Historical Kunming Part 2: Discourses on Salt and Iron
They also have brine wells, from which they make salt that is used for food by all the inhabitants of the country. And I assure you that the king derives great profit from this salt.
So wrote Marco Polo when he visited Kunming in or near the year 1282 AD. The king was a son of the emperor Kublai Kahn, grandson of Genghis Kahn and the founder of what the Chinese referred to as the Yuan Dynasty. This Mongolian emperor, like the Chinese emperors both before and after him, enforced a complete monopoly on the manufacture and sale of salt throughout all of China. And it was in Kunming that one of these salt production centers was established.
In reading about this monopoly,I came across an amazing connection between modern and ancient Chinese history, one that I will enjoy sharing with you…
Our story begins around 110 BC, during the reign of Emperor Wu, seventh emperor of the Han Dynasty. Emperor Wu was known for lavishing money on territorial expansion (which he was very good at), extravagant displays, and “advisors” aligned with his many superstitions. And in the time honored tradition of other despots, from Pharaoh Khufu to Louis XIV, Emperor Wu’s grandiose visions nearly bankrupted his empire.
But just as Louis XIV came to rely upon the genius of Colbert to save France from economic ruin, so too was Emperor Wu served by one of the period’s great economic thinkers: his agriculture minister Sang Hongyang. It was minister Sang’s idea nationalize the production of salt and iron, selling back to the public at regulated prices. Though wildly unpopular, this monopolization was a huge financial success for the government, and bankrolled many further conquests, extravagances, and superstitions for the rest of Emperor Wu’s reign.
But when emperor Wu died, many people, particularly scholars in the provinces, argued for a return to the lasseiz-faire policies of previous Han emperors. These people became something vaguely akin to a political party, and styled themselves the reformists. Officials of the central government quite naturally argued that the central government should retain the monopoly; these officials styled themselves modernists.
The newly crowned Emperor Zhao was only 8 years old when Emperor Wu died, and China was ruled by a regent named Huo Guang. Regent Huo had no desire to see this disagreement break out into civil war. So six years after the death of Emperor Wu, he ordered the reformists and the modernists to gather at court to hold a great debate that would resolve the issue. That debate was known as the Discourse on Salt and Iron; its proceedings have survived to this day.
A compromise was agreed. Some monopolies, most notably that on liquor, were abolished. But for the most part, the modernists (who were led in the debate by Sang Hongyang himself) were judged to have won the day, and the government got to keep its salt monopoly, though Sang himself would be executed a year later for involvement in a plot to have the regent killed. And the salt monopoly has survived from that day until now.
Taken on its own, this story would be just a mildly interesting historical footnote, an insight into what official life was like two thousand years ago in the world’s oldest surviving civilization.
But let us fast forward now to 2009 and take a look at the actions of a certain government official Chen Guowei, Supervisor on the Enterprise Supervision Board of the State Asset Supervision and Administration Commission. Supervisor Chen had proposed that the salt industry be liberalized and eventually privatized. These reforms were supported by many Chinese businesses, but opposed by consumer groups, who feared instability, speculation-fueled price bubbles, and fears over quality control of iodization (for many Chinese, salt is their only nutritional source of iodine, a key nutrient). And so in the spirit of long-deceased precursor in Chinese government, Supervisor Chen held a meeting on Salt Reform.
The arguments raised in that meeting have echoes over two thousand years long.
- Most of the story of Emperor Wu, Regent Huo Guang, and Minister Sang Hongyang come from Wikipedia and linked Chinese history sites
- The report on the 2009 salt reform meeting comes from East Asia Forum
- And the Discourses on Salt and Iron themselves? The ones written two thousand years ago? Still available on Amazon :-)