Late Han Zhao Tang

Chapter 585 Zhuge Liang's Equal Transportation Method
In the first year of the reign of Emperor Shenwu, Zhang Yu ascended to the throne as the Prince of Tang. In order to limit the power of the prime minister, he specially designed an office, with the head being the Director of the Accounting Office. Because the Accounting Office had great power and the authority to audit various departments, the court officials privately referred to the Director of the Accounting Office, Yu Yi, as the "Accounting Prime Minister."

The title originated from Zhang Cang. At that time, Zhang Cang served in the Prime Minister's office as a marquis, overseeing the reporting of accounts from various prefectures and kingdoms, so people called him the "Prime Minister of Accounting." Thus, the title "Prime Minister of Accounting" was given to him, but he did not have the actual power of a prime minister.

In its early days, the Accounting Department's responsibilities were limited to auditing finances and managing state-run salt and iron monopolies, so its power was not particularly significant. However, with Zhang Yu's permission and tacit approval, the Accounting Department's jurisdiction gradually expanded in recent years, acquiring judicial power and the ability to intervene in administrative approvals, thus becoming a check on the power of the prime minister.

Yu Yi proposed the Pingzhun and Junshu laws to Zhang Yu, aiming to replenish the national treasury. However, in achieving this goal, he was inevitably seeking to expand his power.

As the head of administration, Zhong Yao was responsible for the affairs of the prefectures, counties, and the central government. However, the expansion of power sought by the Accounting Department would inevitably affect the exercise of the prime minister's power. Therefore, in order to protect his own rights, Zhong Yao naturally disliked Yu Yi's pursuit of power expansion.

Of course, maintaining the power of the prime minister was only one of the reasons why Zhong Yao opposed the price stabilization and equalization of transportation. More importantly, the price stabilization and equalization of transportation would greatly affect commercial taxes and severely dampen the vitality of the private economy.

In the Zhang Tang tax system, commercial taxes included cash tax, market rent, and vehicle and vessel tax. In order to better collect commercial taxes, the imperial court dispatched officials to directly manage the markets in major cities such as Yecheng, Nanzheng, Chenliu, Chang'an, and Taiyuan. In other markets, the prefectures and counties set up their own market supervisors to collect taxes. The commercial taxes were submitted to the prefectures and counties on their own, and then transported to the central government.

Therefore, commercial taxes, like land taxes, were not directly under the jurisdiction of the Accounting Office. However, if the Equal Transportation Law is implemented now, commercial taxes will inevitably drop significantly, which will greatly damage the interests of the prefectures and counties.

After all, with constant output, money doesn't appear out of thin air; it only transfers from one party to another. The equalization of transport simply replaced merchant trade and profited from it. A sharp decline in private commerce meant a significant reduction in commercial taxes.

Against this backdrop, it was inevitable that Zhong Yao would oppose Yu Yi's implementation of the Equalization of Transportation Law.

The differing opinions of the two ministers greatly influenced the direction of public opinion at court. Some officials criticized the Equalization of Transport Law as an evil law, claiming it monopolized all goods from various routes, plundering merchants' profits, and that if the country implemented the Equalization of Transport Law, it would be competing with the people for profit. In response, an official from the Accounting Department submitted a memorial outlining the numerous benefits of the Equalization of Transport Law in replenishing the national treasury.

However, the conflict of bureaucratic power was not important to Zhang Yu. As the founder of the empire, he was concerned with whether the policies were beneficial to the country and the people. If they were implemented, wouldn't it be ironic that the officials would enrich themselves while the people would suffer?

Looking at the memorial on the table, Zhang Yu remained silent for a long time, pondering its advantages and disadvantages.

"Wenhe, Gongze, what are your opinions?" Zhang Yu suddenly asked.

Guo Tu said, "The equal distribution system confiscates the profits of merchants and common people to enrich the national treasury. However, whether this method is feasible, I dare not presume to speak on economic matters. As the ancient saying goes, oranges grown south of the Huai River are sweet oranges, while those grown north of the Huai River are bitter oranges. The commercial law collects from merchants, and the equal distribution system confiscates their profits. The two have different intentions, and it is difficult to judge them!"

As a member of a prominent family, Guo Tu was naturally involved in commerce and trade. However, he dared not openly criticize the Equalization of Transport Law, lest it arouse Zhang Yu's suspicion. After all, he had served Zhang Yu for over ten years and had a thorough understanding of Zhang Yu's temperament.

"His Majesty!"

Jia Xu pondered for a moment and said, "I think Lord Guo's theory of oranges and trifoliate oranges is brilliant. Commercial taxes are simply collected because merchants make huge profits. However, if officials act on behalf of merchants, they may find it difficult to act like merchants. After all, being an official and being a merchant are different things, and collusion between officials and merchants is a great scourge to the people."

"In my opinion, the difference between oranges and trifoliate oranges should be asked of the farmers, and the difference between the equal transport system and commercial taxes should be asked of those who govern well."

"Who can I consult?" Zhang Yu asked in return.

Jia Xu stroked his beard and said, "Running water never stagnates, and a frequently used door hinge never rusts. If Your Majesty wishes to inquire about the advantages and disadvantages, it would be better to summon young and outstanding individuals to discuss governance."

"A promising young talent?"

Zhang Yu smiled, having already chosen a candidate, and said, "Zhuge Kongming has economic talent. He first went to Shu to present the Shu brocade official camp method. Now, let's summon Zhuge Kongming to the palace!"

As he spoke, Zhang Yu looked at Guo Tu and asked, "Is Zhuge Liang on duty today?"

“He is on duty tomorrow, so we can summon him to the palace today!” Guo Tu said.

"good!"

Since the Zhuge family formed a marriage alliance with Zhang Yang, the King of Shanggu, their status in the country has been steadily rising.

For example, Zhuge Jin was originally a surrendered official, but because he was appreciated by Zhang Yu and his younger brother Zhuge Liang was Zhang Yang's son-in-law, Zhuge Jin was appointed as the governor of Jibei Commandery. Or perhaps Zhuge Liang entered officialdom last year and was directly recruited as a vice minister. Under Zhang Yu's arrangement, he accompanied the strategist to Bashu in the south.

Zhuge Liang's outstanding performance during his southern campaign impressed Yu Yi, who wanted to recruit him into the Ministry of Revenue. However, the Ministry of Personnel was unwilling to let him go, so Zhuge Liang ultimately remained in the Ministry of Personnel, where he was responsible for financial matters related to the Ministry of Revenue.

Not long after, urged repeatedly by his attendants, Zhuge Liang hurriedly entered the palace to meet Zhang Yu.

"Your subject, Zhuge Liang, Vice Minister of the Ministry of Revenue, pays his respects to Your Majesty!"

Zhuge Liang straightened his clothes and bowed respectfully.

"No gifts, please give me a seat!"

Zhang Yu gestured for Zhuge Liang to sit down and said, "Kongming, do you know why I summoned you to offer your advice?" Zhuge Liang sat up straight and said, "You are in charge of the land and taxes of the prefectures and counties. Recently, there have been many disputes in the court over the Equalization of Transportation Law. Therefore, Your Majesty's summons of me to the palace must be for the sake of the Equalization of Transportation Law!"

"Ha ha!"

"Kongming's wise plans have won the hearts of the people, and I am truly worried about the Equalization of Transport Law!"

Zhang Yu chuckled a few times and asked, "You claim to have the talent of Guan Zhong, but I wonder what your opinion is on this?"

Zhuge Liang said, "Your Majesty, I believe the Equalization of Transport Law is feasible, but it is not!"

"how you said that?"

“Merchants travel north and south, all to buy low and sell high, profiting from the price difference. So it is feasible for the state to take away the profits of merchants.” Zhuge Liang said, “However, the ability of merchants lies in adapting to changing circumstances, while the duties of the government are limited and constrained. Moreover, since they are profiting for the state, corruption will inevitably arise. Therefore, we cannot take away the ability of merchants.”

"You can take away the merchants' profits, but you cannot take away their skills!"

Although Zhuge Liang's words were full of profound meaning, Zhang Yu understood them perfectly: the government was stagnant and bureaucratic. Merchants, on the other hand, were driven by profit, and their methods were naturally flexible and adaptable. Therefore, ideally, government intervention in the market should not stifle the vitality of commerce and trade!
"Kongming, please explain your strategy in detail!"

Zhuge Liang cupped his hands and said, "The Equalization of Transport is feasible, but we cannot follow the practice of Emperor Wu by setting up merchant officials within the prefectures, such as setting up a jujube official in Hedong Prefecture and an orange official in Ba Prefecture. Instead, we should change the old policy and set up transport officials across prefectures and counties to observe the fluctuations in prices in the prefectures and counties, and follow the policy of moving goods from expensive to cheap and using nearby goods instead of distant ones, so as to collect and transport goods in a unified manner!"

“In the past, all taxes levied by prefectures and counties had to be sent to the capital. Now, if the grain yield in Wei County is high, grain can be diverted to Wei County to provide relief, and the profits obtained from this will belong to the state. Collecting taxes is the responsibility of the prefectures and counties, transporting them is the responsibility of the Grand Canal, and selling them is the business of the merchants. By doing this, the prefectures and counties will receive more money and grain, while merchants will not be able to manipulate prices, and the people will not suffer from exploitation!”

"Kongming's plan is quite good, but if the right person carries it out, it will bring great benefits; if the wrong person carries it out, it will bring great harm," Zhang Yu commented.

While Zhuge Liang's and Sang Hongyang's methods of equalizing transportation appear similar—both involving buying low and selling high—their internal implementation details and overall framework differ. During the reign of Emperor Wu of Han, in order to replenish the national treasury for the northern expedition against the Xiongnu, officials in various prefectures and kingdoms, driven by short-term exorbitant profits, frequently engaged in forced buying and selling.

However, Zhuge Liang considered the prices of people's livelihoods from the perspective of the overall market system. Grain prices in Jizhou and Weijun were high, while grain prices in Youzhou and Yuyang were low. Therefore, he could have the Yuyang government purchase grain and transport it to Weijun, where merchants would buy the grain and sell it to the people.

The profits were distributed among the higher authorities, with Yuyang Commandery receiving 50%, the canal transport receiving 25%, and the remaining 25% going to Wei Commandery. Meanwhile, merchants from Wei Commandery used these channels to distribute low-priced rice to the markets, thus stabilizing grain prices in Wei Commandery.

The central government plays a more inter-state role in allocating supplies. As for minor price fluctuations, the government will not intervene extensively but will allow local merchants to trade independently.

Therefore, according to Zhuge Liang's plan, the imperial court needed to establish dispatching commissioners above the prefectures and counties to monitor regional production and price fluctuations in order to achieve the above objectives.

Zhuge Liang said, "Your Majesty's comments are accurate. A government can prosper or perish because of its people. The Equalization of Transport Law mentioned by the Minister of Finance can prevent merchants from using it, but it is based on the consideration of people's livelihood. However, it can be implemented and prevent powerful families from manipulating prices."

Zhang Yu smiled and said, "Should this law be implemented by the Accounting Department, or should it be managed by the Ministry of Personnel and the Ministry of Finance?"

"Your Majesty, the grain transport in Hebei is managed by the various prefectures themselves. However, in my opinion, it is appropriate for the capital region to coordinate the grain transport commissioner, who will be responsible for the supply of taxes in Hebei and ensure the self-sufficiency of military supplies. Therefore, it would be better to let the grain transport commissioner concurrently serve as the transporter."

Zhuge Liang said, “Your Majesty has established a Grand Canal Transport Commissioner in Hebei, another Grand Canal Transport Commissioner in Henan, and a Land Transport Commissioner in Guanzhong. These three commissioners are directly under the jurisdiction of the capital. If Guanzhong suffers a famine, the Grand Canal Transport Commissioners can be ordered to urgently dispatch grain and fodder to stabilize grain prices. The Grand Canal transport involves many matters, and the three commissioners can even be put in charge of the allocation of salt, iron, and silk.”

"According to what Kongming said, does he intend to put the Accounting Office in charge of the grain transport and transshipment, while the prefectures and counties collect the grain and goods, so that the Grain Transport Commissioner can allocate them for profit?" Zhang Yu asked.

"Your Majesty is wise!" Zhuge Liang said.

Zhang Yu frowned and remained silent for a long time. Now he had to admit that Zhuge Liang's proposed Equal Transport Method was comprehensive and took into account many benefits.

If the Accounting Department wanted to expand its tax revenue sources and its own power, the administration would be unwilling to relinquish commercial taxes and local administrative interests. However, under the system designed by Zhuge Liang, the Accounting Department was responsible for the two duties of canal transport and transshipment, allowing local prefectures and counties to reap the benefits effortlessly. Furthermore, the administrative power that the administration valued was not encroached upon by the Accounting Department; instead, a mutually beneficial cooperative relationship was established.

Furthermore, local merchants purchased goods from the accounting bureau, saving the bureau the cost of selling directly to the people and protecting the interests of private merchants.

In a series of macro-level designs, the biggest losers are the large merchants, who cannot control prices or make huge profits from the price difference of goods.

"This plan should be discussed with the two prime ministers!"

Zhuge Liang's outstanding top-level design ability satisfied Zhang Yu, who said, "If this strategy is feasible, you will be appointed as the Hebei Grand Canal Transport Commissioner."

"Thank you, Your Majesty!"

(End of this chapter)