Chapter 962 - Shandong Business

Even if cargo arrived safely, the Great Ming's supply system and finances remained in a state of extreme chaos. Many merchants full of dreams of fortune had bankrupted themselves only to receive slips of paper in payment—or sometimes not even that. Some had committed suicide; others ended up on the streets as beggars or simply starved to death.

Doing government business in Dengzhou required not just capital and commercial ability, but deep official connections. Here in Dengzhou, some men not only made fortunes transporting military supplies for the court, but also used their ships plying the Bohai Sea to secretly engage in smuggling. They moved urgently needed goods and specialties back and forth among the Great Ming, Korea, and the Later Jin, raking in enormous profits.

Sun Yuanhua knew all of this very clearly. But since he was skilled at being an official, he wouldn't make a fuss over such matters—the reasons were self-evident. The merchants involved in this smuggling all had powerful backers. Some were too formidable for him to offend outright; others he needed to work hard and risk their lives for him, so alienating them was out of the question; still others were his patrons, friends, or classmates from the same examination year. If he stirred things up, everyone would fall out, and not only would his reforms fail—even his position as Dengzhou-Laizhou Governor might become untenable.

Therefore, Sun Yuanhua, aside from doing his best to control the outflow of grain and pig iron to the Later Jin, turned a blind eye to other matters. He also needed the smugglers to import desperately needed horses from Later Jin territory. Dengzhou was in Shandong—unlike the Ming generals stationed along the Shanhaiguan-Jinzhou line who could purchase horses from Mongolia nearby, acquiring warhorses circuitously from the Later Jin had become the main source of cavalry mounts for the Dengzhou new army. Moreover, the smugglers occasionally brought back considerable intelligence about the Later Jin—far superior to what the court's dispatched secret agents could obtain.

This young man before him might harbor similar intentions. Sun Yuanhua sized up Zhao Yingong. His visit was obviously to "claim connections" and "find backing." For doing business in the Dengzhou area, there was no better backer than Sun Yuanhua himself.

Sun Yuanhua had no aversion to this. In the Great Ming, this was simply the natural order of things. He himself was no puritanical Confucian scholar—otherwise he wouldn't have risen to regional commander before even turning fifty.

This Zhao Yingong not only traded with the Australians but was willing to travel thousands of li to unfamiliar Shandong to seek his fortune, unafraid of risks—clearly a bold and daring man. He also possessed deep trading relationships with the Australians, which could prove useful. Finally, directly controlling a few merchants would only benefit his position.

But whether this person was truly reliable would require further observation. He asked:

"Since you wish to do business here, what trade do you intend to pursue?"

This topic was somewhat sensitive. The business Zhao Yingong actually intended to conduct was human trafficking—naturally he couldn't say this, but whatever he made up had to be plausible. He had considered this question repeatedly beforehand. He now replied cautiously:

"Your Excellency is training troops here. What you need most is naturally grain..."

Sun Yuanhua stroked his beard and nodded. "Correct—grain indeed." He sighed. "Difficult."

Zhao Yingong asked: "May I ask Your Excellency the reason?"

"The court does have grain to speak of—it's only the matter of 'transport' that's difficult." He proceeded to explain.

Dengzhou and Laizhou were crowded with large numbers of troops who consumed vast quantities of grain. Additionally, they had to supply grain to the tens of thousands of troops stationed in the Dongjiang garrison in Liaodong. The grain transfer burden was enormous. Yet land transportation in the Dengzhou-Laizhou region was extremely inconvenient. During the Ming, the Shandong Provincial Administration encompassed six prefectures. The three eastern coastal prefectures—Qingzhou, Laizhou, and Dengzhou—were called the "Eastern Three Prefectures," while the three western prefectures along the Grand Canal—Jinan, Yanzhou, and Dongchang—were the "Western Three Prefectures." Comparatively, the Eastern Three Prefectures lagged significantly behind the Western Three Prefectures in both transportation and trade.

The Eastern Three Prefectures along the coast were mostly hilly and mountainous, making land transportation extremely difficult. Dengzhou Prefecture, at the easternmost point and surrounded by sea on three sides, had the most isolated land transportation of all. "Though its western border connects to Laizhou and Qingzhou, the mountains and ridges form barriers; the paths are fit only for birds and sheep. Carts cannot fit their axles; riders cannot travel abreast." It was said to have "not a single passable road." Such transportation conditions undoubtedly severely hindered commercial exchange with other regions, creating a situation where the area was "remote in the eastern corner, blocked by mountains and surrounded by sea, with poor soil and sparse population, lacking trade routes, and rarely visited by merchants."

Large quantities of grain shipped north from the south traveled the Grand Canal to reach Shandong, then required overland transfer to reach Dengzhou, Laizhou, and similar locations. The geography of the Eastern Three Prefectures made overland transfer extremely difficult. Because the roads were so poor, transport costs soared.

Grain allocated by the court to Dengzhou-Laizhou garrisons and the Dongjiang garrison often couldn't be quickly transported to Dengzhou, piling up in places like Linqing. This not only greatly increased spoilage losses but also required tremendous bureaucratic maneuvering. Getting grain to Dengzhou meant conscripting civilian laborers, hiring vehicles, providing food and lodging along the way, and sometimes repairing bridges and roads. All this required cooperation from local officials. Sun Yuanhua was after all only the Dengzhou-Laizhou Governor, not the governor of all Shandong. Once outside his jurisdiction, matters weren't so straightforward. He therefore had to invest considerable effort cultivating relationships with the provincial authorities and prefectures along the route to ensure grain could be transported smoothly.

This applied not only to grain but to all other supplies as well. To modern eyes, the Eastern Three Prefectures were all coastal counties—typical regions suited for an "export-oriented economy" with excellent maritime transport conditions. The entire Eastern Three Prefectures coastline stretched nearly three thousand kilometers, and of the 29 subordinate prefectures and counties, coastal ones comprised nearly sixty percent. As early as the Sui, Tang, and Northern Song dynasties, Dengzhou, Laizhou, and Jiaozhou had developed into important ports for China's foreign trade.

However, due to the strict maritime prohibition in the early Ming, maritime trade along the Shandong coast had withered. Though the prohibition loosened after Jiajia and private maritime shipping recovered somewhat, the scale remained small. Each ship's capacity was only a few hundred shi, and only two or three hundred ships arrived annually. Dengzhou, Laizhou, and similar areas remained mired in poor transportation and difficult goods circulation. Sun Yuanhua often suffered headaches over this.

By comparison, other supplies could at least be shipped by sea. Only grain—if transported from Jiangnan—had to travel by the Grand Canal. This was a systemic issue; switching to the sea route wasn't a decision he could make unilaterally. The tribute grain system was a major imperial policy that even Xu Guangqi, now in the Grand Secretariat, couldn't influence.

Zhao Yingong said: "Since that's the case, why not try to procure locally? Even if it can't solve everything, it could at least solve part of the problem, and the common people would benefit as well."

Sun Yuanhua replied: "You're new here and don't understand the complexities. As for local grain—the Dengzhou-Laizhou area has always had poor, barren soil with limited production. Unfortunately, it's also a place where 'surplus grain cannot be exported to other prefectures for exchange, and shortages cannot be relieved by purchasing from other prefectures—grain is only for self-sufficiency. Thus a small harvest means sudden abundance, while a small famine means helpless distress!' Not only do people flee during famine years—they also flee during good years!"

"Why flee during good years?"

"Their grain simply cannot be sold. If it can't be sold, how can they pay their corvée taxes in silver?" Sun Yuanhua looked at him with surprise—wondering how he could fail to grasp such elementary matters.

"Ah—yes, yes." Zhao Yingong hurriedly nodded, realizing he had embarrassed himself again. For Ming people, this was basic common knowledge, but to him it remained unfamiliar terrain.

"Even though the court's local grain procurement adds a gracious two qian of silver per shi, the common people still suffer unbearably." Sun Yuanhua sighed. "Hence the Dengzhou people's proverb: 'Dengzhou is jar-sized; the common folk are at the bottom. When millet is dear, a dou costs a gold coin; when millet is cheap, it feeds dogs and pigs. In a great harvest, they flee with their grain; in a great famine, they starve to death.'"

Zhao Yingong of course knew the reason: simply poor transportation causing circulation difficulties. In good local harvests, grain couldn't be shipped out and couldn't fetch a price; in famine years, outside grain couldn't be shipped in. He had researched this issue before coming to Dengzhou; raising it now was meant to lead into his next topic.

"Since the difficulty lies in the word 'transport,' this humble scholar is willing to assist Your Excellency in this matter." Zhao Yingong said. "I intend to establish a shipping company here."

Sun Yuanhua nodded with a smile but made no commitment. Zhao Yingong wasn't anxious—Sun Yuanhua certainly understood a shipping company's value. His noncommittal response actually indicated he was taking the matter seriously and wanted to think it over before discussing further. He therefore didn't press the topic.

The conversation turned to local agriculture. If local grain production could be improved, dependence on canal grain transfers could be greatly reduced. Sun Yuanhua was therefore quite interested in improving local agricultural production. Like Xu Guangqi, he had considerable expertise in agricultural matters. Xu Guangqi had once used "Western water methods" to develop farmland in Tianjin—"putting learning into practice"—with excellent results. Sun Yuanhua indicated he had once harbored similar thoughts.

"If Your Excellency has such intentions, why not recruit refugees and open wasteland for farming here?" Zhao Yingong probed. "I've seen much wasteland locally. Along my journey, the roads were full of starving refugees crying out for food. If Your Excellency has this intention, it would not only supply military provisions but also be a tremendous... good work." Zhao Yingong had wanted to say "merit," but remembering he was in his Catholic persona, immediately changed it to "good work."

Sun Yuanhua shook his head. "Land and people are easy to arrange—only money is the difficulty."

Taking in refugees required providing food, clothing, and shelter. Though land cost little, reclamation demanded seeds, livestock, and fertilizer. All required substantial upfront investment. Sun Yuanhua, for all his status as Dengzhou-Laizhou Governor, actually only governed Dengzhou, Laizhou, and Qingzhou prefectures plus the Shandong coast and the islands in Bohai Bay—a typically poor and barren region. His resources were limited. Even with court-allocated military pay and grain, he could only barely maintain the army and defense system. Any additional development was simply beyond his capacity.

"Furthermore, this area, being largely coastal or hilly and mountainous, has mostly saline-alkaline and barren soil that cannot be improved without great effort and energy," Sun Yuanhua said. "I am already exhausted from managing military affairs here—I have no spare capacity for this."

(End of Chapter)