Managerial Practices

The Expansion of Business and Charity . As their Shanghai enterprises grew, merchant huiguan leaders invested their fortunes and managerial attention not simply on Shanghai and their native places but also on branch businesses in a network of cites. This was the case for the comprador-merchant leaders of the most powerful native-place groups in Shanghai in the 1860s and 1870s, Guangdong, Zhejiang and, increasingly, Jiangsu sojourners.^[2] Guang-Zhao Gongsuo leader Xu Run, for example, arrived in Shanghai in 1852 as a comprador and invested in silk, tea, tobacco and opium. By 1868 he had opened his own tea firm with branches in Zhejiang, Jiangxi, Hunan and Hubei. The Zhejiang merchant-comprador Ye Chengzhong arrived in Shanghai in 1854, where he became a leading figure in the Ningbo community. Over the next several decades he transformed himself into a financier and industrialist. Although Shanghai was a base for his pioneering development of spinning mills, he established businesses in each major port, including a match factory in Hankou.^[3]

As their economic concerns extended beyond the native place and beyond Shanghai, so did their charitable activities. This geographic expansion of both business and charitable activity was facilitated by improvements in transportation and communication brought about by the regularization of steam shipping among the treaty ports (including those on the Yangzi) during the 1870s. Huiguan increasingly organized assistance to sojourners in other cities.^[4] In the process, for many huiguan leaders the functional native-place community became in practice a multicity, even national, network. Huiguan charitable activities embraced and reinforced this larger network. At the same time, huiguan also became contributors to charitable concerns which transcended native-place networks.

Although huiguan devoted their greatest energies when disasters hit home areas or their fellow-provincials in Shanghai or other cities, in the late Qing the major associations supported citywide charities as well. These included contributions to the Tongren Fuyuantang, the most important of the Shanghai benevolent institutions, which dispensed coffins and provided burial for unidentified corpses. Huiguan and gongsuo support for this local gentry-established institution became particularly important in the post-Taiping period, after plundering damaged the rental-income property of the charitable hall. Huiguan records for the late nineteenth and early twentieth centuries also reveal contributions to support Shanghai-wide disaster relief, as in the case of flooding in 1905.^[5]

Shanghai sojourner associations also participated in the broad trend of charitable activism for the relief of national disasters which has been observed beginning in the late 1870s among elites in the lower Yangzi area by Mary Rankin and within Hankou merchant and gentry institutions by William Rowe. Zhejiang sojourners in Shanghai were quick to organize collection agencies which responded first to disaster in northern Jiangsu in 1876 and then on a larger scale in 1877-78, a time of severe drought and famine in the North China provinces of Henan, Zhili, Shanxi and Shaanxi. The Guangdong comprador Zheng Guanying joined the Zhejiang merchant-philanthropist Jing Yuanshan in the formation of a relief bureau for Shanxi in 1877. Stimulated by Zhejiang philanthropical ventures, encouraged by Zheng Guanying and Guang-Zhao Gongsuo director Xu Run, and not to be outdone on the pages of the Shenbao (which published lists of contributors), other sojourning Guangdong merchants donated heavily in 1878, as relief programs were established by Li Hongzhang.^[6]

This extension of charitable activity beginning during the late 1870s is an important development, but one which—as is the case for other "expansive practices" discussed in this chapter—resists characterization in the opposing categories of "modern" or "traditional"; nonstate/extra-bureaucratic or state/official; "cosmopolitan" or "particularist." These abstracted sets of mutually exclusive opposites are as grounded in our

language and thinking as they are fanciful in terms of approximating the considerably more complex and ambiguous process of social change. A western-originated discourse of progress and modernity, whether Weberian or Marxist in its specific formulations, has greatly encumbered both western and Chinese interpretations of development in modern China by constructing change as a radical break and by anticipating (and therefore finding) change in only one direction. Certainly the expansion of charitable activism incorporated new technologies and ideas. What is striking is the way in which "modern" tools and media facilitated the creation of new (and expanded) notions of the native place as well as new notions of the nation. The point here is that "modernization" in China was multidirectional.

The larger, multiport native-place communities the new activism encompassed were in many ways constituted through new economic and technological developments. Not only did the steamboat make communications and transport (for both business and charity) more practical, but the Shanghai newspaper, the Shenbao , which both reported news from the different treaty ports and was distributed in many of them, helped to bring the worlds of elite sojourners in different ports together. Although much has been made of the transformative impact of the modern press in regard to creating in people's minds the idea of the nation,^[7] it has often been assumed that the rise of newspapers assists the transcendence of local "particularisms." In Shanghai, the press reconfigured people's connections to the larger polity and in certain respects strengthened local identities, both presenting national news and creating an urban "mirror" for new reflections of native-place "face." In other words, we are forced to recognize the paradox of national identification being fueled by native-place loyalties.

The "mirror" of Shanghai public opinion (as articulated in the press) motivated the broadening of both native-place charity and charity which went beyond native-place ties. For example, in a letter to the GuangZhao Gongsuo, the reform-minded intellectual/comprador Zheng Guanying urged his fellow-provincials to coordinate multiport Guangdong collection networks to assist tongxiang refugees in Beijing and Tianjin. He pointed out that Jiangsu and Zhejiang people in Shanghai had established a relief society for northern refugees and that unless GuangZhao and Chaozhou people contributed, not only would they

lose face but foreigners would laugh at them.^[8] Similarly, while conveying the new nationalism of the treaty-port elite, Shenbao editorials which increasingly called on huiguan to sponsor disaster relief in other areas of the country also stimulated native-place rivalries by publishing lists of contributors. While conveying the idea that huiguan were a source of funds on which the nation depended, the newspaper created a new sort of "symbolic capital" which would recur to the native-place community. Whereas huiguan previously vied for the grandest festival, their leaders followed shifts in public opinion and vied for reputations as public-spirited institutions. This shift is seen, for example, in a Siming Gongsuo advertisement in the Shenbao that it had economized and saved one hundred yuan from its jiao , which it donated to flood victims in Hunan.^[9]

Similarly, it is difficult to disentangle gong in the sense of public, collective, and nonstate from guan (official).^[10] The early stages of the charity drive to relieve the North China famine do seem to provide evidence, as Mary Rankin has detailed, of nonbureaucratic initiative and civic activism which created new models of appropriate elite behavior (as articulated in the Chinese press). But such a notion of gong quickly (and, for the participants, apparently unproblematically) was tied to guan with the involvement of Li Hongzhang. Li's sponsorship of charitable relief clearly provided further motivation for elite involvement. Shanghai merchants extended their native-place rivalries through their charitable activism into the realm of national politics. It would be naive, as Leung Yuen-sang has pointed out, to imagine that the wealthy Guangdong merchants who contributed to Li Hongzhang's relief programs did not also view their charity as a bid for the patronage of this powerful official. Li certainly became an important patron of Guangdong merchants,

making them directors of several of his government-sponsored and -supported "self-strengthening" enterprises, even endorsing a Guangdong scheme to monopolize opium importation into all of China, memorializing the throne on the benefits of such a state-sanctioned monopoly.^[11]

Finally, to present the changes in terms of cosmopolitanism versus particularism would obscure the ways in which distinctions between these apparently exclusive notions collapsed in daily practice. The management of charity reflected continuing attachment to native-place ties (even as the net of charity at times expanded beyond them). The expansion of merchant management both provided a larger stage on which to play out native-place rivalries and involved competing native-place groups in cooperative ventures in the interest of broader municipal and national goals. In fact, as charitable and other public activism grew, the elite leaders of different native-place groups increasingly cooperated in citywide joint relief agencies. During their North China famine relief management activities the leaders of the Guangdong community developed cooperative contacts with Zhejiang and Jiangsu notables sojourning in Shanghai. By the mid-1880s an ad hoc committee of sorts linked together influential merchants from different sojourning groups who repeatedly cooperated in organizing relief as disasters arose in different areas.^[12]

Standing in for City Government . In post-Taiping Shanghai huiguan increasingly assumed urban managerial functions, including social control and taxation. Such functions developed through a combination of official and merchant initiative, reflecting officials' recognition of limited government resources as well as merchants' growing public activism. The expanded urban functions of huiguan broadened the range of identities associated with these institutions. At times Chinese officials even borrowed huiguan halls for official functions involving for-

eigners or foreign governments, occasions which called for particularly impressive surroundings. At such moments both foreign and Chinese authorities clearly viewed huiguan as representing Chinese (not provincial) interests. Although the use of huiguan buildings at such moments does not provide evidence of huiguan intervention in the proceedings, it does suggest the magisterial presence of these institutions at moments of national symbolic importance.^[13]

Chinese officials encouraged the use of huiguan as instruments of social control to defend Shanghai against bandits or uprisings, maintain order during popular festivals and settle disputes, riots and strikes in the city. Huiguan leaders often solicited such responsibilities, particularly when they were given license to expand their authority in the city. Major huiguan also contributed regularly to the coffers of local Chinese officials, paying customary fees to the Daotai's yamen , the Magistrate's yamen , and the Mixed Court.^[14]

Government calls to muster huiguan militia did not end with the Small Sword Uprising. Five years after crushing the rebels and destroying Guangdong and Fujian huiguan for their complicity, Shanghai officials appealed again to huiguan to help defend the city. If huiguan militia were risky, they were perhaps no less reliable than other military bodies at the time, and there was little alternative.

Faced in 1860 with approaching Taiping rebels and the disarray of government forces, Daotai Wu Xu relied on his tongxiang for defense. Wu was a Zhejiang native whose extensive business interests linked him closely to the Siming Gongsuo. With gongsuo help, Wu created a Ningbo militia of five hundred "braves." Although this particular militia proved less than useful (reportedly fleeing the Taipings and plundering local villagers as they ran back to Shanghai) and was ultimately dis-

banded, other native-place associations, even the considerably smaller Shandong Huiguan, mustered and trained militia until the fall of the Taipings.^[15]

Native-place ties also played a role in the organization of nontraditional forms of defense. With funding and organizational assistance from his close friend the wealthy Zhejiang comprador-merchant Yang Fang (Takee), Wu also arranged for the innovative hiring of a foreign mercenary militia, the Ever Victorious Army. This was not solely a Zhejiang project; the Guangdong merchant leader Xu Yuting also contributed heavily. The joint support of these two leaders of their respective sojourning communities for a foreign mercenary army again demonstrates the coexistence of organization by native place and innovative cooperative ventures by different sojourning elites in the service of state officials (and in their common interest of defending the city).^[16]

During the Sino-French War (1883-85) social unrest in Shanghai led the Shanghai Magistrate and the Daotai to again call for merchants to raise militia.^[17] Merchants in the foreign concessions also attempted to form militia, as shown by a petition received by the Shanghai Municipal Council in 1884, which also reveals their methods of militia organization:

We, the undersigned representatives of the Kwangtung [Guangdong] merchants in Hongkew [Hongkou] ... request that the sanction of the Municipality be granted ... to the end that merchants and other people may be assured of their safety and not remove from Shanghai in fear and trepidation. It is the purpose of the Kwangtung merchants to enlist two or three men from each shop situated in Hongkew as volunteers, thus the corps will number about 1,000 men.... The weapons which are to be used by the volunteers will be supplied them by ... the Kwangtung Guild.^[18]

In the late nineteenth century local officials continued to rely on huiguan to settle disputes in the city, taking for granted (and reinforcing through state practice) huiguan influence over sojourning communities. When cases entered the courts, courts often referred the matter back to the huiguan for settlement. In cases involving tongxiang and outsiders, huiguan served as legal advisors or representatives.^[19]

Huiguan also averted social disorder in Shanghai by returning potentially disruptive people to their native place. A particularly volatile situation arose in 1907, when Chinese authorities closed more than five hundred opium dens in the Chinese areas of the city. Because each establishment employed a number of people, three to four thousand people stood to lose their jobs. Many of these people were connected to gangs and secret societies, and rumors spread of plots to resist the authorities. In response, the Guang-Zhao Gongsuo moved with alacrity to provide return transport to the many Guangdong provincials who had been employed in the opium dens.^[20]

Local officials also relied on huiguan to control the popular festivals described in Chapter 3. Each year, just before the yulanpenhui , officials contacted the responsible huiguan . One such notice, written in the early 1870s, makes clear the pivotal role of huiguan as mediating institutions between the state and the people:

During the seventh and eighth months the people of Fujian, Guangzhou, Ningbo and Shaoxing compete in yulanpenhui processions. This excites and draws together unwholesome elements, who create disturbances and incidents. Thus in the past prohibitions against these processions have been recorded. Now ... the Magistrate has notified the heads of the huiguan of Fujian, Guangzhou, Chaozhou, Huilai, Ningbo and Shaoxing, etc., to

make clear ... that such activities are uniformly forbidden.... The prohibitions of each former Daotai are on record.... All Fujian, Guangzhou, Chaozhou, Huilai, Ningbo and Shaoxing huiguan managers and also the people of these places are hereby forbidden from holding processions.^[21]

The huiguan , themselves implicated in the organization of these disorderly festivities, responded to such proclamations by publicizing their commitment to maintain order in the city. The Guang-Zhao Gongsuo admonished fellow-provincials to "refrain from inciting trouble" during the seventh month, transmitted the Daotai's prohibitions and warned that processions must not enter the Chinese walled city or the foreign settlements. The huiguan proclaimed that it would turn in any rumor-mongers or troublemakers to the authorities and would absolutely refuse to assist the lawbreakers.^[22]

By both sponsoring these festivals and assuming responsibility for controlling them, huiguan directors consolidated their leadership position as head of their respective sojourning communities. If huiguan did not suppress yulanpenhui and jiao , there is no reason to doubt that they exercised their joint interest with the government in keeping order. The persistence of large ritual celebrations, as detailed in the previous chapter, despite government orders to the huiguan to prohibit them, suggests that huiguan were unwilling or unable to sacrifice this source of popular authority.

Although government officials' attention was drawn repeatedly to disruptive huiguan activities and abuses of delegated power, huiguan remained generally under their protection throughout this period. Similarly, officials' delegation of authority to huiguan even after the experience of a huiguan -led uprising in the city, as the following examples illustrate, dramatizes the contingency of government power and government dependence on ambivalent, or Janus-faced, institutions which derived their power from below as well as above.

Tax Collection. Huiguan and gongsuo services were crucial to post-Taiping tax collection. Local officials realized that if merchant associations were not themselves involved in the collection procedures, there would be no way to control smuggling and tax evasion. Huiguan involvement had two effects. First, the delegation of governmental functions to specific associations increased their authority in the city. Second,

because of native-place distinctions within trades involving more than one regional group, taxation in practice was not always applied equally to all members of a trade. Powerful native-place bang could manipulate tax-farming mechanisms to the disadvantage of their rivals.

After initial merchant opposition and systematic smuggling in response to the introduction of transit taxes (lijin ) in China in the 1850s and 1860s, a system of mutual accommodation developed between merchant groups and government officials, by which important huiguan and gongsuo gradually took on tax collection. In the lower Yangzi area, this process continued through the early twentieth century.^[23] This involved a significant expansion of huiguan functions.

The administration of tax collection involved setting up tax offices, issuing transit permits, and posting agents at roads and bridges to prevent smuggling from the tax-exempt International Settlement into Chinese territory. In 1875 the North China Herald described a multiplicity of such offices, some government directed, some huiguan or gongsuo directed, each of them supported by "squeeze," with the result that "every article of native produce is similarly afflicted by officers detailed in all directions for the purpose." By the 1890s the government-huiguan/ gongsuo lijin -collection symbiosis was increasingly regularized. Merchants established and ran their own highly profitable tax-collection offices, guaranteeing the government a fixed sum.^[24]

The opium and foreign piece-goods trades were among the first to develop merchant-leased lijin tax-collection bureaus in Shanghai.^[25] It seems likely that these led the process because foreign involvement in these trades facilitated smuggling (goods imported by foreigners were exempt from lijin transit taxation). By registering goods in a foreign name, Chinese merchants routinely avoided lijin payments. Local officials anxious to secure tax revenues negotiated tax-responsibility compromises with merchant associations.

The opium trade provides an example of the workings of one tax office, illustrates the symbiosis of official and private business and shows how tax responsibility could increase the power of a native-place bang , helping to exclude outside (in this case western) competitors. As early as 1871 western observers remarked on the existence of a notorious "Opium Guild" (Yangyao juanju , or "western medicine" collection office) which leased the administration of the opium tax from the Daotai.^[26]

This "Opium Guild" soon became the focus of a celebrated legal suit involving opium trade, not in Shanghai but in Zhenjiang. Before the 1870s, opium was transported up the Yangzi into Zhenjiang and the interior by Chaozhou merchants who purchased it from western companies in Shanghai, paying taxes to Shanghai officials. These merchants sold to their fellow-provincials in Zhenjiang who controlled the local opium trade. In the early 1870s David Sassoon, Sons and Company discovered that it could make a greater profit by importing opium directly into Zhenjiang. This system enabled Chinese purchasers outside the Guangdong huiguan in Zhenjiang to avoid taxes altogether, smuggling the purchased opium on small, armed boats under British flags. The Sassoon innovation threatened Guangdong traders in both Shanghai and Zhenjiang and also cut into opium-tax revenues collected by Shanghai officials.

The Zhenjiang Guangdong huiguan directors discussed the matter with the Shanghai Chao-Hui Huiguan when they went to ceremonially congratulate their tongxiang on the Chinese New Year.^[27] Recognizing that as long as western merchants imported opium directly into Zhenjiang they could not prevent smuggling, Chao-Hui Huiguan leaders determined to end western trade in Zhenjiang. After constricting Sassoon's trade by threatening any Chinese who bought from the foreign company, they bought out the declining Sassoon enterprise, restoring the Zhenjiang opium trade to the Chao-Hui Huiguan.^[28]

Surviving transcripts of a trial which undertook to expose the "Swa-

tow Opium Guild" reveal the organization and taxation of the opium trade and the embeddedness of the trade in wider native-place interests. In September and October of 1879, the case of "Messrs. T. W. Duff and D. M. David vs. the Swatow Opium Guild" unfolded before the readers of the North China Herald . Duff and David were opium merchants who tried to trade in Zhenjiang after the demise of the Sassoon operation. They accused members of a Chinese "guild" of combining to exclude them from the trade. Arguing that this violated treaty stipulations, the western merchants sought compensation for losses they claimed to have incurred as a consequence. The British Vice-Consul and the Chinese Daotai presided, in addition to the British Assessor and the Chinese Magistrate, because of the importance of the case.^[29]

The case was never resolved to the satisfaction of the foreign plaintiffs because they misunderstood the nature of Chinese associations, taxation arrangements, and the overlap between Chinese business and government organizations. Although the defendants were both directors of the Chao-Hui Huiguan and officers of the Shanghai Opium Tax Bureau, the prosecution failed to prove the existence of a discrete guild of opium merchants, on which its case depended.^[30] Instead, there was the Chao-Hui Huiguan, which the defendants described as a club for sojourners. Whereas the defense stated that all of the several hundred opium merchants in Shanghai were from Chaozhou prefecture,^[31] they argued that the huiguan was not a business association because merchants were but a small minority of the community it served. The large part of the community, which numbered between twenty and thirty thousand, they argued, was made up of poorer and middling classes. Moreover, there were also traders who dealt in sugar, bean-cake fertilizer and cotton. In these arguments the defense invoked the broad tongxiang community to mask the merchant direction of the association.

Chinese officials supported the Chaozhou merchants in this case because the huiguan used its tax monopoly authority to prevent smuggling associated with foreign inland trade. The huiguan stationed men outside British firms in Zhenjiang to monitor those who came and went. Hui-

guan interest in protecting Chaozhou business coincided with the interests of Chinese officials who were concerned to protect their tax revenues. The Shanghai Daotai backed up all of the testimony of the Chao-Hui Huiguan, even false or misleading information.^[32]

This case also demonstrates the substantial involvement of sojourning Shanghai merchants in economic matters outside both the native place and Shanghai. Although directors of the Zhenjiang huiguan were asked by the local Daotai to collect the lijin tax on opium and prevent smuggling, they acted not autonomously but in a subordinate relationship with their powerful Shanghai fellow-provincials. Joint meetings of the Shanghai Chaozhou opium merchants and the Zhen-jiang Guangdong huiguan were held at the Shanghai Opium Tax Bureau to determine tax arrangements in Zhenjiang. The draft lijin tax for Zhenjiang was drawn up not in Zhenjiang but in Shanghai, by the Shanghai Chao-Hui Huiguan. The Zhenjiang magistrate even accompanied a delegation of Zhenjiang huiguan directors to Shanghai for discussions with the Shanghai huiguan .^[33]

In other cases, native-place bang used tax-responsibility license to disadvantage Chinese competitors. In trades involving merchants from several bang , different groups often struck different tax bargains with local officials. The sugar trade provides an example of the maneuvering which accompanied the imposition of lijin . The trade was originally dominated by people from the sugar-producing region of southeastern Fujian and northeastern Guangdong (Chaozhou). By the mid-1870s Jiangsu and Zhejiang merchants (grouped together strategically as a Jiang-Zhe bang ) had entered the trade. Relations were much closer between the Chaozhou and Fujian bang than between these allied southern bang and the Jiang-Zhe newcomers, who imported foreign sugar and shipped it to other areas. For the still powerful but declining Fujian and Chaozhou sugar bang, lijin and defense (choufang ) tax collection offered an opportunity to regain the edge over their competitors.^[34]

In 1874 the government-run Shanghai sugar-tax bureau lowered the · taxation rate to dissuade sugar merchants from smuggling. The lijin tax was reduced to 61.5 percent of the former level, and the defense tax was halved. Three days later, negotiations between the Chaozhou and Fujian bang and the tax bureau resulted in a prejudicial enforcement of the new rules. The local Jiang-Zhe merchants complained in the Shenbao that only the southern bang received the discounts whereas they were forced to pay the full tax.^[35]

Shenbao editorials, which tended to represent local interests against southerners, criticized the government for encouraging a Fujian-Chaozhou monopoly. The Jiang-Zhe bang complained of unequal treatment to the Daotai, who conceded their case but failed to intervene on their behalf, forcing the unhappy Jiang-Zhe merchants to accept the terms of the southern bang : "When we transport sugar it is confiscated by the sugar tax bureau, and we have no appeal.... If we want to ship it to other places, we have to ask the two bang [Fujian and Chaozhou] to represent us in paying the tax [to get the discount] and then they charge us for the service."^[36] The Daotai in this period was Feng Jun-guang, a Guangdong native.^[37]

A similar case demonstrating how native-place bang could manipulate tax monopolies is provided by the Shanghai Silk Cocoon Gongsuo, organized by merchants from the silk-producing prefecture of Huzhou (Zhejiang). In the 1890s this gongsuo used its lijin tax responsibility to prevent non-Huzhou merchants from shipping cocoons to Shanghai. It did this by requiring all silk boats to carry a tax-authorization certificate and then limiting the distribution of certificates to its own boats.^[38]

Important recent scholarship has maintained that the imposition of late-nineteenth-century taxes created a new sense of commonality among merchants which enabled them to transcend native-place ties. The examples discussed above suggest that it was equally possible (and perhaps more likely) for native-place bang to manipulate the new taxes and their tax-collection responsibilities in order to strengthen their position and reinforce regional distinctions.^[39]

Quasi-Police Functions . To fulfill tax-collection and smug-gling-prevention duties, it was not uncommon for merchant associations to hire low-paid runners. These men had to be streetwise, muscular and skilled fighters who could ferret out hidden goods and suppress smuggling. Thus huiguan depended on tongxiang toughs in order to match forces with smuggling gangs.^[40] The best illustration again comes from the opium trade, which engendered the most profitable and most determined smuggling.

The employment of runners by the Opium Tax Bureau was endorsed by both Chinese and Settlement authorities to prevent smuggling. The Opium Tax Bureau initially hired seventeen runners; by 1875 the number had grown to thirty. In 1883 runners were uniformed and given identity cards stamped by both the Municipal Council and the Chinese Mixed Court Magistrate. Officially, these men were empowered to seize all smuggled opium and take it to the Tax Bureau. They could ask the police to arrest smugglers but could not make arrests themselves.^[41]

In practice, agents of this Opium Tax Bureau indiscriminately seized all opium transported in the city on which no tax had been paid, including opium transported in the foreign settlements and registered under foreign names. They regularly assaulted suspects and dragged them off to the police and courts. No sooner were runners given official identification cards than police reports flowed in detailing disturbances connected with arrests of alleged smugglers. Moreover, the Opium Bureau did not hesitate to bring foreigners to court. When foreigners interfered with opium seizure, the Bureau sued for assault of its employees.^[42]

Irritated by assaults on foreigners and the repeated exposure of foreigners engaged in smuggling, the Municipal Council began to limit the activities of the Tax Bureau. Police were instructed to permit certified runners to peacefully execute their duties but to suppress groups of unauthorized "rowdies" who accompanied the legitimate runners.^[43]

The Opium Tax Bureau, supported by the Daotai, retaliated against Settlement police suppression by hiring foreigners to augment its forces. For Chief and Deputy-Chief runner, the wealthy Chaozhou merchants hired an Englishman and an Australian. It also engaged two foreign lawyers, Messrs. Drummond and Wainewright, to represent it in cases before the Mixed Court. Despite foreign protest, the antismuggling activities of the Opium Tax Bureau continued until smuggling was resolved by the commutation of all opium lijin through the addition of an increased import duty.^[44]

The expansion of huiguan activities into the realm of urban management reflects a growing, mutually beneficial symbiosis with local officials, a relationship which in many ways resembled cycles of diminishing state initiative and local gentry activism but was also clearly generated by the new needs of a densely populated and socially and economically complex city. Given the intricacies of urban management and urban interactions, neither party to the relationship (the merchant managers or

the state) could be described as autonomous or controlling. In the case of opium-tax collection, Chaozhou merchants clearly exploited their bureaucratic position to increase their power in the city, making the opium-tax office an appendage to their huiguan . The huiguan merchants who operated the tax office were quick to use its influence and official status in dealings unrelated to opium. In March 1878 the opium office intervened in a case involving a Chaozhou rice-junk owner whose boat and cargo were damaged in a collision, mediating with the Shanghai Magistrate on behalf of the junk owner.^[45] Such appropriations of state office for the nonofficial business of native-place groups was tolerated because such blurring of official and unofficial business was normal practice and because officials depended on the tax revenues produced by such offices.

In their quasi-governmental functions in the city, including their assumption of such bureaucratic functions as tax collection, huiguan directors acted in the interest of their sojourning communities. Although in the above examples sojourning merchants did not overtly take on public responsibilities out of a sense of identification with the broader municipality, such gradual identification may have been a paradoxical result. State reliance on huiguan , the frequent presence of tongxiang Shanghai officials at huiguan meetings and regularized assumption of bureaucratic and order-keeping functions enmeshed native-place associations increasingly in a citywide bureaucratic web.