5—
Local Variations and Underlying Principles

Together, the development of the palace-memorial system and the operations of local finance under the huo-hao kuei-kung reforms reflect an important transformation in the structure of decision making during the early Ch'ing. Both were manifestations of the Yung-cheng emperor's efforts to manipulate the lines of official communication in order to by-pass the organs of central bureaucratic decision making and establish a direct link between the emperor and his representatives in the provinces. The purposes of this realignment of power were twofold. On the one hand, it allowed the emperor far more initiative and control than had been enjoyed by any previous Ch'ing emperor. More important, however, was the creativity that this change in the power structure permitted in the reform of administration. Without Yung-cheng's strengthening of the palace-memorial system, from an occasional avenue of information on crop and weather conditions to an institutionalized link between emperor and official for the reporting of all aspects of local affairs, the huo-hao kuei-kung reforms could never have taken place.

Information transmitted in secret palace memorials first alerted Yung-cheng to the real fiscal instability of local administrative units. It was in his replies to palace memorials that the emperor was able to orchestrate personally the direction of reform. Despite

court opposition to the ideas embodied in No-min's and Kao Ch'eng-ling's memorials, the palace-memorial system made it possible for the reforms to spread throughout the empire without the interference and the potential obstruction of central-government bureaucrats, whose administrative philosophy was far more conservative than that of the emperor or his trusted officials in the field. The variations in local adaptation of the reforms and the ambiguities in the system of reporting and accountability utilized must be viewed in this light.

The Yung-cheng emperor was concerned that provincial autonomy in managing huo-hao funds be maintained in order to ensure the flexibility necessary for effective administration of local government. For this reason he was determined to prevent the Board of Revenue from imposing the item-by-item supervision over huo-hao accounts that it exercised in auditing regular taxes. However, the emperor's instigation of changes in certain provincial reform proposals shows that he was not content to leave implementation entirely up to the provinces themselves. Why, then, did the emperor not simply issue an edict declaring a uniform pattern for reform in all provinces? First, Yung-cheng firmly believed in the principle of "suiting one's policies to the time and place."^[1] To assume that the specific mechanisms for provincial funding appropriate to a province with high land-tax revenues and relatively little commercial income, such as Shansi, would be effective in a place where agricultural production was limited and resources from mining played a major role in taxation, such as Yunnan, would have been disastrous. The only way to ensure the success of a plan for legalized and rationalized local finance adapted to the particular needs of individual provinces was to allow the provinces to develop their own plans for reform. At the same time, by using the palace-memorial system to advise provincial leaders as they designed their reform proposals, the emperor could guarantee that despite local differences, each province would adhere to the basic goals of huo-hao kuei-kung .

We are now privy to many of the secret exchanges by which the emperor and the provincial bureaucracies worked out the formula that we call the return of the meltage fee to the public coffers. However, to officials at the time, particularly those in the central government, it is likely that the emperor's guiding role was far less apparent. Moreover, Yung-cheng himself was often deliberately noncommittal, leaving the day-to-day decisions in the hands of the

officials at the top of the provincial hierarchy. This strategy was designed not only to encourage provincial officials to take a greater role in local fiscal decision making, but to deflect from the emperor's own person the responsibility for any subsequent failure of the reforms. By appearing not to have a personal stake in the decisions made in connection with the implementation of the reforms, Yung-cheng could step in and initiate changes if they were necessary, without seeming to contradict his own orders. It was for this same reason that the original proposal for reform was introduced as a "grass roots" plan from the Shansi bureaucracy and not in the form of an imperial edict.

From our previous descriptions of the huo-hao kuei-kung reforms we can see that differences in economic resources, regular tax obligations and even the commitment of local officials to reform led to variations in the timing and structure of local fiscal reorganization. The emperor's own insistence on local initiative and planning in order to retain some of the flexibility inherent in the informal funding system might lead us to view the reforms as lacking a unifying set of principles, regulations, and goals. In fact, nothing could be farther from the truth. Local accommodations were made in the items of revenue included in local fiscal planning, and variations did exist in the proportions of huo-hao set aside for yang-lien and provincial expenditures. Implementation was delayed in a number of places and not every province adopted the same method of huo-hao remittance. An examination of the reforms as a whole, however, indicates a strong unifying conception embodied in principles and regulations which, though not always promulgated in the form of administrative statutes, were nevertheless known and followed by officials in every province. It is to these general guidelines and an assessment of the reforms that we now turn.

Public-Expense Funds

Public Expenses and the Central Government

One of the most important concepts implicit in the huo-hao kuei-kung reforms was that provincial and local administrative units should have their own regular sources of funds, provided from clearly defined tax sources and immune to exactions either from the central government or higher administrative units within

the province itself. Such funds came to be known as kung-hsiang . Items for which they were spent were usually called kung-yung or kung-shih . Kung-hsiang revenues allocated for kung-shih were known as kung-fei .^[2]

Provincial and local revenues were designated as kung-hsiang in part to distinguish them from the cheng-hsiang under the control of the central government. This distinction was important not only to avoid the much-feared conversion of provincial-expense revenues into regular taxes, but also to demarcate central and provincial responsibilities in financing projects on the local level. The huo-hao kuei-kung reforms were not, as it is sometimes assumed, devised to relieve the central government of those fiscal responsibilities that it had previously assumed in the provinces. Examination of the scattered evidence of cheng-hsiang allocation in the provinces shows that, to the contrary, the share of local expenses borne by the central government probably increased during this period, as part of a comprehensive drive to eliminate deficits by providing mechanisms to guarantee local solvency.

Nor did the existence of a regular source of provincial revenue lead the central government to abdicate its primary responsibility for the more costly outlays connected with military security. To the contrary, the demise of the informal funding system stimulated a greater consciousness of the need to prevent such expenditures from burdening the common people. A dispute that arose in Kansu between Shen-kan Governor-general Ch'a-lang-a and Kansu Governor Hsü Jung illustrates this point. In order to meet urgent demands for military supplies in his province, Hsfi Jung had ordered the accelerated collection of taxes in arrears. Resistance by the province's taxpayers prompted Ch'a-lang-a to file a complaint with the Board of Revenue against his overly zealous subordinate. In his recommendations to the emperor on this matter, Board President Prince I condemned Hsü's actions and set forth the government's position on funding for military campaigns. "If there is a shortage of funds for military expenses and provisions, the appropriate measure is to request, in a t'i-pen , that the central government allocate additional funds."^[3]

The 1720s and 1730s were a period of heightened central-government awareness of its role in funding major relief and construction projects. Yung-cheng's condemnation of officials who solicited feng-kung contributions for disaster relief was in part a reflection of his commitment to the use of cheng-hsiang for this

purpose.^[4] Likewise, when reviewing Fukien's allocations of huo-hao , Prince I was disturbed at the extent to which that province was using its own furlds for expenditures that were rightly the responsibility of the central government. He therefore ordered the governor and governor-general to pay for expenses such as warship construction and the erection of military barracks out of cheng-hsiang and to report such allocations to the Board of Revenue in a routine memorial.^[5]

Soon after the Yung-cheng emperor's death, the question of the role of the central government in paying for public-works projects was raised again. The issue was not whether the government should pay for such projects in the provinces, but whether the practice of assessing contributions from the local population to pay for construction projects should be allowed at all. In a memorial to the new emperor, President of the Board of Works Lai-pao and other Board members pointed out that it was the usual practice for the Board of Works to allocate cheng-hsiang funds for projects such as river conservancy (ho-fang ) and the construction of dikes (t'i-an ), city walls (ch'eng-yuan ), floodgates, and embankments (cha-pa ). However, in Chihli, Shantung, Kiangnan, and Szechuan officials occasionally paid for these items out of special levies on the people's landholdings. A list of the projects for which such levies had been authorized was enclosed to assist the emperor in deciding whether this exception to the rules governing fiscal responsibility should be allowed in the future.^[6] In advising the emperor, the members of the Board clearly favored banning these so-called contributions and placing full responsibility for major allocations on the central government. Their arguments were truly in the spirit of the huo-hao kuei-kung reforms, for although they recognized that many such contributions were made voluntarily, out of a sense of public-mindedness, the Board feared that any fiscal policy based on irregular contributions would invite extortionary exactions from the local population by higher officials.^[7]

Concern that cheng-hsiang revenues be readily available to meet the central government's obligations in the provinces even led to changes in the method of storage and distribution of regular tax funds. Steps had already been taken in this direction during the late K'ang-hsi period, when "surplus" central-government revenues were placed in treasuries in Manchuria, as well as in those of each Manchu general-in-chief, garrison commander, and brigade general.^[8] The transfer of these funds out of the imperial capital to

depositories in the provinces was designed to facilitate funding in case of a military emergency. However, the later expansion of this policy to include civilian treasuries was a result of the government's desire to avoid delays in the allocation of cheng-hsiang revenues that might lead to a greater burdening of the common taxpayer. In YC 5 (1727) it was decided to distribute additional funds to the provinces of China proper, to be stored in provincial treasuries. The provinces were classified in three groups, each receiving between 100,000 and 200,000 taels. In CL 41 (1776) the quotas of stored revenues were increased.^[9] These funds were in addition to the quotas of retained taxes (ts'un-liu ) deducted by each province from the regular taxes remitted to the capital each year, and represented total deposits, not an annual deduction. Unlike ts'un-liu funds, these deposits were still the property of the central government, set aside for emergency expenses in the provinces. Deposit in the provincial treasuries was designed to avoid the costs and delays involved in transporting silver to the provinces when it was needed for an emergency.^[10] Expenditure was probably much more closely scrutinized than were funds allocated to the provinces directly, and appropriation without authority (shan-tung ) was punishable by beheading.

In addition to the funds stored in the provincial treasuries, the Yung-cheng emperor also initiated a policy of depositing central-government revenues in lower-level treasuries. At first no quota was set for the amounts to be stored, but in YC 8 (1730) these deposits were regularized. The amounts to be stored in prefectural, chou, and hsien treasuries were divided into four grades, ranging from 100,000 to 300,000 taels.^[11] Central-government funds distributed among local administrative units in this manner were known as fen-ch'u chih-k'uan .^[12]

The central government's concern for the efficient allocation of cheng-hsiang revenues was an outgrowth of the attention focused on local finance during the huo-hao kuei-kung reforms. The principle that public projects should be paid for out of public funds, duly collected and budgeted for such purposes, forced the central government to reevaluate its own proper contribution to the administration of the provinces. Rather than encouraging the central government to encroach on local funds, the reforms seem to have served to highlight the respective responsibilities of each level of the government. The funds designated as kung-hsiang were meant to be used for quite different purposes than cheng-hsiang and the

methods of controlling, reporting, and allocating these funds were indicative of their unique nature.

Relieving the Burdens on the People

One of the main purposes of the huo-hao kuei-kung reforms was to relieve the local population of the burden of indiscriminate surcharges previously levied on the pretext of supporting local administration. By simply providing officials, runners, and clerks with adequate living expenses, it was assumed that the motivation for much of the corruption associated with the tax-collection process would be eliminated. More specifically, the provision of yang-lien led to the abandonment of many fees that were not extortionary but had been crucial to the operation of the informal funding system.

One striking example concerns fees previously levied to support provincial education commissioners. These men were charged with the duty of supervising both the hsien- and provincial-level examinations in their provinces and with monitoring the education and behavior of degree-holders and government students. Educational commissioners were among the officials whose hidden expenses were high and whose frequent travel brought them into constant contact with the local administration. In most provinces it was the responsibility of the magistrates to provide for the education commissioner's expenses, as well as the costs of administering the examinations.^[13] This was usually accomplished by demanding fees from the inhabitants of the chou or hsien. In Shensi this fee was called k'ao-p'eng kung-yin and was collected from the people at the time that the examinations were administered in their jurisdiction. In Szechuan the education commissioner's costs were met by gifts of ceremonial presents (chih-i ), usually of three or four taels each, sent to the commissioner by students taking the examinations. With the institution of yang-lien for the education commissioner these fees were banned and at least one extra burden was lifted from the shoulders of the local population.

We have already noted the central government's commitment to the provision of funds for major public-works projects in the provinces. However, minor projects remained the responsibility of the provincial governments themselves. In the past, despite the statutory elimination of corvée labor, it was often necessary to call upon the local people to contribute both the labor and supplies for

these projects. The availability of kung-hsiang revenues enabled provincial officials to carry out on a cash basis most transactions involved in local construction and administration.

In Kwangtung province, for example, repairs on garrison buildings and watchtowers had previously been handled by apportioning the responsibilities for the supply of labor and materials among the local inhabitants. The governor-general was naturally worried that such levies would place inordinate demands on the people's resources. But he had more practical concerns as well. The equal division of labor services among the people was an inefficient way to carry out repairs. Corvée labor on military projects aroused tensions between the soldiers and the people, and the people's lack of specialized skills led to inferior workmanship and costly delays. Procurement of supplies by means of popular "contributions" also gave clerks and runners too great an opportunity for extortion. The governor-general therefore requested permission to follow the precedent already set in Shantung (and, in fact, in many other provinces as well) of allocating the funds for repairs from the kung-hsiang .^[14] The emperor's response to Governor-general Shi Yü-lin's request indicates that the use of huo-hao funds for public projects was widespread and implicit in the original intent of the reforms.^[15] "Public expense funds exist expressly for you to use in the province for this purpose. What reason would there be not to carry out a plan such as this one, of such benefit to the soldiers and to the people? Deliberate and carry it out."

An examination of the sample budgets submitted by the provinces to the emperor^[16] shows that funds were invariably set aside for repairs and minor construction projects such as that mentioned above. Thus, many of the surcharges to which the people were subjected under the guise of contributions for public works were eliminated. Moreover, by prohibiting the contribution of officials' and runners' salaries and wages for construction projects, the reforms eliminated one of the main pretexts for levying nonspecific surcharges as well.

The Allocation of Kung-fei

The term kung-fei , as we have seen, referred to all funds collected by the province that were not remitted to the central government as regular taxes or distributed to individual officials in the

form of yang-lien . The manner in which these funds were budgeted and disbursed varied from province to province. However, allocation can be divided into four general categories: allowances given to chou- and hsien-level officials to cover "outside" expenses, allowances granted to high officials to cover the cost of yamen operations, funds set aside in the provincial treasury for local- and provincial-level irregular and emergency expenses, and funds set aside to cover the fees and expenses incurred in sending taxes, goods, and reports to the central government.

Kung-fei Allowances to Chou and Hsien Officials

As we have seen, the portion of huo-hao revenues allocated to chou and hsien magistrates in the form of yang-lien was to be used for the official's living expenses and for the costs of operating his own yamen. Expenses incurred outside the yamen, most notably for famine relief and for construction projects, were not expected to be covered by the official's yang-lien .

In at least some provinces, a separate allowance was granted to the chou and hsien for the public expenses in the magistrate's jurisdiction. The separate allocation of kung-fei to chou and hsien magistrates in Shantung was instituted as early as YC 3 (1725). Of the total annual receipts of huo-hao in that province, 140,000 taels were budgeted for the public expenses of the whole province. However, in accordance with Shantung's policy of partial remittance of huo-hao , chou and hsien magistrates were allowed to retain 22 percent of their total huo-hao income for their own kung-fei and the costs of remitting taxes to the financial commissioner.^[17] This was beyond the yang-lien allocated to them by the financial commissioner. Thus, of the total funds set aside in that province for public expenses, 120,000 taels were retained by the chou and hsien themselves and only 20,000 taels were deposited in the provincial treasury for the expenses of the province as a whole.^[18]

The magnitude of chou and hsien public-expense allowances in Shantung was unusual. In general, kung-fei allocations to lower-level administrative units were small and seen as supplementing yang-lien and providing for emergencies. Beyond this, it would be the responsibility of the province to handle major expenditures. For example, when the governor of Kansu decided to increase the very low rate of yang-lien payments in that province, magistrates, who were receiving a uniform payment of 600 taels in yang-lien

per year, were given differentiated kung-fei allowances as well. These allowances were based on the complexity of public business in their jurisdictions and ranged from an additional 600 taels for the Lanchow magistrate to 360 taels for medium chou and hsien and 160 taels for out-of-the-way chou and hsien.^[19] It was also the practice to grant separate allowances of kung-fei to the chou and hsien in Shensi. We have no evidence of the size of these allocations. However, Shensi Governor Chang Pao stated that "chou and hsien officials are each given public expenses besides yang-lien , on the basis of the complexity or simplicity of [official business] in their locale."^[20] Although yang-lien and kung-fei were listed together in the provincial budget submitted to the emperor,^[21] the fact that they were viewed as separate items is underscored by the provision that officials holding concurrent posts be given only half the yang-lien of the second post but receive the full allotment of kung-fei for both posts.^[22] Inasmuch as yang-lien was used for an official's personal expenses and the internal operations of his yamen, he would not need as much yang-lien as two officials holding two different posts. However, the "outer" expenses of hsien would not decrease during a temporary vacancy in the magistrate's office.^[23]

The same motivation seems to have been at work in the decision to grant kung-fei to chou and hsien officials in Chihli province. Sometime after YC 7 (1729), a tutor in the Imperial Academy named Ts'ui Chi memorialized regarding the need to provide magistrates with special funds for emergency expenditures.^[24] Ts'ui pointed out that unexpected matters occasionally arose on the local level for which funds were needed immediately. If the chou and hsien had already collected the taxes in their areas, they normally would transfer these regular taxes for emergency use. If, however, there were no newly collected taxes to transfer, or the official feared impeachment for the transfer of funds, he would usually borrow the necessary funds from saltshops, pawnshops, or rich households, or exact a temporary levy from the people. These borrowed funds were called ling-pi . After the emergency had been resolved (and presumably the funds to meet the emergency had been allocated by the provincial government), the borrowed funds were returned. However, sometimes less than the original amount was returned or a long period of time was allowed to elapse before restitution was made. As a result, both the people and the merchants were burdened. Moreover, Ts'ui was convinced that "treacherous merchants and wealthy and powerful households" were using this situation to coerce officials into alliances for their own benefit.

Ts'ui sought to rectify this situation by calling on a precedent set by the emperor in YC 7- "Shifting funds" had led to chronic deficits in Ta-hsing hsien and Wang-p'ing hsien in Chihli's Shun-te prefecture. In order to relieve the fiscal pressures on these two hsien, both of which lay within the precincts of the imperial capital, Yung-cheng had granted 10,000 taels to each to be stored in the hsien treasury and used in the event of an emergency. The magistrates could report the allocation to the metropolitan prefect and issue the necessary funds without waiting for the latter's approval. After the emergency had passed, the funds would be returned to the hsien coffers so that a balance of 10,000 taels would always be on hand.^[25]

Although he recognized that other chou and hsien did not require the reserve of funds granted to Ta-hsing and Wan-p'ing, Ts'ui felt that the problem of shifting funds and borrowing from the people was a serious one throughout the empire. He therefore requested that the emperor order each governor and governor-general to rank his subordinate chou and hsien according to the complexity of government business and allocate to them a portion of the huo-hao , unloading tax, property-deed tax and so on that was remitted to the province for public expenses. Ts'ui suggested that the busiest areas, situated at the crossroads of major transportation routes, might receive 1,000 taels. The next busiest could be given between 500 and 800 taels. The simplest, according to Ts'ui, need not receive any emergency funds at all.

Because the emperor did not issue a rescript to Ts'ui's memorial, it is difficult to know how Yung-cheng reacted to this suggestion, or whether widespread publicity was given to Ts'ui's views. It is clear, however, that even after the reforms, officials at various levels of the government continued to be concerned that magistrates would not have enough funds to carry out public business without some supplement beyond their original yang-lien quotas.

In YC 12 (1734), Chihli Governor-general Li Wei addressed himself directly to the problem of shifting funds at the chou and hsien level. When the huo-hao kuei-kung reforms were originally implemented in Chihli, many chou and hsien had been granted a reduced level of yang-lien because it was assumed that they would continue to receive a portion of surplus revenues and customary fees (hsien-yü lou-kuei ) from the post stations within their territories. In the course of the reform movement in Chihli, these fees were also eliminated, resulting in shortages in the affected chou and hsien. In the YC 12 huo-hao report to the emperor, Governor-

general Li proposed yang-lien increases in those areas to bring their yang-lien into line with the rest of the province.^[26]

The governor-general did not stop there. Li Wei also pointed out that in Chihli many magistrates continued the practice of advancing funds for public business (yin-kung p'ei-to ). In order to pay for non-yamen expenses, magistrates were also forced occasionally to contribute funds from their yang-lien . To remedy this problem, Li requested that each magistrate be allowed to retain "silver for carrying out public business" (pan-kung yin-liang ) based on the complexity of public business associated with his post.^[27] By requesting a special fund for chou and hsien public expenses, Li once again affirmed the principle of the separation of yang-lien from "outside" expenses.

It is not clear whether other provinces made separate allocations of kung-fei directly to the chou and hsien. For example, the Shansi budget submitted by Kao Ch'eng-lin in YC 3 (1725) indicates that 10,158 taels were set aside for miscellaneous construction and other costs incurred by the chou and hsien.^[28] However, it is not possible to determine from this document whether the funds were sent to the magistrates along with their yang-lien or were kept in the provincial treasury in anticipation of annual requests for construction funds by local governments.

The mere fact that we do not have direct references to chou and hsien kung-fei allowances outside of Chihli, Shensi, Szechuan, and Shantung does not mean that they did not exist. The gazetteer of An-yang hsien in northern Honan contains a detailed discussion of the various local expenditures that were previously met through the collection of irregular surcharges. According to the authors of the gazetteer, once the policy of huo-hao kuei-kung was implemented, all of these items were subsumed under a single huo-hao surcharge of 15 percent of the hsien's annual regular taxes.^[29] If we assume that all emoluments listed for ranking officials and teachers in Confucian schools, student stipends, sacrificial expenses, and alms for the widowed and poor were paid for from retained cheng-hsiang taxes (ts'un-liu ), the hsien still required 6,171.78 taels in huo-hao allocations to pay for normal yamen operating expenses and "outside" costs incurred by the hsien administration. It is likely, therefore, that a sizable allowance was granted to the hsien beyond the magistrate's own yang-lien . If this was the case in Honan, it may also have been true of other provinces for which documentation has not survived.

Kung-Fei to Higher Provincial Officials

In almost every province for which a provincial budget still exists, there is evidence that high-level officials were granted regular funds beyond their yang-lien quotas. In most cases, these funds took the form of special allocations to cover the costs of stationery and clerical wages. Usually they were budgeted separately and may have been thought of as elements of provincial public expenses, because these grants did not extend to officials below the rank of financial commissioner.

In Anhui province, the proposed budget submitted in YC 7 (1729) by Governor Wei T'ing-chen^[30] included provisions for separate payment of the wages of runners and clerks in the offices of the governor-general, governor, Tartar general and financial commissioner, as well as wages for the standard-bearers and bodyguards attached to the Tartar general and governor-general. Certain stationery costs in the governor's, governor-general's, and financial commissioner's yamen were also paid for with provincial funds. Even the educational commissioner was provided with stationery costs, and stipends were made available for the clerks and runners in his yamen when they were sent outside the provincial capital on missions.^[31]

The Kiangsu budget was not as generous as Anhui's in providing for the expenses of all high officials. It did, however, include substantial funds for stationery, gunpowder, and clerical wages for both the governor's and the governor-general's yamen. The only specific grant made to the financial commissioner was for stationery expenses.^[32] In Kiangsi, similar allocations were provided for the governor and governor-general, in addition to which the financial commissioner and judicial commissioner were given wages for their clerks and runners. The latter was also allowed a special fund to cover his statutory expenses.^[33] Specially budgeted kung-fei in Kweichow seems to have been limited to the offices of the governor and governor-general. Although the province contributed only toward the stationery expenses of the governor-general's yamen, provisions made for the governor's yamen included stationery supplies, clerical salaries, military supplies, firewood and lamp oil, and salaries for his private secretaries.^[34] At least part of these extraordinary allocations may be accounted for by the fact that at the time this budget was drawn up, no measures had yet been taken to provide the governor with yang-lien .^[35]

Both the amount of yang-lien granted to high provincial officials and the existence of special allowances of kung-fei to cover yamen costs indicate that considerable care was taken to ensure the fiscal solvency of officials residing in the provincial capital. This, of course, reflected the great expenses incurred in posts which had the responsibility of managing the affairs of the whole province. However, it also cannot be ignored that the original critique of deficits and corruption, out of which the reforms grew, placed a large part of the blame on high officials. If the government was to guarantee that high officials took their duty of supervising the fiscal behavior of their subordinates seriously, it was imperative that these same officials be completely removed from financial dependence on the chou and hsien.^[36]

The Kung-Fei of the Whole Province

Every province had a special category of revenue stored in the provincial treasury for the purpose of meeting provincial public expenses. This silver reserve is best viewed as a kind of provincial discretionary fund. In every province but Fukien, the amount of huo-hao revenues to be deposited in this fund was determined not by a calculation of annual expenditure requirements, but on the basis of the surplus available after the deduction of official yang-lien and other fixed expenses.^[37]

The logic of such a system becomes apparent when we examine the kinds of projects that were paid for from the provincial publicexpense fund. The reports of Governor T'ien Wen-ching to the emperor present a representative sample of kung-hsiang expenditures in Honan province. In 1725, huo-hao funds were used to buy a plaque for a state-sponsored temple. Cash was also lent to poor peasants whose land had been inundated by sand after severe floods, so that they could buy water buffalo to assist in plowing under the sandy soil. In addition, 8,000 taels were allocated to improve the military camps in the province.^[38] In 1727, 612 taels were used to buy eight government boats to outfit a ferry crossing at a strategic communications point, and an unspecified amount was issued to rebuild a temple.^[39] A grant of 2,000 taels was given to the Nan-ju circuit intendant to aid in flood relief in Ku-shih hsien, an area frequently affected by floods and small-scale bandit activity.^[40]

In response to imperial criticism of the size of Honan's huo-hao surplus, several major projects were initiated in 1729. To pay for

the repair of city walls, 65,550 taels were disbursed to nineteen chou and hsien. These funds were earmarked to cover the costs of both labor and materials. Another 5,836 taels were allocated to build 2,400 new examination cubicles to provide for the growing numbers of students coming to the capital to take the provincial examinations. Over 4,700 taels were used to construct a new jail for the judicial commissioner's yamen.^[41] Finally, 6,750 taels were spent to repair Honan's granaries, making it possible for the chou and hsien to replace existing buildings made of straw and mud with new facilities constructed of brick.^[42] In 1730, huo-hao funds were allocated to update and revise the provincial gazetteer.^[43] Moreover, a project to repair city walls was undertaken again in 1731, this time focusing on replacing walls that had been made of mud with more durable brick structures.^[44]

The situation in Honan was not exceptional. In discussions of provincial budgets submitted to the emperor, memorialists frequently mention appropriations for famine relief, river works, construction projects, and military procurement as falling into the category of provincial public expenses. In provinces where the chou and hsien officials were given separate kung-fei allowances, it is likely that some of the more distinctly local projects would have been handled without provincial-level intervention. However, in places like Honan, where huo-hao funds were more tightly controlled at the provincial level, magistrates generally had to petition for kung-hsiang funds, as was the case in Ku-shih hsien's appeal for famine relief. The reforms resulted in the transfer of much of the provincial surplus from the local to the provincial level, reducing the discretionary fiscal power of the magistrate. This loss of initiative on the local level was somewhat offset by the fact that control over large public-expense funds made it possible for the provincial government to initiate projects that individual chou and hsien might not have undertaken. Moreover, as in the case of citywall building or the large-scale construction of examination halls, economies of scale in the purchase of materials were made possible that would not have existed if projects were carried out on a piecemeal or strictly local basis, as in the past.

In the absence of detailed yearly accounts of provincial huo-hao expenditures, it is difficult to determine whether the benefits of kung-hsiang funds were distributed equitably among subordinate administrative units. For the few expenditures we do know about in Honan, it seems that huo-hao funds were indeed dispensed lib-

erally throughout the province. In the case of city-wall and granary construction, poorer areas were probably the most affected, because the emphasis was placed on upgrading construction that had earlier been undertaken with poor materials. However, there was a constant danger that concentration of the provincial surplus in the capital could result in a disproportionate allocation of funds to those chou and hsien within the capital environs. This seems to have been the case in Shensi province's 1726 budget,^[45] and it may reflect the fact that other chou and hsien in the province were given separate kung-fei allowances.

The institution of a provincial discretionary fund was in keeping with the demands of a political economy that required flexibility at all levels. Whereas administrative expenses were viewed as permanent, the expenses covered by provincial kung-fei were seen as temporary, often arising without warning and necessitating large outlays of money. Although floods or drought occurred frequently in many parts of China, no one could predict where or when they would strike next. On the other hand, projects such as city-wall construction or the building of charity cemeteries might be necessary only once in a generation. Upon completion of such structures, maintenance was usually turned over to local authorities. Therefore, it would not make sense for the provincial government to establish permanent bureaus of wall repair, with their own staff and budget. Where continuous funding was necessary, as in the case of boat construction in Fukien, or periodic dike maintenance throughout the empire, separate budgetary categories were established.

This is not to say that projects of the kind described above were carried out on an entirely ad hoc basis. Supervision of a particular undertaking was generally assigned to a permanent staff, headed by a nearby prefect or a circuit intendant^[46] and including expectant officials who used the opportunity to practice and demonstrate their administrative skills.^[47] Before allocations were made, estimates of material and labor costs were submitted by officials at the site.^[48] These estimates were subject to approval by the governor and, if central-government funds were involved, by the Board of Revenue as well.^[49] Officials in charge of a project were under constraints of time as well as money, as deadlines were usually set for completion in order to avoid delays and corruption.^[50] If a project took more than one year, accounts were submitted annually to ensure that the funds were not being wasted and that the final report

would not result in huge cost overruns. At the completion of the project, a final account of expenses was submitted and any surplus funds were returned to the provincial kung-hsiang .^[51]

Payments to the Central Government

One final category of kung-hsiang expenditures should be mentioned—funds spent in fulfillment of provincial obligations to the central government. It has been stressed that the huo-hao kuei-kung reforms were not an attempt by the central government to appropriate a larger portion of the local government surplus. Nevertheless, aside from those funds used to repay deficits, a part of the provincial kung-hsiang , and in some places a sizable part, did go directly or indirectly to the central government. It should be kept in mind that all of these expenditures would have been made whether or not the reforms had been implemented. Huo-hao kuei-kung had the effect of transforming what had been informal fees paid personally by high provincial officials into fixed allocations disbursed from the kung-hsiang of the whole province. Another burden was thus lifted from the shoulders of the governors, governors-general, and commissioners, reducing their own need to exact bribes and fees from their subordinates.

Payments to the central government fell into three broad categories: fees to central-government boards when submitting taxes or accounts, transportation fees for the shipment of those taxes and accounts, and costs of supplementing the Board allocations for the purchase of goods sent to the capital. Although we have direct evidence of such payments for only six provinces, it is reasonable to assume that some provision of this kind was made in every province. This is particularly so since the yang-lien of central-government officials was eventually budgeted from such provincial remittances.

The size of the allocations to the central government appears to have depended on the customary fees originally sent to the boards, the province's responsibilities in providing goods for the capital, and the size of its tax quota. The portion of the provincial budget devoted to such costs in the Kiangnan region was particularly high. Of a total of 71,144 taels allocated for public expenses in Anhui, over 50,000 taels were spent for purposes of no benefit to the province. These included fees to the Board of Revenue and its Board of Scrutiny at the time of the annual accounting, fan-shih to

the Board of Punishments, the costs of remitting taxes to the Board, and supplemental funds for the purchase of goods costing more than the Board price.^[52]

In Kiangsu, approximately 56,000 tads were set aside to pay expenses incurred in the remittance of taxes and to supplement the costs of dyes and pewter sent to the capital.^[53] However, inasmuch as that province's total kung-fei budget was considerably larger than Anhui's, payments to the central government did not cut as deeply into the Kiangsu surplus. This could not be said of Kiangsi, where almost half of the fixed public expenses of 62,204 taels were allocated for Board fees and the transport of regular taxes and shipments of goods to the capital in Peking.^[54] Chihli, as the site of the imperial capital, bore a particularly large responsibility for Board expenses in the form of remittance fees. If data for 1729 are typical, that province also spent about as much on Board fees as it did for all other provincial public expenses.^[55] These figures, of course, refer only to the fixed allocations in each province. Because all four provinces had surplus huo-hao and kung-fei which could be used as a discretionary provincial fund, the proportion of provincial revenues siphoned off by the central government, although high, was not as enormous as it first appears.

Outside these two regions, allocations of Board fees were probably considerably lower. Particularly in newly developing areas with low agricultural productivity, the central government was hesitant to make unreasonable demands on local resources. Of the 79,740 taels spent by Kansu province for yang-lien and public expenses, only 2,000 taels were sent to the Board of Revenues and Punishments in the form of clerical fees.^[56] Similarly, Kweichow spent only slightly more than 2,200 taels for this purpose.^[57]

Accounting and Accountability

The manner in which officials reported huo-hao income and expenditure to the central government provides an excellent example of the Yung-cheng emperor's reliance on personal authority in dealing with the provincial bureaucracy. Just as the decisions leading up to the adoption of huo-hao kuei-kung were taken outside the normal bureaucratic channels of communications, so the emperor divorced the day-to-day administration of the new provincial funds from routine scrutiny by the Boards. The collection and allocation of regular taxes were subject to rigorous Board sur-

veillance throughout the tsou-hsiao system of annual accounting. However, provincial authorities were specifically instructed not to report their huo-hao income to the Boards, but only to inform the emperor of their decisions via secret palace memorials.^[58]

All deliberations concerning rates of collection, distribution of funds in the form of yang-lien or kung-fei , methods of remittance, and so on were undertaken by the provincial governors, governorsgeneral, and financial commissioners. Although there is no record of the deliberations themselves, formal input from the lower levels of government probably was minimal, confined to requests for grants of aid for specific projects. Once the basic plan for huo-hao reform was established in a province, the governor or financial commissioner was required only to submit an annual report to the emperor in the form of a yellow register (huang-ts'e ) similar to those submitted to the emperor for regular taxes.^[59] These yellow registers merely listed total funds, following the format of the fourcolumn account. In this manner the emperor was kept informed of the aggregate income and expenditures in a province, leaving the details of disbursement to the provincial authorities themselves.

Occasionally a more elaborate report of expenditures was made, particularly when a change in official personnel in the provincial capital took place.^[60] These reports were similar to the chiao-tai reports submitted as evidence of proper management of regular tax funds when an official left office. In the case of both yellow registers and the more irregular end-of-term reports, the emperor usually returned the memorial without comment or with a simple "noted" (lan ) appended to the end of the account.

The implications of this arrangement were twofold. On the one hand, the Yung-cheng emperor displayed his continuing concern for the fiscal independence of the provincial governments. If the huo-hao kuei-kung reforms were to succeed, the provincial governments had to be assured the same flexibility in allocating funds that had been possible under the informal funding system. If the finances of the provincial treasury were subject to the same itemby-item scrutiny that was applied to the disbursement of cheng-hsiang funds, it would have been impossible for the provinces to respond quickly to emergencies or react to changing local conditions. The emperor acknowledged that he could not know the conditions within the provinces in the same way that a local official could. It was therefore logical to leave the details of huo-hao expenditure to these men.

Yung-cheng also seems to have had a special antipathy toward the interference of court officials in local fiscal affairs. During the debates surrounding the implementation of the reforms, the conservatism of officials within the capital bureaucracy, who were divorced from the daily operations of local administration, became readily apparent. Although the emperor was quick to shift the personnel holding the highest offices in the provinces, filling these crucial posts with men whose integrity and administrative philosophy he could trust, it was far more difficult to alter the composition of the central bureaucracy. Many of these men were holdovers from his father's reign, and their approach to local finance reflected the K'ang-hsi emperor's reluctance to tamper with the balance of fiscal power by legalizing huo-hao . Moreover, the emperor may have felt that these men, who had viewed deficits only in terms of corruption, and had failed to recognize the real shortage of funds on the provincial and local level, would not have been sympathetic to the spending needs of provincial administration.

The emperor did give the governors and financial commissioners broad discretionary powers in the allocation of provincial funds. In fact, there is reason to believe that he was willing to tolerate far more local independence than even the officials themselves recognized. The yellow registers of annual accounts were the only reports specifically required of officials by the emperor. Yet the emperor was constantly being barraged by reports ranging from those of the chiao-tai type mentioned above to two- or three-line notifications whenever a large sum of money was allocated for any purpose. These reports are symptomatic of a form of bureaucratic paranoia common among officials during the Ch'ing period. Even when given authority in allocating provincial funds, high provincial officials felt the need to report their actions to the emperor. In all probability, they hoped to cover themselves in case their successors questioned the way in which funds were handled during their tenure. This fear grew out of the heavy emphasis placed on an official's handling of tax matters in his career evaluations. Consequently, even though huo-hao revenues were not subject to the same sanctions and review that were applied to regular taxes, the association between the mishandling of taxes and impeachment seems to have been too ingrained in the officials' collective psyche to allow them to exercise their autonomy in such matters.

In contrast to the often compulsive reporting by high provincial officials themselves was the emperor's own responses to these re-

ports. When the emperor chose to issue any rescript to a memorial on the handling of huo-hao funds it was usually to urge the memorialist to take greater responsibility for decision-making himself. Sometimes he simply stated that he was leaving the decision up to the memorialist, as in the case of a report by the governor and governor-general of Kwangtung regarding allocations of yang-lien for submagisterial-level officials.^[61] More often the emperor simply indicated that he would not interfere in local fiscal affairs by stating that he took no interest in memorials of this kind,^[62] or that his habit was merely to glance at such memorials and nothing more.^[63] Occasionally, Yung-cheng even displayed some exasperation when officials continued to request imperial approval for decisions that should have been their own. After a long memorial from the Kiangsi governor requesting raises in certain officials' yang-lien allowances, the emperor wrote in an extremely informal style, "Okay, if it should be raised then raise it."^[64]

This is not to say that the management of huo-hao revenues was completely unsupervised. Notwithstanding his protestations to the contrary, the emperor did keep a close watch over the management of provincial finances through the palace-memorial system. As we have seen in the discussion of the implementation of the reforms, Yung-cheng was not averse to criticizing the manner in which a governor was handling the remittance, allocation, or disbursement of huo-hao revenues. The emperor also played a major role in guaranteeing that allocations were equitable and served the goal of redistributing the resources of a province where they were needed. Moreover, as the only agent privy to knowledge of the reforms in every province, the emperor also played an integrative role, informing officials as to how the reforms were being carried out elsewhere and ensuring that there were no undue discrepancies in the rates of yang-lien being paid to officials of comparable rank and responsibilities in different provinces.^[65] Thus, although the actual management and allocation of yang-lien was in the hands of the governor and financial commissioner, these funds were still ritually attributed to the emperor as the ultimate source of all revenues and laws in the empire. Even when an official decided on his own yang-lien , it was not uncommon to send a memorial thanking the emperor for his magnanimity in granting the official this new source of funds.^[66]

The emperor's occasional intervention in provincial financial affairs was not intended as an encroachment on provincial authority.

In view of the structure of authority in the Ch'ing legal system, it played an important function in strengthening the power of the provincial leadership as well as enabling the emperor to check abuses in the exercise of that leadership. But without the assignment of some general supervisory functions to the Board of Revenue, the provincial authorities had no means to enforce their control over the funds emanating from the local level. Because huo-hao revenues were not integrated into the regular Board of Revenue statutes, the provinces were allowed a far greater degree of autonomy in handling huo-hao than they had in handling cheng-hsiang . This assured considerable flexibility in the allocation of funds. However, it had one serious drawback, which had its roots in the dual nature of the Ch'ing legal system. Judicial cases involving crimes committed by commoners could be tried and adjudged at all levels of the bureaucracy. Although appeals could be made to the court and the emperor, provincial officials did not require central-government intervention in handling most cases. The same was not true when crimes involved misconduct in office. In such cases, although the official's superior in the provinces could recommend sanctions, the decision to apply sanctions against an official lay with the Boards and the emperor. Moreover, impeachable crimes had to be defined in the statutes of the various Boards, which taken together constituted a code of official discipline. In order to preserve provincial fiscal autonomy, huo-hao matters had not been integrated into the official code, hence corruption or recalcitrance in the implementation of huo-hao kuei-kung could not be dealt with through the usual channels used in cases of violation of the disciplinary code. High officials had only one way to deal with malfeasance in the newly created huo-hao kuei-kung system, which was to report the malfeasance directly to the emperor in a secret palace memorial and request that special sanctions be applied against the official involved.

Once deficits were paid up, as pointed out in chapter 4, magistrates in Shansi were reluctant to continue remitting huo-hao to the provincial treasury. This problem was not limited to Shansi province alone. In YC 10, Hupei Governor Wang Shih-chün sought imperial guidance in handling a similar problem in his province. Between YC 1 and YC 3, twelve hsien magistrates failed to remit a total of 4,232 taels of huo-hao to the provincial treasury. Although the amount was small, these cases were indicative of the difficulties encountered in trying to control huo-hao revenues. The

governor had clear authority to impeach a subordinate and demand that he repay cheng-hsiang deficits, but he did not know if he could do the same in the case of deficits in the kung-hsiang .^[67] The emperor assured Wang that deficits in the provincial publicexpense fund were an even more serious matter than shortages in cheng-hsiang revenues, and advised against leniency in dealing with these magistrates. Stern procedures for retrieving the funds were therefore set in motion, procedures which the governor probably would not have invoked without the authorization of the emperor.

The Yung-cheng emperor's extraordinary attention to the details of everyday administration is well known. Even a cursory examination of the thousands of memorials bearing his voluminous personal comments provides convincing evidence of his care and understanding in supervising local-government affairs. In his effort to bypass normal bureaucratic channels and deal with local fiscal matters through direct communications with provincial officials, Yung-cheng had no choice but to handle personally the numerous memorials received at his quarters every day. There is evidence, however, that the emperor did not shoulder the entire burden himself. The few extant disposition slips submitted to the emperor on local fiscal matters by Prince I, in his capacity as President of the Board of Revenue, indicate that occasionally the emperor did turn to his most trusted fiscal advisors in deciding provincial fiscal issues. Even though secret palace memorials were to be viewed only by the emperor and the memorialist, Yung-cheng did sometimes show tsou-che concerning huo-hao and yang-lien matters to the Board of Revenue. Furthermore, these secret palace memorials were, in rare instances, even copied and kept in the Board's files.^[68] Nevertheless, the Board only acted in an advisory capacity when reviewing these memorials and did not have the same powers of scrutiny that it exercised in the acceptance or rejection of chengh-siang accounts.

In YC 9 (1731), the system of reporting was modified to include additional input by the Board of Revenue. According to a Board communiqué, all governors and governors-general were ordered to inform the Board of any increases made in yang-lien quotas. The Board would then deliberate whether or not the proposed increases should be approved, and their recommendation would be sent to the emperor. The Board also indicated that it would inspect the accounts of huo-hao funds spent and saved when they were

reported annually to the emperor.^[69] This does not appear to have been an order requiring provincial officials to report their annual huo-hao accounts in a routine tsou-hsiao tse , but rather was an announcement of the Board's intention to continue its practice of informally advising the emperor on the accounts submitted as secret palace memorials. It was not until the Ch'ien-lung reign that the real discretionary powers of the provincial government in the management of local finances were encroached upon by the central government.

Yang-Lien

Changes in Yang-Lien Allocations

The yang-lien rates established in the early years of the Yungcheng reign were not viewed as static quotas. Throughout the first decade of the reforms there were numerous instances of yang-lien being increased and occasionally diminished in order to meet the needs of officials in the field. Sometimes these increases were in the form of across-the-board raises for all officials in a province. At other times an increase was granted to an individual official whose expenses were agreed to be larger than the funds provided when huo-hao kuei-kung was first implemented in his province. Often the original deliberation to raise yang-lien came from the provincial officials themselves, but a change in rates could be called for by the emperor and, after 1731, at the instigation of the Board of Revenue in its advisory capacity.

The most striking across-the-board raises in yang-lien occurred in Fukien and in Honan. The rates of yang-lien originally formulated in Fukien were considerably lower than those for comparable posts in other provinces in central China. This was the result of both the low rate of huo-hao collected in that province and the high proportion of provincial funds that had to be allocated for administration and defense. As we have seen in chapter 4, the emperor was concerned that allocations of yang-lien in Fukien would be insufficient and ordered that surplus revenues from official lands and miscellaneous commercial taxes be used to compensate for shortages in provincial funds. Over 40,000 taels were required to bring Fukien's yang-lien rates into line with the needs of local officials.^[70] When the surplus revenues granted by the emperor proved inadequate to meet all the costs of yang-lien and kung-fei , an addi-

tional grant of 20,000 taels was made to the Fukien treasury from cheng-hsiang revenues disbursed by imperial decree to Chekiang province.^[71]

The circumstances leading to increases in Honan's yang-lien were the opposite of those found in Fukien. The success of the huo-hao kuei-kung reforms in Honan was reflected in an everincreasing surplus in the provincial treasury. In 1728 the emperor reacted to this accumulation of revenues by ordering Honan Governor T'ien Wen-ching to devise ways to spend more of the provincial income for the benefit of the people and administration. T'ien responded by suggesting increases in the yang-lien quotas disbursed to lower-level officials. The governor felt that the 3,000 taels annually allocated to each circuit intendant was adequate. He did, however, ask for an increase of 400 taels for chou and hsien magistrates and 300 taels for independent chou magistrates. This raised the yang-lien as follows: independent chou magistrates to 1,800 taels, large chou and hsien to 1,400 tads, medium chou and hsien to 1,200 taels, and small hsien to 1,000 taels.^[72]

There are also numerous examples of yang-lien rates being increased for individual posts. Such raises were generally proposed by the provincial governor or financial commissioner. In YC 5 (1727), Li Wei requested that the Chekiang educational commissioner's yang-lien be raised from 1,000 taels to 2,500 taels.^[73] In YC 9 (1731) Kiangsi Governor Hsieh Min proposed that several border hsien and small hsien with large populations of "tent people" be reclassified as medium and large hsien and their yang-lien raised accordingly.^[74] These changes were made in recognition of the difficulty entailed in controlling border areas and in preventing the people from fleeing into neighboring provinces to evade taxation. The grain and post intendants in Kiangsi had originally been in charge only of tribute grain and post and salt affairs. During the Yung-cheng period, however, each was given jurisdiction over three prefectures and was made responsible for all judicial matters in their respective subordinate chou and hsien. As a result, both intendants were faced with greatly increased travel expenses and the costs of hiring additional private secretaries expert in local administrative and legal issues. Therefore a raise in yang-lien was also requested for them.^[75]

Changes in the remittance of customary fees could also give rise to modifications in the allocation of yang-lien . When the reform first went into effect, the director-general of water conservancy

(Tsung-ho ) received contributions from salt merchants which constituted the major portion of his yang-lien . When these contributions were eliminated, the director-general was left with only a small grant from merchants and surplus silver from the river treasury, totaling around 5,000 taels. This was not enough to cover the costs of travel to inspect construction sites, assisting the governor, rewarding soldiers attached to the river administration, hiring private secretaries, and so on. Therefore, a request was made that a raise in yang-lien be granted for this post.^[76] The elimination of fees as a means to support river administration and the substitution of increased yang-lien also reflected the gradual trend toward greater fiscal rationalization in local administration.

Officials sometimes requested raises in yang-lien for their own posts. In YC 6 (1728), the Hupei financial commissioner complained that the approximately 11,600 taels he received for yang-lien and operating expenses were too little in view of the high costs of remitting accounts to the Board and the numerous private secretaries and servants needed to man the province's top financial yamen. Hsü Ting claimed that because of the inadequacy of the funds provided in the provincial budget, he had been forced to rely on assistance from his father to cover his official expenses. This would not have been at all unusual under the prereform system of financing. Moreover, the usual response of emperors to claims such as Hsü's would have been an admonition to exercise greater frugality in his personal and official life. That Hsü Ting's own fears of such a reply proved unfounded is testimony to the transformation of the concept of fiscal responsibility after the reforms. Instead of chastising Hsü for excessive expenditures, Yung-cheng praised the plan to raise his yang-lien and stated that it had never been the policy of the dynasty to require an official's family to support him financially in the fulfillment of his administrative duties.^[77]

By the end of the Yung-cheng period, officials were sometimes quite militant in insisting upon their right to receive adequate yang-lien . Szechuan Governor-general Huang T'ing-kuei was particularly angry about the way in which his request for a raise in yang-lien was handled after authority to judge such requests was extended to the court. Huang memorialized that the Szechuan governor-general's yang-lien was only 6,000 taels and requested that it be augmented by 4,000 taels. He received a reply from the Grand Secretaries Chang T'ing-hu and Chiang T'ing-hsi by court letter. Enclosed was an imperial edict which stated that the sum of

6,000 taels was really insufficient. However, since Huang was concurrently in charge of the post of provincial commander-in-chief, the edict ordered the grand secretaries to inquire whether or not Huang received yang-lien for that second post, and expressed anger that he had failed to mention this additional yang-lien in his memorial.^[78]

Huang devoted an entire page of his rejoinder to insisting that he was not attempting to profit personally from his official responsibilities, pointing out that the post of provincial commander-inchief carried no yang-lien , but only about 2,800 taels a year from emoluments and military rations. Huang stated that he had already run into shortages and had been forced to shift funds and to borrow 1,000 taels from the governor, which he had not yet been able to repay. Moreover, much of the funds from his military command had gone to pay for two military expeditions to Liang-shan, to reward soldiers, and to hire laborers and coolies. Finally, Huang complained that although the duties of the governor-general were the most numerous, the governor received 19,000 taels annually in yang-lien and the financial commissioner received 10,000 taels. He thereupon closed his memorial by doubling his original request to 20,000 taels per year for the governor-general's yang-lien , a request which the emperor acknowledged and accepted with a simple response of "noted."^[79]

In general, the emperor left the determination of yang-lien rates to the provincial officials themselves. When he did intervene, it was most often when yang-lien was being established for a post for the first time. In such cases the emperor acted as an advocate for the official concerned to ensure that the yang-lien decided on was sufficient for his needs. For example, when the Anhui, Kiangsu, and Kiangsi governors were consulted to provide yang-lien for the Liang-chiang governor-general, it was suggested that the total contribution from the three provinces be 14,000 taels. Yungcheng felt that this would not be enough and hinted that 20,000 taels would be a more appropriate figure.^[80] Imperial intervention was also instrumental in guaranteeing adequate yang-lien for the Hunan governor. When Financial Commissioner Chu Kang suggested that the governor be granted a quarterly allowance of 1,000 taels, for an annual yang-lien of 4,000 taels, the emperor replied:^[81]

How can 1,000 taels be enough for the governor's needs? Previously, when Pu-lan-t'ai memorialized to

sell his family property [in order to finance his administration] I sent a rescript vehemently stating that this was not right. When the new governor takes office, you should discuss adequate yang-lien [with him]. Your present stance makes you appear to be offering a pretense of virtue. I do not make it a principle to have high provincial officials perform their duties on an empty stomach [i.e., without adequate compensation]. As Hunan Financial Commissioner these last few years you understand the situation thoroughly. . . . Handle matters fairly.

In rare instances an official requested that his yang-lien be lowered. In YC 11 (1733), the Shansi governor reported that the new acting judicial commissioner had spent only 7,000 taels of his annual 10,000-tael yang-lien . He therefore requested that the extra 3,000 taels be returned to the provincial public-expense fund.^[82] This, however, was reduction in that individual's yang-lien and probably did not mean a revaluation of the yang-lien quotas for all future judicial commissioners in the province. The only instance where the downward adjustment of yang-lien might have had an institutional impact was T'ien Wen-ching's refusal to accept additional yang-lien when he was elevated from the post of Honan governor to that of Honan-Shantung governor-general.^[83] However, this post was created expressly for T'ien and was eliminated soon after his death.

Extension of Yang-Lien

The trend toward fiscal rationalization was not reflected merely in increased yang-lien for posts where the original quota had proven inadequate. As the reforms became established, the number of officials to whom it was granted was also extended to include all the ranking civil officials in the provinces. We have already seen how the omission of yang-lien for the governor and governor-general of several provinces was quickly rectified.^[84] In many provinces it was several years before yang-lien was provided for education commissioners. This was because they frequently had an informal source of funds that was considered legitimate and served as a substitute for yang-lien . In general, these funds were linked to the administration of the civil-service examinations. For example, whenever the education commissioner in Shensi went to an area to hold the lower examinations, gifts were supplied by the

chou and hsien whose residents were among those attending the examination. These gifts were called k'ao-p'eng kung-ying or contributions of supplies to the examination hall, but were really obtained by levying surcharges on the local populace.^[85] In Hupei the education commissioner received his funds from the sale of the examination booklets used by students to write their answers. For each set, a fee of two or three taels above the cost of the paper was charged, yielding as much as 6,000 taels per year.^[86] These sources of funds were so widely accepted that in YC 5 (1727), when the Kwangtung education commissioner, Yang Erh-te, requested an increase in his yang-lien , the governor memorialized that the request should not be granted, because it was expected that the education commissioner would be provided with funds by the chou and hsien in which he conducted the examinations.^[87]

The emperor left it up to the individual provinces to decide whether or not to grant yang-lien to education commissioners. On the whole he felt that to grant them four or five thousand taels a year was appropriate.^[88] Moreover, Yung-cheng hoped that providing them with yang-lien would be an incentive to greater diligence in the execution of their duties.^[89] The reason the emperor did not insist on the suspension of contributions for the support of these officials and the institution of empire-wide yang-lien payments for education commissioners may be traced to his fear that some officials would nevertheless continue to exact fees for holding the examinations. Because this fee was paid directly by those involved in the examinations, it was not something that could be easily stopped by applying official sanctions. There was no way to ensure that such a widely accepted practice could indeed be eliminated by fiat.^[90] Despite the emperor's lack of leadership in this matter, efforts were made eventually in several provinces that had relied on informal funding practices to bring the funding of education commissioners into the mainstream of the reforms.^[91]

When the huo-hao kuei-kung reforms were originally formulated, yang-lien was provided only for civil officials of the rank of magistrate and above. Those officials closest to the people, including assistant magistrates and the numerous officials attached to the main administrative yamen, such as registrars, jailors, education officers, and other minor officials of the eighth, ninth, and unclassified rank (tso-tsa ) were not included in the new system of funding. The reasons for this omission were twofold. On the one hand, officers below the rank of magistrate were not considered

part of the main body of the bureaucracy. Often these posts were filled by people who had not passed the highest levels of the examination system or who had obtained their rank by purchase. Except in rare instances, they were not eligible for promotion to higher positions, and although holding office, they were viewed by the rest of officialdom as not far removed from the clerks and runners below them. Moreover, they did not command the sort of multifunctional yamen found at higher levels in the bureaucracy and were not seen as requiring the extensive staff found under officials of higher rank. Economic constraints also played a part in their exclusion from the yang-lien rolls. During the early years of the reforms, there was a constant fear that huo-hao revenues would not be sufficient to cover all the costs of provincial administration. To include these low-level functionaries in the ranks of officials supplied with yang-lien might have been judged to be an inordinate burden on provincial resources.

This proposition is confirmed by the Yung-cheng emperor's response to the first attempt to bring minor officials into the yang-lien budget. Honan Governor T'ien Wen-ching first proposed providing yang-lien for low-level functionaries early in YC 3 (1725). He pointed out that these officials had important duties and were constantly being sent out on government missions. Their material rewards were meager, however, and their rank low, providing little incentive for them to abide by the official disciplinary code. T'ien, who himself had risen from the rank of assistant hsien magistrate, felt that many of the men in such posts were extremely talented, and he proposed that if the emperor extended his benevolence to them by granting them yang-lien , they naturally would respond by displaying more virtue and devotion in the execution of their duties.^[92]

The emperor was not as confident as T'ien of the efficacy of such a policy. Although once again insisting that all such decisions were up to the governors and governors-general, Yung-cheng accepted the popular notion that very few of these low officials were really distinguished civil servants. The extraordinary few who were could be rewarded under a recent imperial act of grace that permitted their recommendation for promotion to higher rank. Rather than grant yang-lien to these lowly subordinates, the emperor felt it would be better to increase the yang-lien of the magistrates so as to enable them to improve the general level of administration through-

out the chou and hsien. Yung-cheng's real concern, however, was reflected in the last lines of his rescript:^[93]

In this instance I have unavoidably been overly severe. You should weigh the situation further and not immediately take my words for the truth. . . . I am even more concerned that this matter does not concern Honan province alone. If there are provinces whose huo-hao is insufficient, where will they find the funds to spread this benevolence? You must think further about this point.

In other words, the emperor was concerned that by allowing low-level officials in Honan to receive yang-lien he would appear to be favoring the officials of one province over the others. Local differences in the application of the reforms were permissible so long as the general structure of fiscal management remained fairly uniform throughout the empire. Honan's surplus could not be used to provide its officials with benefits that other provinces could not match. So long as it was unclear whether other provinces would be able to follow suit, it was not advisable to allow Honan alone to take the reforms this major step further, no matter what the benefits would be in eliminating local corruption and rationalizing local fiscal management.

By the beginning of YC 6 (1728), it was becoming apparent that the reforms were a success and that adequate funds could probably be found to allow every province to extend its yang-lien budget to include all officials. Early in the year, T'ien Wen-ching once again proposed that low-level officials be provided with yang-lien . The real intention of such a move, to eliminate corruption on the lowest levels of the bureaucracy, was made clear by T'ien's concession that officials who were not in direct contact with the people need not be considered for yang-lien . However, such officials as assistant and subassistant prefects and magistrates and registrars, whose role in supervising and investigating local affairs brought them into close daily contact with the people, would be given yang-lien of between 80 and 120 taels.^[94] This time the emperor found T'ien Wen-ching's proposal both fair and appropriate and told him to carry it out.

Concern about the continued acceptance of customary fees despite the institution of yang-lien was instrumental in the decision to extend this new dimension of the reforms beyond Honan prov-

ince. In mid-1728, T'ien Wen-ching was promoted to the rank of governor-general of Honan and Shantung. One of his first acts as governor-general was to expose the continued use of customary fees as a means of funding in Shantung. T'ien's report prompted an edict by the emperor that was to result in the extension of yang-lien to all officials in the provinces as the most effective means to eliminate forever these corrupt and unregulated exchanges of funds.

In his edict of the eighth month of YC 6, the emperor acknowledged that some officials continued to receive lou-kuei regardless of the fact that they had already been granted yang-lien . This was to be deplored. Yung-cheng ordered the governors and governorsgeneral of each province to investigate their subordinates one by one and report on their activities in a secret palace memorial. The emperor still felt that the solution to this problem was to ensure that every official had adequate yang-lien . Therefore, he also ordered the governors and governors-general to find out if there were any officials under them who had not yet been granted yang-lien and to extend it to them. At the same time Yung-cheng publicly endorsed the complete remittance of huo-hao to the financial commissioner and public redistribution of funds from the provincial treasury.^[95]

One of the first provinces to respond to the emperor's edict was Hunan. The edict prompted Hunan to switch from partial to complete remittance of huo-hao according to the Shansi-Honan model. Officials in Hunan also used this opportunity to calculate yang-lien for minor officials within the yamen at all levels of the provincial bureaucracy. Following the principles set down by T'ien Wen-ching, these new grants of yang-lien were made only to officials who came into close contact with the people or who frequently were sent outside the yamen on official missions. Among those included were the secretaries in the financial and judicial commissioners' yamen (li-men, cho-mo ), treasury keepers, jail wardens, registrars, and assistant chou and hsien magistrates.^[96] Hunan's huo-hao revenues were not as large as Honan's; this accounts for the lower rates at which yang-lien was granted to these officials. Nevertheless, the province was able to supplement the cost of these additions to the provincial budget with the return to the public coffers of 8,000 taels in salt fees formerly sent to the grain intendant.^[97]

Not every province was so quick to comply with the intent of the emperor's edict. In many instances, attempts were made to in-

crease the existing yang-lien quotas or provide funds only for higher officials who had not been previously included in the provincial budget. It was in such cases that Prince I and the Board of Revenue began to exercise the initiative that eventually may have led to their greater authority in advising on yang-lien matters. For example, in YC 7 (1729) Chihli Governor-general Yang K'un sent the emperor a recapitulation of the deliberations conducted in that province to provide each official with adequate and fair yang-lien . Prince I and the Board found the amounts agreed upon to be generally appropriate and recommended that the emperor order him to allocate the yang-lien as suggested and turn the original accounting report over to the Board. Although these deliberations provided yang-lien for independent and regular chou subassistant magistrates, no attempt was made to provide yang-lien for officials of the rank of assistant hsien magistrate and below. In view of the fact that almost 80,000 taels still remained in the Chihli treasury after some 220,000 taels were disbursed as yang-lien , the Board recommended that the remaining low officials be provided with yang-lien ranging from several tens of taels to around 100 taels apiece.^[98]

The emperor quickly reacted to the Board recommendation and ordered Yang K'un to reconsider yang-lien for minor officials. Yang consulted the financial commissioner and submitted a yellow register to the emperor listing possible rates of yang-lien for the officials in question. Surprisingly, the emperor responded that the rates seemed somewhat high and that he feared they would be too great a drain on provincial resources. Once again, Yung-cheng took the administration of Honan's finances under T'ien Wenching as a model and told Yang that he might inquire secretly as to the amounts these officials were granted in that province.^[99] In the meantime, Yang K'un was replaced as governor-general by Metropolitan Censor T'ang Chih-yü. T'ang resubmitted a reduced yang-lien schedule that would cost the province slightly over 8,600 taels annually for minor officials, leaving the province a surplus for public expenses of over 30,000 taels.^[100] These new rates were submitted to the emperor in the form of a yellow register and to the Board of Revenue in the form of a clear account (ch'ing-ts'e ), indicating the increasing role being assumed by the Board in yang-lien matters.

Yang-lien for minor officials was such a novel concept that many provinces took years to carry it out. Occasionally delays were due

to disputes over the amount of yang-lien that should be provided. In Kwangtung the provincial leadership readily acceded to the idea of providing yang-lien for these officials. However, differing interpretations of the purpose of salaries led to disagreement over acceptable rates. Both the governor-general and the acting governor regarded these new grants of yang-lien as token payments, along the lines of the emoluments granted officials by the emperor in the form of feng-yin . Therefore, they proposed simply to supply each official with funds from huo-hao equivalent to their feng-yin quota, thus doubling their salaries.^[101] The financial commissioner disagreed with this method, pointing out that yang-lien was not intended merely to pay for an official's personal expenses, but also to cover the costs of yamen administration and missions outside the yamen. If this plan were followed, the officials would have enough to support their families, but nothing more.^[102] The emperor left the decision up to the provincial authorities, who eventually came around to the financial commissioner's point of view. As a result, yang-lien for lower officials was set at between 60 and 80 taels, a decision that added 17,520 taels in new fixed expenses to the already strained Kwangtung provincial budget. The funds for the additional yang-lien grants were provided by surplus revenues from Kwangtung's commercial licensing tax (shui-ch'i hsien-yü yin ).^[103]

In view of the number of people involved, it is not surprising that ranking officials were hesitant to allocate large quotas for minor officials' yang-lien . In Kwangtung alone there were 255 officials for whom yang-lien was added. The largest categories were jail wardens (78) and subdistrict magistrates (126).^[104] This latter figure is of particular interest because it shows that in at least some hsien, not only was there an assistant magistrate, but there must have been more than one subdistrict magistrate below him, bringing the administration far closer to the people than has generally been recognized. By providing such officials with sufficient administrative funds, the government was clearly taking an important step in the direction of eliminating illegal surcharges and extortion.

The control and elimination of corruption at the lowest levels of the administration seems to have been foremost in the minds of provincial officials as they sought to find the funds to furnish minor officials with yang-lien . As each province reported its deliberations to the emperor, several concerns expressed by the Kiangnan governor-general and Anhui governor were echoed re-

peatedly. Anhui had originally failed to provide yang-lien for its minor officials because there was not enough huo-hao in the provincial treasury. It was common knowledge that because these functionaries had no means to pay for their administrative expenses they exacted money from the villagers in their areas (ssu-ch'u li-hsia ) and engaged in the practice of handling litigation for the people without official authorization (shan-shou min-ssu ).^[105] In YC 10 (1732), it was discovered that in Anhui salt fees of approximately 30,000 taels were being sent to high and low yamen in the province. With the approval of the grand secretariat and the emperor, Governor-general Kao Ch'i-cho and Governor-general Li Wei decided to return these funds to the provincial treasury to be used for provincial public expenses. As a result, they were able to allocate 50 tads apiece to the 163 minor officials in closest contact with the people, in the hope of eliminating the illegal methods utilized to support local administration.^[106] In fact, in many provinces it was the cooptation of former lou-kuei and surplus commercial and customs revenues that made the extension of yang-lien and the success of huo-hao kuei-kung possible.

Lou-kuei after the Reforms

In chapter 2 we examined the informal funding network by which local government was financed before the huo-hao kuei-kung reforms. What became of these various items of "saved funds," bribes, customary fees and so on, once officials were provided with regular salaries and public expenses? Contrary to our expectations, not all of these funding sources were declared illegal and eliminated from the provincial budget. Some continued to be collected, but rather than entering private pockets in the form of graft, they were sent to the provincial treasury to "supplement public expenses" (ch'ung-kung ). It was not mere expediency that allowed the Yung-cheng reformers to retain some of the irregular sources of income that had flowed into the informal funding network and reject others. In order to understand how these decisions were made, we must examine the values that lay behind the late-imperial conception of bureaucratic corruption.

Throughout China's imperial history, low taxation was viewed as a fundamental prerequisite of benevolent rule. During the early

Ch'ing this was linked to a vision of relatively static agricultural productivity which reached its ultimate expression in the K'anghsi emperor's ban on future increases in the head tax to match China's growing population (yung-pu chia-fu ).^[107] Although this proscription did not debar the government from extracting additional revenues from increased productivity on the land, especially that resulting from land reclamation,^[108] it did prevent any increases in the legal rate of taxation on lands already entered in the tax rolls. K'ang-hsi recognized the need of local officials for supplementary income, but deemed it safer to allow them to collect it illegally than to condone a rise in the land tax. The risk of diminished central-government control over the behavior of local officials was far outweighed by the possible damage such an action would inflict on the emperor's credibility as a benevolent ruler. At a time when tax resistance was rampant and an alien dynasty was attempting to establish its legitimacy as the rulers of the Chinese people, presentation of the imperial image took precedence over matters of practical governance.

Such a position was possible so long as the "state finances" (kuo-chi ) and "people's livelihood" (min-sheng ) were not too adversely affected. When the illegal diversion of funds itself became a threat to both the kuo-chi and the min-sheng , it became necessary to rectify the existing fiscal system, even if it meant raising taxes and tarnishing the emperor's personal reputation.

If we view the Yung-cheng-period reforms as an effort to readjust the fiscal administration of the empire in order to protect the kuo-chi and min-sheng , the selective elimination and incorporation of elements of the informal funding network becomes more comprehensible. Two types of funds within the informal funding system were strictly banned during the reforms—private levies on the people (ssu-p'ai ) and customary fees exchanged between officials (lou-kuei ). The former were seen as instrumental in depleting the resources of the common people and as a primary cause of arrears in regular tax collections. The latter, by draining the funds available to lower officials, were viewed as a major cause of deficits in provincial treasuries. By fostering informal links of patronage, it was the main obstacle to bureaucratic discipline and morale. Moreover, when these forms of graft interacted, they tended to reinforce each other. Increased demands for customary fees forced lower officials to step up their collections of surcharges from the

people. In order to protect themselves from disciplinary action as a result of the arrears and deficits caused by these illegal diversions of funds, officials were increasingly willing to pay off their superiors in the form of lou-kuei . It was for these reasons that ssu-p'ai and lou-kuei were the primary targets of the reforms, and it was to eliminate the need for such fees and surcharges that rational and legal funding on the local level was established.

Even before the reforms were instituted the emperor issued an unequivocal ban on surcharges and customary fees. Once the reforms were in effect, Yung-cheng continued to warn officials against such exactions. In his edict calling for the extension of yang-lien payments to all officials not previously provided for in provincial budgets, he again decried the collection of customary fees and specifically linked yang-lien to the elimination of these illegal practices.^[109] Even the large-scale general audit of Kiangnan tax arrears undertaken in YC 7 (see chapter 6) was in part a response to irregularities in local tax-collection practices that defied the ban on surcharges and interfered with the well-being of the kuo-chi and min-sheng .

However, a number of items within the informal funding network continued to be collected after the reforms. In fact, our knowledge of many categories of funds within the network depends on reports to the emperor when these funds were returned to the provincial coffers to supplement public expenses. Surplus from the purchase of rice, materials for construction, and so on was considered a legitimate source of public funds. For example, taxes formerly levied in kind to provide local granaries with rice or to fulfill central-government quotas of tribute rice were commuted to cash payments at fixed rates. Inasmuch as the market price necessary to buy the rice for these purposes fluctuated greatly, any profits that accrued to the local government as a result were not viewed as having been taken from the central government or the people. Officials in Fukien were able to generate over 5,000 taels from the surplus "rice price" (mi-chia ).^[110] Similar surpluses, arising from the purchase and sale of stabilization rice, were reported in Shantung.^[111] There, the financial commissioner also reported an average annual surplus of 3,000 taels in tribute-grain taxes that were also returned to the public treasury.^[112] In contrast to windfall profits from the purchase of goods, the accumulation of funds through the use of improperly balanced scales was considered cor-

rupt, because it entailed collecting more than the legal quota from the people. Whenever possible, this practice was eliminated, and in some instances new scales were issued to provincial yamen.^[113]

Salt Fees

The most important of all the informal funds coopted by the provinces during the reforms were salt fees (yen-kuei ). Almost every province depended to some extent on fixed periodic payments made by salt merchants to supplement the revenues in the provincial treasury.^[114] Generally, these fees were paid to individual officials. In addition, in salt-producing provinces such as Yunnan, officials received surplus revenues from productive salt wells and surplus profits from the sale of salt within the province.^[115] Following the emperor's proscription against the acceptance of customary fees, there was considerable confusion as to whether salt fees were to be included in the ban. Many officials, fearing prosecution for the acceptance of salt fees, immediately memorialized the emperor to demonstrate that they had used the funds derived from salt fees for public purposes. For example, Shantung Governor Huang Ping reported that during his six years as a judicial commissioner he had received a total of 30,000 taels in the form of "customary gifts from salt merchants" (yen-shang kuei-li ). During that period he had used these funds to establish charity schools in each of the six prefectures in the province, to institute stipends for students and to pay teachers' salaries, to supply aid to families of deceased officials without the means to return to their home provinces, to aid starving refugees, to help repair bridges, buildings, and roads, to build charity cemeteries, and to help clothe and feed prisoners. In addition, in the spring of KH 60 (1721), when salt bandits appeared in the province, Huang claimed to have used part of his salt fees to send extra soldiers and police to assist in their capture.^[116]

Despite their fears of imperial sanctions, officials did not move as quickly to curtail the collection of salt fees as they had in the case of surcharges levied on the common people. On the one hand, fees from the salt administration, as a source of revenue for high provincial officials, were too important to be eliminated without some consideration. Moreover, fees from salt merchants, and from merchants in general, were not viewed in the same light as fees exacted from the people. Whereas the productivity of the land was

seen as finite, so that additional exactions by local officials would of necessity mean less available income for either the central government or the people, the salt industry was expanding and could accommodate additional demands for revenue without too much harm to the merchants and with virtually no drain from the revenues due the central government. Even more important, the salt merchants from whom these fees were derived obtained their wealth by the emperor's grace in their participation in an official monopoly. Therefore, it was considered natural that they should want to repay this favor by contributing to the well-being of the area in which they did business.

In fact, the main argument offered by officials in favor of the continued acceptance of salt-merchant fees and contributions was that they were given voluntarily and therefore were not to be compared with forced levies on the common people.^[117] The case of a group of Ho-tung salt merchants was typical. In YC 3 (1725), 100,000 new salt licenses were issued in Shensi province. The salt merchants of the region benefited enormously from the opportunity for increased sales, and in YC 6 (1728) they volunteered to contribute 5,000 taels annually to the public expenses of the province. According to the merchants themselves, they made such an offer not only because they profited from the increased issue of salt licenses, but because the dynasty itself had brought such prosperity to the land that the population was increasing and the demand for salt was constantly rising.^[118]

One merchant, Chang Hung-yü, felt that his life had been particularly touched by imperial grace and wished to contribute an additional 2,000 taels annually beyond that being proffered by the merchant group. Chang stated that his grandfather had been the first in his family to go into the business of selling salt. Chang and his father inherited this business from his grandfather. At first they were just small merchants doing business in the countryside. There were no contract merchants at the time to transport and sell the salt. After he had transported the salt from the well, he did not even have exclusive rights over its sale. Now, Chang said, he was in charge of all salt licenses for Honan's T'ang hsien. His license quota was 4,787 yin . As the population of T'ang hsien increased and harvests continued to be reaped in abundance year after year, he was able to sell all his quota and an excess quota (yü-yin ) as well.^[119] Chang offered to repay the government for his own success by contributing part of his profits to the public fund. It is impor-

tant to note that it was only after the Board of Revenue was satisfied that the 7,000 taels these merchants wished to contribute were indeed "excess profits" resulting from the sale of additional salt licenses that they granted the merchants' request.^[120]

From the above example we can see that the government was not unconcerned about the merchants' own welfare. Often, when salt fees continued to provide a source of provincial income, the amount paid by the salt merchants was reduced from the level common under the informal funding system. In the Ho-tung salt administration, more than 100,000 taels had previously been collected from salt merchants both to supplement public expenses and to help pay officials' yang-lien and the wages of clerks, runners, and patrol soldiers. This sum was considered excessive and was lowered under the supervision of the salt controller.^[121] In Hukwang, the level of yen-kuei was reduced from 160,000 taels to slightly over 30,000 taels.^[122] Similar, if not as drastic, reductions were also made in Chihli and Shantung.^[123] Lack of evidence does not mean that reductions were not made elsewhere. However, whether or not the fees were lowered in every province, the method of remittance and management of these funds was probably altered everywhere in accordance with the funding guidelines established during the Yung-cheng reforms. It was these changes that had the greatest impact on local fiscal administration.

Prior to the huo-hao kuei-kung reforms, salt fees were sent by the merchants directly to the officials in whose jurisdiction they did business. Additional fees were also sent by groups of merchants to high provincial officials residing in the provincial capital. After the institution of yang-lien it was felt that officials had adequate funds for their own administrative expenses. Moreover, because the provinces now had public-expense funds in the provincial treasuries, the chou and hsien would no longer need supplemental funds with which to make contributions to provincial construction projects (kung-chüan ). Therefore, salt merchants were instructed to remit their yen-kuei directly to the provincial coffers, either by sending them to the financial commissioner or by submitting them to the provincial salt controller, who would handle their transfer to the provincial capital.^[124] Moreover, the rate at which salt fees were remitted was now fixed and no longer depended on the whim of the official to whom they were sent.

Salt fees and surplus revenues were used for various purposes, some of which were of special benefit to the salt merchants. The

huo-hao kuei-kung reforms encouraged the integration into the regular chain of bureaucratic command services that previously had been provided through the informal funding network. For example, Acting Liang-huai Salt Controller I-la-chi reported that under the old system the salt controller sent agents to the dikes at T'ai-chou and Kao-yu chou and to the north bridge at Yangchow to inspect the boats delivering salt. Each of the three agents was sent lou-kuei by the salt merchants, providing them with an annual income of some 6,000 taels each. According to I-la-chi, these funds all ended up in the pockets of the three agents. These agents being yamen runners who received a fixed wage already adequate to support their families, I-la-chi did not feel it was appropriate for them to pocket fees from the salt merchants as well. Moreover, the embankments and bridges already had official deputies (wei-kuan ) assigned to them. so it was unnecessary to send additional yamen servants to inspect the unloading process.^[125]

I-la-chi discontinued the deputation of the three yamen runners. However, he did not eliminate the lou-kuei customarily sent to them. The salt controller reasoned that the elimination of this 6,000 taels would mean only a small increase in the profits of individual salt merchants, whereas it represented a valuable addition to the operating expenses of the official yamen. Instead he proposed to continue its collection to cover the costs of patrol and seizure of smuggled salt. This would not only serve the interests of the merchants in controlling illegal competition in the sale of salt, but would relieve the merchants of the need to supply the government with irregular levies of supplemental aid.

Under this new system of patrol, officials, runners, and yamen servants would be posted at strategic places along the salttransportation route. A registrar, archivist, and saltwatcher from the salt controller's yamen would be used. Inasmuch as these officers already had salaries, no additional expenses would be incurred through their participation in the patrols. In addition, five low-ranking officers, including four probationary officials (shih-yung kuan ), would also be assigned to this duty. I-la-chi estimated that it would require 400 taels per month, or 5,000 taels annually, to pay additional official salaries and to hire the necessary patrol boats and runners. The remaining 1,000 taels would then be saved and be available if it became necessary to set up additional patrols.^[126] In this way the supervision of salt transport and sale would be systematically integrated into the regular control functions of yamen

officials. At the same time, the funding of these services would be rationalized and it would no longer be necessary to levy additional duties on the salt merchants, thus eliminating the pretext for random extortion by yamen personnel.

Customary fees from salt merchants were also used to pay for the wages and salaries of officials, clerks, and runners within the salt administration. The wages and salaries of officials and runners allowed by quota in the regulations of the Board of Revenue were deducted from the salt gabelle in much the same way that civil officials deducted their wages and salaries from the regular land and head tax. As in the case of the regular administrative apparatus, however, these allowances never covered the full costs of clerical wages, stationery, and supernumerary runners. Therefore, after the reforms the salt administration itself continued to collect a fixed amount of customary fees to cover its own administrative expenses.^[127] These fees were also used for social services such as banquets to honor leading salt merchants and to provide relief for saltproducing households that were victims of flood and other natural disasters.^[128]

Of course, salt fees, once returned to the public coffers, were not used exclusively for services pertaining to the salt administration itself. In many provinces they provided an important supplement to the revenues derived from the land and head tax. In particular, when the decree was issued calling for the allocation of yang-lien for minor officials, many provinces were compelled to turn to salt and customs administration lou-kuei for the needed funds.^[129] Salt fees also constituted an important part of the provincial surplus and were often used for such elastic expenses as the purchase of relief grain and the provision of welfare for famine victims.

Surplus from Customs and Commercial Duties

Determining the contribution of customs and commercial duties to the provincial coffers is far more difficult than assessing the impact of salt fees. By their very nature, customs revenues were more variable than other taxes, and throughout the late-imperial period control of these sources of income presented a challenge to the administrative skills of both the central and local governments. Because of the extreme fluctuations in customs revenues in any given year and at any particular collection point, logic would seem to dictate a policy of full remittance without setting specific quotas.

However, it was this very elasticity that compelled governments in the late-imperial period to set quotas for customs revenues fully recognizing that the quotas had little relationship to actual income.

A number of factors influenced the volume of trade at a particular customs station. Natural phenomena frequently disrupted commercial activity. The customs quota for the Lin-ch'ing station in Shantung was established during the Ming dynasty. However, spring flooding and winter freezing tended to limit the use of the Wen and Wei rivers leading to this customs station. Moreover, in the summer and fall, when ships were able to travel, the sluices were often closed on the route south, causing a backup of merchant ships and bringing transport to a standstill.^[130] Therefore, merchants preferred either to unload their goods from the south and carry them by cart for the remainder of the trip north^[131] or to bypass the Lin-ch'ing stop on the Grand Canal route and pass through Chi-ning and Tung-ch'ang instead.^[132] By the Yung-cheng period, only ships carrying grain from Honan and Shantung on route to Tientsin continued to pass through the Lin-ch'ing station. A particularly good harvest in Shantung and Honan, however, coupled with natural disaster in the chou and hsien on the border between Chihli and Shantung, could stimulate a continuous stream of merchants plying the route through Lin-ch'ing. This was the case during one year in the late Yung-cheng period, with the result that instead of falling short of its quota, the Lin-ch'ing station had surplus customs revenue of more than 40,000 taels.^[133]

In areas where trading was generally brisk, late rains and a poor harvest could reduce merchant activity by half, with disastrous results for individual customs stations.^[134] Even when harvests were good throughout the empire, price differentials between regions could completely upset the flow of the staples trade. The Huai-an customs station relied largely on the bean trade moving south for its revenues. In 1727 and 1728, harvests in Kiangnan were extremely good and prices fell. As a result, merchants could not be induced to come to Kiangnan to trade in beans, and customs quotas at Huai-an could not be met.^[135]

The flow of trade could also be affected by imperial policy, often in ways not anticipated when a decree was promulgated. The Yangtze River trade between Szechuan and Kiangsu relied largely on ships carrying textiles upriver to Szechuan and saffron and rice downriver to Kiangsu. About 50 to 60 percent of the taxes collected at the K'uei pass derived from these items. When the num-

ber of ships carrying cloth and saffron began to decrease, the K'uei superintendent of customs, Mu-ko-te-pu, investigated the matter and found that the reason lay in the emperor's prohibition against carrying Szechuan rice across its borders. According to the testimony of long-distance merchants, in the past all bolts of cloth shipped to Szechuan were collected at Chungking prefecture for sale to the villagers in the surrounding countryside. Rice was the main medium of exchange used to purchase the cloth. Since the prohibition against carrying rice out of the province had become effective, merchants were unwilling to trade for rice but demanded their payment in silver. Consequently, the cloth piled up unsold and less new cloth was moved into Szechuan, resulting in serious losses in customs revenues.^[136]

Given the unpredictability of those revenues, a dual system of remittances was established to guarantee minimum revenues to the central government and to allow enough flexibility to ensure that at least some of the income collected beyond the quota was also sent to coffers in the imperial capital. The regular quota (cheng-e ) was sent to the Board of Revenue quarterly. Collections beyond this quota were accumulated in the course of the year and remitted annually in a lump sum to the Imperial Household treasury.^[137] These excess revenues, called ying-yü , varied from year to year and were not considered in an official's evaluation of performance in office. This arrangement was designed to protect merchants from excessive exactions by officials competing to surpass their predecessor's collection record,^[138] besides providing a source of income for imperial coffers. Because one's career did not depend on accurate accounting of ying-yü income, a large portion of excess customs revenues was never reported to the central government and ended up in the pockets of local officials, runners, and clerks connected with the customs administration.^[139]

In conjunction with the reforms in the collection and distribution of land- and head-tax revenues, the Yung-cheng emperor set about overhauling the administration of customs income as well. Just as part of the intent of the huo-hao reforms was to protect the people from harsh official exactions, the reforms in the customs administration were designed to protect merchants from unjust surcharges. At the same time, distribution of the customs surplus was rationalized to guarantee the fullest possible remittance to the central government while satisfying local claims to supplemental customs income. Part of the requirements for such a

plan were met by the huo-hao kuei-kung reforms themselves. By providing provincial officials with adequate sources of revenues, it was hoped that the demands for lou-kuei from the customs administration would be reduced. Serious efforts were made in many places to reduce or eliminate the customs surcharges levied on long-distance merchants that had previously entered the informal funding network.^[140]

The efforts to regulate customs duties followed the same principles applied to taxes in the agricultural sector: uniformity, public announcement of rates, and improved bookkeeping techniques. In the sixth month of YC 4 (1726), Yung-cheng issued an edict calling on customs officials to collect and remit in full (chin-shou chin-chieh ) all surplus merchant duties at each customs station in the empire.^[141] In order to encourage officials to declare the actual revenue potential at their customs stations, a one-year deadline was allowed for such declarations and a moratorium was placed on repayment of previously undeclared surplus income.^[142]

Two factors stood in the way of central-government control of customs revenues: a complete disregard for the legal rates of collection at individual duty stations and concealment of customs income through duplicate bookkeeping. In order to eliminate the first obstacle, a decree was issued requiring all customs stations to collect duties according to the rates issued by the Board of Revenue. To ensure adherence to these rates, they were to be engraved on blocks and printed so that they might be clearly posted at each collection point, much in the same way that officials had been ordered to post the land-tax rates at key points in each chou and hsien.^[143]

The difficulty in enforcing compliance was apparent immediately. Although the official rates were expressed in terms of rates according to type of cargo, the volume of trade passing through certain customs points, coupled with a lack of staff, had forced some customs stations to collect duties on the basis of the capacity of the boat, without regard to the type of cargo. In the case of the Chiu-chiang customs in Kiangsi, this practice had been in effect as early as SC 2 (1645), when the customs station first opened. Initially there were no regulations governing collection, and the Board was satisfied so long as the quota of 99,000 taels was met. In SC 12 (1655), under the guidance of Customs Superintendent Fei-ta, each boat traveling the route that passed through the port at Chiu-chiang was given a registration number, and these numbers, along

with the boat's specifications, were sent to the Board. However, as the boats stopping at the port proliferated, it became increasingly difficult for the station's staff to measure and investigate the contents of each boat. Although the quota itself had since doubled, customs inspectors could do no more than rely on visual estimates of each boat's capacity, levying duties at a uniform rate of approximately 0.02 tael per picul of cargo.^[144]

The inefficiency of such a system had long been known to both provincial and court officials. In fact, all attempts at regulation had become futile. Boats varied in size, depth, and width. Some were old and some were newly built, and the capacity of these various types could not be judged at a cursory glance.^[145] In Shantung, where duties were also levied on the capacity of the boat, shippers renovated their boats to make the cargo hold deeper and wider, thereby deceiving the official inspectors, who could make only a perfunctory estimate of capacity from onshore.^[146] Moreover, although boats carried a variety of goods of vastly differing value, duties were applied uniformly. These anomalies had been reported to the court many times, but the fear that inadequate staff and confusion in levying customs duties would result in deficits in the regular quota prevented any change in the system of collections from being implemented.^[147]

This resistance to change reflected an aversion to risk shared by both provincial and court officials. Officials preferred to maintain an inefficient method of collections that had at least produced a reliable minimum quota, rather than switch to a more complex system that could produce greater average income for the government but could also result in greater problems in particular years. Instead, the government turned to improvements in bureaucratic procedure to protect merchants from excessive demands by customs staff and to provide the central government with better information about the actual volume of trade passing through each port. This was accomplished by issuing registers (hao-pu ) to each customs station on which were recorded the name of the duty station, the date, and the amount of silver collected as tax from each merchant. In order to avoid falsification of these records, the merchants were to fill out and sign these registers themselves. Moreover, in the manner of the three- and four-stub receipts used in the collection of the land and head tax, the customs inspector's portion of the "receipts in payment" (wan-shui ch'üan-ken ), issued

upon payment of the duties, was also sent along to the Board for comparison with the records in the hao-pu .^[148]

The need for improved accounting is vividly illustrated by the state of customs collection in Fukien. The province had sixteen customs stations in the early Ch'ing. Yet despite regulations requiring the documentation of all customs transactions, at year's end the quota for the whole province would simply be divided among all the stations and false records would be compiled under the auspices of the stations at Nan-t'ai and Hsia-men.^[149] Any surplus above the quota would then presumably be divided among the staff of all sixteen stations, with payments to civil officials in the province being made in the form of customary fees. As a result of the reforms, not only were accounting methods made more stringent, but variations in the rates of collection between and within customs stations in the province were made uniform, in order to simplify collection and ensure that the increase in prices as a result of taxation was shared more equitably by consumers throughout Fukien.

The combination of the huo-hao kuei-kung reforms and the order to eliminate corruption within the customs administration at the same time that efforts were being made to remit all surplus customs revenues in full to the imperial capital could not but cause some consternation and confusion at the local level. This was particularly true in those areas where the reforms were implemented early. As explained in chapter 2, apart from blatant falsification of customs revenues, many customs stations gained extra revenues by charging fees to cover the costs of customs administration and lou-kuei to superior officials. Because lou-kuei to superiors had been eliminated and officials had been provided with yang-lien , it was not considered unreasonable that customs duties now be collected according to the established Board rates. However, when the emperor issued his edict calling for the complete remittance of excess revenues (ying-yü ), many customs officials feared that without collection of surcharges their ying-yü remittances would drop and they would be accused of stealing. Therefore, in some areas officials continued to sanction the collection of duties at rates above those promulgated by the Board.^[150]

Yung-cheng's assurances that his edict on ying-yü was simply intended to guarantee complete remittance of legally collected duties seems to have assuaged some of the fears of officials in charge

of customs revenues. However, as in the case of salt fees, it soon became apparent that some provision had to be made to allow a share of customs revenues to continue to flow into the provincial coffers. The emperor's order to eliminate surcharges and fees within the customs administration was not met with unanimous approval. Some officials felt that additional levies on merchants were justifiable because merchants could afford them and had paid them willingly for as long as could be remembered.^[151] Although all agreed that hiding and pocketing customs revenues was not to be condoned, many provincial officials were concerned that the customs administration itself could not operate without some transfer of funds from the customs surplus to its own coffers. Ch'ang Pin, who had been a customs official himself, pointed out that runners at the Canton customs collected various inspection fees that were used to pay wages, transportation costs, and so on. In an impassioned plea he asked the emperor how the clerks and runners and other staff members of the customs administration could be expected to work on empty stomachs.^[152]

Ch'ang Pin was not alone in his concern. Superintendent of Fukien Customs Chun-t'ai argued that the number of employees in the customs administration went far beyond the statutory quota and that expenses accrued in running this agency were great. Only by allowing the regulated collection of long-standing customary fees for their support could one guard against the more serious problem of embezzlement and deficits.^[153] Kiangsi Governor Pu-lan-t'ai went into even greater detail in describing the expenses incurred by the customs administration in his province, expenses for which, he claimed, it was imperative to skim a certain amount off the revenues remitted to the central government. To cover Board fees and the transport of documents and taxes alone, several thousand taels were needed. These expenses were covered by a hao-hsien on the regular tax as well as a transport fee (chieh-fei ) deducted from the ying-yü collected at each station. To pay the living expenses of yamen runners, a fee called "list silver" (tan-yin ) was charged to each merchant submitting a list of the taxable goods he carried. Moreover, every month, 400 to 700 taels were accumulated because of both differences in weights between the official scales and the market scales and variations in the fineness of silver. This miscellaneous customs revenue (lin-kuan ling-shui ) was turned over to the supervising official at each customs station to pay for his daily living expenses, ink, paper, private secretaries' and clerks' salaries,

and other costs. Any surplus at the year's end was reported and submitted to the governor's yamen.^[154]

In order to meet the needs of customs administration, an arrangement was finally worked out whereby all customs expenses were deducted from the ying-yü before the latter was remitted to the imperial capital.^[155] These funds were used to pay the yang-lien of customs officials and the wages of their clerks, runners, and private secretaries, as well as administrative expenses and the costs of compiling accounts and remitting taxes. Only after all such deductions were made and reported to the emperor in a palace memorial were the remaining "excess revenues" sent to the Board to be turned over to the Imperial Household treasury. Because the ying-yü thus remitted represented not the total surplus of the customs administration, but only the saved portion after expenses, it was often called "saved surplus" (chieh-sheng ying-yü ).

The ying-yü total continued to represent both collections of fees beyond the Board's schedule of duties and increased income due to the growth of the volume of trade. In accordance with the spirit of the reforms, however, the amount of customary fees, too, were published so that merchants would know precisely what was expected of them. Moreover, instead of allowing the customs-administration staff to pocket fees personally, yamen expenses were budgeted from the excess revenues and monthly allowances were issued to support customs employees and curb corruption.^[156]

Despite the proscription against the acceptance of customary fees, customs fees (shui-kuei ), like salt fees, continued to play a role in the finances of the provinces. Following the reforms, fees that were previously paid to high provincial officials were returned to the provincial coffers to help cover the public expenses of the whole province. In many instances the first response of provincial governors to the reforms was to insist that because customs revenues rightly belonged to the central government, all former customary fees should be combined with the cheng-hsiang customs revenues and sent to Peking. In every case where such a request was made, the emperor refused to accept these revenues and authorized their use in the province of origin to supplement public expenses.

Yung-cheng's special edict to Acting Kiangsu Governor Ho T'ien-p'ei explains his reasoning on this matter. Ho reported that in addition to the maritime customs quota and excess revenues collected in Kiangsu, there was a surplus of 5,732 taels that did

not belong to anyone. Rather than cover up the existence of this surplus, Ho reported it to the emperor and proposed that it be sent to the capital. The emperor replied:^[157]

This kind of surplus lou-kuei has never been predictable. Although you have loyally and sincerely memorialized the facts, it is not appropriate for me to permit you to voluntarily send [this money to the capital]. You need only memorialize about funds like this and keep them temporarily on reserve in the provincial treasury in case there are local public expenses or the need for funds to reward [outstanding soldiers or officials]. These funds belong to you to memorialize about and use as you see fit.

Yung-cheng was consistent in his policy of allowing provincial officials to return customs lou-kuei to the provincial coffers. In Kiangsi, customs and salt fees were retained to provide minor officials with yang-lien .^[158] Kwangsi's revenues from the land and head tax were so low that in YC 5 (1727) the emperor issued a special edict granting over 15,000 taels from the province's customs surplus to supplement the costs of providing officials with yang-lien . When it was discovered that an additional 31,400 taels in surplus could be derived from Kwangsi's customs administration, this too was turned over to the governor, with instructions to divide it among the ranked and unranked officials in the province on the basis of the difficulty of their posts.^[159] Evidence also exists for the return of customs surplus to the provincial coffers in Shantung, Fukien, and Fengtien.^[160] In each case the basis for allowing retention of customary fees or surplus levies seems to have been that they were paid willingly by the merchants and did not interfere with the fulfillment of the quota due the central government.^[161]

Revenues from Miscellaneous Commercial Duties

Customs duties were not the only form of commercial taxes that was legitimized as a source of local revenue during the reforms. Although the evidence surrounding these sources of provincial income is less abundant, local commercial duties were also a focus of reform.

As already pointed out in the description of the implementation of huo-hao kuei-kung , taxes on the sale of property, unloading of goods, brokerage licenses and so on played an important part in

the revenues of several provinces. Like the land and head tax and customs and salt duties, local commercial taxes were legally the property of the central government, to be collected in full and remitted in full to the Board of Revenue. However, as we noted in our discussion of informal funding prior to the reforms, these so-called miscellaneous taxes (tsa-shui ) were the most difficult taxes for the central government to control. Because the volume of commercial transactions fluctuated from year to year, magistrates generally remitted only a customarily agreed-upon quota to the central government, retaining the surplus to cover quota shortages in future years and to pay for their own expenses and for contributions to the expenses of superior administrative units.^[162]

Throughout the early Ch'ing, as the volume of trade and transactions in the sale of land and buildings rose, the central government's ability to regulate trade and the remittance of taxes was further circumscribed. One indication of the extraordinary rise in local commercial activity was the increased issuance of brokerage licenses during the early-eighteenth century. Brokers were licensed middlemen who were particularly important in arbitrating prices and bringing together buyers and sellers in local periodic markets.^[163] In order to control the volume of local trade and ensure the payment of taxes and maintenance of a "fair" price structure, the central government set limits on the number of brokers who could be licensed in each province. In Hupei, the Board of Revenue set a quota in YC 4 (1726) establishing the number of licenses the financial commissioner could issue to each chou and hsien to certify brokers in their jurisdictions. Legally, new brokerage households (ya-hu ) could be authorized only by rescinding the license of one broker and substituting another. Nevertheless, according to a report by Governor Wei T'ing-chen, by YC 9 (1731) the number of licenses actually issued by the individual chou and hsien had increased tenfold over the quota set five years earlier.^[164] The revenue derived from the sale of licenses was small. Annual licensing fees ranged from 0.5 tael for a large firm (shang-hang ) to only 0.3 tael for a medium-sized (chung-hang ) one and 0.15 tael for a small firm (hsia-hang ). By selling an extra 1,000 licenses, the province might hope to increase its revenues by at most around 300 taels, hence it is likely that the violation of the quota reflected a real need to increase the number of brokers engaged in handling a growing trade, and was not a ploy to gain additional revenues. This fact was acknowledged by the Board of Revenue when it granted Gov-

ernor Wei's request not to hold subordinates to fixed quotas in issuing licenses and collecting commercial taxes.^[165]

Provinces could indeed generate a substantial surplus from the collection of taxes on commercial transactions. Inasmuch as this excess revenue was the result of legitimate tax collection and not the product of surcharges or monetary manipulation, it was not subject to the same proscriptions applied to lou-kuei . Instead of demanding a greater share of this surplus for the central government coffers, Yung-cheng allowed the provincial governments to retain surplus commercial taxes for their own use.

Although evidence is scanty, it is probable that commercial-tax surplus contributed some income to every province. For example, in YC 8 (1730) the Board of Revenue permitted Kiangsi province to retain part of its unloading tax (lo-ti shui ) and property-deed tax (t'ien-fang ch'i-shui ).^[166] It was in areas where revenues from huo-hao were lowest that income from commercial taxes had the greatest impact on the provincial kung-hsiang . As pointed out in chapter 4, both Kwangsi and Yunnan relied heavily on revenues from mining, salt, and surplus comercial duties.^[167] In Kwangtung, surplus revenues of at least 35,000 taels were collected from the unloading tax and an additional 48,448 taels from the property-deed tax.^[168] By YC 12 (1734), the annual surplus from these two duties alone had risen to more than 120,000 taels. Seventy thousand taels were earmarked for provincial yang-lien and to cover the costs of boat repairs, and the remaining 50,000 taels were stored in the provincial treasury for emergency expenses.^[169] The most dramatic example of the reliance on commercial taxes for the success of the reforms was in Kweichow. There, only 18 percent of the revenues returned to the provincial coffers derived from the land and head tax. A full 59 percent of all provincial revenues emanated from salt and commercial taxes retained by the province for its own use.^[170]

The reliance of these provinces on salt, customs, and miscellaneous duties both for emergency expenses and to supplement the income necessary to allocate yang-lien and kung-fei demonstrates that the role of "surplus" taxes and fees from the commercial sector was far more important than is indicated by statutory quotas. Although their total contribution to local treasury stores was still not as great as that derived from the land and head tax, only a small number of provinces could survive without an infusion of some nonagricultural income. In the land-tax-poor areas beyond

central China and the north China plain, commercial revenues were vital to the success of the huo-hao kuei-kung reforms. Unlike lou-kuei , which burdened the people and destroyed official morale, income from salt, customs, and commercial taxes took advantage of China's growing population and commercial activity to provide an expanding and legitimate source of local funds that neither violated dynastic law nor harmed the livelihood of the masses of common people.