History of Money, Banking, and Trade
A historical look at the development and evolution of money, banking, and trade. From the ancient civilizations to the present.
History of Money, Banking, and Trade
Episode 42. From Bronze to Banking: How China's Economic Evolution Shaped Our World
Step back in time to discover how ancient China's financial innovations continue to shape our modern economic thinking. The pendulum swing between state control and private enterprise that defined China's economic evolution offers striking parallels to today's most pressing financial debates.
When Emperor Wu established state monopolies on salt and iron production to secure the legendary Silk Road trade routes, he unknowingly set patterns that would reshape global commerce for centuries. These policies simultaneously generated tremendous wealth and accelerated inequality—a tension that remains at the heart of economic policy debates today.
What makes China's story particularly fascinating is how these developments occurred largely in isolation. Separated from other ancient civilizations by vast natural barriers, China cultivated revolutionary innovations without external influence. Their metallurgists created steel 1,700 years before Europe. Their mathematicians embraced negative numbers and correctly calculated pi as 3.14 while Western counterparts dismissed such concepts. Their engineers pioneered deep borehole drilling, reaching depths of 600 meters during the Han Dynasty and becoming the world's first society to develop fossil fuel markets.
Perhaps most relevant to our contemporary challenges is Wang Meng's cautionary tale of economic reform. His well-intentioned efforts to address wealth inequality through land redistribution and currency reform created chaos when poorly implemented. His introduction of 28 different currencies simultaneously destroyed market confidence and triggered disastrous inflation—a sobering lesson for modern monetary policy experiments.
The wealth gap in late Han China bears an uncanny resemblance to modern America. Records show farming households barely earned enough to cover basic subsistence and taxes, while officials earned six times more—remarkably similar to income disparities today where 60% of American households struggle with essential costs.
This deep dive into China's financial history offers more than historical curiosity—it provides wisdom as we navigate our own economic crossroads. Subscribe now to continue this journey through the fascinating evolution of money, banking, and trade across civilizations.
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The financial brilliance of ancient China offers profound lessons for our modern economy. From the revolutionary policies of Li Kui, who abolished hereditary slavery and granted private land ownership, to Emperor Wu's creation of what economists might recognize as the world's first mercantile state, might recognize as the world's first mercantile state, china's economic evolution reveals striking parallels to contemporary challenges. What makes China's development particularly fascinating is how it occurred largely in isolation, separated from other ancient civilizations by vast deserts and mountain ranges, china cultivated unique innovations in bronze casting, silk production and governance without direct external influence. By the time of the Shang and Zhou dynasties, china had not only caught up, but in many ways surpassed its ancient counterparts. The pendulum between state control and private enterprise swung dramatically throughout Chinese history. Emperor Wu's controversial state monopolies on salt and iron production secured the legendary Silk Road trade routes that would eventually connect China with Rome, reshaping global commerce for centuries. Yet these policies also accelerated wealth inequality, a tension that remains at the heart of economic policy debates to this very day. Chinese technological innovations were nothing short of revolutionary. Their metallurgists created steel 1,700 years before Europe, while engineers discovered deep borehole drilling during the Han Dynasty, reaching depths of 600 meters, and becoming the first society to develop fossil fuel markets embraced negative numbers and correctly approximated pi as 3.14, at the time, greco-roman mathematicians dismissed such concepts entirely. Despite Emperor Wu's aggressive reforms to curb land concentration, powerful elites consistently circumvented these measures, creating extreme wealth gaps between the average families and the ruling classes. This cautionary tale of economic concentration undermining central authority offers valuable perspectives as we navigate our own challenges of balancing prosperity with equality. I am Mike Di. This is the History of Money, banking and Trade podcast. Join us as we continue this journey through China's remarkable financial history and discover how ancient economic wisdom continues to illuminate our path forward.
Speaker 1:During the first century BCE, gong Yu, a prominent Confucian scholar, came to prominence as he opposed the Han government's reliance on state monopolies, including coinage, iron and salt production. Gong Yu, like other Confucian traditionalists, believed that money, particularly state-minted coins, encouraged greed, disrupted the overall society and led to exploitation of the poor. He argued for a return to in-kind payments, such as paying with grain or cloth, which were seen as more stable and more in line with Confucian morals. This was a direct response to Han government under Emperor Wu, who had ruled from about 141 to 187 BCE, who had established state monopolies on coinage, iron and salt to fund military campaigns and centralize economic control. Gong Yu criticized these monopolies for employing hundreds of thousands of convict laborers in harsh conditions which he saw as exploitive and, more importantly, oppressive and corrupt. The Confucian ideal society is dominated by agricultural simplicity. This meant that the economy would generally be less complex and the government would be based on morality, not commerce and profits. Gong Yu believed that only if society went back to a Confucian way of life, thereby reducing trade and state industries, social order would be restored. Gong Yu protests were part of a larger debate between Confucian reformers and legalist-influenced state policies which had a European real-politik feel to it in the Han Dynasty. While his proposals to abolish coinage were never fully adopted, later rulers like Ebro Yuan did temporarily reduce state monopolies under Confucian pressure.
Speaker 1:Ebro Yuan of Han, who ruled from 74 to 49 BCE, was one of the most effective rulers of the Western Han Dynasty, as he was known for his practical governance, fiscal responsibility and consolidation of Han power. After years of turmoil caused by his predecessors, his reign marked a period of stability and prosperity. One of his first actions was he halted costly military campaigns. Unlike his predecessor, emperor Wu, who drained the treasury with wars against the steppe tribes and his expansionism, xuan avoided large-scale invasions and focused on defense and diplomacy. On defense and diplomacy, he also strengthened borders through colonization, where he established agricultural colonies manned by the military in the frontier regions. This would allow De Han to reduce the need for expensive military deployments, as these colonies were manned by permanent residents who would also be members of the military. Additionally, xuan cut palace extravagance, as he lived a modest lifestyle compared to the earlier emperors. Thereby he cut wasteful spending that was ultimately assumed by the taxpayers, ultimately assumed by the taxpayers. He stabilized relations with the steppe tribes instead of endless war. He also used marriage, alliances and trade. In addition, he used a tactic that would be very popular by the Romans when dealing with the Germanic tribes, in that they would divide the different tribes in the confederation, which made the steppe confederation weaker. Emperor Xuan of Han secured the western regions through diplomacy, maintaining Han influence in the Tarim Basin without resorting to costly wars.
Speaker 1:Although Confucianism had been established as the official ideology under Emperor Wu, emperor Xuan further strengthened its role in governance. He struck a careful balance between Confucianism and legalist principles, appointing Confucian scholars to key administrative positions while enforcing strict legalist oversight to prevent corruption. He also reduced the severity of punishments compared to earlier Han rulers, but preserved a strong and effective legal system. Most notably, emperor Xuan prioritized merits over noble birth when selecting officials. This approach led to more competent governance and the implementation of effective welfare policies such as famine relief and support for the peasantry. Why would modern scholars state that Emperor Xuan ultimately had a successful rule? Well, it appears that he learned from past mistakes. He avoided Emperor Wu's financial carelessness while preserving Han strength. He figured out how to balance hard power through military strength and diplomacy, and soft power through his Confucian governance.
Speaker 1:His reign is often seen as the last great period of the Western Han before its decline under later emperors. His successor, emperor Yuan, continued the policy of reducing government expenses. Continued the policy of reducing government expenses. Early in Emperor Yuan's administration, a schism had developed, a phenomenon that would plague his entire reign and cause government officials to concentrate on infighting rather than effective governance. One faction included many Confucian scholars, his teachers Shu'a and Zhou, aligned with an imperial clan member who was also a Confucian scholar, liu Gengsheng. Another faction was his cousin, twice-removed Xi Imperial Secretary Hong Gong, and Chief Eunuch Xi'an. Hong Gong and Xi'an are believed to be the emperor's lovers. Yuan gave them both key administrative positions, which eventually proved to be disastrous, as they plotted the deaths of many officials who opposed them.
Speaker 1:This split caused problems that didn't just stop there. In fact, the state of Han worsened with Yuan's son Chang, who ruled from 33 to 7 BCE. He ascended to the throne and his interests were chasing women and enjoying life rather than ruling the empire enjoying life rather than ruling the empire as much as Emperor Chang liked chasing women. He died childless, so his nephew Ai ascended to the throne in 7 BCE. Ai got rather connected to a minor official named Dong Xian, promoting him rather quickly to higher ranks. This caused rumors of a supposed homosexual relationship, which was furthered by the fact that the childless I wanted to leave his throne to Dong. Thus, another succession crisis emerged in 1 BCE. When I died, dong Xian and his entire family were forced to commit suicide and another one of Chang's nephews was chosen.
Speaker 1:The source material suggests that Emperor Ai's favoritism and homosexual relationship contributed to the downfall of the Western Han Dynasty dynasty. I personally don't buy the homosexual angle as the reason, but favoritism over meritocracy could lead to poor governance. Additionally, he was afflicted by a mysterious illness throughout his brief six-year reign. I declared on his deathbed in 1 bce that dong xiang would succeed him as emperor, that Dong Xian would succeed him as emperor. However, without the protection of his powerful lover, dong was little more than an empty suit, as he was promptly overthrown by the court after Ai died. Ultimately, this forced Dong and his wife to commit suicide. Thus, another succession crisis emerged in 1 BCE, when Ai died and another one of Chang's nephews, emperor Ping, was chosen, but he was only 8 years old when he rose to the throne.
Speaker 1:One of the more interesting stories about Ai's rule was the story of the cut sleeve. About Ai's rule was the story of the cut sleeve. In fact, without the legend of the cut sleeve, emperor Ai would have been just another unremarkable ruler in the grand scheme of things. The story preserved in the Hanshu recounts how Dong Xian often shared the emperor's bed. One morning, when Ai needed to rise, but he didn't want to disturb Dong, who lay sleeping on his sleeve, he simply cut the fabric rather than wake him. This was the extent of his love and affection, or perhaps, as some suggest, it merely speaks to his wealth and the Han court surplus of fine silk robes. The tale became legendary. Upon learning of the emperor's gesture, courtiers supposedly turned the cut-sleeve into a fashion trend.
Speaker 1:Duan Xiao became one of China's most enduring euphemisms for homosexuality. Ming and Qing scholars titled homoerotic stories as records of the cut sleeve, while Republican-era policies in Beijing classified same-sex relations as the preference of the cut sleeve. It isn't a widely used modern term, but it still resurfaces occasionally online. It is striking that this ineffectual ruler, whose passions were blamed for courtly decadence and part of the overall dynastic collapse, he is best remembered for an intimate act of attentiveness. Today, as in much of the world, homosexuality in China exists in a minimal space, tolerated but not fully accepted. Gay venues operate so long as they stay discreet. Yet China's long and often overlooked history of same-sex love offers hope to the present-day LGBTQ community, particularly in a nation that only declassified homosexuality as a mental illness in 2001. Emperor Ai's legacy is important in the fact that, yes, he was an ineffectual ruler, but he highlights the fact that China has a long, rich and diverse history.
Speaker 1:The earliest surviving national census from 2 CE recorded a population of about 12.2 million households and about 59.6 million individuals. Additionally, there were more than 20 cities in the Western Han period, with an estimated population in the range of 30,000 to 100,000 people. Most of these cities were concentrated on the central plain. Only two were located south of the Yangtze River. The next national census in 57 CE counted only 21 million persons. Archaeological research indicates that many cities shrank in size and population over the course of the Han Dynasty. There is also corresponding evidence for a ruralization of Chinese populations compared to earlier times, resulting in a substantial increase in the number of small village communities. Therefore, while the population appears to have dropped significantly, it's possible that the population moving far off into rural places meant that they just weren't counted. The census of 2CE also listed 48 local Iron Monopoly offices, chiefly in Shandong, northern Jingsu and in southern Shaanxi.
Speaker 1:The three state-run textile factories established at Linzi in Shandong each had several thousand artisans producing high-quality silks. However, while certain changes were happening politically, social and economic changes were also happening. You start to see individual entrepreneurs rise through the ranks. For example, chu Wei was an upstart entrepreneur who was not a royal appointment, but rather he generated his wealth by manufacturing workshops he controlled. Chu signified an upwardly mobile class of entrepreneurs developed by a craft manufacturer. What this tells us is China's economy started to diversify, as not all artistic families sought to exploit opportunities through their land holdings.
Speaker 1:In one case, it was discovered that there was a theft of grain by a group of bond servants. A bond servant essentially is a slave that is bound in service without wages. When they were discovered, the thieves' lord offered to make reparations in the form of lands and laborers, but the aggrieved noble insisted on payment in grain. Now there are two ways in which they could have verified this transaction. For one, they could have received a split tally to certify the transaction. In addition, they could have used a bronze inscription that would have also documented the transaction.
Speaker 1:The tally stick was a popular reconciliation and record-keeping tool in England right through the 1800s. The reason being was the English people were generally illiterate, so the use of tally sticks provided a visual and tangible way to track debts and payments. Visual and tangible way to track debts and payments. A tally stick had notches on it representing specific amounts, with a description inscribed on both sides of the adjoining notch side. The stick was then split in half, with one half, known as the foil, going to the debtor, and the other half, known as a stock that would go to the creditor. When the debt is paid, the two halves of the stake would be compared to verify the accuracy of the payment. These tally stakes were used for ordinary transactions and they were also used to track tax payments and income. Tally stakes were used to record debts and taxes from the 12th to the 19th centuries, but were discontinued in 1826. They would eventually be replaced by modern practices using paper ledgers and accounting practices. Unfortunately, many of these records on the tally sticks were lost forever, as they were often used as firewood.
Speaker 1:Now I bring up the English use of tally sticks because it was more recent and we have good record keeping of it, and I also suspect that there were a lot of similarities in Han China. Another thing that was noticed in bronze inscriptions in Western Zhou was certain land transactions appeared to settle debts, not so much land sales or land speculation. It should also be noted that these land transactions were not done with cowry shells or other forms of money at the time. At the time they really weren't formalized markets or exchanges. Even though Han China was going through turmoil, scholars were actively advancing mathematics. The Chinese had created Gaussian elimination, which was row reduction, and an algorithm used to solve linear equations, by the end of the 2nd century CE. This was achieved in Europe only in the 18th century, so you can see that they were literally 1600 years ahead of the Europeans, for mathematical textbooks written down during the Han rule, it is clear that their math was first developed as a need for trade, then improved for the needs of the states, such as calculating taxes and resurfacing plots, then improved for the needs of the states, such as calculating taxes, as well as dividing labor and other administrative tasks, so as commerce and scholarship were advancing.
Speaker 1:Emperor Ping, now on the throne, since he was a child, was under Wang Meng's regency, but Ping died in 6 CE at the age of 14. They then left the throne to Liu Ying, who was only a year old. When he came to the throne, he was also under Wang Meng's regency. Therefore, before his official ascension, wang Meng had effectively ruled as emperor. From the moment Emperor Ping took the throne, his dominance rankled the remaining Han royals, who resented both his unchecked authority and his dismissive treatment of the imperial family. In an attempt to placate them, wang Meng publicly vowed to surrender power once the young emperor came of age. Yet in 9 CE, he revealed his deception by betraying that promise. As he declared that the Han dynasty had rescinded the mandate of heaven, he overthrew the boy emperor and proclaimed a new era, the Xin dynasty, which turned out to be very short-lived. By then, wang Meng had already consolidated absolute control over the imperial government and the military. Therefore, he ensured no significant opposition could challenge his coup. With this act, he brought the Western Han Dynasty to an end.
Speaker 1:Wang Meng launched extensive economic reforms. He reimposed state monopolies on salt and iron. He overhauled the monetary system and introduced new taxes and revived older ones. His policies included an income tax on skilled professionals and even a sloth tax to penalize landowners who left fields uncultivated. While these measures were later vilified as acts of a tyrannical ruler, however, in the grand scheme of things, wang Meng was in fact, a diligent and capable administrator. He even executed his sons when they broke the law, thereby demonstrating his firm adherence to his vision of governance, to the widening wealth gap and land concentration in the late Western Han Dynasty. As such, it turned out to be good intentions going bad.
Speaker 1:To give you a good idea about the wealth disparity in the last couple hundred years of the late Western Han dynasty, salary estimates of annual income shows that the minister of state made about 120,000 coins. Mid-ranking officials were paid about 40,000 coins, while a typical farming household earned about 20,000 coins. This 20,000 figure would have barely covered taxes and basic subsistence. This is clearly not an ancient problem alone. If you look at America in 2025, 60% of US households cannot afford a minimal quality of life, meaning that a significant portion of Americans more than half struggle to meet basic living expenses. Meaning that a significant portion of Americans struggle to meet basic living expenses. This is largely due to wage stagnation that started in the Reagan administration in 1981 and rising costs of essential goods and services like healthcare and childcare. And then, to make matters worse, the rentier class is squeezing the working class, especially the younger adults and working poor, when it comes to housing. Now I bring all the modern stuff up, because you can see that this is something that's been happening forever. So in ancient Western Han dynasty, the average farming household just could not meet basic expenses, and this is really no different than the 60% of the population in the United States that can barely meet any expenses as well.
Speaker 1:Elites in late Han China and in modern America controlled vast estates which were often tax-exempt Shocking, I know rich people not paying the fair share of taxes. Small farmers faced extensive debt. Then, when the inevitable poor harvest occurred, then, when the inevitable poor harvest occurred, it could have resulted in them needing to sell their land and therefore they became tenant farmers or, worse yet, vagrants. The tax base shrank as land concentrated in private hands. Then, when the government needed to fund foreign wars, they resorted to coin debasement, not unlike the Roman Empire. Therefore, wang Meng's reforms included various areas of his administration.
Speaker 1:Land nationalization and redistribution was one of his first reforms, and redistribution was one of his first reforms. The well-field system revival was implemented as all land was declared state property to be redistributed equally. Families with about 11 acres could keep land. Larger states were confiscated. The goal was to break up elite monopolies to restore small farmer stability. Additionally, they reverted back to economic controls State monopolies in salt, iron and wine, and, in addition, coinage was re-centralized. Price stabilization offices were established with fixed prices for grain, cloth and loans. Abolition of private slavery was enacted, as they banned the sale of people. However, enforcement was weak. There was a bureaucratic purge, whereas they essentially abolished Han nobility by stripping their hereditary privileges. Additionally, he appointed technocrats loyal to him, weakening local elites. Ultimately, wang Meng's reforms failed as elite landlords resisted by hiding certain holdings or even bribing officials to avoid confiscation. In addition, local bureaucrats sabotaged reforms as many of them were landowners themselves. Ultimately, while these reforms were well intended, economic chaos ensued as price controls backfired because markets froze up because no one sold at state-mandated prices.
Speaker 1:Wang Meng's coinage reforms were a key part of his broader attempt to restructure the economy and consolidate his power during the Qin Dynasty. However, his monetary policies were poorly executed and contributed to economic instability. Wang Meng also introduced multiple currency systems in a short span, including reintroducing the knife and spade coins and round coins with varying denominations. This constant switching confused merchants and the public. Their transactions became much less efficient and therefore this uncertainty severely disrupted the overall economy. To give you an idea of this confusion and uncertainty, at one point he implemented 28 different types of currency, making transactions unnecessarily complicated.
Speaker 1:People struggled to determine the value of the different coins. This meant no one could sincerely trust the financial system and its various coinage. The financial system and its various coinage. Probably the worst thing you can do to any economy and trade is to not trust the accepted currencies. This is why silver and later gold currencies work so well. One could trade with foreign counterparties if silver or gold was being transacted, because trust and certainty would have been established, even if the two parties didn't speak the same language or had vastly different cultural ideas and customs, and this is precisely why going off the gold standard was so controversial, especially post-World War I.
Speaker 1:Then there were the poor quality issues of some of the new coins that had low intrinsic values because some were made of cheaper metals. So they weren't made of gold or silver, which is fine, but they were assigned higher face values of which most people wouldn't accept. Therefore, this led to inflation and counterfeiting. Wang Meng also nationalized gold stocks, which contributed to the problem even further. These policies drove sound coin and gold out of circulation, unleashing rampant inflation and severely disrupting commerce and industrial production. Coins deposited in tombs and hoards during this era consist overwhelmingly of Wang Meng's new currencies, suggesting that much of the existing stock of the wujiu coins had vanished into the melting pot. In other words, people took the gold or silver that may have been circulating in certain coinage and they melted it down.
Speaker 1:There is a widely accepted economic principle known as Gresham's Law, which states that bad currency drives out good currency, which states that bad currency drives out good currency. What Gresham Law states is when you have two or more types of money that are in circulation that are legally required to be accepted at the same or similar face value, but one has a higher intrinsic value than the other. The money with the higher intrinsic value the good money will be hoarded or withdrawn from circulation, while the money with the lower intrinsic value the bad money will continue to circulate widely. This even works in the black market as well, a recent example being in places like modern Argentina, where people will accept US dollars as the preferred medium of exchange but are legally required to transact in the Argentine peso. But everyone wants to hoard US dollars, as they will usually hold their value better. This even includes when you have a president of the United States that has disastrous economic policies that weaken the US dollar. So, for example, let's say you are a citizen in a country that has extreme or hyperinflation and you come into US dollars, or even gold or silver, you are more likely to hoard those assets and try to unload the devalued local currency.
Speaker 1:Wang Meng tried to enforce the use of his new currencies by outlawing older Han Dynasty coins, but this only worsened economic chaos as people resisted or hoarded the old, more trusted money, which would be the reasonable outcome. The constant reforms eroded public confidence in the currency, leading to an increased use of credit instead of monetary exchange, which harmed commercial activity, which added unnecessary risks to the exchanges commercial activity, which added unnecessary risks to the exchanges there. The reforms failed to stabilize the economy and instead made inflation worse and reduced transactions due to the needless market confusion. His unintended outcome was the peasants and the merchants suffered, contributing to the widespread discontent that fueled rebellions. From a modern perspective, we nearly saw something similar in the United States during the late Gilded Age, because farmers in the middle of the country and the South were suffering badly, similar to the farmers of the late Han. As such, there was a major push to introduce a bimetal currency system by adding silver to back the dollar as well. So those gold was back in the dollar. They wanted to add silver. The biggest reason was the farmers were severely short of gold and a recent hoard of silver was discovered in the West. So they believed by adding a bit of inflation this would help prices of their crop yields. It never went through, as only gold could back the dollar. But one wonders what would have happened if silver was in fact added Additionally. The story of the Wizard of Oz may have been an allegory to these events.
Speaker 1:Wang Meng's coinage reforms ultimately proved to be overly ambitious, poorly implemented and disconnected from the economic realities of China. Rather than improving commerce, his reforms disrupted trade, caused inflation and alienated both the wealthy and the common people. The common people were those he was trying to help, but instead it only accelerated the collapse of his regime. Then there were the natural disasters and the Yellow River floods of 11 CE, which displaced millions, sparking food shortages and famine. The Yellow River was a gift from the gods as well as a curse. It got its name because of the amount of silt it carries. The silt is great because it offers a good balance of water retention and aeration, making it fertile for plant growth and allowing for healthy root developments. However, it is a curse because the silt buildup has caused the river to shift its main course at least 18 times in the last 3,000 years. Therefore, the river's tendency to flood and deposit large amounts of silt contributed to these shifts. As such, silt is the gift. Instability is its curse.
Speaker 1:Elites turned on Wang Meng and supported Li Shu, later known as Emperor Gong Wu of the Eastern Han. Ultimately, he faced an idealism versus reality, as Joe, era models were outdated for a complex Han economy. Worse yet, there wasn't any administrative capacity to enforce his sweeping changes. This culminated in the red eyebrow, which was a major rebellion consisting mostly of impoverished peasants, bandits and displaced farmers. They got their name from painting their eyebrows red to distinguish themselves from the Wang Meng's forces.
Speaker 1:Wang Meng's downfall is often blamed on his policies, but the true crisis stemmed from the catastrophic natural disasters During his reign. The El River flooded twice, shifting its course and unleashing widespread famine, mass migrations and chaos across China's heartland. Such disasters would have crippled any regime. Even a modern 20th century government would have struggled to respond effectively During the collapse of Wang Meng's Qin Dynasty. It was one of several revolts that contributed to Wang Meng's downfall and the restoration of the Han Dynasty. Wang Meng's failed reforms, including the chaotic coinage changes, heavy taxes and land redistribution, caused widespread poverty and famine, in addition to the corrupt officials and forced labor further angered the people.
Speaker 1:Unlike more organized rebellions, the Red Eyebrows were a loose, decentralized movement with no clear political agenda. They simply just wanted to survive and end the oppression. Just wanted to survive and end the oppression. They used guerrilla tactics, raiding granaries and government offices. Despite Wang Ming's downfalls, he did have his followers who supported him. Scholar Huang Tan lamented the draining effects of usury as, as he stated, the rich merchants of today dispose of great quantities of land and money. In making loans, the sons and brothers of middling families undertake indentured labor on their belief, hastening to and fro with diligence of mental servants, collecting payments comparable to the income of a hereditary noble. These are the same arguments that will be made for centuries, if not millennia. Therefore, one of Wang Meng's reforms in response to usury concerns was that he had created a credit system with low interest, which would have been about 3% per month, with a maximum of about 10% per year for the poor farmers. Presumably, these interest rates were reasonable compared to the prevailing rates in the private market.
Speaker 1:After Wang Meng's death in 23 CE, the Red Eyebrows sacked the capital, but lacked a clear leader to establish a new government. There wasn't any strong leadership. They were a mob of desperate peasants, not an organized political force. The rebels lacked a governing plan. They had no strategy to rule, leading to even more chaos. Eventually, they were defeated by Li Shu, who eventually went by the name of Emperor Guangwu Emperor Guangwu who restored the Han Dynasty, which became known as the Eastern Han in 25 CE. The Red Eyebrows were a desperate, violent reaction to Wang Meng's misrule, but their lack of organization led to their eventual defeat.
Speaker 1:Once the Han Dynasty was restored, the Red Eyebrows proved to be a key factor in Wang Meng's downfall. The red eyebrows proved to be a key factor in Wang Meng's downfall, proving that his policies had alienated even the peasantry, the same group of people he was aiming to help the most. Their rebellion showed the power of mass uprisings in Chinese history, setting a pattern for later revolts such as the Yellow Turban Rebellion in the late Han period. The legacy was a cautionary tale, as the Eastern Han abandoned these reforms, but land inequality continued to destabilize the dynasty. Later dynasties, such as the Tang and the, for example, copied Wang Ming's idealistic rhetoric but avoided his methods. Modern parallels can be seen as an early socialist experiment with similar pitfalls. Wang Ming's reforms were well-intended but impossible to implement in a society where elites control the bureaucracy and the economy. His collapse proved that top-down radicalism without grassroots support or a flexible policy risks disaster, despite all the recent chaos that was attributed to Wang Meng.
Speaker 1:The recent chaos that was attributed to Wang Meng, china's economy was re-expanded in certain sectors. As such, there is a reference in Han texts to pooling funds that are confined to cases of collective payments for boats and pack animals rather than sharing investment risks. However, a rare trove of legal documents concerning a commercial dispute in 27 CE suggests that agents were routinely employed in commercial dealings. The Jiuan documents are a collection trove of over 40,000 ancient Chinese texts written on wooden and bamboo slips that were discovered in the Jiuan region of northwest China along the Silk Road. These slips served as their standard writing material during the Han Dynasty, before paper became widely adopted became widely adopted. Juwan documents reveal that frontier officials regularly engaged in trade on their private accounts. This practice of buying and selling on credit, with payments deferred on the terms specified by the contract, occurred frequently throughout this time period. Therefore, it appears that this was a common practice in the Han times. However, even though this was the beginnings of the Silk Road, few Chinese merchants ventured beyond the empire's frontiers during the Han period.
Speaker 1:If you want to look at how China had evolved from the Western Han to the Eastern Han, it is worth looking at the economic and labor conditions during the Han Dynasty, particularly the Eastern Han. The Eastern Han was a period from about 25 to 220 CE. The payment of wages were typically half in coin, half in kind, such as grains. This reflects a partially monetized economy where grain, a staple commodity, still played a central role in transactions. Paying wages in grain ensured workers had food security, while coins allowed for flexibility in purchasing other goods and paying taxes. The dual payment system also implied that grain maintained a stable store of value, whereas coinage might have been subject to fluctuations due to inflation or even debasement fluctuations due to inflation or even debasement. Plus, china relied heavily on cheaper metals in their coinage in comparison to the people of Mesopotamia, greece and Rome. However, the most valuable coins in the Roman Empire were the gold coins, but they remained almost entirely in the hands of the wealthy elites.
Speaker 1:It was the silver coins that achieved widespread geographic and social redistribution through trade and military payments, but the production and circulation of bronze currencies were highly localized in the Roman Empire, whereas the Chinese relied heavily on cheap bronze currencies, which meant large numbers were needed to settle relatively simple transactions. This was a big reason why their coins had a hole in the middle, because they were designed to be strung together for easier carrying and accounting. The square hole was a distinguishing feature of the Chinese coins and remained a characteristic of Chinese coinage for centuries. I'd submit that if they had used silver coins instead of the cheap bronze or copper coins. The hole wouldn't have been practical because you wouldn't need to string large amounts for basic transactions amounts for basic transactions For those who fell into debt and then couldn't produce the required amounts of grain or coinage.
Speaker 1:They would have fallen into indentured labor, which was a form of slavery. The practice of indentured labor was still common in the Eastern Han, with terms ranging from 1 to 15 years, often tied to debt bondage. This indicates that many laborers, who were more likely to be peasants or impoverished individuals, entered into contracts to pay off debts or they were so desperate that they wanted to secure their access to food and shelter. The fact that this did not lead to permanent servitude distinguishes it from chattel slavery or hereditary serfdom. After the contract ended, the laborer could theoretically regain his freedom, though economic conditions might have forced them into repeated cycles of bondage. Many of the Irish indentured servants in the Americas that were initially shocked or even possibly confused by the institution of chattel slavery, particularly as it applied to people of African descent. This reaction is often tied to their own experience of indentured servants, which was a form of temporary contractual labor, not a lifetime or hereditary slavery status.
Speaker 1:Women dominated the state-run textiles and lacquer workshops. These occupations reflected the traditional gender roles where weaving and handicrafts were considered women's work roles. Where weaving and handicrafts were considered women's work, the state likely relied on female labor for these industries due to their perceived suitability for detailed and repetitive tasks. Fewer opportunities in private employment suggest that private enterprise may have preferred male labor or the social norms restricted women's participation outside state-controlled settings. Grain prices in Western Han would have been around 80 to 110 coins per hue. One hue is a unit of volume of approximately 20 liters.
Speaker 1:In the Eastern Han you can see the effects of inflation, as the price increased to around 150 to 200 coins per hue, roughly double the price of the Western Han. However, wages also increased, as well as monthly wages would have increased at least threefold. The rise in grain prices could indicate a few things, such as inflation, population growth, which would have increased demand, or possibly due to decreased agricultural productivity due to land concentration, or possibly climate issues. Nonetheless, wages rising more than grain prices suggests that real wages or purchasing power may have improved for some laborers, though this would depend on regional variations and the broader cost of living. Alternatively, if grain prices rose due to monetary factors such as coin debasement. The nominal wage increases might not reflect real gains. In the end, the Eastern Han saw significant changes from the Western Han, including greater monetization of the economy. However, each period had their own powerful landed elites who controlled labor and resources. Both the Western and Eastern Han had periodic economic instability. For example, the late Eastern Han crisis led to the dynasty's collapse.
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