Beijing, January 1668
Snow may have wrapped the city in a wintry blanked, but inside the Forbidden Palace the Emperor was more active than ever.
The Kangxi Emperor sat on a throne wrapped in furs, while his officials tried to explain to him the main problems facing the dynasty.
“So I understand this,” he said with his brows arched, “you’re telling me we cannot feed Beijing.”
The official looked at the figures. “That’s correct, Your Illustrious Majesty. Traditionally, the city received grain from the south via the Grand Canal. Now...” the official shrugged.
Another official spoke up. “To be fair, the Ming loyalists provide us with grain in tribute as part of our peace terms. But should they ever cease to supply us with grain, we would have a problem.”
Kangxi scowled. “So our armies keep them pliant, and their grain keeps us from going to war again.”
“We need to find,” he mused, “a way around this.” He thought for a moment of the Red Haired barbarians. “Tobacco came from the Spanish lands. Perhaps other crops grow there too that would thrive here?”
One of the officials stroked his beard. “Who knows? But it would be easy to find out. But our other proposal, Your Illustrious Majesty, would be to improve the canal system along the Yellow River.”
“And how will we pay for that?” demanded an older official. He slammed a cane on the ground and quoted Confucius. “Those who do not economize will agonize.”
“Anyway, don’t you remember what happened to the Ming? The state was broke by the end because it spent more than it collected.”
Kangxi spoke up. “But the problem now isn’t that the state is broke. It’s that the people lack a medium of exchange, which cripples everything we try to do. With no silver, people cannot pay taxes, buy cloth or grain, or earn a living in the cities. And if they cannot pay taxes, then we cannot build canals.” [4]
One official, wrapped in a fur from Siberia and silk woven in Jiangxi, asked, “If you ask me, this is for the best.” He took out a piece of paper, and read a series of points. “First, peasants should be producing their own cloth and grain, not buying it. Second, if we ban the use of silver, then trade will stagnate and people will travel less, keeping them close to their ancestral shrines. Third, without precious metals to buy frivolous luxuries, the gap between rich and poor will be lessened. Fourth, it’s easier to steal copper taels than silver cash, so crime will decrease.”
The official beamed. “So you see, abandoning silver entirely and using copper
only when necessary would work best.”
Kangxi though about what his father would do in this situation. Then he realized his father would have fallen to the ground frothing at the mouth and then said Jesus told him that China should not be sold for a sack of 30 taels of silver." Shaking his head, he said, “Any other ideas?”
The insulted official slunk to the back of the chamber while another official stepped forward. “We could try importing more silver, but since most of our trade comes through the Ming territories anyway, this would only increase our dependence on them.” The official hesitated, and then said, “Well, people use money because it’s a convenient medium of exchange. Silver is only a shiny metal that everyone agreed is worth something, right?”
There was a feeling of unease in the room, and then the official said, “well, suppose we come up with another medium of exchange.” He hesitated. “We could try, for instance, paper money.”
The Kangxi Emperor thought. “Would it work?”
“Well, the reason that people use silver is that they trust it; it does not have any intrinsic value to cold and hungry people.”
“So how do you get people to trust pieces of paper?”
There was an awkward silence, and the official hesitated before answering. “We must make sure that it’s accepted for tax revenues. That gives it a clear value that people will use it for, and it will be far easier to carry a thousand taels of paper than a thousand taels of silver.”
The Emperor sighed and rubbed his eyebrows. “Do it.” [5]
[5] These ideas were all debated during OTL Qing, save for paper money (the original proposal involved using stamped copper coins with artificially imposed higher values).