Qing Yao

Chapter 285 It's not a debt, it's a deposit!

The newly appointed acting provincial governor swore an oath with his yellow jacket, even staking his future on it. Moreover, he could receive half of the grain payment upfront. After the grain merchants did the math, they concluded that even if the provincial governor reneged on his promise, they would at most bear half of the risk of the initial grain payment.

However, if the provincial governor keeps his word, the grain merchants will not only gain huge profits, but also establish a good cooperative relationship with this promising young provincial governor, which will also be of great benefit to their future business expansion.

To the grain merchants' surprise, Lord Zhao also gave them a political advantage: if they transported a certain amount of grain to the disaster area, they could apply to the court for official rank and titles for them.

For example, transporting 300,000 shi of grain could be reported to the emperor for the rank of a sixth-grade official, 500,000 shi for the rank of a fifth-grade official, and transporting more than one million shi of grain for the rank of a first-grade official.

"A first-rank official hat?!"

A chorus of exclamations erupted in the main hall of the prefectural government office.

To date, only one merchant has been granted the highest rank of official hat by the imperial court: Jiang Chun, the former head merchant of Yangzhou, who was awarded the title of Grand Master of the Palace during his lifetime.

Secondly, Huang Zhiyun, Zhang Jinwen, and others, who were also salt merchants, were granted the rank of second-grade official hat.

The descendants of Shanxi merchants who made great contributions to the Qing Dynasty in its early years and were transferred from civilian to Imperial Household Department status mostly held official ranks of the second or third grade.

Originally, "Dingdai" was an ornament on an official's hat. Giving "Dingdai" to a merchant was a symbol of honor, like the titles Zhao An received in his previous life, such as "National Outstanding Private Entrepreneur" and "Top Ten Outstanding Youths".

Having this title, although one does not actually have any real power, one can enjoy the court and local privileges. Those of higher rank also have the power to directly petition the emperor and enjoy significant trade privileges.

This practice was also unique to the Qing Dynasty, known as "Imperial Merchants".

They were popularly known as "red-hat merchants".

In Zhao An's memory, Hu Xueyan, Sheng Xuanhuai, and Zhang Bishi, the founder of Changyu Wine, were all first or second-rank officials in the late Qing Dynasty. Before these people, there were also many famous Shanxi merchants and salt merchants who were granted official titles by the Qing court.

Starting from the reign of Emperor Shunzhi, merchants and gentry who actively donated to the government, whether in times of disaster or military crisis, could receive official titles and rewards, mostly for those below the sixth rank.

Zhao An, however, offered them official hats of the sixth rank or above, and instead of having the grain merchants donate, he encouraged them to actively transport grain to the disaster area, with Anhui purchasing grain from them at high prices.

As long as you grain merchants bring the grain in to me, I'll let you make money and I'll fight for better treatment for you!
In addition, those who perform exceptionally well can use the power of the provincial governor to recommend their sons and nephews to the imperial court for admission to the Imperial Academy. If they have achieved academic success, they can be directly appointed as officials under the jurisdiction of prefectures and counties.

Of course, the officials under this prefecture and county were of a lower rank, because the provincial governor could directly appoint officials under the prefecture and county who were below the sixth rank, and those above the sixth rank had to be jointly recommended by the governor.

Zhao An has set out his terms, and they are very realistic and attractive prices. It remains to be seen whether the grain merchants will be tempted.

He would definitely do what was within his power, and he would even submit an application for official rank; whether it was approved or not was up to the old man.

Since the old man really wouldn't approve it, Zhao An had no choice but to award them the Outstanding Contribution Award in the name of Anhui Province.

The grain merchants were given the time it takes for an incense stick to burn to discuss the matter collectively. After the time was up, Zhao An came to the main hall again. The result was that the grain merchants unanimously agreed with Lord Zhao's plan and said that they would start transporting grain to the disaster area at full speed from that day forward.

Zhao An drafted a specific set of regulations for the same plan and ordered them to be sent by fast horse to the Anqing Provincial Governor's Office, instructing relevant personnel of the Provincial Governor's Office to summon the grain merchants to carry out the procedures in accordance with the regulations.

Based on the terrain and the actual situation of the disaster in Anhui, Zhao An designated Anqing and Huizhou as one point, and Chuzhou as another point, with both points working together to transport grain to the disaster area.

This approach involves two steps, rather than the previous "routine operation" of Anhui Province focusing solely on transferring grain from Anqing, the provincial capital, to various regions.

That would be too inefficient.

The coordination of matters in Chuzhou was entirely entrusted to Prefect Yan Kun. Grain transported from other places was sent to disaster areas such as Sizhou, Fengyang, Yingzhou, and Suzhou via Chuzhou, while the remaining disaster areas were handled by Anqing.

Zhao An also drafted a detailed set of regulations on how various regions should coordinate, cooperate, and provide relief, and ordered someone to copy it and send it out immediately by fast horse.

The wording was extremely harsh, stating that anyone who did not comply with the regulations would be dismissed on the spot, and those who committed serious dereliction of duty would be reported to the judicial authorities.

At the same time, the Grain Transport Office was ordered to send people to various places to supervise the distribution of disaster relief grain.

Currently, in terms of oversight, Zhao An can only rely on the employees of his "old workplace".

He will definitely be transferring a large number of personnel to fill positions in Anhui's officialdom regarding the grain system.

When the director attains enlightenment, everyone else will ascend to heaven as well.

Embezzlement and waste are unavoidable, but as long as it's within the bounds, Zhao An can turn a blind eye. But if it goes beyond the bounds, don't blame him, this newly appointed upright official, for using a few heads to establish his authority.

However, this grain solution had one major problem: the grain merchants sold the grain directly to the provincial governor's office at a price of six taels per shi (a unit of dry measure). This meant that if a grain merchant brought in 100,000 shi of grain, the provincial treasury would have to settle half of the grain payment with them, which was about 300,000 taels of silver.

If one million shi (a unit of dry measure) are transported, the first payment will be three million taels.

Anhui was a poor province. The annual tax revenue of the provincial treasury, including land tax and grain tribute, totaled 260 million taels. The annual customs duty in Wuhu was 40 taels, and the annual salt tax and miscellaneous taxes were about 50 taels. In total, the annual tax revenue of Anhui province was about 350 million taels.

In the past, only 20% of the 3.5 million taels of silver was kept locally each year, while the remaining 80% had to be handed over to the imperial court. In other words, the Anhui provincial treasury actually only had about 700,000 taels of silver available for local use each year.

Even though Anhui has suffered severe disasters and the imperial court no longer extracts taxes from Anhui, the largest source of Anhui's annual revenue is still the land tax. With such a severe disaster, it would be remarkable if Anhui could collect even one-third of the land tax this year.

How do you calculate this? Zhao An, as the acting provincial governor, could only access about one million taels of silver from the provincial treasury. Even if the Ministry of Revenue asked Jiangsu and Jiangxi provinces to provide more than two million taels of silver to Anhui, the entire provincial treasury could only provide more than three million taels of disaster relief funds.

More than two-thirds of Anhui Province was affected by the disaster, with over ten million people affected. Most areas suffered a complete crop failure this year. It is estimated that the imperial court will need to provide at least five million shi (a unit of dry measure) of relief grain to the disaster area to sustain the crops until next year's replanting.

If five million shi of grain are settled at six liang per shi, that's thirty million liang of silver!
This is equivalent to more than half of the national treasury's revenue.

Does Anhui have the funds to settle this?
Based on the previous year's grain price of one tael and two mace, that would amount to six or seven million taels. There's definitely no problem with the silver; it will only take a year or two at most.

When will the 30 million taels be recovered?
Did the imperial court agree to Zhao An's actions?

If the imperial court disagrees and the Ministry of Revenue refuses to cover the shortfall, where will the money come from?
This question wasn't raised by Prefect Yan Kun, but by Liu Xiaolou, who had previously worked as a junior accountant in the tax office. He cautiously muttered, "Sir, you wouldn't be trying to trick the grain merchants into handing over their grain, would you?"

Zhao An chuckled lightly: "What, do I look like a swindler, or someone who doesn't pay back his debts?"

Liu Xiaolou looked worried: "Sir, you are definitely not a liar. I know you are trying your best to save the people, but how will you repay so much money for grain? If you don't have the money to settle accounts with the grain merchants, you may be in big trouble."

"Grain merchants don't deliver all the grain at once, and they don't all rush to settle payments at once."

Zhao An's thinking is actually based on a cycle and phased approach.

Take advantage of the time difference.

If the grain merchants transported a total of 500,000 shi of grain to the disaster area this month, the settlement price would be 3 million taels of silver, and paying only half would be 1.5 million taels.

The grain merchants didn't all crowd into the provincial treasury to "run over" the 1.5 million taels of grain payment; they came one by one, one today and one tomorrow, which gave the treasury a breather.

“The adults’ idea is good, but,” Liu Xiaolou worried that even if they did it, the amount of unpaid grain would be astronomical in the end, because of the reality in Anhui.

"This is a critical time. The disaster victims are waiting for food to save their lives. Once this period passes, the disaster situation in various places will ease, and the urgency for food will be much less. Food will not be so important, and the price of grain will naturally drop. I told them that the settlement price is six taels per shi, but I didn't say when the settlement would end."

Zhao An wasn't being unreasonable; rather, grain merchants could raise prices under the pretext of tight supply and demand, so when supply and demand were not tight, they would naturally lower prices according to market reactions.

From a business perspective, this month the settlement price is six taels to one shi (a unit of dry measure), next month it might be five taels, and by the end of the year it might be the normal price of one tael and two mace.

This is a normal market reaction; grain merchants can't possibly insist on selling at six ounces per shi (a unit of dry measure).

If someone dares to do that, they're no ordinary businessman; we'll have to strike hard.

Even if you try to extort money from the government, there's still the law!

Merchants are driven by profit. They can make a lot of money with 6 taels per shi, and they can also make money with 1 tael and 2 mace per shi. It's just a matter of how much or how little they can make. As long as there is profit to be made, and the government's credibility is there, and Zhao An really wants to fight for political treatment for grain merchants, he will do whatever he can to meet their needs.

Who dares to say that Zhao Fantai is a fraud?

"The most difficult period right now is these three months. I estimate that at least three million shi of grain will need to be put into the disaster area so that the people can get through the famine smoothly."

Liu Xiaolou calculated that no matter how much the market adjusts in the next three months, Zhao An will need to come up with at least ten million taels to pay for the grain.

The entire treasury could only use a little over three million taels. Where would the remaining six million taels come from?

Even if we mobilize gentry and wealthy households to donate money and goods, and mobilize people in unaffected areas to donate money and goods, we can only solve the shortfall of a few hundred thousand taels at most.

If we ask the imperial court for more, we can only get a little over a million taels, which is a drop in the ocean.

Liu Xiaolou was worried that if Zhao An, the newly appointed provincial governor, owed so much money, it would not only damage his reputation but also affect his career.

If the imperial court were to "pass the buck" and dismiss Zhao An from his post as governor, the grain merchants would surely fight Zhao An to the death.

Zhao An didn't speak, but simply picked up his pen and wrote an official document on the document paper.

Liu Xiaolou took a closer look and discovered that Zhao An, in his capacity as acting provincial governor, had ordered the provincial treasury to transfer all the silver stored in the treasury to the Anqing Xianfeng Bank.

Emperor Xianfeng's journey?
Liu Xiaolou was stunned. It seemed that Xianfeng Bank only had one branch in Yangzhou. Where did Anqing come from?

Zhao An lightly blew on the ink stain and casually said to Liu Xiaolou, "You want to be my Hu Xueyan?"

Liu Xiaolou was stunned: "Sir, who is Hu Xueyan?"

You don't need to know this person.

Zhao An told Liu Xiaolou with a smile that the silver reserves of the various provincial governors were not actually stored in the so-called provincial treasury, but in local money shops.

The purpose is to earn interest.

This refers to a system of "government-controlled and commercially operated businesses".

Essentially, the silver reserves of various local vassal states were local agents of the imperial treasury. The "public funds" used for local circulation were realized through the remittance network of private money shops, while the core tax silver was directly melted and controlled by government-run banks.

To put it bluntly, the Qing government's official banks only controlled the minting and issuance of coins, but the circulation in the market relied entirely on private money shops and banks.

This is why there were so many private "banks" during the Qianlong era.

The provincial treasury silver reserves were a tempting target for private banks. Whoever could secure the provincial treasury silver reserves could transform themselves into a large commercial bank.

Coincidentally, Zhao An was also starting a bank.

The immediate order was to send Liu Xiaolou to Yangzhou to find County Magistrate Ding and instruct him to quickly arrange for people to set up the Xianfeng branch in Anqing, and at the same time, to establish the Xianfeng branch in Jiangning.

The sooner the better.

We don't need to worry about anything else. First, we need to set up the venue, manpower, and scaffolding. Then, based on the "red-headed" document that Zhao An just wrote, we can directly take over the Fan Treasury Silver business and upgrade it directly to the largest commercial bank in Anhui.

Hu Xueyan became the number one red-hat merchant in the late Qing Dynasty because all the land tax, grain tax, and subsidies in Zhejiang Province were deposited in his Fukang Money Shop.

This created a situation where the annual revenue of Anhui's provincial treasury was deposited in Xianfeng Bank. When grain merchants withdrew their money, they would go to Xianfeng Bank to withdraw it. However, the grain merchants certainly couldn't transport the cash away because the conversion rate was complicated and the transportation costs were high.

Therefore, one can only use the Anqing Xianfeng Shipping Company's tickets to withdraw funds in Jiangning or Yangzhou.

Since the silver was going to be deposited in a money exchange anyway, as long as Xianfeng Bank's withdrawal speed was fast and the interest rate was no lower than that of its competitors, the grain merchants didn't really need to rush to withdraw their silver.

If Zhao An exerts a little more "political" influence, he can use financial tools to "resolve" the debt of several million.

"In other words, the grain merchants sell grain to you, Your Excellency, and you issue them a treasury slip. They then take this slip to your bank to exchange it for silver notes. However, because Your Excellency is the provincial governor, the grain merchants dare not, or rather, feel embarrassed to, take all the silver."

After hearing Zhao An's idea, Liu Xiaolou couldn't help but sigh at how "Little Anzi" could become such a high-ranking official in just one year, while he was just a lowly follower.

The two had completely different perspectives and ways of thinking.

However, in Zhao An's eyes, "debt settlement" was just a side effect, because what he valued at all was not the money, but the powerful group of grain merchants.

Behind the grain merchants were actually large "financial cliques" in the Jiangzhe region, namely the so-called gentry class.

Without some kind of influence, would an ordinary person dare to sell grain in a disaster area?

To be promoted from acting to permanent, one must not only use this disaster relief effort as a stage to showcase one's abilities and win the praise of the people, the recognition of leaders and subordinates, but also the support of the gentry group.

To win the support of the gentry, one must form a united relationship with them based on shared interests.

The Xianfeng trip served as the best link between the two sides.

You all wouldn't want your money to go to waste, would you?
Therefore, you must support me in becoming the official leader, support me in becoming the top leader, and support me in vying for the top position.

Back then, Wang Danwang, the governor of Zhejiang, relied on lending money to win over the gentry of the entire province. Zhao An's approach was much more sophisticated—he offered salad oil as a gift with deposits!

Yes, the salad oil is Lord Zhao.

(End of this chapter)