In the years leading up to the First Opium War, a debate occurred within the Qing government over how the opium problem should be addressed, with one side arguing for its legalization (so that the state could tax it and thus give some much needed cash to the treasury) and another for harsher punishments against smugglers. The latter side won, kicking off the events that led to war with Britain and the start of the century of humiliation.
So what if the government legalized opium instead? Would it be necessary for there to be another ruler in the Daoguang Emperor's place? How much more damage could opium addiction cause, and what will happen to trade with Europeans without the Treaty of Nanjing? I assume there'll still be pressure to open up Chinese ports to European ships and merchants, so how could it be dealt with?
I actually think the status quo could have continued for quite some time if a war is avoided in the 1830s. The thing is, Westerners at the time largely weren't chomping at the bit to open China to unrestricted trade by force - the Opium War actually rivals Sarajevo in terms of the sheer amount of misunderstanding, blundering and plain bad luck required on both sides for things to get violent. There were a few people in Britain and the US who favored asserting their military might over China for trade's sake, but most people opposed the idea because war with China would, at least in the short term, shut down the very trade they valued so heavily.
Remember communications between England and China were really slow at this time - it could take up to 6 months one way for a ship to travel from London to Canton. So even if nothing goes wrong on the military end of things, you're still risking at least a year's worth of trade by going the gunboat diplomacy route. That wasn't an upfront cost the British were consciously willing to pay, at least not before it became a question of national honor instead.
That said, China had a slew of other problems at this time, the main ones being hideous levels of unrest and corruption, and opium addiction will only make those harder to deal with. I can't say as much about how bad that would be relative to OTL, however. And it's possible that if another White Lotus-level rebellion emerges eventually then at that point the West might apply some pressure for additional considerations from Beijing.
That said, China had a slew of other problems at this time, the main ones being hideous levels of unrest and corruption, and opium addiction will only make those harder to deal with. I can't say as much about how bad that would be relative to OTL, however. And it's possible that if another White Lotus-level rebellion emerges eventually then at that point the West might apply some pressure for additional considerations from Beijing.
I actually think the status quo could have continued for quite some time if a war is avoided in the 1830s. The thing is, Westerners at the time largely weren't chomping at the bit to open China to unrestricted trade by force - the Opium War actually rivals Sarajevo in terms of the sheer amount of misunderstanding, blundering and plain bad luck required on both sides for things to get violent. There were a few people in Britain and the US who favored asserting their military might over China for trade's sake, but most people opposed the idea because war with China would, at least in the short term, shut down the very trade they valued so heavily.
Ironically enough, there were also people who favoured going to war because they thought this would *end* the opium trade -- the idea being that, if the East India Company could trade freely in China, they wouldn't have to resort to high-value, easily-smugglable goods like opium, but could just sell normal things instead.
Ironically enough, there were also people who favoured going to war because they thought this would *end* the opium trade -- the idea being that, if the East India Company could trade freely in China, they wouldn't have to resort to high-value, easily-smugglable goods like opium, but could just sell normal things instead.
Also, the Chinese were under the impression that Opium smoking was punishable by death in England, and therefore they should be able to stamp out the habit in China just as easily.
First, a brief look at events on the British side:
In 1813, the BEIC's charter is renewed but its monopoly on Indian trade is removed. British merchants not affiliated with the BEIC can now enter the Indian market. Soon enough, they demand to be let into the most profitable part of the Indian market: the trade with China, which the BEIC still holds a monopoly on for now.
In 1826, the Anglo-Burmese War ends and the BEIC is left with a staggering amount of debt. The best way to pay it off: more opium. Opium smuggling into China picks up from 350 tons per year in 1822 to around 1,350 tons in 1832.
In 1833, the BEIC's charter is again renewed but this time its monopoly on Chinese trade is removed. Now every British merchant who's been champing at the bit to be allowed to trade in China is interested in dumping as much opium as possible into the Chinese market in order to outdo his competitors -- which actually includes plenty of merchants from America and the Indian princely states. Opium smuggling into China picks up from 1,350 tons in 1832 to 2,550 tons in 1839.
The price of opium in Guangzhou and most of southern China craters, but the extra amount being smuggled in means that the British smugglers are still profiting. One of the results is that native opium farmers in Sichuan and Yunnan are forced to step up production in order to maintain their profit margins. This will have consequences later.
In 1842, the Treaty of Nanjing is signed. It makes no provisions for opium and the British opium traders want it to stay that way, because opium is worth more when it's contraband than when it's legal, just like alcohol in Prohibition-era America. They want opium to be illegal, but for the law enforcement to be too weak to deal with them. However, while they do make a lot of money after the treaty is signed, the amount of money coming in every year slowly goes down for some reason. Unbeknownst to be them, the native opium industry is stepping up production to meet the competition and they are beginning to eclipse it. By the Second Opium War, when opium is legalized, they've decisively beaten the British opium traders.
In 1858, the Qing finally legalized opium and taxed it. This actually helped keep the Qing government afloat, as it was in the middle of dealing with half a dozen rebellions at that point and much of the country was in ruin.
Second, a brief look at events from China's side:
In 1772, an official named Heshen becomes the emperor's favorite and is named to one of the highest posts in government, an unheard-of honor for someone so young. He quickly begins amassing power.
In 1780, Heshen becomes Minister of Revenue, allowing him to basically do whatever he wants with the treasury.
In 1789, the Qing invasion of Vietnam fails, at a cost of 151 million taels of silver.
In 1799, the Qianlong Emperor dies and the Jiaqing Emperor is finally able to prosecute Heshen for his corruption, which by this point has become so brazen that you have to be physically blind to not see it. The resulting investigation reveals that Heshen had squirreled away over a billion taels of silver in government revenue and had created an elaborate network of corruption throughout the bureaucracy. The Jiaqing Emperor starts a general anti-corruption purge but has to stop halfway through because of the far-reaching scale of the rot his father had turned a blind eye to. In the years afterward, he and his successor will look for any possible way to reduce corruption and reduce government expenditure.
In 1804, the White Lotus rebellion is finally defeated after ten years, at a cost of 120 million taels of silver. This debacle has revealed to the government that the Manchu banner forces have gone completely soft since their last use and are just not fit for purpose. More government oversight is needed, and in the meantime the government has to rely on the historically less prestigious ethnically-Han Green Standard Army and on local militias for suppressing rebels. The costs of this campaign + the invasion of Vietnam causes inflation in China which continues all throughout the early 19th century. However, many officials misattribute this problem to Heshen's legacy of corruption and believe that money is still being siphoned away by corrupt officials and recommend more stringent anti-corruption measures; the Daoguang Emperor concurs.
In the 1810s, the Spanish American Wars of Independence kick off. Where there was previously one royal mint and one type of coin being made in the Spanish American colonies, now there are many competing mints with varying qualities. This is important because previously the Spanish dollar had been the only currency traded in China that was reliable enough for merchants to do their accounting in. There was no national silver mint in China -- instead, there were about 70 different local mints, each with their own standards and relatively low reliability. Suddenly the Spanish dollars being sent over from Mexico are unusable by merchants. Desire for foreign silver drops, which causes a sharp silver crunch on top of the already present inflation. The Daoguang Emperor + the dominant faction at court see the situation and search for a cause, and they eventually land on opium + more corruption.
In the midst of all this, the amount of opium coming in from overseas quadruples in 10 years (1822-1832), and then doubles again in 7 years (1832-1839). This simply can't be ignored anymore, and it's contributing significantly to the silver crunch. Qing officials estimate that it's siphoning off half of China's silver revenue every year, though the true number is closer to a fifth. In reality, there's something much bigger at play that they haven't realized yet: Mexico. Mexico is the source of China's main silver coin, the Spanish trade dollar, but government instability in Mexico has caused the quality of its dollars to drop, and the Chinese market has responded accordingly by completely rejecting the new Mexican coins. This will go on all the way until the 1850s.
So that's the reason for the halt in silver inflow, but what about the rise in silver outflow? Well, that's because the British smugglers are exchanging the opium for Chinese money with native associates off the Chinese coast. Due to Chinese monetary laws, they can't come into Canton with that money or they'd be detained and asked where they got it; to avoid this, they have to get the money reforged into British coins in India, which means that the coins are leaving the Chinese market and never returning. If opium were legal, then it could be sold by the British merchants themselves directly in Canton and the outflow of silver would be much lower.
Eventually, the Daoguang Emperor decides to send a capable minister named Lin Zexu to deal with the problem, and that's where the First Opium War starts.
Obviously, the government would have a new source of revenue and would not be losing quite so much silver every year. If you combine this with the Spanish American colonies not cooking off and declaring independence (or, alternatively, doing so a decade earlier), then the Chinese can actually make up for this loss by purchasing more Spanish dollars. Legalizing opium would also mean that it's not as profitable for native and British smugglers alike, so the smuggling networks that were built up around it are much smaller and opium is actually less of a problem in China.
But the main effect is that it opens the door for future reforms. With the revenue from opium taxes, as well as the return of the Spanish dollar in the 1840s, the Qing economy would've gotten out of the crisis zone, and attention could be turned elsewhere... like toward catching up with the British.
There's this misconception that the Qing government was dominated by reactionaries who didn't understand British power. In reality, the Daoguang Emperor himself acknowledged at the end of the war that the Qing lost because the British had better guns and better ships. They knew the British had superior technology... they just figured they wouldn't be coming back so soon and that China had to solve its money problems first before it could start catching up with Britain. And it's worth noting that Daoguang's faction believed this, but plenty of other factions believed Britain was the bigger problem. When the Daoguang Emperor died in 1850, they came out of the woodwork to petition the new emperor to adopt various far-reaching reforms, but he agreed with his father's position and continued his policies.
The problem here is in actually getting the government to think legalizing opium was a good idea. The Daoguang Emperor and the faction around him believed that China's money issues, which had many causes in reality, were all caused by two things: corruption and (later) opium. In Confucian ideology, corruption comes with immorality and personal degeneracy, so it's very easy for a Confucian ideologue to argue that doing drugs is immoral and a symptom of corruption -- so really, the entire problem was caused by corruption.
In order to change the government's priorities and point it in the direction of the right policies, you need to change the sequence of events both inside and outside of China. Really, the main limiting factor here is how far back can the POD to be?
For example, you could remove Heshen from the picture before he becomes a massive problem with a POD around 1780. This alone is a massive boost to the Qing because it removes the network of corrupt officials that Heshen patronized and it means that subsequent emperors don't automatically assume that any problem with revenue is due to that network not being suppressed hard enough, even after that network was long gone. This removes the Daoguang Emperor's obsession with corruption and makes it possible for opium to actually be legalized in his reign.
Not in Daoguang's place, but in Qianlong's place.
Daoguang was reacting to what he saw, rightly or otherwise, as the most widespread and systemic problems in the Qing system: corruption, overspending and moral degeneration. And from the available data (and the limited understanding of global economics in China) at the time, he was pretty much correct, and all of that had started in Qianlong's reign. Of course, he had the wrong solutions, but that's the fault of the data he had to work with.
There are opportunities for change outside of China, though:
1. Britain takes the Philippines in the Seven Years' War, or during the American Revolution, or during the Napoleonic Wars, causing British military superiority to come up as an issue much earlier.
2. The Spanish American colonies don't rebel, thus preventing the silver crunch in China in the 1820s-30s, and make it more likely for government to accept the idea of legalizing opium.
3. Or maybe the Spanish American colonies rebel sooner and cause the money problems in China to happen earlier, meaning that the Qing have solved that issue by the time the opium issue starts becoming a problem.
4. The BEIC's 1813 charter revokes their monopoly on both Indian and Chinese trade, causing the opium issue to come to a head earlier. Combine with any of the above.
and what will happen to trade with Europeans without the Treaty of Nanjing? I assume there'll still be pressure to open up Chinese ports to European ships and merchants, so how could it be dealt with?
It would continue to be done through the port of Canton. Most nations were not willing to rock the boat when it came to China. When asked to hand over their opium and leave in 1839, the Americans did so without a fuss. Only Britain, due to its massive holdings in India and the merchants' lobbying in Parliament, was willing to go to war. However, with opium off the table, the issue probably wouldn't come to a head for several decades at least.
It's interesting to speculate about the effects on the British balance of trade and on British India in general if Indian opium were replaced by domestic legal opium around 1839. This happened later in the century OTL, but by that time Britain was producing its tea in India rather than exchanging it (indirectly) for opium in China. The East India Company would lose enormous revenues from its opium monopoly in Bengal and elsewhere and metropolitan Britain would need to find silver to pay for its tea habit.
I wonder if, assuming opium is legalized but its consumption still spirals out of control due to corruption and an atrophied bureaucracy, the government's stance on the matter could provide rhetorical ammunition for the Taiping? They'd promptly squander it by being insane (unless Hong Xiuquan is somehow bumped off in a way that doesn't make them fall into anarchy), but still.
I wonder if, assuming opium is legalized but its consumption still spirals out of control due to corruption and an atrophied bureaucracy, the government's stance on the matter could provide rhetorical ammunition for the Taiping? They'd promptly squander it by being insane (unless Hong Xiuquan is somehow bumped off in a way that doesn't make them fall into anarchy), but still.
Given that the PODs for this lie between 1763 and 1813, and Hong Xiuquan was conceived in 1813, I think him being born in the first place is a hard thing to square with this idea.
Any POD after 1813 runs into the fact that the Spanish American Wars of Independence are going on, which is about to cause a silver crunch that will last until Mexico finally stabilizes and can start minting reliable silver dollars again. When the crunch happens, the root cause won't be immediately obvious to the government, and one of the main theories going around will be that it's yet another symptom of corruption and moral decay, which will damage the pro-legalization argument's chances of being accepted.
The next major opportunity for legalization is in an alternate 1850 with no Opium War (and preferably with the BEIC's monopoly on the China trade not being abolished in 1833, so there's less of an opium scare in the 1830s), after the silver crunch has been resolved and the government's attention can be turned toward other subjects. The first of these would probably be reforming the Manchu banner armies, which had proven corrupt and ineffectual during the White Lotus rebellion and would be necessary for dealing with any future rebellions. This would definitely include importing Western guns and probably include swapping out the archery part of the imperial exam for a gunnery test.
