Chapter Seventeen: Currency Reform

Zhu Youxiao turned to another matter. "When it comes to the imperial treasury’s silver, it is nothing more than increasing revenue and cutting expenditures. At present, coin minting across the provinces is in utter disarray, and the markets are flooded with inferior copper coins. I wonder if you have any advice to offer me on this?"

"You once inquired about coin-minting machines," Guangqi replied thoughtfully. "Is it Your Highness’s intention to reclaim the right of minting coins from the provinces?"

"Indeed, that is my wish. The varying standards of provincial coinage mean all the profits fall into corrupt officials’ hands, and with no stable currency system, trade among the people is greatly hindered. Should we acquire a minting machine, we could use new methods to produce new coins—not only in copper, but also in silver. In this way, all profits would belong to the court, while the people would benefit from easier exchange."

In the Ming dynasty, silver was the main currency, but it was used in chopped bits called "broken silver" or "silver shards," making trade inconvenient and causing significant loss. That was why Zhu Xiaoqi wanted the court to issue standardized silver and copper coins to drive out the inferior ones.

"This matter must wait until the minting machines arrive, but the way to proceed can be planned in advance. We must decide how many mints to establish nationwide, and where; stipulate the size and fineness of the coins; set the exchange rate between copper and silver coins, and the method for converting silver coins to raw silver. All these regulations should be drawn up beforehand, so that minting can commence as soon as the machines arrive. I will rely on you to devise these plans."

Xu Guangqi found this perplexing. Both tax collection and coinage were strictly imperial prerogatives; while tax policy might be drafted in advance for the heir, the matter of coin-minting machines had already been discussed with the missionaries, who had promised to make inquiries and bring back the machines, artisans, and methods to the Ming court. Thus, the installation of the machines ought to be completed within a year or two at most. For the heir to say that minting would begin as soon as the machines arrived—what did that mean? Did he believe he would soon ascend the throne? This thought flashed through Xu's mind, making him break out in a cold sweat, and he dared not pursue it further.

Zhu Xiaoqi, noticing nothing amiss, continued, "The reform of the currency system and the matter of taxation can, in fact, be unified. In the West, there is an institution called a 'bank,' quite similar to our money houses. The bank oversees the manufacture and issuance of coins at the mint, and tax revenues are deposited into the bank as well. You may consult the Westerners about banking. It would be best if a Westerner familiar with banking could help establish one, with the possibility of appointing him as a director in the Ministry of Revenue—or even a vice minister, should he prove truly capable."

That was a high position—almost a vice minister. Surely, the Westerners would be tempted by it.

Xu Guangqi’s sense of unease only deepened, but he agreed to everything. The two then exchanged formal courtesies and parted ways.

Upon leaving the palace, Xu instructed his coachman to drive to the Imperial Stables, where he found his friend Li Zhizao, the assistant director. Li was in the midst of a game of chess; he apologized, welcomed Xu into his study, called for tea, and asked him to wait while he finished the game. Xu, knowing Li’s fondness for chess and mahjong, resigned himself to waiting, as Li would not stop until the match was done.

He waited nearly half an hour before Li finally triumphed and returned, apologizing again. "Brother Zixian, forgive me. You arrived mid-game."

Xu wasted no words, dismissed the servants, and recounted his conversation with Zhu Xiaoqi in detail. He had an excellent memory—though not word for word, the account was near complete. Afterward, he sipped his tea and looked to Li Zhizao.

Li pondered the matter for some time, then hesitantly remarked, "The Crown Prince’s grandson holds no office, no power. What use is there in making such arrangements?" He glanced at Xu.

"What you think is what I think," Xu replied. "The heir is extraordinarily intelligent—as his comments on tax, coinage, and banking attest—yet how can he not know that such matters are not within his power? The contrast between his wisdom in affairs and his ignorance of human matters is too great. What could be the reason?"

Li nodded, then a thought struck him. He looked closely at Xu, who met his gaze with an incredulous expression. In a hoarse whisper, Li said, "Could it be...?" But he immediately fell silent. Xu nodded. "I suspect as much. That is why I came to discuss this with you. But how could the heir know that he will soon be emperor?"

Both men were Christians and did not believe in omens or spirits. For the heir to ascend so soon was, by all logic, impossible; after all, there were two people before him—should the Emperor pass away, the Crown Prince would still succeed, and it was unlikely the Crown Prince would quickly die as well. Both considered this, but then another question arose: even if it were to happen, how could the heir know?

They debated the matter at length but could reach no conclusion. Were it not for Zhu Xiaoqi’s youth and lack of power, they might have suspected him of plotting usurpation. In the end, they could only conclude that the heir possessed exceptional intelligence—at least concerning practical matters—but was utterly naive in the ways of the world. In truth, his remarks belied this theory, but lacking a better explanation, they chose to deceive themselves for the time being.

Setting this aside, Xu asked Li to help draft the minting regulations, while he himself would work on tax policy. As for the banking regulations, they would need to consult with the missionaries and money-handling experts before they could begin drafting.

Li Zhizao himself had a keen interest in arithmetic, having collaborated with Matteo Ricci to translate the first Western mathematical texts into Chinese. Thus, composing the minting regulations was no difficulty for him, and he agreed readily. What’s more, should the heir truly ascend, such work would be remembered as a great service.

Xu Guangqi then returned home, where his family handed him a letter from Macau. It was from Father Nicolas Trigault, who proposed that, since the heir was interested in Christianity, perhaps he could invite the newly arrived missionaries to the capital for an inspection—at their own expense, under the heir’s name.

The next day, Xu presented the letter to Zhu Xiaoqi, who, after some thought, deemed it a good idea. He instructed Xu to reply, conveying these main points: first, that the court wished to purchase a large number of European cannons, specifying heavy guns weighing a thousand catties or, if not, the new-style falconets would suffice; second, that the missionaries skilled in telescopes and artillery manufacture should bring detailed information, and, if possible, more Western books and translators; third, that if clockmakers or minting machine experts and their craftsmen had arrived, they must come to the capital with the missionaries. As for payment for the cannons, it would be made upon their arrival in the capital. If all went well, the heir would support the building of churches in Beijing and permit preaching among high officials.

Xu hesitated again—was this something the heir could authorize? The latter two requests were minor, and the invitation itself was only a formality, but the purchase of cannons was a serious matter. After some deliberation, he voiced his concern: "Your Highness, I fear the matter of purchasing cannons is not so simple."

Zhu Xiaoqi considered this and agreed. By the time the cannons arrived, however, he expected to have ascended the throne, at which point all would be easily settled. For now, the official reason needed careful phrasing—he could hardly say the heir wished to go hunting.

"Very well, then. Omit the request to purchase cannons. Instead, ask them to forge more cannons, and once there is a sufficient stock, we will negotiate the purchase. The other two requests remain unchanged." A few months’ delay was nothing; if the Manchus wanted to taste cannonballs, there would be plenty of opportunities.

"One more thing—emphasize the third point: the importance of the minting machine, which may well surpass that of the cannons. Let them know that if we acquire a minting machine, we will provide even greater support." He believed that the principles behind the minting machine could be applied to other types of machinery as well. Relying solely on handcrafting firearms was far too slow and imprecise for mass production.