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Luxurious Networks
Salt Merchants, Status, and Statecraft in Eighteenth-Century China
By Yulian Wu STANFORD UNIVERSITY PRESS
Copyright © 2017 Board of Trustees of the Leland Stanford Junior University
All rights reserved.
ISBN: 978-1-5036-0079-9
CHAPTER 1
Courting the Court
In 1757, the Qianlong emperor conducted his second southern tour in Jiangnan. The wealthy salt merchants in Yangzhou made the arrangements for the imperial visit. They not only financed the court's travels from Beijing, but also provided the food, lodging, and entertainment for the emperor and his retainers. Before the emperor's arrival, one of the head merchants named Jiang Chun (1720–1789; zi Yingchang, hao Heting), under the supervision of staff and eunuchs sent by the court, renovated his splendid garden to receive the emperor. Jiang Chun's preparations proved to be a great success. The emperor was delighted by Jiang Chun's garden and granted it a special title: Jing xiang yuan (The garden of tranquility and fragrance). The emperor also, surprisingly, met with Jiang in person. During Jiang's audience with him, the emperor untied his own golden-silk-thread pouch (jin si hebao) and gave it to Jiang as a gift. The emperor also awarded Jiang Chun, along with other three head merchants, the honorary title "the chief minister of the Imperial Parks Administration" (Fengchenyuan qing), referring to a position that belonged to the Imperial Household Department.
Although salt merchants had long been an important group in Chinese history, the economic and political privileges that the High Qing Jiangnan salt merchants received were extraordinary. The Han dynasty (206 BCE–220 CE) was the first to establish salt monopolies, making the central government the only institution legitimated to operate the salt business and collect revenues from it. But from the start, the difficulties created by the limited size of the bureaucracy and the vast scale of the salt business required the central government to delegate power to the salt merchants. As the only licensed businessmen who were allowed to trade salt, these merchants obtained tremendous profits. By Qing times, the Jiangnan salt merchants, most from Huizhou, were clustered in Yangzhou and Hangzhou, and conducted business in the Lianghuai and Liangzhe salt zones.
Jiang Chun was one representative of the many salt merchants who not only gained remarkable favor from the Manchu court but also participated in Jiangnan cultural activities by collecting antiques, publishing books, and patronizing fine arts. The story that begins this chapter was only the beginning of the intimate relationship between the Qianlong emperor and Jiang Chun. Twenty-seven years later, in 1784, during his sixth southern tour, the emperor once again visited Jiang Chun's residence. This time, Jiang Chun brought his son Jiang Zhenxian — who was only six years old — with him. When the emperor invited Jiang Chun's son to make a wish, the boy answered that he wished the emperor to grant him longevity. The emperor happily issued a decree that Jiang Zhenxian "shall live for one hundred years" (shou zhi baisui). During their conversation, the Qianlong emperor rubbed the head of Zhenxian and granted him his own pouch. As the scholar Yuan Mei (1716–1798) later commented, the imperial favor that Jiang Chun received was "unprecedented" (gu wei you ye).
This chapter explores the historical and political reasons for the Huizhou salt merchants' new and close relationship with the Manchu court in the High Qing period. This court-merchant network, as we shall see, originated from particular changes in salt monopoly policies. Although the Qing salt monopoly system continued the practices of the prior Ming dynasty, it added two new elements: the appointment of the emperors' bondservants as salt bureau officials and the establishment of the head merchant position. These institutional changes created new opportunities for the Huizhou salt merchants to connect with the emperor's bondservants and ultimately the Qianlong emperor himself.
The chapter is divided into four parts. The first part presents the institutional history of the salt business, exploring how the Manchu court used a hereditary franchise system that served as the foundation for the Qing salt monopoly. The second and third parts discuss how the Manchu court developed two new policies to achieve its political goals, expanding its own network in the salt monopoly system and incorporating Han Chinese merchants into the management of the salt business. The last section, drawing on materials from confessions, demonstrates how the salt merchants took advantage of institutional changes to build up their connections with the court in High Qing period.
THE HEREDITARY FRANCHISE SYSTEM: LEGACY FROM THE LATE MING
Even after the Ming government fell, the general structure of the salt monopoly policy, particularly in the form of the hereditary franchise system, remained intact. That hereditary franchise system, implemented in 1617, enabled the Huizhou merchants to dominate the salt business in Jiangnan. Understanding this hereditary franchise system is critical for comprehending how the Jiangnan salt merchants operated their business and accumulated wealth in the Qing.
From Grain-Salt Exchange System (kai zhong fa) to Hereditary Franchise System (gang fa)
Generally speaking, the Ming salt monopoly policies underwent three phases: from the grain-salt exchange system (kai zhong fa) to the "paying silver for salt" system, and finally to the hereditary franchise system (gang fa). These phases mark a transformation from a state-controlled salt business to a monopoly system with more state-merchant cooperation in the late Ming.
At the beginning of the Ming dynasty, the central government employed a grain-salt exchange system to meet the needs of the military defense against the Mongols on the northern frontier. Through the grain-salt exchange system, salt merchants delivered grain to the military posts on the frontier in exchange for government-issued tickets to buy salt from designated salt fields and then sell salt in designated areas. The state, in this process, controlled salt production and operated the salt business as, in Yang Jeou-yi's term, "a wholesaler." The merchants, on the other hand, retailed salt in the frontier area under state control.
As early as the 1410s, however, this grain-salt exchange system collapsed, because of delayed salt allocations from the state to the merchants, and abuse of the salt monopoly system by the court and powerful officials. The policy was gradually replaced by a monetized policy of "paying silver for salt," a system that was institutionalized in 1491. Under this new policy, the merchants could obtain a salt license to conduct their salt business by simply paying silver to the office of the salt commissioner and thus avoided the trouble of delivering grain to the frontier.
This new policy of "paying silver for salt" caused a power redistribution among salt merchants. Before the policy was put into practice, Shanxi and Shaanxi merchants were the major businessmen who delivered grain to the frontier; geographically, these merchants' business areas were closer to the north. This situation changed, however, as a result of the new policy. The "paying silver for salt" policy now allowed salt merchants to conduct their business in areas where the salt commissioners worked. A massive number of salt merchants, therefore, emigrated to the cities of the most profitable salt regions, such as Yangzhou and Hangzhou. Huizhou was much closer to these salt areas than to Shanxi and Shaanxi provinces, and the Xin'an River facilitated transportation between Huizhou and Jiangnan. The Huizhou merchants then began to establish and expand their business in Jiangnan, and gradually obtained dominant power in the salt business there. Their descendants, the main subjects of this book, would eventually become the most influential salt merchants in High Qing.
The new policy failed to save the ruined economy of the Ming government. On the contrary, it weakened Ming military power on the northern frontier because more merchants moved inland and stopped delivering salt and grain to the frontier. Moreover, the money from the policy of "paying silver for salt" was often embezzled by court power holders and officials, who stopped buying grain for frontier troops. As Ho Ping-ti has argued, "the break-up of the grain-salt exchange system ushered in a period of transition and confusion in salt administration during which the frontier merchants abandoned their northern colonizing posts and became salt merchants of the interior provinces, particularly of the Liang-huai area." In order to resolve these problems, the Ming state in 1617 made one last effort, initiating yet another salt monopoly policy — the hereditary franchise system — in Lianghuai.
In the hereditary franchise system, "the state organized salt merchants with old licenses for the Huainan sector of Lianghuai into ten syndicates (gang)." The government here also enacted a policy that allowed only the merchants whose names were registered with the government to have salt licenses. In this way, every salt merchant had to enroll in a syndicate in order to access the salt trade. Through the hereditary franchise system, the work of the merchants was closely tied to specific areas. Unlike the grain-salt exchange system, which allowed merchants to trade in any salt region, the hereditary franchise system used a fixed group of selected merchants to conduct the salt trade in a specific region. While the merchants were now regulated more by the state, they also obtained more power in the salt business. Once the hereditary franchise system was launched, merchants — not the state — played a dominant role in the "production, initial acquisition, transportation, and retail" of salt. The hereditary franchise system thus allowed merchants to control or even monopolize the salt business "under the state's sanction." This policy nurtured the rise of enterprising Jiangnan salt merchants in the Qing dynasty.
The Qing Salt Monopoly Policy in the Lianghuai and Liangzhe Salt Zones
In 1644, after the Qing conquest of China, the new government sought an easy and reliable source of revenue to support its military endeavors. The salt business was highly lucrative, but the new Manchu rulers lacked experience in managing a state-run salt monopoly. They therefore adopted the hereditary franchise system of the late Ming, hoping to quickly build up the state treasury by collecting revenue from wealthy salt merchants.
The system they adopted comprised eleven salt zones. Each salt zone was further divided into three subzones, based on the distance between the salt markets and the production sites: (1) salt production sites, (2) the areas close to the production sites, and (3) the areas distant from production sites. The salt in the areas farthest away from the production sites was taxed more heavily than the salt sold in areas close to the production sites. The reason for the heavier tax was that the government assumed that the salt sold in areas farther away from its production site would, because of larger demand, be easier to sell.
The Manchu court operated different policies in individual salt zones. The Lianghuai and Liangzhe zones covered the salt business in the Jiangnan area, the most prosperous area of the Qing dynasty (see Map 1.1). These two salt zones, because of their large amount of revenue, drew special attention from the Qing government. This was especially true for the most remote subzones in Lianghuai and Liangzhe, which were called the gang areas (gang an). In order to secure taxes from these gang areas, the Qing government used the hereditary franchise system to manage the business. Each gang area consumed the salt that the state designated for it. The state also guaranteed that only the merchants who assumed the tax quota within the specific gang areas could sell the salt allocated to them. Because the gang areas often had a larger population, these merchants gained the most profit, and the state received most of its revenue from these merchants. The wealthy Huizhou salt merchants conducted most of their business in these gang areas of the Lianghuai and Liangzhe.
Many scholars have concluded that the Lianghuai salt zone was the most important salt market for the Qing government. The Lianghuai salt zone encompassed parts of the provinces of Jiangsu, Anhui, Hubei, Hunan, Henan, and Jiangxi. Divided by the Huai River, the Lianghuai salt zone consisted of two sections: Huaibei (the area north of the Huai River) and Huainan (the area south of the Huai River). According to one calculation, "since Lianghuai produced 40% to 50% of the total salt revenue at various times of the Qing, the gang area of Huainan alone delivered approximately 28% to 35% of the salt revenue of the entire country." The city of Yangzhou served as the center of the Lianghuai salt business. The wealthiest salt merchants (who were usually Yangzhou salt merchants) operated in the gang area of the Huainan subzone.
Because of its economic importance, the Huainan subzone has received the most attention from current scholars. The Qing government practiced unique policies in the Huainan subzone. These practices, Yang Jeou-yi argues, were the key reasons for the rise of the Yangzhou salt merchants. As Yang explains, the Lianghuai salt monopoly policies had two distinguishing characteristics. The first and most important one was that the Huainan gang area offered "franchised certificates" without restricting merchants to a single "franchised salt territory" in which they were responsible for buying, delivering, and retailing salt. Almost all the major salt zones were regulated by this franchise system. The Huainan gang area, however, was an exception. The Huainan salt merchants were only responsible for buying salt from production sites and shipping it from Yangzhou to other regions. They were, however, not responsible for retail, which fell to local merchants. The Huainan salt merchants therefore avoided the danger of unsuccessful retailing.
The Huainan salt merchants were also able to decide the quantity of salt that they were willing to sell each year, based on the capital they could invest. If one salt merchant did not have enough funds for shipments, the head merchants could arrange for other merchants to take a larger quota, in order to meet the revenue requirement for the Huainan gang area. Thanks to this unusual arrangement, Yangzhou merchants "were not individually required to assume a fixed quota of salt shipment every year" and "they were less vulnerable to the fate of confiscation by the state." These institutional advantages helped make Yangzhou salt merchants the wealthiest merchants in eighteenth-century China.
The Liangzhe salt zone, which covers part of the territories of the Jiangnan salt business, also contributed a large amount of revenue to the state in the High Qing, ranking second among all the salt zones. The Liangzhe salt zone encompassed part of the provinces of Zhejiang, Jiangsu, Anhui, and Jiangxi. The Qing state offered hereditary franchised salt territories in Liangzhe. Although the Liangzhe salt merchants lacked the economic privileges that Huainan businessmen enjoyed, they still accumulated wealth from their gang area through the hereditary franchise system. In fact, the Huizhou salt merchants, who had dominated the salt business in Hangzhou (the center for Liangzhe region) since the late Ming, quickly recovered from the destruction of the Ming-Qing transition. These salt merchants soon joined their Yangzhou counterparts among the wealthiest and most prominent merchants of High Qing.
NOVEL POLICIES IN THE QING: APPOINTING THE EMPERORS' OWN BANNERMEN
The new Qing government adopted the franchise system from the late Ming for its own salt monopoly system. Yet the Manchu rulers also developed several novel features for the institution to serve its new political agenda. Among them, two stand out. The first was the direct appointment of bannermen and, more significantly, the emperors' own bondservants, as the salt administrators in Jiangnan salt bureaus and the practice of keeping them at their posts for an extended period of time. The second feature was the establishment of a new head merchant system, by which the state appointed wealthy salt merchants to assist the official bureaucracy's salt administrators. Both of these new policies allowed the Qing emperor to inject his own personal networks into the administration of the salt monopoly. The Jiangnan salt merchants, especially the merchants in Lianghuai, by the same token, took full advantage of the new policies, deftly forging ties with both officials in the salt bureaucracy and, ultimately, the court. These two institutional transformations, as the following section shows, were products of the Qing rulers' ethnic policies, an unintended consequence of which was to propel the rise of the Huizhou salt merchants during the High Qing.
(Continues...)
Excerpted from Luxurious Networks by Yulian Wu. Copyright © 2017 Board of Trustees of the Leland Stanford Junior University. Excerpted by permission of STANFORD UNIVERSITY PRESS.
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