My Portable Ming Dynasty

Chapter 244 Taking one step and thinking thirty steps ahead

Fan Kuan arrived at the teahouse opposite the Datong Guild Hall ahead of time and met the clan chief, Fan Baoxian.

After the two discussed the matter of the bank last time, Fan Baoxian did not return to his hometown of Datong, but stayed in the capital to personally prepare for the establishment of the bank.

Just as Fan Kuan had predicted, commercial exchanges between the capital, Zhigu, and Dengzhou and Laizhou were close, and the money exchange business was quickly promoted after its emergence.

In its early days, the financial industry was essentially an industry of converting credit into cash.

The Fan family of Datong had influence among their peers and also controlled the Commercial Daily, so they gained initial trust.

For merchants traveling between the three places, carrying large amounts of cash was inconvenient, while settling accounts with banknotes was both convenient and quick.

Fan Baoxian proceeded steadily, first having the merchants of the Fan family in Datong settle accounts using their bank accounts.

Then the merchants who traded with the Fan family also discovered the benefits of using the bank for settlement and began to use it as well.

The Fan family's bank in Datong gradually built its reputation, and soon merchants from Shanxi began to use it for settlement.

Now, it's not just Shanxi merchants; many merchants from other provinces also use these banks to do business with Shanxi merchants.

Fan Baoxian's next goal is to get merchants from outside Shanxi to use Fan's bank for settlement.

By then, the Fan family of Datong will no longer be a local business family, but will become a top-tier business family.

However, the two were not discussing the money exchange today.

Fan Kuan handed a petition to Fan Baoxian.

"Petition to Levy Commercial Tax in Shanxi"

Fan Baoxian flipped to the last page and saw the last few signatures on the petition. These were all from officials and wealthy merchants from Shanxi whom Fan Kuan had contacted. After reading them, Fan Baoxian fell into deep thought.

How could there have been any petitions to the imperial court to levy taxes in any dynasty?
When Fan Kuan brought it up, Fan Baoxian thought his cousin had gone mad. But when Fan Kuan explained the reasoning, Fan Baoxian hesitated.

Seeing that Fan Baoxian was still hesitant, Fan Kuan said:

"Clan leader, you've been to Shanxi, the capital, and Zhili, can't you see it yet?"

What Fan Baoxian had seen and heard these days had indeed greatly shocked him.

The biggest difference lies in the attitudes towards merchants in the capital and Shanxi.

The Fan family of Datong is the largest merchant family in Shanxi, but the Fan family of Datong does not have a very good status in Shanxi.

The ancestral homes of the Fan family all used the most ordinary earthen walls and the same blue tiles found in ordinary people's homes. Only the Fan family compound dared to use luxurious decorations.

Even the Fan clan of Datong did not dare to overstep their bounds when offering sacrifices to their ancestors, and used the same rituals as ordinary people.

The Fan family of Datong is so low-key because they have learned from experience. Many families have been targeted by the government for flaunting their wealth, and ended up being ruined and killed.

The Fan clan of Datong understood this, so after Fan Baoxian became the clan head, he sent out hermits like Fan Kuan to befriend powerful figures in the capital, and also worked hard to establish relationships with officials and princes in Shanxi. In the end, they managed to stand firm through several political upheavals and develop the Fan clan to this extent.

Fan Kuan said:

"Merchants can only have status if they pay taxes. Merchants in the capital and Zhigu pay taxes according to the law, and even government officials dare not bully them at will."

Fan Baoxian nodded slightly.

The change in the attitude of the capital's direct merchants towards merchants was a very subtle one, and it was not caused by a few slogans from the government, a few articles by Su Ze, or a few decrees from the imperial court.

According to Fan Kuan's analysis, this change is comprehensive.

The biggest reason is the change in the performance of officials.

After the imperial court lifted the maritime ban and began levying commercial taxes in the capital, the fastest-growing taxes, such as the maritime trade tax and commercial tax, became key indicators for evaluating officials.

For example, astute officials like Lin Bingzheng quickly discovered the unique aspect of using commercial tax collection as a performance evaluation criterion.

Officials in each county are actually compared horizontally.

The meaning of horizontal comparison is that the performance of a county magistrate is mostly determined by competition with other county magistrates under the same prefecture.

In the past, the first thing to be assessed was land tax.

Land tax collection is of paramount importance, but the Ming Dynasty has been established for hundreds of years. Land taxes that could be collected have long been collected, and those that could not be collected have long been abandoned.

The situation is similar in all counties of the same prefecture; it is very difficult to stand out in terms of land tax.

The remaining indicators, such as encouraging agriculture and sericulture, educating the people, and rectifying social customs, are all very abstract and difficult to quantify and assess.

At this time, commercial taxes were introduced.

It's unclear whether this was intentional on the part of the Ministry of Revenue or a natural outcome.

As a pilot area for commercial tax and new official reforms, Shuntian Prefecture quickly linked commercial tax collection with official performance evaluation.

Commercial tax revenue growth is a quantifiable indicator and the easiest item to evaluate, since no one would hand over money to the national treasury for their own political achievements.

As the trend of evaluating officials' performance changed, the attitudes of the various county governments in Shuntian Prefecture toward industry and commerce also changed.

While strictly levying commercial taxes, the government also began to realize that it needed to retain industrialists and businessmen who could provide stable tax revenue.

Business owners are not farmers trapped on the land.

They can leave.

Merchants can avoid county towns altogether; they simply won't come to your city to do business.

Once the government understood this, the change came from the inside out.

Firstly, many counties have abolished discriminatory policies, such as prohibiting merchants from wearing silk.

Secondly, it is necessary to acknowledge the income from their legitimate businesses, strictly prohibit harassment by corrupt officials, and crack down on local thugs and gangsters who affect business activities.

Finally, preferential conditions in terms of land and policies were offered to encourage merchants to set up workshops.

As things unfolded, an unexpected outcome occurred.

With more commercial tax revenue, the government was able to afford to hire more new officials, resulting in improved efficiency and integrity in government operations.

Many of the people in the Gyeonggi region are literate.

Thanks to the publicity in newspapers such as the Commercial Daily, even the most conservative literati had to admit that the county's development was indeed related to the taxes paid by merchants.

The events that occurred in Shuntian Prefecture served as a test of Su Ze's theory of morality for the four classes of people.

For a merchant to gain power, he must fulfill his obligations.

Paying taxes according to the law is a businessman's obligation.

If merchants are willing to assume obligations, then the government will protect their rights.

Fan Kuan understood this principle, which is why he strongly urged Fan Baoxian to contact officials and scholars from Shanxi and request that commercial taxes be levied in Shanxi to carry out new official reforms.

Fan Baoxian, holding the petition, said to Fan Kuan:

"Let me think about it and I'll give you an answer in a few days."
-
When Su Ze's memorial, "Request to Expand the Examination for Personnel and Reform the New Officials," was delivered to the Office of General Affairs and Postal Service, Yang Sizhong felt a little relieved.

Su Ershu has finally submitted his memorial this month!

Yang Sizhong found the contents of this memorial unsurprising.

The memorial was simple: it summarized the effectiveness of the civil service examination and suggested that the court promote the civil service examination and the new official reform in more regions.

In his memorial, Su Ze praised the changes in Fangshan County and set Zhang Mingyuan, the new clerk of the Fangshan County Household Affairs Bureau, as a model. Su Ze listed the work that Zhang Mingyuan had done to revitalize the Fangshan County Glazed Tile Kiln.

Su Ze then introduced the changes in Fangshan County. Fangshan County has now become the main glass production area in the Beijing-Tianjin-Hebei region, and the five-color glass produced in Fangshan County is even exported overseas.

Commercial tax revenue in Fangshan County has increased from negligible to more than half of last year's land tax revenue.

Lin Bingzheng, the magistrate of Fangshan County, used the surplus funds of the county government to build almshouses and orphanages in the county, and also built water conservancy and canal transportation facilities in Fangshan County.

Fangshan County cracked down on criminal activities within the county. The newly appointed constables dismantled several criminal gangs in Fangshan County, and the public security situation in Fangshan County improved significantly.

Su Ze attributed the changes in Fangshan County to the fact that the civil service examination had selected qualified talents.

The tax reform in Shuntian Prefecture also demonstrates that, with the support of reliable new officials, a county can not only collect commercial taxes but also maintain stable development and achieve better political results than before.

In his memorial, Su Ze requested the court to commend Lin Bingzheng, the magistrate of Fangshan County, and Zhang Mingyuan, the deputy magistrate of Fangshan County, so as to better urge officials in Shuntian Prefecture to promote commercial tax reform.

Finally, Su Ze suggested that the imperial court conduct civil service examinations in more provinces and levy commercial taxes.

After reading it, Yang Sizhong could only marvel at Su Ze's brilliant methods.

The Crystal Palace Expo, the Civil Service Examination, and the Commercial Tax Reform—the national policies promoted by Su Ze never involved empty promises or grand pronouncements; instead, they clearly laid out the advantages and disadvantages to everyone.

Everyone can see the results of Shuntian Prefecture's reforms. If you want to oppose Su Ze, you should at least come up with a better solution, right?

Of course, Yang Sizhong was not so optimistic.

The opposition to this memorial must have been very strong.

Yang Sizhong was in charge of the Office of General Affairs and Postal Service, and he had access to a large amount of intelligence. Su Ze's memorial actually contained a fatal flaw.

That is, not all business owners agree with him.

In the Gyeonggi region today, business owners who support commercial tax reform are often those who have recently emerged as business owners.

This group of people all share roughly the same characteristics.

They are either workshop owners who gain a technological advantage in old industries through new technologies, such as silk and cotton industry owners in the north who use new machines.

Or they might be business owners in emerging industries, such as soap makers, wool textile manufacturers, or sugar and alcohol producers.

Yang Sizhong defined them as "new industrial and commercial elites".

These people are the ones who have benefited from industrial and policy reforms, and it could even be said that they have benefited from the technological changes promoted by Su Ze. They are clearly close to Su Ze and support his policies.

These people also have another characteristic: they have just acquired their wealth, so their families' social status is still relatively low.

Unlike the business owners in Southern Zhili, who had already gained political status through marriage alliances, donations to academies, and support for their children's imperial examinations, they did not need Su Ze's "Four Classes of Morality" to improve their political standing.

Su Ze deliberately confused the concepts in his memorial. Those who supported the commercial tax were the newly wealthy industrial and commercial elites in the capital region, such as the business owners in Southern Zhili, who would certainly not support the collection of commercial tax.

Yang Sizhong suddenly thought of something. Su Ze's memorial did not seem to specify where the commercial tax should be levied.
Logically speaking, after promoting commercial tax reform in the most prosperous capital region in the north, shouldn't the next step be Southern Zhili?
It's clear that Su Ze didn't mean that.

Yang Sizhong considered a possibility.

Just as a series of reforms in the capital region led to the emergence of "new industrial and commercial elites" in the capital, does Su Ze intend to cultivate these "new industrial and commercial elites" in other less economically developed regions as well?

This conjecture struck Yang Sizhong like a bolt of lightning, instantly making the connection.

Yes, look at the speed of industrial development in the Beijing-Tianjin-Hebei region in the past two years. What if we extended this to other northern provinces?

If Su Ze can truly cultivate a new force of "industrial and commercial elites", then will they be able to stand up to the powerful clans of Southern Zhili?
Su Ze could submit memorials time and again to expand the provinces covered by the new officials and commercial tax reforms, but in the end, he couldn't leave only the southeastern region without paying commercial taxes, could he?
Yang Sizhong was sweating profusely.

Others think three steps ahead for every step they take, but Su Ze thinks thirty steps ahead for every step he takes.

When did this plan begin? When Su Ze first proposed the "Four Classes of Morality"?
Or perhaps it was when Su Ze helped Gao Gong promote practical learning?
This strategic planning ability is simply terrifying.

Oh, and there was also the reform of the Office of General Communications and Postal Services.

If the imperial court wants to increase its control over local areas, it must accelerate the speed of information transmission to ensure that government orders can be delivered to the grassroots level.

There was also Su Ze's "New Report of Music Bureau," which was the most effective tool for the imperial court to bypass local powerful families and communicate directly with the lower classes.

Meanwhile, Su Ze had just begun to establish a nationwide newspaper sales network through the Ministry of Communications and Postal Services.

terrible!

This boy must never be made an enemy!
Yang Sizhong made up his mind and quickly sent Su Ze's memorial to the cabinet.
-
Yang Sizhong, who had the ability to foresee the future, looked at the system with suspicion.

He even suspected that there was something wrong with the system.

——[Simulation Start]——

Your memorial, entitled "Request to Expand the Examination System for Personnel and Reform the New Personnel System," was delivered to the Cabinet on the same day. All three Grand Secretaries of the Cabinet agreed with your memorial, while Lei Li, the Grand Secretary in charge of river works, did not submit any draft opinions.

However, officials in the outer court, especially those from the Southern Zhili region, opposed this memorial.

The emperor has accepted your memorial.

——[Simulation End]——

[Remaining Prestige Points: 820]

At this point, the simulation results of the system are considered normal.

Su Ze didn't expect the memorial to be approved directly.

Expanding the scope of the civil service examination was, frankly speaking, for the purpose of collecting commercial taxes.

Originally, the officials hadn't quite grasped the reforms in Shuntian Prefecture, but now that Su Ze had brought up expanding the scope, everyone understood.

How could the wealthy and powerful in the southeast simply lie low and let the imperial court collect taxes?
Even though Su Ze didn't mention in his memorial where to expand the pilot program, everyone is a cunning fox. Once the door to expansion is opened, it's only a matter of time before it covers the whole country.

You, Su Ershu, submitted two memorials every month, each expanding the scope to one province. It only took a little over half a year for the two capitals and thirteen provinces to complete!

However, the next message from the system made Su Ze wonder if there was something wrong with the system.

[Should I spend 100 prestige points to force the memorial to pass?]

One hundred points? Did the system miscalculate?

Su Ze counted several times to confirm that the system only required 100 prestige points to pass the memorial.

Since that's the case, Su Ze naturally wouldn't stand on ceremony, and he decisively chose "yes".

(End of this chapter)