Episode 44. Han’s Tightrope: Markets, Monopolies, and Mandates

What if the health of an empire could be read in the trust of its money and the fairness of its institutions? We follow Han China through a gripping arc: from early market freedom and soaring wealth to Emperor Wu’s heavy hand—state monopolies in salt, iron, and liquor, unified coinage, and price-smoothing granaries—and then into the turbulence of debasement, counterfeit coin, and a monetary dark age. Along the way, the Silk Road begins to hum, standards slash fraud, and safer routes let merchants scale. The big question never leaves the stage: how do you let markets innovate while the state secures public goods, strategic industries, and national defense?

Power’s center shifts inside the palace as eunuchs move from attendants to advisors to kingmakers. Underage emperors and captured courts turn offices into commodities, selling posts—sometimes on credit—and feeding a patronage machine that guts merit and drains public trust. Land concentrates, smallholders slide into tenancy, and the tax base erodes as elite estates dodge oversight. Then the climate turns cruel. Floods, famines, and plague meet a state that has neglected canals and dikes. The Mandate of Heaven looks broken, and people respond: the Yellow Turban movement rises, is crushed, and leaves the center permanently weakened. Warlords seize the stage, and China fractures into Wei, Shu, and Wu, with economies refocused on agrarian recovery and survival.

Still, the Han legacy endures—territorial reach, administrative craft, vibrant trade networks, and lasting achievements in thought and art. The lesson is timeless: prosperity thrives on balance. Money needs credible standards; markets need guardrails; public works need care; and institutions must be shielded from capture. We unpack the policies that worked, the choices that failed, and the signals leaders missed, drawing clear lines to today’s debates on central banking, antitrust, and industrial strategy. If this story challenged your assumptions or echoed our present, share it with a friend, subscribe for more, and leave a review with the policy lever you’d pull first.

Chapters

• 0:00 Markets Rise, State Strikes Back
• 0:27 Coinage Chaos and Monetary Trust
• 1:16 Silk, Standards, and Safer Routes
• 2:24 The Eternal Balancing Act
• 2:46 Eunuchs Enter the Inner Court
• 5:38 From Gatekeepers to Kingmakers
• 7:06 Underage Emperors, Overgrown Factions
• 8:30 Reform Hopes and Military Strain
• 10:31 Corruption, Land Grabs, and Tax Shifts
• 12:04 Students Protest, Power Tightens
• 13:54 Merit Sold, Titles on Credit
• 15:24 Floods, Famines, and Lost Mandate
• 17:04 Yellow Turbans and Broken Authority
• 18:22 Warlords, Fragmentation, and Three Kingdoms
• 21:05 A Golden Age’s Long Shadow
• 32:46 Farewell to Han, What’s Next

Transcript

SPEAKER_00: 0:00

Wealth surges, currency crises, and monopolies on life's essentials. Han China's economic story feels startlingly current. The early Western Han lies a fair push unleashed private enterprise and wealth inequality. Then Emperor Wu changed course as he swung the state to more central control through salt, iron, and liquor monopolies. And then he centralized the minting of coinage. Furthermore, price smoothing techniques were implemented through their ever normal granaries, which propped up prices to help out the farmers when prices were low, and then they reduced prices when they were expensive and released grain reserves to prevent famine. The gains were real, stronger coffers, military capacity, and national security. But so were the trade-offs that included stifled innovation, a bloated bureaucracy, and simmering public resentment. Coin debasements, private minting and Wang Mang's brawling twenty-eight currency experiment triggered counterfeiting, hoarding, in kind payments, and an urban retreat, resulting in a monetary dark age. Then the counterswing was Emperor Gong Wu's political reset and Emperor Ming's infrastructure reinvestments, which rekindled agriculture and trade. The Silk Road, as we know it, was still in its infancy as Land Sea networks dominated trade, especially through the Cushion Empire's lucrative middlemen rule. By time Emperor Jang consolidated the Eastern Han Second Golden Age, Silk functioned as a currency across Central Asia. Standards cut fraud and safer routes on locked scale for merchants. The through line was a pragmatic balance between markets driving efficiency and innovation versus state regulations to implement safeguards, stability, public goods, and strategic industries for national security. However, the Western and Eastern Han Chinese, just like modern economies, have shown that when trust in money cracks, the economy collapses, putting enormous pressure on governments. When control smothers enterprise, growth thins. Much of what happened in the ancient Chan economies have shown a resemblance to modern antitrust concerns, central banking, and industrial policy, showing why the pendulum keeps swinging, and why smart policy accepts the need to adjust. However, as the ancient Han Chinese were constantly fine-tuning their economic and governmental policies, the power of the eunuchs were growing throughout the generations. Eunuchs were present in the Chinese court as far back as the Shang and Zhou dynasties. Originally, their primary function was to serve as gatekeepers and attendants to the royal family. Eunuchs really started to step to the forefront when they began acting as advisors to emperors during the Eastern Han Dynasty, especially from 146 CE onwards. While records suggest eunuchs served in the Chinese court as early as the second millennium BCE, their role went from being just gatekeepers to acting as counsel to emperors as they became prominent during the Eastern Han period. The eunuchs' influence was the result of an ever-creeping power grab. As eunuchs grew more influential, they eventually made their way up the chain of command as they became advisors to the Eastern Han emperors, primarily because they were seen as loyal and trustworthy figures. Additionally, they lacked a potential for familial ambition or dynastic aspirations that could threaten the emperor's power. Their lack of descendants meant that they were thought to be less susceptible to corruption and nepotism. And their immediate access to the emperor's inner circle made them valuable intermediaries between the inner and outer courts. Another potential reason was they were castrated and therefore may not have been a threat to get with the women of the palace. In other words, they wouldn't pose a jealousy factor, if that's what you want to call it. However, the official reason probably would have been the fact that since eunuchs were castrated, they could not have their own families or heirs, making them less likely to engage in power struggles or seek to usurp the throne. Consequently, eunuchs were given proximity to the emperors and the imperial women, giving them the unique access to the inner court and the ability to influence decision making. Additionally, eunuchs were often used to counterbalance the power of other court officials and certain factions in the palace, thereby creating a system of checks and balances within the government. Eunuchs performed other duties as well, including managing the imperial household, and some even served as military commanders. While eunuchs were initially seen as loyal and trustworthy, the more power they grabbed, the more they were susceptible to corruption and abuse. Some eunuchs became so powerful that they were able to manipulate the court and even influenced imperial appointments. Thus, they were able to get allies within the governments. Thus, they were able to get more allies inside the governments, leading to even more power. Therefore, by the second century CE, eunuch factions had become kingmakers in Lolang, as they repeatedly manipulated weak emperors and dismissed scholarly officials. Now, weak emperors might be unfair because when an emperor comes to the throne as a 12 or 13-year-old or even younger, can you really call them weak? They were either preteens or teenagers and were even as young as toddlers, so they were clearly inexperienced and probably quite naive because of their age. As eunuchs became counsel to these underage emperors, they were able to convince the emperors to appoint relatives and allies of the eunuchs to key posts, thus eroding its previous tradition of promoting individuals to key government positions through meritocracy. I am Might D. If you like what you hear, please subscribe and follow to continue this journey through the fascinating evolution of money banking and trade across multiple civilizations. Emperor Shun's reign saw modest attempts at reform. In 131 CE, Emperor Shun founded a new national university to expand the previous imperial university complex to more than 1800 rooms. The following year, students were selected from across the empire based on their literary knowledge. The university became a key institution for training bureaucrats that had decayed over the decades. Han Generals briefly reasserted influence in Central Asia. However, in 127 CE, the general Ban Young was removed from office on false charges, and the situation in Central Asia diminished again. People could clearly see that the Empire's military strength was in steep decline, and many of the eunuchs' governmental policies were becoming irreversible. Emperor Shun wasn't even a teenager when he came to the throne, as he was probably about 10 years old, and therefore he failed to control the corruption among them and the other officials who jumped on the corruption bandwagon. In addition, because of his age, he also delegated significant power to his wife family, the Liangs, who were themselves corrupt. Shun sat on the throne for 19 years. His lack of leadership meant that the Eastern Han Dynasty continued its relentless decline. Additionally, the rise of eunuch and consort families' power was at the expense of the central authority, and it was a defining feature of the later Eastern Han Dynasty after Shun's death in 144 CE, which triggered another crisis because his infant son ruled for barely a year before he died. Empress Dawager Liang seized control and she selected another underage heir, a great grandson of Emperor Jang. The boy Emperor Ji was murdered by poisoning in 146 CE by the powerful official Liang Ji. Liang Ji then convinced his sister, the Regent Empress Daujer Liang, to put the 14-year-old Emperor Huan on the throne. Emperor Huan, another Jang descendant, came under the Liang clan's control. He grew resentful of Liang Ji's authoritarian and brutal rule. In 159 CE, he allied with eunuchs to overthrow them. In the process, he slaughtered the Liang faction. However, this had an unintended consequence as it strengthened the eunuchs' control over the governments. Eunuchs were now indispensable, and they were rewarded with government positions, wealth, and unchecked power. Huan's reign was marked by corruption and incompetence, either because he was just too young and inexperienced, or he was purposely given bad advice from the eunuchs. He ignored capable advisors, suppressed criticism, and in 161 resorted to selling minor government officials to replenish the treasury, a disastrous president, which some could say is happening in 2025 under the Trump administration. The powerful eunuchs used their position to illegally acquire vast landed estates, often through confiscation and seizures. This exacerbated the existing problem of wealthy landowners hoarding land, which ultimately deprived the imperial government of crucial tax revenue from small and independent farmers. This therefore increased the tax burden on commoners. To compensate for lost revenue and fund costly military campaigns, the government, under the influence of the eunuchs, imposed heavier taxes on the common people. This created severe economic strain on the peasantry, which was already vulnerable to crop failures, floods, and famine. It has certain similarities to modern United States from the disastrous tariff policy. This tariff policy has shifted the economic burden of the massive tax cuts that were given to the millionaires and billionaires through consumption taxes that is paid largely by the middle and working class to make up for the massive deficit caused by President Trump. Eunuchs exploited their control over the court to funnel state resources to themselves and their allies. Tell me that doesn't sound familiar. Their duties included overseeing the procurement of goods like food, medicine, and building materials, which offered many opportunities for embezzlement. It sounded like the breakup of the Soviet Union when certain people close to the Communist Party were sold key assets for pennies on the dollar. Thus the oligarchy was started. That doesn't include the outright bribery in Han China when many top official posts were sold to the highest bidder. This practice not only increased the wealth of the eunuchs, but also allowed them to appoint their unqualified associates to powerful and lucrative positions, further entrenching their control and damaging the bureaucracy. Looking at these practices in Eastern Han China by the corrupt eunuchs eerily resembles much of the Trump administration's policies when dealing with certain government agencies. The middle and working class lose out while the wealthy dismantle the governments, while also extracting resources and reducing government oversight for their personal gain. The eunuch Caesar of land and wealth contributed to massive social and economic inequality. Large landowners, including the families and associates of powerful eunuchs, grew wealthier, while the taxpaying peasantry was squeezed dry. Does this sound familiar? Eventually, the populace is going to push back. In 166 CE, university students staged protests, demanding Emperor Huan purge corrupt officials. Rather than heed their calls, the emperor ordered the arrest of all the demonstrators. Historically, Emperor Huan has been regarded as a ruler of moderate intelligence, but poor statecraft, and his reign significantly accelerated the decline of the Eastern Han Dynasty. Emperor Huan died in January 168 CE without a son to succeed him. Emperor Do was jealous of how he favored consort Tian, so she had her immediately put to death after the Emperor died. She conducted a survey among the members of the Imperial clan and decided on the 11-year-old Liu Hong, who then ascended to the throne as Emperor Ling. On March 9, 168 CE, Emperor Huan was buried and given a temple. But this temple name was later revoked in 190 during the reign of Emperor Xian. But before Xi'an came to the throne, the disaster of partisan prohibitions occurred from about 166 to 184 CE, which saw eunuchs prosecute Confucian scholars and cripple state governance even further. The reason they were able to continue these terrible, self-dealing policies was the emperors continued to come to the throne at such a young age that they couldn't possibly rule the state. Underage emperors, for example, Emperor Ling, who ruled from 168 to 189 CE, came to the throne when he was only 12 years old. Therefore, these underage kings continued to be figureheads, thus accelerating the decentralization of the state authority even more. On top of that, middle class families vanished from records. This meant that the society had gaps between the ultra wealthy and the rest of society that were growing even more. The small landowners, once the backbone of Han bureaucracy, were squeezed by heavy taxes and military conscription, causing them to fall into tenant status. Wealth concentrated in magnet clans that amassed estates but avoided direct oversight of farming. In addition, magnate families rarely managed production directly. Instead, tenant farming dominated with a typical 50-50 split, which meant that tenants typically surrendered half of their harvest to the landlords. But to make matters worse, the landlords implemented harsher terms for the tenants. For example, if landlords provided tools and animals, shares could rise to 70%, trapping peasants into debt cycles. While not legally bound, tenants had little mobility, thus this resembled a de facto serfdom. When Empress Dowager Dao installed Emperor Ling under her regency, she attempted to curb eunuch power but failed dramatically because in 169 CE the eunuchs massacred the Tao clan and therefore took full control of the kingdom. Under Emperor Ling, corruption worsened. To fund his decadent lifestyle and massive imperial construction projects, Emperor Ling began the unprecedented practice of openly selling government positions for money. Previously, officials were recruited based on merit through the civil service system, but by now meritocracy was all but dead. But somehow, it got even worse. Once all the wealthiest officials bought the pieces of the pie, Emperor Ling realized that there wasn't enough people with cash reserves to continue this bribery scheme. So therefore, he offered titles on credit at double the original price. This allowed less scrupulous individuals to buy their way into power and then exploit the populace to pay their debt back. In other words, even more stress was put on the working class as the government was filled with corrupt, unqualified officials, so therefore investment wasn't possible. Consequently, it was purely an extraction operation at this point. These officials in turn levied heavy taxes on the peasants and ruthlessly exploited them to recoup their investments. Honestly, this doesn't sound all that much different than what private equity has been doing. They've been plundering American companies now for the past 30, 40 years. The eunuch faction wielded massive power under Emperor Ling. They oversaw imperial construction and a system of messengers that were sent about to regional officials where they were forced to pay bribes to them. Sounds like a mafia shakedown to me. With the dwindling number of independent farmers to tax, the central government lost its primary source of revenue, further exacerbating the empire's decline and centralizing power to local strongmen. But before that, Emperor Ling amassed vast personal wealth by diverting funds from the imperial treasuries. He built extravagant palaces and lavish gardens, including a replica of steppe nomad tents. In 177 CE, to make matters worse, the Han army suffered a crushing defeat against the Xiambei, a rising nomadic confederation. So while the emperor and his cronies were getting exceedingly wealthy, the average family's income was primarily based on agriculture. It wasn't all that long ago that many of these families had successful family farms. However, many middling families fell into debt to these wealthy landowners and were forced to become tenants or laborers, unable to compete with the powerful landowning elite. The government implemented severely regressive taxation policies as they demanded high taxes from the peasantry to fund its operations. But the system was plagued by tax evasion by the rich through corruption, especially under the influence of the powerful eunuchs. Then to make matters worse, China was experiencing devastating floods, famines, droughts, and plagues, which further crippled their agricultural economy and made it difficult for peasants to produce food. Massive floods during the final centuries of the Han Dynasty were most likely part of the natural change in climate, but the Chinese had known this for literally centuries, if not millennia, so proper flood controls could mitigate part of the natural disaster. However, the government was a basket case, run by inept people who were looking to extract as much wealth as possible, therefore they neglected flood control along with other infrastructure projects. Does this sound familiar if you're an American in 2025? As it were, you can almost guarantee that when unqualified grifters get a hold of any government, disasters and then instability will follow. Eunuchs did not directly cause the floods, but their rise to power contributed to the corruption and government decay that led to catastrophic infrastructure failures that followed the floods. The main reason emperors could claim the right to rule was through the mandate of heaven. This concept had been around for well over a thousand years by this point. The mandate of heaven was first introduced by the Zhou dynasty in 1046 BCE to legitimize their overthrow of the preceding Shang Dynasty. Essentially, the Mandate of Heaven was a Chinese philosophical and political concept that provided the divine right to rule, asserting the ruler's authority was granted by heaven. Additionally, it was the philosophical basis for the rebellion against the Shang in 1046 BCE, as the people believed that they had the right to transfer power because the rulers became tyrannical and corrupt. To retain the mandate, a ruler had to govern honorably, nobly, and maintain harmony with the cosmos and the people. The loss of the mandate was indicated by obvious signs such as natural disasters, famines, or rebellions, which legitimized the overthrow of a dynasty and the rise of a new one. By 184 CE, these governments and market failures, along with natural disasters, ignited the Yellow Turban Rebellion, a major peasant uprising led by Taoist preachers. These preachers were a bit kooky as they appear to be faith healers, but when people are desperate, they will follow anything if it gives them hope. The Taoist community offered communal activities like fasting, musical performances, chanting, incense burning, getting the people into a trance-like state, and then offering sermons. The rebellion got its name because the rebels wore yellow headscarves. This was because the preachers believed in an impending apocalyptic change involving yellow skies, marking new governance, which inspired the color of their headwear. They also united followers across ethnic and gender lines. One of the first actions was to declare the Han's mandate of heaven is over. The rebellion was almost predictable, as the peasants had enough of years of poverty, famine, and heavy taxation. The people were starving while the rich lived lavishly, and therefore the rebels had been pushed to the brink and attacked government officials and garrisons. The Han government was dysfunctional and therefore struggled to respond effectively due to internal divisions and outright corruption. There were also power struggles between eunuch and imperial families, which obviously resulted in a decline of central authority. The fact is the central government found it difficult to respond, but this kind of proved the rebels' point for the rebellion. Nearly the whole point of the government at this time was grift and corruption. One of the main goals of the rebels was to reestablish order by overthrowing the corrupt and weakened Han governments. However, the rebels were unable to overthrow the Han as it took about a year for the government to get itself together, and therefore they were able to put down the rebellion. Although it was suppressed within a year, the rebellion significantly shattered imperial authority and is seen as a major turning point in Chinese history. It also fostered the rise of powerful regional warlords who had initially helped suppress the uprising, further contributing to the fragmentation of China. The O Turban Rebellion would have ultimately contributed to the rise of the Three Kingdom period. Consequently, the poor tenants and landless laborers revolted against eunuchs and the landlords. As such, the late Hanuch magnate feud and rural inequality became a cautionary tau for later dynasties, which shaped the Tang Song efforts to curb elite power. After the rebellion, the last emperor Xi'an, who ruled from 189 to 220 CE, faced immediate eunu betrayal, but in 189 CE, a general slaughtered the eunuch faction in a bloody purge. However, the power base had fragmented and splintered. As a result, military leaders and aristocratic governors controlled their own region, effectively becoming independent warlords. General Dong Zhao seized control of the young emperor and moved the capital from Luoyang to Chang'an. After Dong Zhao's assassination, Emperor Xian was held hostage by other generals. Then in 196 CE, a relatively minor warlord named Kao Kao made a bold political move by inviting the emperor and his court to reside under his protection. The fact that the emperor needed protection should give you an idea as to the weighing power of the Han Emperor. At the time, this probably seemed surprising to people in China because Kao Kao was not yet a major figure, but the maneuver significantly elevated his status. From that point forward, he steadily gained prestige and power, eventually becoming one of the most influential warlords in China. His rise exemplifies how military leaders used their control of the imperial court to legitimize their authority. By the end of the second century, China had fragmented into numerous competing warlord states, plunging the country into full-scale civil war. Among the key contenders were Li Xu in the Southwest, a self-proclaimed distant relative of the Han Royal family, and Sun Chuan in the Southeast. This set the stage for a three-way power struggle for the throne. Kao Kao died in 220 CE, but his determined son Kao Pai inherited his position. The thing is, the Han Emperor was still technically in charge of China. 220 CE, Dier Kao Pai took over his father's position. He pressured Emperor Xi'an to abdicate the throne in his favor. With that act, the Han Dynasty came to an end after more than four centuries of rule. Emperor Xi'an was not executed. Instead, he was granted a noble title and lived in relative comfort as a duke on an estate provided by Kao Pai. Li Xu Bei took the title of Emperor in 221, while Sun Chuan followed them both by taking the same title in 229. Li Xu Bei took the title of Emperor in 221 CE. Sun Chuan followed that by taking the title of emperor in 229 CE. Thus, China was divided into three states, the Wi, the Xu, and the Wu, and the period of the Three Kingdoms began. The economy during the next 50 years in the early part of China's Three Kingdom period was in shambles due to the severe disruption caused by the collapse of the Han. The end result was a period of extreme scarcity and a shift in economic power away from the devastated northern plains towards the more stable southern regions, as the population in the northern tiers was devastated and those who survived were often displaced due to crippled agricultural production, especially in the north. A unified national economy gave way to three separate state-controlled economies, all heavily focused on agrarian recovery to support constant warfare to feed their population and armies. Northern China saw a significant decrease in population due to warfare and migration. Many people fled south to the Yangtze River basin, which contributed to the South's economic and demographic growth under the state of Wu. The Late Han's decline was the result of a cycle of weak emperors who were all well underage and sometimes not even a year old when they came to the throne, and as a result, the regents and the eunuchs effectively took control of the empire. Each faction undermined the state through various self dealing and grift. Then, when the inevitable natural disasters occurred or poor harvests, the The peasant population, which grew steadily due to the increasing wealth inequalities from the extreme wealth concentration due to unsavory tactics, the foreseeable revolt happened. These revolts weakened the empire, then warlordism finished it. This pattern became a cautionary tale for later dynasties about the dangers of court corruption and military decentralization. The Han dynasty had drastically changed from the early Western Han, which was from the 2nd to the 1st century BCE, saw the creation of the small landholder farmers that were taxed directly. At the same time, units were present, but they were marginalized and may have served as useful counsel to the emperors. The Western Han could have been viewed as an empire that valued meritocracy, as middle class families found positions in the bureaucracy if they were capable. In contrast to the late Eastern Han, which was the second century CE, tenant sharecropping dominated agricultural production as wealth concentrated into the hands of fewer and fewer people who were often associated with the court or the eunuchs. Eunuchs had gained control of the royal courts as they influenced the child emperors and elite magnets pushed out the middle class to monopolize power in the bureaucracy. The collapse of the Han Dynasty was not sudden. It was the result of decades of political fragmentation and internal decline. Yet, despite its eventual fall, the Han era is widely regarded as one of the golden ages of Chinese history, and rightfully so, because under Han rule, China experienced vast territorial expansion, stretching from Korea to the east to Vietnam and the south, and deep into Central Asia, reaching as far as present-day Kazakhstan. The economy flourished, driven by booming production in silk, iron, and ceramics, and by the growth of long-distance trade through foreign middlemen. One of the dynasty's most lasting legacies was the development of the Silk Road, which ended up connecting China to Europe and would be a major driver for facilitating cultural and commercial exchange over the next millennia. The Han period also saw tremendous advancements in philosophy, literature, science, and the arts. Many influential texts and ideas from this era are still preserved and studied today. Thanks to these achievements, the Han Dynasty became viewed as a classical age of Chinese civilization, if not human civilization, an enduring model for future generations of Chinese business leaders, engineers, and intellectuals. I want to thank you for taking your time to listen or watch this episode, and hopefully the episodes prior. This wraps it up for ancient China. Up next, we will get into Greek histories. If you like what you hear and want to donate to the show, you can visit us at patreon.com/slash history of money banking trade, or you can visit our website at moneybankingtrade.com. Thank you very much. Talk to you soon.