Chapter 292: Surface Rights

ps: Asking for monthly tickets and recommendations.

Chen Xin couldn't help smiling when he heard the name Mao Chenglu. This adopted son of Mao Wenlong was the Vice Regional Commander of Guanglu Island. Guanglu Island lay not far northeast of Jinzhou and was one of the larger islands under Dongjiang Town's control.

"Where is the man he sent?"

Song Wenxian smiled. "I've kept him waiting for a few days, though he hasn't been mistreated in food or drink."

Chen Xin nodded. "Mr. Song handled that well. That way it's easier to negotiate terms. But I doubt Mao Chenglu's offer to join us is sincere. If I'm not mistaken, he'll send other men to Dengzhou to call on Lu Zhi or Wang Tingshi, and may even be in contact with Kong Youde and the others. He'll go with whoever bids highest."

"My lord is astute, which is why I kept him waiting. Across from Guanglu lie the Hongzuibao and Guifubao lines. The Jianzhou bandits there have all fled, and the Fuzhou bandits are cut off by the mountains. My lord also left a naval detachment at Jinzhou, with boats patrolling near Guanglu every day. It wouldn't be easy for Mao Chenglu to defect to the Jianzhou bandits. But judging from the man himself, he has always regarded himself as the legitimate successor of Dongjiang Town. He won't go over to the Jianzhou bandits unless he's at a dead end."

Chen Xin stood and paced a couple of circles. Mao Chenglu had originally been a nobody; Chen Xin had only heard of him after arriving in Wendeng. In the original history, this Mao Chenglu had always brooded over Mao Wenlong's death. After Yuan Chonghuan died, a Dongjiang Mobile Corps Commander named Zhou Wenhuang had submitted a memorial requesting posthumous honors and pensions for Mao Wenlong, but the matter did not go as the Emperor wished. Back when Yuan Chonghuan killed Mao, Chongzhen had been forced by circumstances to say some approving words. Now, though he had executed Yuan Chonghuan, he was unwilling to slap his own face. Citing Mao Wenlong's squandering of military funds and lack of results in containing the enemy, he refused to grant Mao Wenlong any posthumous honors, only permitting his family to retrieve his remains. In the end, Mao was buried by the shores of West Lake in Hangzhou.

Chongzhen saved his own face. Every man in the Mao family army felt they had lost theirs, and the resentment in their hearts only grew. Not a shred of loyalty remained. It was no accident that when Kong Youde and Li Jiucheng seized Dengzhou, they raised their arms and supporters flocked to them in droves. Chen Youde and Mao Chenglu came running eagerly to join them, each being granted the title of Regional Commander. Mao Chenglu was stationed at the parade ground east of the Water City. In the end, forced to go to sea, he was captured by Huang Long and executed by slow slicing along with Chen Guangfu and the others.

Chen Xin had none of Chongzhen's misgivings. Dongjiang Town was a force that had to be won over. Even if Dongjiang Town was now too weak to withstand a single blow, it was still better than letting Huang Taiji take it. He said to Song Wenxian, "How does Mr. Song intend to deal with this man?"

Song Wenxian had always been a crafty old fox. After following Chen Xin for several years and participating in matters at an ever-higher level, his skill at scheming against people had grown day by day. He already had a plan in mind and said to Chen Xin without hesitation, "This man is the foremost of Mao Wenlong's adopted sons. After Yuan Chonghuan killed Mao Wenlong and divided Dongjiang into four commands, he alone commanded one of them. His prestige in Dongjiang is far beyond that of Kong Youde and the others. Now that we've just dealt with a group of Dongjiang officers, Mao Chenglu is sounding us out partly because he fears we might move against him, which is why he didn't dare come himself. We need to win this man over, and we can offer fairly good terms. First, for their ginseng and sable pelts, have the trading company offer a higher price. Second, for their grain, if they don't have enough to eat, sell them some at a slightly lower price."

"Mr. Song is brilliant. First stabilize Mao Chenglu; as long as he doesn't defect to the Jianzhou bandits, that's enough. Later, once we've finished expanding our army, the Jianzhou bandits' influence in the Liaonan region will recede even further. Kong Youde and the others will have even less capital to draw him over. I will arrange the trading company matters for them."

Song Wenxian said in a low voice, "I also have an idea that could win the goodwill of the Dongjiang people without spending any silver."

"Oh? Please, Mr. Song, do not begrudge your guidance."

"My lord is too kind. Wenlong died on Shuangdao, off the coast of Lushun. That island is now within our jurisdiction. We could very well build a cenotaph for Marshal Mao on the mountaintop where he was killed, provide it with incense and offerings, and each year invite Marshal Mao's family and old friends to come pay their respects."

Chen Xin broke into a grin. Song Wenxian's mind was indeed nimble. Chen Xin, having been raised on materialist education, had never placed much importance on what came after death and did not understand the ancients' fixation on such matters, so he had never considered this kind of approach. Now, hearing it, he praised, "Mr. Song, that is an excellent idea. A cenotaph is no great thing. Mao Wenlong's case is rather delicate at court. Although one of the charges against Yuan Chonghuan was the unauthorized execution of a frontier commander, it never said Mao Wenlong was innocent. Everyone knows the Emperor couldn't bring himself to admit fault, and the Emperor does not wish to bring the matter up again."

Song Wenxian said calmly, "My lord flatters me. That is precisely why this matter can only bring benefit and no harm."

"Mr. Song, this is a brilliant stratagem. With this pretext, the people of Dongjiang will have an excuse to travel to and from Lushun. It will also make things easier for you, Mr. Song. We can publicize it a bit in various places."

"But there's no need to publicize it too deliberately. Lushun is a key military site for our town and not convenient for receiving merchant ships. Shuangdao offers shelter from wind and waves and often has merchant vessels there. We could set up a pier on Shuangdao to supply passing merchant ships with fresh water. Many of those merchants also travel to Dongjiang, and they will spread the word better than we could."

Chen Xin nodded. "Then go ahead and handle this. Mao Wenlong spent his life in the saddle, daring to go to sea with just two hundred men to launch a counterattack and saving hundreds of thousands of Liaodong refugees. It's only right to leave a place of remembrance for him in Liaodong. We might as well build this cenotaph well."

Song Wenxian acknowledged the order and lifted his tea to drink, when suddenly he heard Chen Xin clap his hands. Startled, Song Wenxian spilled tea onto his beard. He hurriedly set down the cup and asked, "My lord, have you thought of another brilliant scheme?"

Chen Xin raised a hand to stop him from speaking. His eyes darted about for a moment, then fixed on Song Wenxian. "Your mention of merchant ships just reminded me of something. The Dengzhou merchants suffered heavy losses this year. There will certainly be gaps in the private trade with Liaodong. Why don't we seize this fine opportunity to monopolize the Liaodong sea trade?"

Song Wenxian said in astonishment, "How would we monopolize it?"

Chen Xin chuckled. "Private trade with Liaodong will only be conducted by Dengzhou and the Wendeng Trading Company. The Dengzhou naval camp is now under Lu Zhi's control. First negotiate the shares with him, give a share to Wang Tingshi, and we can monopolize it. If other merchants want to trade, they can pay taxes in exchange for a passage flag. Selling silk, cloth, tobacco, and the like is fine, but grain, saltpeter, and sulfur are forbidden. That way everyone can make money without giving the Jianzhou bandits any real help. If anyone tries to smuggle goods privately..." Chen Xin made a light chopping motion in the air with his hand.

Song Wenxian shook his head. "Wang Tingshi and the others will certainly demand a great deal. It might be better to keep things as they are. The trading company's reputation is higher than theirs; sooner or later we'll be able to take a larger share."

"Even if the trading company could take the entire share, in the end we'd still have to give them a cut. Besides, apart from making silver, there are even more benefits. We'll designate a single place for trade. Ordinary merchants who want to trade private goods will have two conditions: first, pay taxes and obtain a passage flag; second, they must use the Four Seas Money House for all silver transactions."

Song Wenxian thought it over carefully but still hesitated. "Using only the money house for silver transactions doesn't seem to bring much real profit."

"You'll understand the benefits later, Mr. Song. Once they get used to the money house, they'll realize its convenience. By the time those island commanders can't do without the money house, controlling Dongjiang will be as simple as using the money house."...

"This year the money house will extend to Yingtian and Xushuguan, and the bill of exchange business must get underway. My demands on the trading company this year are also high. Cigarette sales must double, and southern goods must increase by at least fifty percent. Part of the local products bought back from Liaodong will be sold directly by the trading company to capture greater profits."

Inside the Wolonggang camp in Dengzhou, Liu Minyou personally carried a cup of tea and handed it to Zhou Laifu, who had just rushed back to Dengzhou. This tailor from the seventh year of Tianqi was now the general manager of the Four Seas Trading Company, with over three hundred men under him, spread along the Grand Canal and throughout Dengzhou. However, as general manager, he currently only oversaw the canal business; the Dengzhou and Liaodong Sea branches were still managed by Liu Minyou himself.

Zhou Laifu stood to receive the teacup, unable to hide the joy on his face. "Mr. Liu, I'm relieved that you are all safe. When Kong Youde revolted last year, I was in Linqing. Rumors were flying everywhere, all sorts of talk." Zhou Laifu lowered his head and sighed. "Those people made Li Jiucheng out to be a demon reborn. I told them, if they were demons reborn, then Lord Chen is the Martial Star incarnate, and with you, Mr. Liu, as the Literary Star, you'd deal with those demons just the same."

"It was all General Chen's doing." Liu Minyou smiled and waved his hand. "I merely helped prepare some supplies. Most of all, it was those combat troops who were effective. And to say more, without you, Laifu, and the others working hard to earn the pay and provisions, those combat troops wouldn't have had such strong fighting power."

Zhou Laifu said with great respect, "You two lords did not scorn my humble origins but instead entrusted me with heavy responsibility. With such kindness, no matter how well I do, it is only my duty."

Liu Minyou laughed heartily. "Laifu, after years of experience, your way of dealing with people is indeed vastly different from before."

At that moment, a maidservant brought in several plates of pastries. Liu Minyou had her place them all on the side table next to Zhou Laifu. Zhou Laifu, travel-worn and dusty, was indeed somewhat hungry. Having worked with Liu Minyou for several years, he was well acquainted with his superior's temperament. Without standing on ceremony, he ate and talked with Liu Minyou at the same time.

Liu Minyou pointed at the departing maidservant. "There is a group of women here in Dengzhou who were abducted by Kong Youde and his men. Many are young ladies or maidservants from wealthy or official families. They can read and keep accounts. Some have already been placed in the cigarette factory and retail shops; the rest are still idle. Laifu, I need you to help employ some of them."

Zhou Laifu immediately agreed. "If they can read and do arithmetic, the trading company would be more than happy to have more of them. But the specific number depends on how far you, sir, intend to expand the trading company."

"This year we will certainly expand to the department level in Shandong. The main focus will still be tobacco and southern goods. Zuo Changhao wrote some time ago saying he will come to Dengzhou in the fourth month. I will discuss it with him in detail then and strive to double the quantity of southern goods again. Laifu, you will join us then."

"Yes, then I shall stay until the fourth month. As for the business along the canal..."

Liu Minyou said in surprise, "The letter I sent you was precisely to have you arrange your personnel properly, because the time might be longer."

"I did make arrangements, but I still can't help worrying a little. Business is getting better and better. As soon as the canal thawed, the shops were packed with people coming to buy tobacco. Those who couldn't get goods right away found inns nearby to stay in. Seeing it truly makes me happy."

Liu Minyou smiled. "So the tobacco business is that good. This year there's also a kind of cigarette with a filter tip; business will be even better then."

Zhou Laifu's expression turned serious. He said to Liu Minyou in a low voice, "My lord, some cigarette workshops have also appeared in places like Linqing and Yangzhou. They're all privately run. Their products lack flavor, but taking advantage of our short supply, they openly solicit customers outside our shops, pricing one wen lower than us. There have already been many clashes with our shop clerks. According to my private inquiries, their costs are actually higher than ours, but they've cut their profits and are now selling to the surrounding villages."

"This was to be expected." Liu Minyou had long been mentally prepared for folk imitations. But Wendeng's cigarettes had assembly lines and hand-operated cigarette rolling machines, making their efficiency far higher than those workshops, and their costs would also be lower.

Liu Minyou thought for a moment and said, "Ignore them for now. Once they've sunk more silver into it, we'll launch a big price cut and make them lose everything. After that, no one will try it again."

Zhou Laifu hesitated, then finally said, "One of them is the most brazen. It's a partnership opened by several members of the gentry in Linqing, and the department magistrate and the judge also have shares. Before I left this year, they had already made the brokers direct all merchants exclusively to their tobacco shop. Last year we also used Zhou Hongmo to grease the palms of that department magistrate, and he hadn't made trouble for us. But this year, he pulled this move. Only a few old customers from last year came to the Linqing shop, and even they were harassed in various ways by those brokers."

"What!" Liu Minyou sprang to his feet. He had heard about brokerages from that Ding fellow in Yangzhou. The power of the canal brokerages was extraordinary, much like the search engines of later generations' internet. Without the brokerages, the customer flow to the Wendeng tobacco shop would plummet.

Seeing his agitation, Zhou Laifu quickly tried to reassure him. "My lord, didn't you just say that when the time comes, a price cut will deal with them..."

"That only works against ordinary merchants. When local officials are involved, it's different. They control the brokerages; even if we cut prices, it's useless."

He paced two circles, then stopped and said to Zhou Laifu, "I will discuss this matter with Lord Chen. How can we let them run amok like this?"

But at the moment, he couldn't think of any solution. The profit and sales volume of cigarettes were both very large, and the barrier to entry was not high. It was only a matter of time before merchants set their sights on it, but he hadn't expected officials to get involved so quickly. Linqing fell under the Shandong Provincial Administration Commission, and Wendeng's connections there were very ordinary. Previously they had relied solely on one Zhou Hongmo. Now that the profits were so great, that connection was no longer enough. They would have to see how Chen Xin or Song Wenxian handled it.

He had always been thinking of expanding the trading company's network of shops to capture more end-user profits. Now it seemed that these local officials and gentry were truly the greatest obstacle. No matter how low his costs or how good his goods, he might not be able to compete with them. Perhaps it would be better to stick to wholesale only.

Liu Minyou thought back and forth without reaching a conclusion and had to set the matter aside for the time being. He pulled a booklet from the table and said to Zhou Laifu with a smile, "This year the Wendeng trading company will also be reorganized. It will be divided into several large commercial districts. I want you to take overall charge. I have a plan here. Take it back with you these next few days, look it over, and give me your suggestions."

Delighted at yet another promotion, Zhou Laifu quickly accepted it. He flipped through it roughly. It was covered with many squares connected by lines, with the names of some departments written inside.

Liu Minyou, thinking that Zhou Laifu had been away from Wendeng for over a year and needed some time to rest, smiled and said to him, "Laifu, it's rare for you to come back. Go home to Wendeng first and spend time with your wife and children. When Lord Chen returns, I'll send word for you to come to the meeting."

"Thank you, Mr. Liu."

Zhou Laifu was about to take his leave when Liu Minyou insisted on seeing him out. Just outside the door, they ran into Mo Huaiwen hurrying over. Mo Huaiwen gave Zhou Laifu a slight nod, then leaned close to Liu Minyou's ear and whispered urgently, "Our settlement households got into a fight with the civilian households of Dengzhou at Anxiangbao. Three people are dead."

"What! Why did they fight?"

"It's over the land reclamation."

Liu Minyou said anxiously, "Don't we have the title deeds?"

"Those civilian households are fighting to the death to stop us from taking over. The two most troublesome groups among them are, first, those who years ago attached themselves to a Provincial Graduate with official rank to evade taxes, though in fact they still farm the land themselves and live off it. The other group are those who hold surface rights to the land. They say our title deeds only cover the subsoil rights, and that whoever farms the land must get the approval of the surface rights holder."

"This damn mess." Liu Minyou frowned in annoyance. (To be continued.)