system (24 A: 2b), states that two or three times as much land of the poorer varieties was necessary for a family. A tax amounting to only a tithe of the produce would provide very little for the officials in poor years, when they needed a larger income than in good years. This sum was furthermore too small for the requirements of a developed government, which maintained an expensive and luxurious court, an elaborate bureaucracy with post-roads and post-stations, a standing army, government schools, a government university, etc., etc. Hence there had been added to the tax on land other taxes, such as a regular conscript system, which required three days a month service at the distant frontiers (regularly commuted to a money payment for substitutes, who became a standing army). In addition, there were heavy poll-taxes of various sorts. Tung Chung-shu said, in a memorial to Emperor Wu (24 A: 16b), that farm tenants paid out five-tenths of their income to their landlords. In Han times, money had come to be the usual medium of exchange, so that the payment of all taxes in kind was a special boon granted by the throne to the farmers only on special occasions, when grain was extraordinarily low in price. Thus the ching system seems to have been a dream of idealistic scholars; it had probably been tried only in a restricted area and in much simpler times, and, if applied literally, was quite impractical in a society like that of Han China. (In recent centuries, it has been considered by orthodox Confucian authorities as a practise suitable only for Spring and Autumn times. That conclusion is however probably a consequence from the experience of Wang Mang and others with this scheme.) The ching system had however the great merit of doing away with tenancy and large land-holdings, from both of which China suffered.

This system had great authority, for it had been urged by Mencius (III, A, iii, 13-20; Legge, 243-5) and was said to have been the system employed by the Confucian sages. Tung Chung-shu, the great Confucian authority, had urged it upon Emperor Wu (24 A: 17a), and Shih(1) Tan, another Confucian, had urged it upon Emperor Ai in 7 B.C. (24 A: 20a), probably because they felt that the land needed redistribution and taxes were too onerous. Wang Mang, who had secured the throne because he followed Confucian practises whole-heartedly, naturally ordered its enactment.

In order to prevent any increase in tenancy, he at the same time nationalized all land. He named all cultivated fields, "the King's fields, wang-t'ien 王田," and ordered that they could not be bought or sold. Thus farmers were deprived of the opportunity to alienate their land, even in extremities. The amount of land that one family could hold was also limited. A family containing nine adult males or less was allowed to possess a maximum of 900 mou (102 acres or 41.5 ha.) of arable land; any family with less than that number of adult males and more than that amount of land must distribute its excess land to relatives or neighbors. Thus land ceased to have any market-value and wealthy land-owners were compelled to get rid of all but a small part of their land. Wang Mang must have realized the extremely drastic nature of this reform and the resentment it would arouse, for he added that anyone who dared even to criticize the ching system would be exiled beyond the frontiers or suffer execution.

At the same time, slavery, which had also been disapproved by Confucians, was to be abolished. Tung Chung-shu had urged its abolition more than a century previously (24 A: 17a). As a consequence of Shih1 Tan's proposals in 7 B.C., it had actually been ordered that vassal kings might own only 200 slaves, marquises and princesses only 100 slaves, and others only 30 slaves, but this law had been dropped and had never been enforced (11: 3a). Wang Mang now produced a text from the Confucian canon, which was interpreted to assert that slavery was lawful only for the government, i.e., there should be no slaves except those in penal servitude to the government. Private slaves were renamed "private adherents 私屬" and were not to be bought or sold.

The limitation of land holdings was a specifically Confucian measure. Tung Chung-shu had advocated the limitation of the amount of land that could be held by an individual (24 A: 17a). Shih1 Tan had repeated that statement (24 A: 20b). When Emperor Ai had agreed, his officials suggested that kings and marquises should be allowed unrestricted amounts of private land within their kingdoms or marquisates; outside these areas they should be restricted to 3000 mou (342 acres or 136 ha.). It was also proposed that the number of slaves be restricted. The Emperor's maternal relatives had however found this restriction inconvenient, and prevented it from being put into effect (11: 3a; 24 A:20b). The ching system and the limitation of land had the backing of Confucian tradition and sentiment.

A customary practise, like the free ownership of land, cannot be changed overnight. Land had been bought and sold freely in China for several centuries. After Wang Mang's edict was published, it was but natural that the wealthy should seek to convert their excess land and slaves into money. Pan Ku reports that countless people, nobles, ministers, and commoners, were sentenced for purchasing or selling land or slaves (99 B: 9a). It is not surprising that two years later the prohibition against buying or selling land or slaves was rescinded (24 A: 21b).

In A.D. 17, a tax of 3600 cash per slave was levied upon all slave-owners, including nobles (99 C: 1b). The intent of this tax was not to eliminate slavery, but merely to obtain money. Since rich households depended upon slaves for domestic service, this law bore chiefly upon the wealthy nobles and high officials.

In the abolition of slavery and the restriction of land holdings, Wang Mang was undoubtedly making a needed reform. It is possible that the more thoroughgoing nature of this enactment, as compared with previous proposals of the kind, indicates a genuine altruism on his part and a desire to help the poor. The severity with which violations of his enactment were punished may have also been merely a general characteristic of his government. He very likely conceived of himself as altruistic. The drastic nature of his enactments may however have been merely his conception of the lengths to which a new and thoroughly Confucian dynasty should go in carrying out supposedly ancient practises and an expression of his sense of power. This latter supposal is moreover more in harmony with the rest of his deeds. Certainly he seems to have shown no pity for those who suffered from his reforms.

Since these reforms were all rescinded within two years, someone was evidently able to bring so much pressure upon him that he had to revoke this reform of land tenure and slavery. We are not told who it was, so shall be compelled to resort again to inference.

No large part of the population in China has ever been enslaved except by a general conquest. Slaves have rarely, if ever, been used for agricultural work. Skilled artisans, who are able to make money by plying their trades, tend to become freemen; free labor is more efficient than slave labor and clever slaves purchase their freedom. Chinese slavery was limited chiefly to domestic service and rough labor. The government was undoubtedly the largest slave-owner; criminals were frequently condemned to forced labor for a period of years or for life and were put to work in the government offices. (C. M. Wilbur, Slavery in China During the Former Han Dynasty, pp. 241-44.) The menial labor at the various bureaux was performed by these slaves. Thousands of such enslaved criminals were employed in the government iron and salt monopolies. A capital sentence could sometimes be commuted, at the culprit's request, to castration, whereupon he became a eunuch in the imperial palace---a eunuch government slave. Many, perhaps most of the palace eunuchs must have originated in this manner. We hear of thousands of slaves in the imperial palace and occasionally even of a highly educated slave-girl, such as Emperor Ch'eng's inamorata, Ts'ao Kung (HFHD, II, 369). Government slaves were freed when their terms were completed. Government slaves were sometimes bestowed upon imperial relatives or favorites; occasionally at least, they were sold (Wilbur, op. cit., p. 446). There may have been hereditary slaves, but there is some evidence that children of slaves were automatically free, at least by the fourth generation, unless (as must have very commonly been the case) they were, as children, sold or given into slavery by their parents, in order that they might be reared. The Huns captured large numbers of Chinese in their raids upon the borders; these people were often sold, many, in all probability, to Chinese. The slave-market was however chiefly maintained from children sold by their poor parents or from children or adults kidnapped by powerful people (perhaps given actually unjust, but technically legal sentences of enslavement). Criminals who were enslaved by the government would rarely be of high caliber and would be suitable chiefly for rough labor; for entertainers and other trained domestic slaves, the nobles and wealthy had to depend chiefly upon the slave market. 11

Outside the government service, the largest number of slaves were in the noble houses. The nobles maintained slaves as entertainers as well as domestic servants. Rich merchants also had such slaves; sometimes slaves were used for manufacturing. The prohibition of the sale or purchase of slaves would have limited severely the supply of high quality domestic slaves and it would have made the government the only remaining source of slaves. At the time, it produced little immediate change, except among merchants who had bought slaves for resale. We may well conclude that it was Wang Mang's nobles, probably his close relatives, who persuaded him to rescind this measure, for these nobles would have found it impossible to replenish the high quality slaves in their households. Since the revocation came so soon, the measure had a negligible effect upon slavery.

Just how Wang Mang put the ching system into effect is not told. He could not cut the land up into regular squares; probably he did not change the boundaries of fields, but merely limited to 900 mou the amount of land one family might possess. The Han land-tax was one-fifteenth, so that the introduction of the ching system probably meant an increase in the land tax to one-tenth. The other taxes, such as the poll-tax on adults, (suan), the poll-money (levied on children), the military taxes (fu), likin duties (collected at the Wu Pass and probably at the other passes), were probably continued. Then the actual effect of the ching system was very likely limited to prohibiting the sale of cultivated land, limiting land holdings, and an increase in the land tax.

The ban on selling cultivated land was probably a benefit to the poor farmers. It prevented them from losing their land in time of drought. Hence they were compelled to fall back upon the government for relief and to become vagrants when that relief was not available. We are not told about any mortgages upon farm land. This prohibition of the sale of farm land merely fixed the existing farm population upon the farms they then occupied. It was rescinded within two years and so had little actual effect.

The limitation of the amount of cultivated land that could be owned by a single small family was plainly an attempt to diminish tenancy and distribute the land more widely among the people. It only affected large land-owners. These large land-owners were chiefly the bureaucrats and nobility (these two classes were largely identical, since the Han nobilities had been mostly discontinued and Wang Mang's nobles were his relatives and officials); merchants were not allowed to own farm land. The reason that the nobles would wish to own large private farm estates requires explanation.

The Han dynasty's full marquises (which Wang Mang replaced by four degrees of nobility: marquises, earls, viscounts, and barons) all had their noble estates located outside of Kuan-chung (the capital region, roughly the present central Shensi), some at considerable distances from the capital---in the present southern Honan, Hunan, Shantung, or Hopei. The nobles had little control over their fiefs; these estates were managed by chancellors, who were appointed by the central government; in practise, nobles received merely the income from these estates in the form of 200 cash per household or its equivalent in grain, out of which they had to pay their annual contributions to the imperial court (91: 6a). But the transport of grain or even of bronze cash from a distance to the capital presented difficulties because of banditry, and sometimes cost more than the value of the grain itself. It may have been impossible to make regular deliveries to the capital from the noble estates, because of the distance. Most of the nobles, moreover, lived at the imperial capital, Ch'ang-an, the center of culture, civilization, and political power. Hence it became the practise for such nobles to purchase private land in Kuan-chung, the income of which they used for their expenses. Such neighboring lands could be watched, and rents brought to the capital with ease. The largest private land-owners were the same rich nobles who had large numbers of slaves. Wang Mang's uncles are described as having, at the time of Wang Mang's childhood, "several tens of concubines in their harems, slaves by the thousands or hundreds, musicians, singers, actors, dogs, horses, large residences with earthen mountains inside, cave gates, high verandas and pavillions, double passage-ways," etc. (98: 7b). To keep up such extravagent establishments, large estates were essential.

Wang Mang did not interfere with the feudal estates of his nobles, he merely required them to distribute their excess private fields among their relatives or neighbors. It would not have been difficult for some nobles to find members of their clans to take these excess cultivated fields, manage them, and remit part or most of the proceeds to the original owner. There was, however, the danger that these new owners would cease paying rents to the original owner. Those nobles who could not or would not use such subterfuges and who did not have adequate official salaries would be compelled to retire from the court to their feudal estates. That meant, however, leaving civilization to live in the "sticks," the abandonment of one's social life and of the source of political perquisites. Exclusion from the capital was a penalty considered more severe than dismissal from office; it was visited upon officials who had become obnoxious to the court. Wang Mang had suffered three years of such exile and knew its bitterness; his intimates and the members of his clan probably reminded him of the suffering he was preparing for them and of the ease with which certain nobles were circumventing his enactment. So much pressure was brought upon him (in all probability, practically the whole court, except the conscientious Confucians, were unanimous in this matter) that he had to rescind his enactment. In the end, this reform of land tenure amounted to nothing.

We can only speculate concerning Wang Mang's motive in attempting to alter land tenure. He might have been moved by compassion for the miserable condition of the peasant farmers, but in my opinion, any such attitude on his part is doubtful. He did not commonly indulge in compassion; his great increases in taxation would seem to preclude any real concern for the poor. His concern was rather to carry out Confucian policies. The ching system was one of the outstanding Confucian economic policies; if he had not attempted to put into practise a policy recommended by Mencius, Tung Chung-shu, and other outstanding Confucians, he would have appeared lukewarm, so that one important source of his unusual popularity would have been gravely undermined. Statecraft and ambition, not compassion, were his driving ambitions.

The third group of economic measures enacted by Wang Mang were the six monopolies (established A.D. 10; 99 B: 12b; C: 1b) and increased taxes. Government monopolies were by no means new in China. More than half a millennium earlier, in the first half of the seventh century B.C., Duke Huan of Ch'i is said to have made himself powerful through a government monopoly in the manufacture of salt and iron. (Maspero rejects this tradition; Karlgren defends it.) The Ch'in dynasty, which first unified China under a single government, continued these two monopolies (24 A: 16b). Emperor Wen (180-157 B.C.) had allowed the common people to evaporate salt, smelt iron, and coin money (Discourse on Salt and Iron, Gale, p. 28), but Emperor Wu had withdrawn these privileges. Tung Chung-shu had protested against these monopolies without avail (24 A: 17a). In the famous discussion of 81 B.C. (reported in the Discourses on Salt and Iron), when the economic policies of the government were reviewed, the Confucian literati likewise protested against these monopolies (HS 7: 5a). In 44 B.C., Emperor Yüan, who was attempting to be a good Confucian, abolished these monopolies, but the loss of revenue compelled him to reestablish them three years later (41 B.C.; HS 9: 6b, 9a). Confucianism in general opposed government monopolies, so that these measures can hardly be said to have been Confucian. Wang Mang, however, found references in Confucian literature to something called controls or kuan, 筦 or 斡, so he changed the name of these monopolies to "controls," and continued them as Confucian enactments. He needed money too much to dispense with them.

A third monopoly was that in fermented liquors. Originally established by Emperor Wu in 98 B.C., it had been abolished in 81 B.C., because of popular criticism. The people were then permitted to brew liquors upon payment of a tax. A high official of Wang Mang produced texts from which one could infer that a government monopoly of liquor was an ancient institution approved by Confucius; he pointed out to Wang Mang that a 70% profit could be made in brewing and selling liquor (24 B: 25a, b). Wang Mang therefore included it as one of his "controls," and established it as another government business.

A fourth monopoly was that of coinage, which probably included the mining and smelting of copper. In this enterprise, Wang Mang was continuing a long-standing Chinese practise. In 175 B.C., Emperor Wen had indeed allowed free coinage (4: 12b), but the consequent depreciation of the currency had caused his son, Emperor ching, to rescind this privilege in 144 B.C. and to establish a death sentence for counterfeiting (5: 7b).

The fifth monopoly was concerned with the products of the mountains and marshes; these included forestry, fishing, hunting, and the taking of other wild products, such as wild honey, etc. Such occupations had been the resource of the poor in ordinary times and of all in time of famine. (The mining of copper and or iron were probably included in the monopolies of coinage [which was of bronze] and of iron, respectively.) For these monopolies too, Wang Mang could cite classical texts. The Chou Offices mentions a Forester of the Mountains 山虞, whose duty it was to enforce the prohibitions concerning these regions, keeping people out of the forests at improper times. He had a subordinate who collected the revenue from the forests. Thus it is implied that there had been a tax upon those who cut trees. This book also lists a Forester of the Marshes 澤虞, who had the local people go into the marshes and waters at the proper times to take the articles of those places, delivering the proper amount to the imperial treasury (as a tax) and keeping the rest for themselves (Chou-li 16: 6b-8b; Biot, I, 370-375). Li-ki III, iii, 11 (Legge, I, 227; Couvreur, I, 293) says, "Anciently, [people] went into the forests at the foot of the mountains and the waters of the marshes at the [proper] seasons without being prohibited," in which statement the qualification "at the proper seasons" implies that there were prohibitions against cutting trees at certain seasons of the year (Chou-li 16: 7a [Biot, I, 372] specifies Spring and Autumn), and so implies a government supervision of these regions with an impost upon those working there, to support that supervision. Elsewhere, the Li-chi (IV, i, iii, 12; iv, ii, 21; Legge, I, 265, 301; Couvreur, I, 350, 396) mentions a Forester of the Wastes 野虞 and a Forester of the Waters 水虞, whose duties were to prevent the cutting of trees at certain times and to collect the revenues from rivers, springs, ponds, and meres. Thus there was ample classical precedent for a taxation of forests and marshes. Wang Mang merely broadened these precedents into a government monopoly and made it cover all forests and marsh products.

The Ch'in dynasty had actually made the rivers, marshes, mountains, and forests a government monopoly (24 A: 16b). In Han times, the revenue from the mountains, streams, parks, ponds, market-places, and shops had been reserved for those overlords who were enfeoffed as their private estates with the regions containing these places, such as kings, marquises, baronets, and princesses. From regions not given in fief, this revenue was reserved for the imperial private purse, in charge of the Privy Treasurer, and was not put into the imperial public treasury, in charge of the Grand Minister of Agriculture (HS 24 A: 9b = Mh III, 541 f). The Privy Treasurer could hardly supervise these regions throughout the empire, hence it is probable that, except for certain areas near the capital, especially Kuan-chung, which he could conveniently supervise, the mountains and waters in most of China had been actually free to the people. Hunting had been prohibited in the imperial parks, which were hunted and fished by government agents; it may not have been restricted elsewhere, especially outside Kuan-chung. Wang Mang seems then to have extended systematically throughout the whole country the Ch'in and Han practise of taxing mountains and waters, and to have made all the occupations related to forests and marshes government monopolies, permitted only to those who paid certain fees. (Possibly only certain of such occupations had previously been taxed.) In A.D. 22, in a time of famine, the mountains and marshes were freely opened to the people (99 C: 17b), possibly because they could not be kept from utilizing these resources.

Detailed laws were made for each of these monopolies; the penalties for violation were as severe as death (99 C: 1b), in which latter respect too, Wang Mang was following classical precedent---Chou-li 16: 7b mentions execution 誅 in this connection (Biot, I, 374 softens this word to "châtiments"). These monopolies were opposed. When the Communicator (the state treasurer), Feng Ch'ang, remonstrated against them, Wang Mang became extremely incensed and summarily dismissed him from office (99 C: 2a). There had been successive years of drought, and there was much banditry. In A.D. 18, a new governor, Fei Hsing, was appointed for a province in the Yangtze valley. When asked what would be his plans upon reaching his province, he replied that these people made much of fishing; the monopolies and taxes on the mountains and marshes had taken away peoples' profits, so that they were starving; he would summon back to farm land those who had taken to banditry and would exempt them from taxes, loan them seed and food, and thus bring peace to the region. Wang Mang was incensed at the covert criticism of his monopolies and dismissed Fei Hsing (99 C: 2b, 3a).

The economic effect of these five monopolies was chiefly to raise and stabilize the price of certain necessities. This objection had been made to monopolies by the Confucians in the famous debate of 81 B.C. They said that the price of salt had become so high that people had to forego it, and that the iron implements made by the government manufactories were inferior and unsuitable. Similar objections were made to the liquor monopoly. The effect of these three monopolies, together with coinage, was, indeed, to put into the hands of the government the most profitable manufacturing enterprises of the time. Only the monopoly in liquors was new in the time of Wang Mang. Its effect was to take away the livelihood of those merchants who had engaged in brewing and liquor dealing, except for those who now became government agents. It probably also raised the price of liquor to the common people. There was no thought of restricting its use. The abuse of alcoholic liquors has rarely become an important problem in China.

The effect of the fifth monopoly, that on the mountains and marshes, was to deprive of their livelihood the country's poor, who had engaged in hunting and fishing, or to compel them to pay for the privilege of continuing their occupations. These monopolies constituted an additional tax upon the poor.

As a whole, these monopolies were thus means of obtaining additional revenue for the government. I can find no other purpose in them. They were a burden upon the poor and common people, since they were a tax upon necessities. They could be counted on to bring in revenue, and were in no sense revolutionary.

This policy of mulcting the people for the benefit of the government also showed itself in Wang Mang's new taxes. A special tax upon merchants and artisans had previously been attempted by Emperor Wu (119 B.C.), compelling them to testify to the total amount of their property and to pay a tax of 9(1/2)% and 4(3/4)% respectively, upon their capital (HFHD, II, 65, n. 15.13; 24 B: 13a, b). This tax had, however, soon been abolished (24 B: 20a).

In A.D. 9, Wang Mang imposed an income tax upon all hunters, fishermen, sericulturalists, artisans, and professional men. They were each to testify to their income for the year, and pay a tithe of it as a tax. Those who refused to testify to their income or who testified falsely were to be sentenced to a year at penal servitude (24 B: 24b). At the same time, it was ordered that all uncultivated fields, whether inside or outside the city, should pay three times the usual land tax. This latter provision was taken from the classical Chou-li (13: 9a; Biot, I, 279f; HS 24 B: 24a and n. 24.3). Wang Mang moreover attempted to systematize the previous practise, begun by Emperor Hsüan (8: 6b and n. 6.4), that official salaries were reduced in time of flood or drought. He enacted that salaries were to be reduced proportionately each year, according to the state of the harvest in each part of the empire (99 B: 29a, b). This system proved cumbersome, for officials hence did not know what their salary was to be until the year was almost over. They therefore made various collections and exactions (24 B: 27a). When they were suspected of having accumulated much property, in A.D. 18, Wang Mang ordered that all but the lowest officials should be required to deliver up four-fifths of their wealth, for the use of the army at the borders. Pan Ku states that inquisitors galloped all over the empire, persuading slaves and subordinates to inform on their masters or superiors (99 C: 3a). We can imagine the limitless opportunities for blackmail and bribery, the repaying of old scores by inquisitors and informers. In the same year, when a serious attempt was made to put down the bandits and rebels, a levy was made, consisting of 1/30 of all property. This levy was immediately repeated, because property had not been assessed at its full value (99 C: 4b, 5b). All officials were also required to make additional contributions out of their salaries, for the rearing of horses (99 C: 4b). It is not surprising that when serious rebellion finally arose against Wang Mang, the bureaucracy did little to stop it.

Wang Mang's fiscal policy seems to have been one of exploiting all the sources of revenue he could find, regardless of the effect his measures had upon the empire. While some of them mulcted the rich, other measures burdened the poor. It is but natural that the enthusiasm for him, which was so abundantly evident before he took the throne, should have evaporated rapidly once he attained unchecked rule. He incurred large and unusual expenses, which were aggravated by the corruption of his officials. His fiscal measures show a remarkable lack of tact and a phenomenal disregard of their effect upon the empire.

The most interesting of Wang Mang's economic experiments was the sixth control, which he called the "Five Equalizations," by which fluctuations of prices in staple goods were to be prevented and loans were to be made by the government. These measures, too, had had their predecessors.

Four centuries earlier, Li K'uei, a student of Confucius' personal disciple, Tzu-hsia, became Chancellor to Marquis Wen of Wei(h) (reigned 424-387 B.C.) and attempted to equalize the price of grain. In good years, the state of Wei(h) purchased grain in large or small amounts according to the state of the crop, while in poor years, it sold grain, thus attempting to prevent fluctuations in its price (HS 24 A: 7b-8b). Unfortunately, we are given no information concerning the success of this policy of speculating in grain, except that it is said to have made "the state of Wei(h) wealthy and powerful."

This policy was again tried in 54 B.C., when Keng Shou-ch'ang, the Palace Assistant Grand Minister of Agriculture under Emperor Hsüan, built Constantly Equalizing Granaries in the border commanderies. These granaries purchased grain when its price was low and sold it when the price was high (24 A: 19b). Granaries were not built at the imperial capital, probably because irrigation had eliminated bad seasons in that region. These Constantly Equalizing Granaries seem to have become sources of expense rather than of benefit to the people; they were abolished by Emperor Yüan in 44 B.C., ten years after being built, in a fit of imperial economy, when other expensive government projects were also abolished, such as the imperial ateliers for silk and metal manufacture and the government monopolies of salt and iron (9: 6a, b; 24 A: 20a).

When moreover, in 115 B.C., Emperor Wu needed money, Sang Hung-yang, an official who had come from a mercantile family, suggested speculation in goods. Prices differed widely in different parts of the empire; Sang Hung-yang had the government purchase goods where they were cheap and transport them to places where they were dear, thus making a profit (24 B: 19b). Since the government had built roads and set up a system of posts, and since criminals sentenced to penal servitude could be used to supply the necessary labor, the government had an advantage over private traders and could make great profits in this manner. The system also prevented undue fluctuations in prices; when prices rose in one region, goods were brought in from other places. We are not told that this system was abolished. It was complained of in 81 B.C., but not abolished; probably the increasing freedom of intercourse led to an approximate equalization of prices in different regions, so that this method of equalization became unprofitable and gradually ceased to function. At least we hear nothing of it after the reign of Emperor Chao. Wang Mang directed the Masters in Charge of the Five Equalizations to neglect prices at other markets (24 B: 24b), so that in his time the government had plainly ceased to transport goods.

Liu Hsin(1a), who brought the Chou Offices to people's attention and induced Wang Mang to make it an officially recognized classic, pointed out to Wang Mang that the Chou dynasty, according to this classic, had a government Office for Money (24 B: 23b). This book recounts that in the Chou period there was an office for the collection of goods unsold in the market-place of the capital and for their storage until people wished to buy them. There was also an office which lent money without interest for a period of three months to people who needed it for ancestral sacrifices or mourning ceremonies, after which time, they paid 10% interest per year (Chou-li 15: 3b f; Biot, I, 326-328; HS 24 B: n. 23.6, 23.8). The Yo-Yü (now lost), which was a commentary on the Classic of Music, told of an institution called the Five Equalizations, by which prices were stabilized, probably for the five fundamental commodities (HS 24 B: 23b and n. 23.9). It is impossible to tell whether these measures had ever been actually put into practise; they were very likely the inventions of Confucians who were idealizing the past.

When Wang Mang came to the throne in A.D. 9, he accordingly established offices for lending and for the Five Equalizations. At the imperial capital and at five other large cities in the empire, Lo-yang, Han-tan, Lin-tzu, Yüan, and Ch'eng-tu, there were set up Masters in Charge of the Five Equalizations at the Markets, each with five Assistants for Exchange and one Assistant for the Office for Money. Storehouses were built at these places. In the middle of each quarter, the Master at each market was to determine a price for equalization for each of three grades of goods (high, middle, and low). These prices were to apply to the five kinds of grains (hemp and similar seeds, glutinous millet, panicled millet, wheat, and beans), linen cloth and silk cloth, thread, and wadding. When any of these goods remained unsold in the market (as they were brought in by farmers), the office for equalization was to buy them at cost or at the market price (provided that price was lower than the price for equalization), so that the people would lose nothing by being compelled to receive a lower price in the market. When the price rose above the price for equalization by one cash, the office for equalization was to sell its goods at the price for equalization. Fluctuations of prices in the market were thus to be prevented, merchants were not to be allowed to corner goods or fleece the country people, and the farmers were to be assured of a market for their goods.

People who needed money for sacrifices or for mourning ceremonies were to have what they needed lent them, from the payments of the income-tax, without interest for ten days or three months, respectively. Others who needed money for working capital were to be given loans, paying interest at 3% per month.

It was an interesting and idealistic experiment. Hu Shih says that Wang Mang's exposition of his monopolies and of the Five Equalizations was "the earliest conscious statement of the theory of state socialism in the history of the social and political thought of mankind" (JNChRAS, 59 [1928]: 229). How far that statement is true may be gaged from the information here given. The credit for this experiment should not however be given to Wang Mang, but to the Confucian author of the passage in the Chou Offices dealing with these matters, and in some degree to Liu Hsin1a.

Rich merchants were selected to operate these offices. Few others would be capable of controlling, without great loss, offices essentially intended for speculating in goods and lending money. Pan Ku says that these merchants communicated their wickedness to various places in the empire and made many false accountings; that the offices and storehouses for goods were not filled (24 B: 25b). If they had been well stocked with goods, their very presence would have kept prices down, without actually purchasing any more goods, until a scarcity arose. Since however these storehouses were not filled, and since they utterly failed to prevent the rise of prices in time of famine (99 C: 16a), this attempt to control prices probably achieved very little, except for providing certain sinecure positions in the bureaucracy.

It is not difficult to discover the reason that this attempt to speculate in goods had only slight economic effects. If the price for equalization was set too high, the storehouses would be filled with goods unsalable at the current price. Hence the Masters, to protect their offices from losing money, probably set their prices for equalization low, with the result that they refused to take goods from the common people, because the current price was too high. Then farmers would not bring their goods to the storehouses except under stress of necessity. We are told that the storehouses remained empty.

When a scarcity was impending, the grain remaining in these storehouses was probably sold rapidly, before famine actually arrived, for goods had to be sold at the price for equalization plus one cash. In times of abundant harvest, because the prices for equalization were set every quarter, these prices decreased before the harvest was reaped, since grain was expected to become plentiful. Thus the farmers were not helped, unless there was a sudden and unexpected fall in prices, such as that caused by a glut on the market. Such gluts were perhaps the only economic situations in which farmers were regularly benefited. The Masters knew that Wang Mang needed money, and they undoubtedly looked upon the storehouses as means of making profits, just as with the other monopolies. They did not accordingly dare to risk a loss. The Masters were former merchants, who hence took the same attitude to the farmers that the merchants did. It is therefore only natural that the farmers should not have been greatly benefited.

The loans made to needy persons were to be taken out of the payments for income-taxes made by professional men. We are not told how much money was loaned. The rate of interest, 3% per month, was however much higher than the usual commercial rate, which was 20% per year (91: 6a), so that few loans were probably made, except for short terms, for which periods the commercial rate was probably also high. There was furthermore a provision that the borrower was not to pay more than 10% of his net income as interest, so that the Masters probably refused to make large loans. These storehouses and lending agencies benefited few except their managers.

Their purpose was undoubtedly good---that of preventing exploitation of the farmers by the merchants. In view of the fact that the Chinese state had been carrying on at least two businesses (the manufacture and sale of salt and iron) for several centuries, Wang Mang's measures can hardly be called state socialism or revolutionary. The Five Equalizations was merely another measure to benefit the people, advocated by the Confucians with the same motive as the ching system and other economic plans.

This motive on the part of the Confucians who first invented these proposals does not however mean that Wang Mang had any strong urge to benefit the people. His chief purpose was undoubtedly to follow Confucian tradition---the practise by which he first secured his popularity and as a result of which he was able to ascend the throne. He was morally obligated to put Confucian policies into practise. Had he really been deeply concerned for the people, he would have removed the monopolies on salt and iron, which pressed most severely upon them. But he showed no inclination to do so; on the contrary, he dismissed any official who manifested an inclination even to relax these monopolies.

Wang Mang was in no sense a revolutionist. He was merely a clever intriguer, who found a new way of gaining popular approval and who clung to it tenaciously. He achieved the throne by playing upon the Confucian attitude of the educated class and becoming a whole-hearted Confucian. Confucianism is an idealistic philosophy that sought to benefit the whole people, and the Confucian literati were in close touch with the common people of their own clans, so that they largely reflected the attitude of the common people to the government. When Wang Mang actually came to the throne, he proceeded to enact various Confucian proposals, but his decrees were not based upon a clear knowledge of the people or of their needs.

He had passed his life as a member of the governing clan, which gained wealth and position merely because it was related to the reigning Emperor. He made his way to leadership by intrigue and secured popularity by espousing the popular Confucian religion of the educated class. When chance made him the dictator of the government and regent for an infant, people found no difficulty in interpreting Confucian teachings so that they were thought to require his enthronement. He then had to put into practise the economic policies embodied in the Confucian tradition, including the particular Confucian books he had newly accepted as authoritative.

His economic policies proceeded from the Confucian tradition, not from any need of the people. His forced colonization of Kokonor (99 A: 24b) and his increased taxation demonstrate his utter callousness to the real needs of the people. His changes in the coinage were a means of mulcting the merchants and moneyed class. His nationalization of land, the establishment of the ching system, the restrictions on large holdings of land and on slaves proved onerous even to his own relatives and followers. These measures were therefore quickly rescinded, even though they were in accord with Confucian tradition and would have proved helpful to the common people.

The first four monopolies were plainly means of seizing for the government the most profitable private enterprises, a procedure that had long been a government policy. It was especially oppressive under Wang Mang, because he added to the number of enterprises taken over by the government and to the severity of the punishments for offending against these monopolies. They put added burdens upon the poorer people, virtually taxing necessities. The fifth monopoly was clearly directed against the poorer people and was in effect a direct tax on certain occupations. The Five Equalizations, an attempt to stabilize prices and make loans to those who needed them, was inexpertly planned and failed to achieve anything of note. Thus Wang Mang's economic policies were either futile or oppressive in their operation. He seems to have oppressed all the economic classes in the empire.

When, in the winter of A.D. 22, the whole empire was in rebellion and Wang Mang at last realized the extremity of the situation, it was decided to rescind all the imperial edicts and ordinances that had been made since he had ascended the throne, especially the economic reforms we have been discussing. Messengers were prepared to be sent out (99 C: 19b). Such an act would have meant a drastic loss of face. The imperial forces, however, achieved a preliminary minor success, and the messengers were not actually dispatched. Such a drastic proposal is evidence that Wang Mang was at last driven to recognize the unpopularity of his economic reforms. Thereafter events happened too rapidly. The rebels continued to gain, and by October of the next year, the capital had been captured and Wang Mang killed by the people of the capital itself. Thus his phenomenal popularity changed within fifteen years into the most bitter hatred. His economic measures must bear much of the blame for that reversal of public opinion. 12 (Reproduced by permission, with omissions and additions, from an article with the same title in the T'oung Pao, vol. 35, [1940], Livr. 4, pp. 219-265.)


1. Joseph Kitchin, Encyclopedia of Social Sciences, art. "Gold."

2. SC 30: 11 (= Mh III, 553 = HS 24 B: 8a) also states that in 123 B.C. (possibly in this and the preceding years since 135 B.C., when Emperor Wu began his war against the Huns) Emperor Wu gave out more than 200,000 catties of actual gold in rewards to his victorious troops---an amount over 1,568,000 oz. or 48,800,000 g. There may have been a set monetary grant for each head or prisoner taken (cf. 6: n. 7.8) or Emperor Wu may have been over-liberal in his grants. They seem to have exhausted the imperial treasury, for at this time a new military aristocracy was established, ranks in which were to be used in the future to reward victorious troops. In 135 B.C., Emperor Wu then possessed at least 1,600,000 oz. or 50,000,000 g. of gold, while in 23 A.D. Wang Mang had three times as much. It is attractive to speculate that in a century and a half the gold stock of China may have tripled. (It should however be noted that Emperor Wu did not attempt to monopolize his country's gold in the way Wang Mang did.)

3. While gold is very widely distributed in China, it has nowhere been mined in very large amounts, and ancient references to gold production in China are quite uncommon. There seems to be only one in the HS---28 Aiii: 42b states that ten-odd li west of Wu-yang District 武陽鄉 in P'o-yang 鄱陽 County of Yü-chang Commandery there was a gold placer 黃金采 (this phrase is interpreted "where gold is taken"). Wu-yang was fifty li east of the present P'o-yang. (This placer is also mentioned in Shui-ching-chu 39: 17b.) But HS 28 Bii: 67a reports, "Yü-chang [Commandery] produces actual gold, but very little. The things that can be gotten with it are inadequate in exchange for the expense [of getting it]."Probably other Chinese deposits were likewise poor. Shui-ching-chu 27: 12b mentions gold in the mountains along the Han River below the Hou-ching Rapids 猴徑灘 below Ch'eng-ku 城固, and also on the southern bank of the Yangtze, below its junction with the Hsiang River ibid. 35: 4a), but neither of these places seems to have produced much gold. Curiously enough, Kiangsi is not at present credited with any gold production. Evidently its deposits were anciently exhausted. (Cf. New Atlas and Commercial Gazetteer of China; Chinese Year Book, 1938-1939, pp. 488-490.) According to a news release from the China Information Committee, dated Aug. 7, 1939, although efforts had been made to stimulate gold production by modern methods, for many years previous to 1938-9, gold production in China and outlying territories had averaged only 130,000 ounces yearly. (Communicated by Prof. T. T. Reed of Columbia University School of Mines.) With ancient primitive methods of mining, even if all the modern lodes were known in ancient times (which is not at all likely), the amount of production would have been very much less. If there had been any large production of gold in ancient China, we would undoubtedly have been informed of it. Ancient Chinese production cannot explain Wang Mang's hoard of gold.Outside of the above few references, gold production is mentioned in the HS only in two regions outside the Chinese area: in Chi-pin (Kabul or northern India) and in Wu-yi-shan-li (Seistan; HS 96 A: 24a, 29a = de Groot, Die Westlande, pp. 87, 91; for identification, cf. Tarn, Greeks in Bactria, pp. 340 ff, 347). But Tarn ibid. p. 103-4) indicates that these regions produced no gold; their gold was an importation from Siberia. The HS says nothing, either in its "Treatise on the Principles of Geographical Arrangements" (ch. 28) or elsewhere, about any gold washings in Yünnan or elsewhere, such as those mentioned by Marco Polo (II, ch. 47-48). HHS, Tr. 23 A: 24a however notes gold produced in the southern borders of Po-nan 博南 County in Yung-ch'ang Commandery, which is the present Yung-ch'ang 永昌, Yünnan. This gold seems however to have first become known between the time Pan Ku wrote in 58-84 A.D. and the age in which Szu-ma Piao (ca. 240-306) compiled the HHS Treatises. According to the Hua-yang Kuo Chih (by Ch'ang Ch'ü, fl. dur. 302-347), 4: 5b, chap. "Nan-chung Chih," this gold seems to have been produced abundantly only after the conquest of this region in A.D. 225. Hence the gold of Yünnan did not contribute to Wang Mang's hoard. While it is always dangerous to argue from negatives, yet the HS is careful in mentioning outstanding products and seems to be interested in deposits of gold. We are hence probably safe in concluding that nowhere in the Chinese world of Han times were there produced any large amounts of gold, so that Wang Mang's store must have been largely imported from outside China.

4. W. W. Tarn, The Greeks in Bactria and India, p. 107 f, points out that the Greeks had to teach the Indians about gold and silver mining and that the Greek invaders got no gold in India ibid. 108; 106, n. 6). In Darius' inscription, no gold came from Sogdiana. Yet in legend, Bactria had been a golden land (e.g., the golden Treasure of the Oxus in v and iv cent. B.C.); from Bactria the Persian empire had drawn its gold; but Bactria itself produced no gold. After Euthydemus (d. ca. 189 B.C.), no Greek king of Bactria coined any gold, although gold coinage was prized. Even in India, no Greek or Saca king coined any gold ibid. pp. 104 f). Bactrian and Indian gold was an importation chiefly from Siberia or the Mediterranean world.

5. Herodotus I, 215.

6. Most of this information is taken from Tarn, Greeks in Bactria, pp. 105 f.

7. E. H. Minns, Scythians and Greeks, p. 7.

8. E. H. Warmington, The Commerce Between the Roman Empire and India, p. 175, 41, 42, 274.

9. Cf. also K. A. Wittfogel, "Foundations and Stages of Chinese Economic History," Zeit. f. Sozialforschung, 4 (1935), p. 44 f.

10. In estimating the areas of land concerned, I have used the Han figure for the li; the length of the Chou li and size of the Chou ching are uncertain. Since however the underlying unit was the pu 步 or double-pace (300 pu made a li), which is a natural and not an arbitrary unit, the difference in these two larger measures between Chou and Han times may not have been large. The Chou foot was one or two inches (Eng. meas.) shorter than the Han foot, but the Chou pu contained eight Chou feet while the Han pu contained only 6 Han feet (cf. 99 A: n. 9.7), so that the two pu seem to have been about the same length.

11. Concerning slaves in agricultural colonies in A.D. 275, cf. HJAS 9, 161. This agricultural slavery was probably little different from other agricultural colonies, except that in this case the colonists were criminals made to farm.

12. An account of Wang Mang's policies is also to be found in Han(s) O. Stange, Leben, Persönlichkeit und Werk Wang Mang's, Inaugural-Dissertation zur Friedrich-Wilhelms-Universitäts zur Berlin, 1934, which is not always quite carefully done. Cf. also Dr. Stange's Die Monographie über Wang Mang, kritisch bearbeitet, übersetzt, und erklärt, Leipzig, 1939.O. Franke, Geschichte des Chinesischen Reiches, I, 375, likens Wang Mang to Richard the Third in Shakespeare; his economic reforms are described on pp. 379-383.O. Franke, "Staatssozialistische Versuche im alten und mittelalterlichen China," SPAW (1931), Phil.-hist. Kl., 218-242, touches upon Wang Mang in passing.An excellent summary of economic matters during the Han period is to be found in W. Eberhard, "Zur Landwirtschaft der Han-Zeit," MSOS, 35 (1932): 74-105; K. A. Wittfogel, "Foundations and Stages of Chinese Economic History," Zeit. f. Sozialforchung, vol. 4 (1935), pp. 26-60.

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