Entrepreneurship in the Late Tang Dynasty

Chapter 151 Surprise
Zhao Huai'an didn't know if this Old Du would also manage upwards. After giving him a series of bad news, he gave him a big surprise.

He told Zhao Huai'an that besides the two taxes, a state had an important source of revenue: local military farms, and that this money was a large sum.

The practice of "Yingtian" (营田) was essentially a system where local governments provided land, hired migrants, or rented it to wealthy and powerful households to cultivate. Half of the land was given to the local government, and if the government provided oxen, then 60% of the harvest was handed over.

How much military farmland did Guangzhou have? About 1,000 hectares. Because some farmland was provided with oxen and some was not, it could yield about 60,000 shi of grain a year.

The allocation of these 60,000 shi is quite flexible. In times of war, these 60,000 shi can be used for our own purposes, and in peacetime, about half of them can be distributed.

Upon hearing that there was such a sum of money, Zhao Huai'an suddenly remembered why the agricultural commissioner of the Xichuan shogunate was standing so far ahead when welcoming Gao Pian in Xichuan last year. It turned out that this was a great benefactor!

He calculated that he could get 60,000 shi of wheat from the winter wheat harvest now, and another 60,000 shi from the autumn harvest. Although the soil fertility would be depleted and there wouldn't be that much time, getting 100,000 shi of grain a year would not be a problem.

Zhao Huai'an quickly calculated in his mind that an infantryman's pay plus rations was 25 guan, and a cavalryman's pay plus 18 guan per horse was 43 guan.

So 100,000 shi of grain is roughly equivalent to 100,000 guan, which means he could support 500 cavalrymen while also supporting 3,000 infantrymen.

Hmm? Doesn't this perfectly cover his current troops?
With just this one moment, Zhao Huai'an's brows completely relaxed. Now, the income from farming alone was enough to support his subordinates and followers.

That way the gun barrel is stable.

Moreover, there was a lot of good news. Du Zongqi continued to report that Guangzhou also had income from salt, iron, tea, and wine.

Gwangju does not produce salt, but because it belongs to Huainan Circuit and has convenient transportation, salt produced in Huaidong is sold exclusively in Gwangju. Gwangju can then collect customs duties from this portion, which amount to about four thousand guan per year.

After the salt was sold in Gwangju, Gwangju could collect a tax on the saltworks, which was not much, about a thousand or a hundred guan a year.

However, when the relationship between Guangzhou and the Jiedushi (military governor) was good in the past, the salt and iron commissioner there allowed Guangzhou to sell a portion of its salt directly and earn the price difference, which in previous years amounted to around four or five thousand guan.

Therefore, Gwangju's annual salt tax was around 10,000 guan.

However, Gwangju's revenue from iron tax was not ideal, because the local area only had some scattered iron sand, so the iron production was very small. Moreover, most of the iron was consumed locally, and very little iron was transported to Gwangju for sale. Therefore, Gwangju's annual revenue from iron tax was only one or two thousand kan, which was better than nothing.

Gwangju may not produce salt or iron, but it does produce tea! Although it could only collect a small toll because it couldn't control the Dabie Mountains, it still collected 20,000 to 30,000 kan a year, which was an important source of rewards for the soldiers in Gwangju.

Then there's the liquor tax, which in Gwangju is barely any, amounting to about five or six thousand kan a year.

Finally, there are some business taxes, which include taxes levied on transit merchants and travelers, as well as income from direct business transactions.

Because Guangzhou was located at the uppermost point of the Huai River, most merchants and travelers would only pass through Guangzhou if they were traveling along the Ru River; otherwise, they would not receive payment from Guangzhou.

However, the Rushui River is not a major waterway. Apart from the prefectures of Ru and Cai, no other merchants or travelers pass through it. Therefore, the income from this part of the river is significantly different from that of the neighboring Shouzhou. Guang Prefecture earns seven or eight thousand strings of cash, while Shouzhou earns seventy or eighty thousand strings of cash, a difference of ten times.

The remaining part involved direct commerce, which previous governors of Guang Prefecture had never done, finding it troublesome and tiring to make money from. Besides, this part had always been earned by the military governors.

Especially in the Huainan region, because it was located in the heart of the country's trade, each military governor opened his own residence and trade shops. Outsiders didn't know exactly how much money he made, but just by looking at how many military governors opened their own residences and shops, they could tell how much they earned.

Zhao Huai'an's eyes lit up when he heard this. This was exactly what he was planning to do! It turned out that the military governors of this dynasty had already started doing it. That was good. As long as he kept a low profile, once the trade routes were established, money would flow in continuously.

Zhang Guinian had previously worried that Huang Chao and his forces were now conquering cities and territories in the Central Plains. With war and trade routes cut off, people would be displaced and unable to sell their tea.
But Zhao Huai'an didn't pay much attention to it, because his tea was mainly sold to Nanzhao, Tubo, and even further to India, which was considered international trade, and the trade route did not pass through the Central Plains but instead went by waterway.

The main distribution center for goods was in the Sichuan area. In his memory, Huang Chao did not reach that area, otherwise the Chang'an court would not have fled to Sichuan for refuge.

Therefore, even as war spread, Zhao Huai'an was able to continue doing business thanks to the Yangtze River waterway.

As for now, most of the wars are still in the northern Central Plains, while the south, especially the Wu and Yue regions, is still very stable. Even if there are some wars, it does not affect the overall trade situation, after all, everyone relies on trade routes for a living.

As for what happens in the future? We'll just have to take it one step at a time and earn money year by year.

Moreover, he is currently in Guang Prefecture, which is a necessary route for bandits from the Central Plains to march south to Ezhou, Yuezhou, and Huainan. He himself has to be at the forefront of this.

If he can stop the bandits from advancing south from here, then most of the south will be unaffected. But if he can't stop them, then what else can he care about? He'll have to run away too.

Therefore, it is precisely because the situation is critical that we must make a lot of money, go to the mountains to sweep tea and recruit soldiers, and increase our military strength to seven or eight thousand. That is the right way.

Now that Du Zongqi has basically finished explaining the income of Guang Prefecture, Zhao Huai'an calculated it himself. Excluding the income from military farms, which was equal to the expenses of the army, he could actually save about 40,000 guan in his hands.

But Zhao Huai'an's joy was short-lived, as Du Zongqi told him that the state's expenses would be deducted from here.

The state government's expenditures mainly consisted of four items: tribute, military supplies, official gifts, military rewards, and state salaries.

The tribute and military supplies have already been deducted, so the remaining 40,000 to 50,000 strings of cash each year are basically used to cover the three parts: rewards for the army, tributes, and salaries of state officials.

The issue of rewarding soldiers and offering tribute is a contradiction. If more is given to the soldiers, less will be given to the emperor. The support of the former determines whether you can maintain your position, while the favor of the latter determines your future. Therefore, how much is given to which side depends entirely on the governors' own decisions.

As he spoke, Du Zongqi glanced at Zhao Huai'an, thinking that given the governor's arrogance, he probably wouldn't offer much tribute to the court.

But he misunderstood Zhao Da. It's one thing for him to be broke now, but once he makes money, you'll see him showering it all on Chang'an.

The support of one's brothers is the sword handle, and the favor of the young emperor is the official robe. Only by having both can one thrive in chaotic times.

It's just spending a little money, right? Spend it!
Finally, Du Zongqi mentioned the salaries of these state officials. This wasn't an issue before because there was interest on the public funds. But Zhao Huai'an had "invested" this money in his residence, so this money now needed to be paid out.

Zhao Huai'an heard about this but quickly dismissed it, deciding to wait until he had the money and prioritize the army.

……

The conversation should have ended here. Zhao Huai'an had basically figured out the financial situation of Guangzhou. In short, with the current financial level, it was more than capable of maintaining the status quo, but lacked the drive to make progress.

Moreover, this is still a relatively stable period. Once a large-scale war breaks out in the Central Plains, revenue will inevitably decrease, and even defending Chengdu will become impossible. Therefore, it is necessary to expand tax sources and engage in bulk commodity trade in order to support the army and wage war.

Then, seeing that Du Zongqi was a local, Zhao Huai'an casually asked:

Do you know anyone familiar with the situation in the mountains?

But that one question led to trouble.

Du Zongqi thought Zhao Huai'an knew something, so he told him in detail about a secret that Guang Prefecture had to hide.

Originally, the prefecture had seven or eight hundred guards, but those were elite warriors who received a salary of twenty strings of cash a year. Most of them worked in local areas, such as outposts and patrols, and were other people.

But as Du Zongqi had said before, it was already good enough to pay the soldiers in the prefecture, so those in the local areas were basically just given a small salary to keep them from starving. After all, the governor was too greedy and simply ran away with the money.

But what good is it if these people don't starve? They all have families; they need to eat too.

So Du Zongqi told Zhao Huai'an that in the lower areas, these county soldiers, local militias, and patrolmen basically all ran their own businesses.

What kind of business can these people be involved in? It's nothing more than smuggling.

The inspectors had a very close relationship with the smugglers of salt on the water.

How do smuggled salt sellers operate? Selling salt directly is easy to get caught, so they need to pickle vegetables like cabbage and radishes to make it easier to sell.

These cabbages, radishes, and the like were basically sold to these people by the inspectors.

Some of the bolder inspection stations even went so far as to directly participate in the smuggling of salt. They would collect the salt themselves and then have salt dealers sell it, profiting from the transaction.

This situation was no secret in Gwangju. The salt and iron officials under the Jiedushi had impeached Gwangju several times, saying that it was damaging the interests of the state and causing great harm.

But if Huainan had truly controlled the smuggled salt dealers in the mountains and along the river, they wouldn't have been allowed to operate for so long. Therefore, those impeachments became nothing more than a pile of worthless paper.

The same applies to the patrol stations on the river and the various local tribes on land. These people often accept bribes from merchants and travelers. Guang Prefecture's commercial tax is only one-tenth of that of the neighboring Shou Prefecture. In addition to the low volume of boat traffic on the waterways, the fact that these people protect smugglers is also a very important reason.

Du Zongqi originally thought that the governor, being such a money-loving person, would surely want to eradicate these cancerous elements upon hearing this, but Zhao Huai'an showed no reaction after hearing it.

Du Zongqi also asked, and then do you know what Zhao Da said?

He glanced at Du Zongqi and cursed:
"If we don't pay them, we can't even let them make their own money? They're just stealing and smuggling. If it were me, I would have robbed them already!"

Du Zongqi choked, looking at the bandit-like governor, and gained a more complete understanding of their magistrate.

However, the information provided by Du Zongqi actually helped Zhao Huai'an.

He was originally worried about how to find out the situation inside the Dabie Mountains. Those deep mountains and forests, without an insider to guide you, you could be ambushed as soon as you entered.

Now, I never expected that after searching high and low, I would find that they had their own people on the inside! It's also fortunate that I made such a big fuss about suppressing bandits, otherwise it would have alerted the mountain strongholds.

Since those inspectors and local leaders do business with those people, they must have close ties. He can now use these people as a breakthrough point.

So Zhao Huai'an asked Du Zongqi:
“Among these people, which family has evaded local taxes? Please provide a list, and don’t list them all from the same place.”

Upon hearing this, Du Zongqi blushed and tried to explain, but Zhao Huai'an simply laughed:
"Alright, it's not your fault. It's common sense. I, Zhao Da, am not ignorant of the ways of the world. It's fine. Just report the cases as you asked, the ones with the most serious thefts. I'll handle them!"

Du Zongqi was already sweating profusely because he realized he had done something stupid. The purpose of those patrolmen and local militias falling into the hands of the governor was to punish smuggling, but this matter of evading land taxes would not stand up to scrutiny.

Thinking about the relationships involved, Du Zongqi opened his mouth twice but still didn't speak, and could only lower his head and accept the order.

Forget it, it has nothing to do with me, why think so much? The governor wants a list, so I'll write it down.

After talking for a while, Zhao Huai'an had drunk seven or eight bowls of tea, and his bladder was about to burst. He then told Du Zongqi about the situation of the agricultural settlements, learned roughly which area they were in, and sent Du Zongqi away.

As soon as Du Zongqi left, Zhao Huai'an noticed that Wang Duo had been silent. He patted him on the shoulder and called out:
"Let's go, let's release the water."

Then Zhao Huai'an and Wang Duo went to the outhouse and started relieving themselves. As he relieved himself, he said to Wang Duo:
"You've heard enough for today. Do you think there's anything wrong with these numbers?"

Wang Duo was also relaxed at this moment, and after hearing this, he nodded without hesitation:
"There's something fishy going on here. The amount of arable land and military farmland in Guang Prefecture is rather small. We learned from Magistrate Wu that Guang Prefecture has a very developed water conservancy system. During the Kaiyuan era, sixteen irrigation canals were dredged along both banks of the Huai River, irrigating 3,000 hectares of fertile land. And that's only a small part along the Huai River. Over the years, the total area of ​​the five counties in Guang Prefecture has definitely exceeded 30,000 hectares."

"And if the arable land figures are false, then the military farmland figures cannot be trusted either."

Zhao Huai'an's urination was taking too long, so he relaxed and gave Wang Duo his order:
"Old Wang, once the rain stops, I'll have a squad of soldiers protect you. You should also find a few people in the army who are familiar with administrative matters, and send them to Pitang, Yingtian, and the counties below. Remember to keep a low profile."

Wang Duo shuddered, carefully placed the bird down, and, with his arms crossed, said to Zhao Huai'an:

"Your subordinate obeys!"

As he was about to leave, he heard Zhao Huai'an call out to him from behind, adding a word of advice:

"Remember to keep yourself safe, and remember to wash your hands. Don't follow Lao Liu's example!"

Wang Duo felt a warmth in his heart, bowed deeply to Zhao Huai'an, and then went out.

Zhao Huai'an continued to drain the water until he shivered, then he laughed.
"Since you guys are both bad at the game and love to play, then I, Zhao Da, will have some fun with you! But if you lose, it won't be as simple as just crying!"

"Jie Jie Jie!"

(End of this chapter)