Chapter 1444: The Frenzied Rise in Salt Prices

Han Palace, Chuigong Hall.

Zhang Yong entered holding a stack of memorials, presenting them respectfully to Emperor Liu for review.

"What has the Crown Prince been busy with lately?" Emperor Liu asked casually as he calmly flipped through the pages.

Upon hearing the question, Zhang Yong clasped his hands and replied: "His Highness is currently working with Chancellor Wang and Chancellor Shen on this year's autumn tax accounting and the stabilization of salt prices."

"How much tax does the Finance Commission expect to collect from this year's autumn levy?" Emperor Liu asked.

Zhang Yong was clearly thoroughly familiar with these matters, answering without hesitation: "Based on the tax quotas set by the Ministry of Revenue in early autumn, with all the autumn taxes from the various circuits and prefectures collected in full, it should come to about twenty-nine million strings of cash. Even if there are discrepancies, they should not be significant!"

Hearing this, Emperor Liu was somewhat surprised and said: "That much? I recall that in the seventh year of Kaibao, the nationwide autumn tax collected was only thirty-six million strings. This year, a great many circuits and prefectures have implemented tax exemption policies—how can it still be this much?"

Zhang Yong calmly explained to Emperor Liu: "Your Majesty, thanks to the court's sound policy of letting the people rest and recuperate, farming has not been delayed across the realm this year. The southern circuits and prefectures were less affected by the northern campaign, so their tax revenues have increased. Additionally, with the court's tax system reforms, commercial taxes and salt taxes have grown considerably. Thus, overall, the autumn tax still amounts to nearly thirty million strings!"

"It seems the court's fiscal reforms are beginning to show results!" Emperor Liu said. "If things truly go as the financial plan projects, then the court's fiscal difficulties will be somewhat alleviated!"

"Your ministers firmly believe that things will get better year by year!" Zhang Yong answered with conviction.

Twenty-nine million strings was absolutely a colossal tax revenue, yet for the entire empire, it counted for little. The Great Han had spread its operations too wide; even if it had reined things in somewhat, what had already been expanded could not be pulled back, and it still required effort and expenditure to maintain.

The Great Han's annual fiscal revenue was basically all spent on the salaries of officials and the military, the stipends of the nobility, and the administrative costs of government offices at all levels both inside and outside the capital.

And this year's fiscal revenue would be hard-pressed to fully cover even that, while still needing to fill the deficit left by the northern campaign. The construction of northern military defenses, as well as the need to maintain considerable military forces in Mobei and the northeast, were all devouring the court's finances. On top of that, the imperial privy purse still owed debts to the national treasury that needed repaying...

Therefore, although the Great Han's finances were steadily recovering, they were far from ample. The aggressive external expansion and the massive northern campaign, though not lasting very long, would require much more time to heal the wounds left by war.

"The salt price in the capital is already forty wen per dou, isn't it?" There was a note of caution in Emperor Liu's tone.

Seeing Emperor Liu raise the question, Zhang Yong's face visibly grew more solemn as he said: "Your Majesty, as of now, the salt price in the capital has already reached fifty-two wen per dou!"

Emperor Liu involuntarily drew in a breath and frowned: "That is indeed somewhat high!"

The Great Han's salt system reform, put simply, was to relax controls, open up the market, reduce the government's role in it, and let merchants take on the responsibility of circulation and sales. The government was only responsible for production, while transportation and sales were delegated to qualified salt merchants, with supervision maintained by the authorities.

The direct reason for this policy change lay in the court's fiscal problems—it was a way to open up new sources of revenue. After all, the immense profits of salt were well known to all, and maintaining a low salt price in the past had indeed seemed a waste.

Through this method, while reducing its operational and maintenance burdens, the court could obtain visibly tangible returns—merely from selling salt licenses, it could gain three million strings in a single stroke.

From the decision in early spring, to preparation, to implementation, in just over half a year, the effects had manifested immediately. And the most direct change was the sharp rise in salt prices—a rise so steep it was almost frantic.

Even during last year's northern campaign, when the salt price in Luoyang had risen under the pressure of supply demands, it had only been around twenty wen per dou, and after the new year it had even fallen back somewhat, settling at a normal seventeen wen.

Yet since the court launched the salt system reform, in just this half year and more, the price of a dou of salt had risen by more than a factor of one—nearly three times what it had been in spring.

Such an increase was somewhat excessive and had stirred considerable criticism. The capital was indeed a place of prosperity, but the common people were gradually voicing grievances over the frantic rise in salt prices.

The relevant court authorities were naturally well aware of the salt price increase, especially Wang Qiwu, who was chiefly responsible for this matter and watched it closely at all times.

However, they had not rashly intervened all along, but had calmly sat back to observe its development. After all, before implementing the policy, they had anticipated this—the rise in salt prices was well within expectations. It could even be said that the court had played a leading role in driving the salt price up.

The ninth year of Kaibao had not yet ended, but the court's revenue from salt profits was already quite considerable. This income counted as extra revenue, greatly supplementing the finances, and could also be used to benefit the salt workers and salt farmers across the realm.

In the past, when the court maintained a relatively low salt price, those most squeezed were naturally the salt farmers everywhere. Now, with the implementation of the salt reform, the government had grown fat, the salt farmers' treatment had improved, and the merchants involved could also eat their fill—but it was the common people of the entire nation who were footing the bill.

Of course, although salt was a necessity for the people's livelihood, it was not like staple foods such as rice and flour. Demand was rigid, but the quantity each household needed could be adjusted. Therefore, even if the price rose somewhat, the impact on the people's livelihood would not be too severe.

Had the increase been a gradual, frog-in-boiling-water sort of rise, the reaction would not have been so intense. But the problem was that it had risen too fast, too wildly, leaving the people without sufficient time to react and adapt.

It was easy to imagine—what had cost twenty wen before now required three times that amount. Anyone would be dissatisfied and complain. If they had never experienced the old prices, it might be one thing, but the people of the Great Han had enjoyed low-priced salt for nearly twenty years.

One should know that in the Western Capital, a strong laborer's average monthly income was only three hundred wen. Therefore, salt at fifty wen per dou was absolutely expensive for the common people.

Thus, when popular resentment accumulated to a certain degree, the court could no longer turn a blind eye. In fact, while the rise in salt prices was certainly driven by court policy, the merchants had clearly played a huge role in accelerating it, and amid this popular resentment, the "profiteering merchants" had also absorbed much of the blame that might otherwise have fallen on the court.

Every reform, while solving old problems, also tends to bring new ones. Since Emperor Liu took the throne, the Great Han had undergone so many changes that on this issue, Emperor Liu and his ministers all had a very clear understanding and ample experience.

So far, the benefits of the salt reform were already evident, and the court had begun to enjoy its fruits. Thus, when problems began to surface, as seasoned hands at governance, Zhao Pu and Wang Qiwu showed no impatience whatsoever—if a solution could be found, they would solve it; if it could not be solved, they would at least mitigate it.

"Don't underestimate a mere salt price—it is tied to the livelihood of the common people. The current rise in salt prices is somewhat excessive. The problem stems from court policy, and since it has stirred popular resentment, the court must address it, to release that resentment and calm the people's hearts!" Emperor Liu said after a moment's thought.

Of course, this was merely an instruction expressing his stance. As for the specific matters, Emperor Liu still intended to leave them to the Hall of State Affairs and the Finance Commission. He would only inquire about the details now and then—he cared only about results. At this point, Emperor Liu had fully entered a state of ruling by non-interference.

"Sensing the boiling resentment of the people, His Highness the Crown Prince has already taken personal charge of overseeing the resolution of this matter. I believe the Finance Commission will soon produce some practical and effective measures!" Zhang Yong said.

"I can rest easy with Wang Qiwu and Shen Yilun handling matters!" Emperor Liu said, then looked at Zhang Yong and instructed: "You keep an eye on this matter as well!"

"Yes!"

In truth, no matter how things changed, the course could not truly be reversed, and the risen salt price could not genuinely fall back down. At the very least, the various classes and groups that had already reaped enormous profits would not permit it—the Finance Commission itself would be the first to firmly uphold this policy.

Even if, bowing to popular sentiment, some measures were applied and some regulations added to slightly suppress the salt price and bring it down a bit, it could never again be maintained at such an extremely low level as in the past.

After all, the salt price was not like the grain price. If the grain price underwent such frantic fluctuations, then without question the court would strike with a heavy fist and crack down severely, because that was something that could truly affect people's livelihoods and social stability.

The Great Han Empire was still a nation rooted in agriculture. After so many years of development, apart from the townsfolk, ordinary farming households all had some surplus grain at home, and their demand for grain and flour was very stable. Unless some disaster occurred, it would be difficult for grain prices to see any exaggerated rise.

If the salt price was too high, the people could still endure it, and in time they would grow accustomed to it. But if they could not afford to eat, then they might rebel—and the harm that would cause would be immense.

Therefore, even without waiting for the outcome, Emperor Liu already knew in his heart that the salt price in the future would still be maintained at a relatively high level, until the people accepted and grew accustomed to it.