The Opium Trade: Bridge between Respectability and Criminality

By 1845 Shanghai was the coastal center of the opium trade. No legal regulation or protection of the opium trade existed prior to 1858 because neither the Opium War nor the subsequent Treaty of Nanjing (1842) settled the opium question. Officially, the drug remained banned by the Chinese imperial government. Nonetheless, the highly lucrative and visible contraband trade flourished to the mutual profit of Chinese and western merchants and officials. The result was widespread smuggling, tolerated by local Chinese officials who were increasingly dependent on illicit opium revenues.^[42]

In the booming contraband trade, Chinese merchants depended on smugglers for their goods. Waterborne smugglers moved opium along the coast; dryland smugglers carried it inland. Smugglers depended on merchants for marketing. Their contacts were necessarily regular and organized. Successful merchants were those who could effectively interact with secret-society smuggling chiefs.

Opium smugglers banded together in tightly disciplined secret societies organized along native-place lines. Many of these banghui were

linked with the Guangdong Three Dot Society (Sandian hui ), a branch of the Ming restorationist Triad Society. They operated through persuasion and force, bribing Chinese officials and local bandit chiefs, moving in armed convoys. These gangs protected opium shipments against the pirate and bandit gangs which were increasingly a feature of the trade routes. In these networks of interdependence, social distinctions narrowed. Petty opium dealers formed the substratum of the growing merchant class. Opporunists who made fortunes in smuggling purchased the trappings of official respectability.^[43]

From the popular point of view, the opium trade was not necessarily considered disreputable. A western visitor to Chaozhou remarked on the openness with which the illicit trade was carried out in the prefectural city and on the pleasantness of the local opium men who appeared, "jolly, respectable . . . and . . . very civil."^[44] In his travels, Robert Fortune was deeply impressed by the opium merchants of Shanghai: "I expected to find those merchants who were engaged in this trade little else than armed buccaneers .... Instead of this, the trade is conducted by men of the highest respectability, possessed of immense capital, who are known and esteemed as merchants of the first class in every part of the civilized world." Such men, as Hao Yen-p'ing has noted, were often engaged by Jardine, Matheson and Company and would form a "nucleus of the modern Chinese business class."^[45]

The endemic smuggling of treaty-port trade as well as merchant participation in smuggling schemes have been recognized.^[46] Unfortunately,

the importance of smuggling in the development of commercial capitalism in China, the organization of domestic smuggling, the connections between secret societies and organized smuggling, and the social composition of smuggling gangs remain largely unexplored.^[47] It is clear, nonetheless, that the effect of opium smuggling on the relationship of merchants to the state provides a basis for understanding the role of merchants and merchant institutions in the Small Sword Uprising of 1853.

When Shanghai became a treaty port, opium import and distribution headquarters moved from Guangzhou to Shanghai. Guangdong people, particularly those from Chaozhou, became the leading brokers of the trade. Months prior to the formal opening of the treaty port, foreign vessels brought Indian opium to a receiving station at Wusong, at the mouth of the Yangzi, just north of Shanghai. Charles Hope, a conscientious British captain, together with the Chinese acting Daotai, responded to this apparent violation of the prohibition on trade at unopened ports by reporting and rebuffing several vessels. Both he and the Daotai were rebuked for their efforts, and the latter was removed from office. The protection of illicit trade thus ensured, the British conducted a brisk business in opium and foreign sundries. Goods were transferred onto the boats of Chinese smugglers who came alongside the British vessels. These Chinese boats then either smuggled the opium ashore or made bargains with local customs officers.^[48] Thus when British Consul Balfour established his consulate at Shanghai in the fall of 1843, the opium trade there was already a year old, and more than six million dollars of opium had been sold to waterborne Chinese purchasers at Wusong. Jardine's led the trade, which penetrated the entire Yangzi basin.

To sell opium in Shanghai without obviously smuggling themselves, foreign merchants depended on locals, including smugglers and secret-society leaders as their brokers, to take the opium ashore and distribute it along the Yangzi valley. Chaozhou people were so deeply identified with these opium-marketing functions that Shanghai people derogatively called them heilao (black guys), a reference to the dark color of opium (opium was also called heiyan , black tobacco). They were also called jia-er-jia-da (Calcutta; ka-er-ka-da in the Shanghai dialect), the name for the intermediate grade of opium emanating from that city.

The fortunes of Chaozhou magnates of the twentieth century, who were variously engaged in native banks, textiles and pawnshops, were based on the profits of this nineteenth-century opium trade.^[49]

Several legendary figures dominate the lore of the early Chaozhou opium merchants. In the period following the Opium War the trade was monopolized by merchants with the surnames Zheng and Guo, who formed the first Chaozhou opium establishments in Shanghai. Both began as petty compradors. Zheng Sitai was a secret-society type who went about with a retinue of vagabonds, swindlers, armed bodyguards and religious leaders. As one story goes, this following so impressed the British that they entrusted to him the task of brokering and protecting the passage of opium. Zheng became rich and founded his own Zheng Qia Ji establishment. His success inspired other Chaozhou merchants to follow his path.^[50]

Guo Zibin came to Shanghai after learning some English while working as a cook for foreigners. Because English-speaking Chinese in Shanghai were "as rare as phoenix feathers and unicorn horns," foreign merchants entrusted Guo with their business. His profits financed the successful Guo Hong Tai establishment. His relatives and fellow-provincials flocked to Shanghai.

As these establishments flourished, together with others founded by Chaozhou individuals with the surnames Chen, Li and Cai, each maintained inland distribution areas. Chaozhou huiguan sprung up along trade routes servicing the merchants. In the important cities and market towns of Jiangsu, Zhejiang and Anhui, Chaozhou huiguan served as

hotels for opium merchants, storehouses, and branch shops, the presence of huiguan themselves marking the penetration of the Chaozhou opium bang .^[51]

The connections among Guangdong opium merchants, Guangdong huiguan and gangs of smugglers and secret-society members are both elusive and incontestable. The uprising of the Small Sword Society which overthrew the local government in Shanghai in 1853 confirms the connections, though the records only partially clarify their nature. In the uprising, official trust in apparent distinctions between "respectable" merchants and secret society members and rebels was betrayed. In retaliation against the rebels, Qing forces razed the implicated huiguan in a fire that blazed for twenty-four hours and took with it the most elegant buildings of the Chinese walled city.