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is so vital a feature of the government of China, that a short notice of the public examinations whereby the ranks are recruited may not be out of place. As a general rule students preparing for the public examination read with private tutors. There are neither high schools nor universities where a regular training can be got. In most of the provincial capitals, and at some other places, there are indeed institutions termed colleges, supported to a small extent from public funds, where advanced students can prosecute their studies, and where both students and tutors receive a small stipend, but they hardly count as factors in the national education. The work is done by private tutors who, on the other hand, are plentiful and cheap. After a series of preliminary trials the student obtains his first qualification by examination held before the literary chancellor in the prefecture to which he belongs. This is termed the Siutsai, or licentiate's degree, and in itself confers no claim to office, but is merely a qualification to enter for the higher examinations. The number of licentiate degrees to be given is, however, strictly limited; those who have failed to get in are set back to try again, which they may do as often as they please. There is no limit of age. Those selected next proceed to the great examination held at the capital of each province, once in three years, before examiners sent from Peking for the purpose. Here again the number who pass are strictly limited. Out of 10,000 or 12,000 competitors only some 300 or 350 can obtain degrees. The others, as before, must go back and try again. This degree, termed Chu jen, or provincial graduate, is the first substantial reward of the student's ambition, and of itself, without more, qualifies for the public service, though it does not immediately nor necessarily lead to active employment. The third and final examination takes place at Peking, and is open to provincial graduates from all parts of the empire. About 6000 competitors enter for this final test, which is held triennially, of whom 325 to 350 succeed in obtaining the degree of Tsin shih, or metropolitan graduate. These are the finally selected men who in due course become the officials and administrators of the empire. Several other doors are, however, open by which admission to the ranks of bureaucracy can be obtained. In the first place, to encourage scholars to persevere, a certain number of those who fail to reach the chu jen, or second degree, are allowed, as a reward of repeated efforts, to get into a special class from which selection for office may be made. Further, the Government reserves to itself the right to nominate the sons and grandsons of distinguished deceased public servants without examination. And, lastly, by a system of "recommendation," young men from the institution termed the Imperial Academy, or from the Manchu schools, or men who have served as clerks in the boards, may be put on the roster for substantive appointment. But over and above the foregoing, which are all deemed fair and legitimate methods of entering the public service, the necessities of the Chinese Government have from time to time compelled it to throw open a still wider door, namely, admission by purchase. During the Taiping rebellion, when the Government was at its wits' end for money, formal sanction was given to what had previously been only intermittently resorted to, and since then immense sums of money have been received by the sale of patents of rank, either to secure admission to office, or more rapid promotion of those already employed. As a result of this policy, the country has been saddled with thousands of titular officials far in excess of the number of appointments to be given away. The more deserving men are thus kept waiting for years, while inferior and less capable officials are pushed ahead, because they have money wherewith to bribe their way. The evils of the purchase system are recognized, and efforts from time to time are

The evil,

made to check it, but with indifferent success. however, is not altogether unmixed, as it has admitted into the service a number of men who are free from that bigoted adherence to Confucian doctrine which characterizes the literary classes, and more in touch with modern progress. All candidates who thus succeed, whether by examination, recommendation, or purchase, in entering the official ranks are then eligible for active employment, but as the number of candidates is far in excess of the number of appointments a period of weary waiting ensues. A few of the best scholars get admitted at once into the Hanlin college, or into one or other of the boards at Peking. The rest are drafted off in batches to the various provinces to await their turn for appointment as vacancies occur. During this period of waiting they are termed "expectants," and draw no regular pay. Occasional service, however, falls in their way, as when they are commissioned for special duty in outlying districts, which they perform as Wei yuens, or deputies of the regular officials. The period of expectancy may be abridged by recommendation or purchase, and it is generally supposed that this last lever must invariably be resorted to to secure any lucrative local appointment. A poor but promising official is often, it is said, financed by a syndicate of relations and friends, who look to recoup themselves out of the illegal, but customary perquisites which attach to the post. The appointments to the junior provincial posts are usually left to the provincial Government, but the central Government can always interfere directly. Appointments to the lucrative posts of customs taotai at the treaty ports are usually made direct from Peking, and the officer selected is not necessarily nor usually from the provincial staff. It would perhaps be safe to say that this appointment is always the result of a pecuniary arrangement of greater or less magnitude.

cipal religions of China are Confucianism, Buddhism, and Taoism. Religion.-As stated in the ninth edition (v. 671), the three prinTo these should be added ancestor - worship, which is practised universally by all classes, and which as a guiding principle of life has a more potent influence over the Chinaman than any other doctrine.

It may be regarded as a branch of Confucianism.

It did not, indeed, originate with that philosopher, having been practised long before he flourished, but the duty was strongly inculcated by him. He enjoined also the due observance of the ritual prescribed by the state for the worship of all recognized deities, including the worship of heaven and earth by the Emperor, and the worship by state officials of local divinities and deceased worthies who may from time to time have been canonized by imperial decree. Confucianism has no priesthood. The acts of worship are performed by the Emperor in person, by the officials, and by the head of every household, each acting within his own prescribed sphere. But Confucianism has always been a tolerant and non-aggressive religion. While enjoining the performance of ancestor-worship, and the observance of the prescribed formalities to recognized deities, it does not at all object to devotion being paid to other possible divinities, so long as the followers do not profess corrupt and heterodox doctrine. The line of division between what is orthodox and heterodox is more political than religious. Any cult which preaches a doctrine subversive of the fundamental and sacred principles of the constitution is heterodox and unlawful, and its practice renders the followers liable to not recognized by the state is harmless, so long as it does not lead severe penalties as savouring of rebellion. But mere belief in gods to action likely to be subversive of the existing order of things. Thus a Confucianist may at the same time be a Buddhist or a Taoist, or he may be all three. The three religions are not mututo give any statistics of the respective numbers of each. The ally exclusive, but run into one another, and hence it is impossible Christian religion was long deemed heterodox, but since the conclusion of the treaties it has officially been proclaimed to be per

missible.

A Confucianist might now, from the Chinese point of view, be also a Christian, and probably many would become so if the Christian religion would accept them on these terms. One of the powerful congregations of the Roman Catholic Church was in the last century prepared to do so, at least it was prepared to allow converts to continue ancestor-worship. The proposal was overhave been by this time as many nominal Christians in China as ruled by the Pope, but had it been permitted there would possibly. there are professors of Buddhism, which was itself a foreign religion.

The state of religion in China may thus be summed up :-Con- | in most provincial capitals institutions termed colleges, where fucianism in the wider meaning, as including ancestor-worship, is accepted universally. Ancestor-worship is practised by practically all classes. Confucianism, in the narrow sense of the worship of Confucius, is compulsory on all officials, and is voluntarily practised by all scholars and aspirants to literary honours. Buddhism is more or less practised, so far as occasional visits to the temples and to sacred shrines are concerned, by about half the population. Taoism is practised to a considerably smaller extent. The services of the priests of one or other sect aro generally invoked for funeral ceremonies. The priests of both these sects live solely in temples and monasteries, and do not enter private houses except when invited, in which case their services are paid for. Neither class attempts to exercise any influence over the people, and both are held in low esteem. Mahommedanism in a modified form is professed by some thirty or forty millions scattered over the north and west of China. They usually perform ancestorworship as well, and if officials, they take part in the Confucian ceremonies.

Christian missions, both Roman Catholic and Protestant, are now established in every province in China. Freedom to embrace the Christian faith is guaranteed by the Chinese Government, and as a rule the missionaries have free scope in teaching and preaching, though local disturbances are not infrequent. The number of Catholic converts is about one million, and that of all Protestant sects is reported to be slightly over 100,000.

An imperial decree which was made public in 1897, conferring a sort of official status on the hierarchy of the Roman Catholic Church in China, deserves a short notice. Since the conclusion of the treaties in 1860, permitting the practice and teaching of the Christian religion, the missionary question has been one of the most important which the Chinese Government has had to deal with. Though the average Chinaman is naturally tolerant and indeed indifferent in matters of religion, the preaching of Christianity has in many parts aroused fierce opposition, leading to attacks on mission stations with loss of life and property. These attacks have in turn given rise to serious diplomatic controversy, and questions connected with missions have formed no inconsiderable part of the work thrown upon the foreign legations in Peking. In general, a missionary is under the protection of his own Government, no matter what his creed may be; but France has from the first constituted herself the protector of Roman Catholic missions, irrespective of the nationality of the priest concerned, and she has thereby been able to bring pressure to bear on the Chinese Government out of all proportion to her commercial interests. An effort was made by the Chinese in 1886 to get rid of French domination by inducing the Pope to send a special legate to Peking as controller of Roman Catholic missions. The Vatican was disposed to consent; but the French Government made such strenuous opposition, threatening to withdraw the concordat in France, that the papal authorities were obliged to decline. France was unwilling to forgo the political influence which the position of protector of one or two thousand priests and about a million of converts gave her, and she has used that influence to obtain redress of grievances and to improve the position of the Roman Catholic missionaries. In 1896 formal permission was given for the missions to acquire and hold real estate in any part of China; but a still more important privilege is the one we have mentioned, namely, the giving a recognized official status to the several grades of the priesthood, and so placing them on terms of equality with the local officials. Bishops are to rank with governors of a province, pro-vicars with judges, taotais, and so on. International matters are to be discussed and settled locally, and in grave cases appeal is to be made to the minister of the nation specially entrusted by the Pope with the protection of Roman Catholic missions." This last

has been own nationals are concerned. It is apprehended that the privilege, while enhancing the status of the priests, will tend to widen the breach already existing between converts and their fellow-countrymen. The interference of priests in matters of litigation where one of their converts is concerned has often been made matter of complaint, and the fact that they are in effect authorized to interfere is not likely to diminish the friction.

repudiated by the British Government as far as Claph

The

Instruction.-Very little was done by the Chinese Government during the period 1875-1900 for the better education of the people. Elementary education is still left to take care of itself." most noteworthy fact to be noticed is the great number of mission schools that are now maintained in various parts of the Empire. Though insignificant as compared with the vast population, these schools are doing valuable service in imparting a knowledge of English to a small proportion of the youth, who in turn, not infrequently, become instructors to a wider class. But among the great mass of the people the densest ignorance prevails, even as regards their own language and history, and much more as to any knowledge of other countries. In respect of advanced education the Chinese Government has done a little better. There are

tutors or professors are maintained at the public expense, and where a limited number of students are admitted. There are also in every district two or three paid officials who are termed directors of studies. Their function, however, is not to teach, but to examine, and they act as registrars of the students entering for the public examinations. The object aimed at is not the general education of the people, but to aid poor and deserving students to pass the examinations, and so enter the public service. The idea of educating the people so as to make them more capable citizens is nowhere to be found, and apparently has never been conceived as one of the duties of Government. At Peking, a college, termed the Tung Wen Kwan, was instituted about 1870. and is still maintained with a staff of foreign professors and teachers. It is mainly a school of languages to enable young Chinese to qualify as interpreters in English, French, etc. Similar schools have been established at Canton, Foochow, and one or two other places, with but indifferent results, and as a factor in the education of the nation they can hardly be said to count. A more promising plan was conceived in 1880, or thereabouts, by the then governor-general of Nanking, who sent a batch of thirty or forty young students to America to receive a regular training, on the understanding that on their return they would receive official appointments. The promise was not kept, however. A report went about that these students were becoming too Americanized. They were hastily recalled, and when they returned they were left in obscurity. Native Press. In connexion with the subject of education we may notice the growth of a native press, which promises to have an important influence on the development of the nation. The Peking Gazette, which is sometimes called the oldest paper in the world, is not a newspaper at all in the ordinary sense, but merely a court gazette for publishing imperial decrees and such public documents as the Government may wish to give out. It never contains original articles nor any discussion of public affairs. The first genuine native newspaper was published at Shanghai about 1870. It was termed the Shen Pao, or Shanghai News, and was issued under foreign auspices, the first editor being an Englishman. It was some years before it made much headway, but success came, and it was followed by various imitators, some published at Shanghai, some at other treaty ports, and at Hongkong. In 1895 there were eleven native newspapers in circulation, and since then the number has largely increased. There are now some thirty-five in circulation, almost all dailies, of which half are issued from Shanghai. Besides the dailies there are at least as many magazines or other periodicals, most of which are issued from the various mission presses, and several of which are exceedingly well written. The effect of this mass of literature on the public mind of China cannot but be of first-rate importance. It must tend, more than anything else, to dispel the darkness and to promote ideas of reform and progress. The attitude of the central Government towards the native press is somewhat undefined. There are no press laws, but as every official is a law unto himself in these matters, there is nothing to prevent him from summarily suppressing an obnoxious newspaper and putting the editor in prison. The Emperor, among other reform edicts which preceded and provoked the coup d'état of 1898, declared that newspapers were a boon to the public, and appointed one of them a Government organ. The Empress-dowager revoked this decree after the deposition of the Emperor, and declared that the public discussion of affairs of state in the newspapers was an impertinence, and ought to be suppressed. The existence of the press, however, is tolerated, and by some officials at least would seem to be encouraged. In any case no interference could be offered to those native papers which are published by foreigners, inasmuch as the latter are, by the extra-territorial clauses of the treaty, exempted from Chinese jurisdiction. The regulation of the press is one of those problems which the Chinese Government has yet to solve.

Social Condition.-The social condition of the people relative to European standards must be put as very low. Agriculture is the one great industry. Four-fifths of the population may be put down as peasant cultivators of the soil. Of these fully one-half are small peasant proprietors owning the land they till, subject to the payment of the state taxes. Nearly all the other half hold land on lease, paying rent; and only a comparatively small proportion are agricultural labourers. But whether as proprietors or farmers the holdings are always very small-so small that the condition of the holders is hardly above that.of ordinary field labourers. The minute subdivision of the holdings is due to two causes-firstly, over-population; and, secondly, the land laws. As to the latter, the invariable rule of succession is equal division among all male children. Not only is there no primogeniture, but a parent cannot, even if he wished to do so, leave all his land to one son. There must be substantially an equal division, the will of the father notwithstanding. As early marriages and large families are the rule, this process of continual division and subdivision has brought things down to the irreducible minimum in many places. In the Journal of the China Branch of the Royal Asiatic Society for

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some portion of the domain being put in mortmain for this purpose. When scattered, the collateral branches of such a family contrive to keep in touch, the common bond being the ancestral hall and the right to join in the family ancestor - worship. Numerous instances can be found where families no better off than the commonalty can trace their descent back through twenty generations.

Finance. In fiscal matters, as for many other purposes, the Chinese empire is an agglomeration of a number of quasi-independent units. Each province has a complete administrative staff, collects its own revenue, pays its own civil service, pays its own militia and naval forces, and out of the surplus contributes towards the expenses of the imperial Government a sum which

1888 a series of short papers, was printed, contributed by missionaries and others living in the interior of the country, describing the social condition of the peasantry. From these it appears that the irreducible minimum is, in the more fertile parts, as low as a sixth of an acre per head. In other words, a family of six persons can make a living out of a farm of one acre. This would make a possible population of 3840 to the square mile. As a matter of fact, the subdivision has in numberless cases been carried even below that limit. Small patches of one-tenth, or even onetwentieth, are to be found as the estate of an individual landowner, and the vast majority of holdings run between one and three acres. With three acres a family is deemed very comfortable, and the possession of ten acres or more means luxury. Three acres is about the largest quantity which one family can manage without employ-varies with the imperiousness of the needs of the latter and with ing hired labour. In the northern provinces, where wheat, maize, &c., which do not require irrigation, are grown, five acres can be worked by one household. If the family possesses more land than that the balance is almost invariably let, and always in similar small holdings. Nowhere is the system of farming by capitalists with hired labour to be found. The following is an instance given by one of the writers in the above-named journal, and may be taken as typical of the bulk of the rural population :—

Pong Hia lives in a village of 300 persons, in which about 30 are landowners. Pong Hia owns more than any other man in his class, having 2 acres (12 mow). His family consists of 10 persons. He is 46 years old, his wife is 41, his son is 22, his son's wife is 22, his four daughters are from 10 to 17, and his two grandchildren are 3 and 8 years old. He and his son till the land, hiring help in harvest-time. The womenfolk weave and

make clothing for the family, rear pigs and fowls, and do all the housework. The house in which these ten persons live is worth £12, including the site; the furniture is worth £4 : 10s., the clothing worth about £4. The family lives comfortably upon the produce of the land, and is reckoned affluent."

To this it may be added that land such as the foregoing will yield two, or sometimes three, crops in the year. The spring crop is wheat, sown in November and reaped in April; the summer or principal crop is rice, planted in May and reaped in August or September; and an autumn crop of cabbages, beans, or other green stuff can usually be got in, sometimes overlapping with the wheat. In the southern provinces two rice crops can be got in succession during the summer, besides the winter crop.

It will be gathered from the foregoing that there is no class of wealthy territorial magnates, corresponding to the aristocracy of this and other European countries. The only class which at all resembles them is the class of retired officials. As the bureaucracy monopolize all the power in the country, they generally contrive to monopolize a good deal of the wealth. This is not infrequently invested in land, and consequently there are to be found in most provinces several such families with a country seat and the usual insignia of local rank and influence. On the decease of the heads or founders such families would, in the natural course of things, be broken up and the land divided, but it is considered more dignified for the sons to refrain from dividing, and to live together, sharing the rents and profits in common. This is sometimes continued for several generations, until the country seat becomes an agglomeration of households and the family a sort of clan. A family of this kind, with literary traditions, and with the means to educate the young men, is constantly sending its scions into the public service, who in turn bring their earnings to swell the common funds, while the rank and dignity which they may earn add to the importance The members of this class and standing of the group as a whole. are usually termed the literati, or gentry. Though the constitution does not recognize them as having any share in the local government, yet they can exercise an enormous influence in public affairs. The peasantry who farm their lands are, of course, under their control. The official rank which most of the members have acquired by promotion or purchase enables them to resist, and perhaps browbeat, the local officials, while they further terrorize the latter by threatening to denounce them to the Emperor, which they can often manage to do through some one or other of their many relations or marriage connexions who may happen to have the ear of the court. Being usually intensely bigoted and conservative, they present a serious barrier to progress, especially if there is a foreign element in it, such as the introduction of railways, or making of roads, or renting of inland residences by foreign merchants or missionaries. Not infrequently have projects for the improvement of trade, assented to by the local officials, been blocked by the opposition of the gentry, the former not daring to incur their resentment. But such families, unless their wealth is kept up by continual accessions, tend, in course of time, to decline through the levelling operation of the law of succession. As the numbers among whom the wealth must be shared increase rapidly with every generation, a point is soon reached when the individuals of the family are no better off than the peasantry who till their land, and then a break-up is inevitable. If possible, however, the eldest branch preserves the family records and the ancestral hall,

its own comparative wealth or poverty. The imperial Government does not collect directly any part of the revenues, unless we except the imperial maritime customs, though these, too, pass through the books of the provincial authorities. We may also except a few of the old native customs stations which are deemed perquisites of the imperial court, as, for instance, the native custom-house at Canton, Hwei Kwan on the Grand Canal, and various stations in the neighbourhood of Peking. The superintendent of these stations is a nominee of the court, always a Manchu, who makes his returns direct to the throne and not to the governors. But otherwise the court and the central Government in Peking are dependent upon the sums they can levy on the provinces. It has hitherto been extremely difficult to obtain anything like trustworthy figures for the whole revenue of China, for the reason that no statistics are published by the central Government at Peking. The only available data are, first, the returns published by the imperial Maritime Customs for the duties levied on foreign trade; and, secondly, the memorials sent to Peking by the provincial authorities on revenue matters, certain of which are published from time to time in the Peking Gazette. These are usually fragmentary, being merely reports which the governor has himself received from his subordinates, detailing, as the case may be, the yield of the land tax or the likin for his particular district, with a dissertation on the causes which have made it more or less than for the previous period. Or the return may be one detailing the expenditure of such and such a department, or reporting the transmission of a sum in reply to a requisition of the Board of Revenue, with a statement of the source from which it has been met. It is only by collating these returns over a long period that anything like a complete statement can be made up. And even then it is quite certain that these returns do not represent anything like the total of taxation paid by the people, but, as far as they go, they may be taken to represent the volume of taxation on which the Peking Government can draw

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Oriental countries, the land has from time immemorial been the
Sources of Revenue.-1. Land Tax.-In China, as in most
In the early years of the present
mainstay of the revenue.
dynasty there was levied along with the land tax a poll tax on all
adult males, but in 1712 the two were amalgamated, and the whole
burden was thrown upon land, families not possessing land being
thereafter exempted from taxation. At the same time it was
decreed that the amount of the land tax as then fixed should be

permanent and settled for all time coming. As a matter of fact
it would appear from the records that this promise has been kept
as far as the central Government has been concerned. In all its
many financial difficulties it does not seem ever to have tried to
increase the revenue by raising the land tax. The amount of tax
leviable on each plot is entered on the title deed, and, once
entered, it cannot be changed. The tax on almost all lands is
thus stated to be so much in silver and so much in rice, wheat, or
whatever the principal crop may be. Except in two provinces,
however, the grain tax is now commuted and paid in silver. The
exceptions are the provinces of Kiangsu and Chekiang, which still

1 Throughout this article the tael spoken of is the Haikwan tael, the present value of which is about 3s. It fluctuates with the value of silver.

send forward their taxes in grain. This is despatched in bulk through a department of the Government to Peking, where it is distributed as rations among the Manchu soldiery and retainers in and about the capital. The value of the grain forwarded (generally called tribute rice) is estimated to amount to taels 6,500,000. The total collection in silver, as reported by the responsible officials, amounts in round numbers to taels 25,000,000. The total yield of the land tax, therefore, is taels 31,500,000, or say £4,725,000. It will readily be granted that for such a large country as China this is a very insignificant one. In India the land tax yields £17,000,000, and China has undoubtedly a larger cultivated area, a larger population, and soil that is on the whole more fertile ; but it is certain that this sum by no means represents the amounts actually paid by the cultivators. It is the sum which the various magistrates and collectors have to account for and remit in hard cash. But as nothing is allowed them for the costs of collection, they add on a percentage beforehand to cover the cost. This they usually do by declaring the taxes leviable not in silver, but in copper "cash," which indeed is the only currency that circulates in country places, and by fixing the rate of exchange to suit themselves. Thus while the market rate is, say, 1500 cash to the tael, they declare by general proclamation that for tax-paying purposes cash will be received at the rate of 3500 or 4000 to the tael. Thus while the nominal land tax in silver remains the same it is in effect doubled or trebled, and, what is worse, no return is made or account required of the extra sums thus levied. Each magistrate or collector is in effect a farmer. The sum standing opposite the name of his district is the sum which he is bound to return under penalty of dismissal, but all sums which he can scrape together over and above are the perquisites of office less his necessary expenses. Custom, no doubt, sets bounds to his rapacity. If he went too far he would provoke a riot; but one may safely say there never is any reduction, what change can be effected being in the upward direction. What the actual sums may be which are thus levied and not accounted for it is impossible to tell, but a rough idea may be gathered from a calculation of the probable area under cultivation and the average actual payment. The area of the eighteen provinces constituting China proper is roughly 1,300,000 square miles, and assuming that one-fourth of this is under cultivation, we should have a taxable area of over 300,000 square miles, say 190,000,000 acres, which is probably under the mark. According to the best information obtainable a moderate estimate of the sums actually paid by the cultivators would give two shillings per acre, This for the eighteen provinces should give £19,000,000 as being actually levied, or more than four times what is returned.

2. The Salt Duty.-The trade in salt is a Government monopoly. Only licensed merchants are allowed to deal in it, and the import of foreign salt is forbidden by the treaties. For the purpose of salt administration China is divided into seven or eight main circuits, each of which has its own sources of production. Each circuit has carefully-defined boundaries, and salt produced in one circuit is not allowed to be consigned into or sold in another. There are great differences in price between the several circuits, but the consumer is not allowed to buy in the cheapest market. He can only buy from the licensed merchants in his own circuit, who in turn are debarred from procuring supplies except at the depot to which they belong. Conveyance from one circuit to another is deemed smuggling, and subjects the article to confiscation.

Duty is levied under two heads, the first being a duty proper payable on the issue of salt from the depot, and the second being likin levied on transit or at the place of destination. The two together amount on an average to about taels 1.50 per picul of 133 b or 3s. 9d. per cwt. The total collection returned by the various salt collectorates amounts to taels 13,500,000 (£2,025,000) per annum. The total consumption of salt for all China is estimated at 25 million piculs, or nearly 1 million tons, which is at the rate of 9 lb per annum per head of the population. If the above amount of taels 1.50 were uniformly levied and returned, the revenue ought to be 37 million taels instead of 133.

3. Likin on General Merchandise.-By the term likin is meant a tax on inland trade levied while in transit from one district to another. It was originally a war tax imposed as a temporary measure to meet the military expenditure required by the Taiping and Mahommedan rebellions of 1850-70; but the Government has never been able to dispense with it since, and it is now one of the permanent sources of income. In the present disorganized condition of China it would perhaps be difficult to impose any other form of taxation which would yield a like return, but at the same time it is in form as objectionable as a tax can be, and is equally obnoxious to the native as to the foreign merchant. Tolls or barriers are erected at frequent intervals along all the principal routes of trade, whether by land or water, and a small levy is made at each on every conceivable article of commerce. The individual levy is small, but over a long transit it may amount to 15 or 20 per cent. The objectionable feature is the frequent stoppages with overhauling of cargo and consequent delays. By

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treaty foreign goods may commute all transit dues for a single payment of one-half the import tariff duty, but this stipulation is but indifferently observed, giving rise to frequent complaints on the part of foreign merchants. The difficulty in securing due observance of this treaty right lies in the fact that the likin revenue is claimed by the provincial authorities, and the transit dues when commuted belong to the central Government, so that the former are interested in opposing the commutation by every means in their power. As a further means of neutralizing the commutation they have devised a new form of impost, viz., a terminal tax which is levied on the goods after the termination of the transit. The amount and frequency of likin taxation are fixed by provincial legislation-that is, by a proclamation of the governor. The levy is authorized in general terms by an imperial decree, but all details are left to the local authorities, who in this, as in all other matters, have a general legislative power. The yield of this tax is estimated at present at taels 13,000,000 (£1,950,000), a sum which probably represents one-third of what is actually paid by the merchants, the balance being costs of collection.

4. The Imperial Maritime Customs.-The Maritime Customs is the one department of finance in China which is managed with probity and honesty, and this it owes to the fact that it is worked under foreign control. It collects all the duties leviable under the treaties on the foreign trade of China, and also all duties on the coasting trade so far as carried on by vessels of foreign build, whether Chinese or foreign-owned. It does not control the trade in native craft, the so-called junk trade, the duties on which are still levied by the native custom-house officials. By arrangement between the British and Chinese Governments, the foreign customs levy at the port of entry a likin on Indian opium of 80 taels per chest, in addition to the tariff duty of 30 taels. This levy frees the opium from any further duty on transit into the interior. The revenue of the Maritime Customs has risen from taels 11,000,000 in 1873, to taels 22,500,000 in 1898. In sterling figures, however, it would seem to have fallen, owing to the fall in the gold price of silver. The revenue of 1873, converted into gold at the exchange of the day, was about £3,666,000, whereas that of 1898 would only give £3,375,000. From the point of view of the Chinese Government, which values everything in silver, the revenue has satisfactorily increased.

5. Native Customs.-The administration of the Native Customs continues to be similar to what prevailed in the Maritime Customs before the introduction of foreign supervision. Each collector is constituted a farmer, bound to account for a fixed minimum sum, but practically at liberty to retain all he may collect over and above. If he returns more he may claim certain honorary rewards as for extra diligence, but he generally manages to make out his accounts so as to show a small surplus, and no more. Only imperfect and fragmentary returns of the native collectorates have been published, but the total revenue accruing to the Chinese Government from this source does not appear much to exceed two million taels (£300,000). It is believed that if this department were included in the purview of the foreign staff of the Maritime Customs the sum might easily be trebled.

6. Duty on Native Opium.-The growth and manufacture of opium was up till recent years forbidden by the laws of China. It was, however, openly connived at by the officials in several provinces, especially in the south-west, where indeed it seems to have been cultivated from time immemorial, and its taxation formed a main source of their income. The restrictions are now withdrawn, and the central Government have been endeavouring to appropriate the taxation to their own uses. The collection remains in the hands of the provincial officials, but they are required to render a separate account of duty and likin collected on the drug, and to hold the sum at the disposal of the Board of Revenue. Opium is pre-eminently a fit article of taxation, and if the levy were faithfully carried out at a rate corresponding, ad valorem, to that which is levied on Indian opium, it would give a revenue sufficient to enable the Government to remit the whole likin taxation on internal trade. The annual import into China of Indian opium amounts to about 50,000 chests, on which the Chinese Government receives from duty and likin combined about 5 million taels (£825,000). The total amount of native-grown opium is estimated at about 400,000 chests (53,000,000 Ib), and if this were taxed at taels 60 per chest, which in proportion to its price is a similar rate to what is levied on Indian opium, it should give a revenue of 24 million taels. Compared with this the sums actually levied, or at least returned by the local officials as levied, are insignificant. The returns so far as published give a total levy for all the eighteen provinces of only taels 2,200,000 (£330,000).

7. Miscellaneous.-Besides the foregoing, which are the main and regular sources of income, the provincial officials levy sums which must in the aggregate amount to a very large figure, but which hardly find a place in the returns. The principal are land transfer fees, pawnbrokers' and other licenses, duties on reed flats, commutation of corvée and personal services, &c. S. III.

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land transfers is 3 per cent., and it could be shown, from a calculation based on the extent and value of the arable land and the probable number of sales, that this item alone ought to yield an annual return of between one and two millions sterling. Practically the whole of this is absorbed in office expenses. Under this heading should also be included certain items which, though not deemed part of the regular revenue, have been so often resorted to that they cannot be left out of account. These are the sums derived from sale of office or of brevet rank, and the subscriptions and benevolences which under one plea or another the Government succeeds in levying from the wealthy. Raising money by sale of title or official rank has long been and still is a favourable device for special emergencies, such as the great famine in Shansi, the inundation of the Yellow river, and so forth, the sale being stopped when the emergency has passed. But excluding these, the Government is always ready to receive subscriptions, rewarding the donor with a grant of official rank entitling him to wear the appropriate "button." The right is much sought after, and indeed there are very few Chinamen of any standing that are not thus decorated, for not only does the button confer social standing, but it gives the wearer certain very substantial advantages in case he should come into contact with the law courts. The minimum price for the lowest grade is taels 120 (£18), and more of course for higher grades. The proceeds of these sales go directly to the Peking Government, and do not as a rule figure in the provincial returns. The total of the miscellaneous items accruing for the benefit of the Government is estimated at taels 5,500,000.

Expenditure. In regard to expenditure, a distinction has to be drawn between that portion of the revenue which is controlled by the central Government, and that controlled by the several provincial authorities. In theory, no doubt, the imperial Government is supreme, and can spend the revenue of the nation in any way it chooses, but in practice it is not so. As the provinces collect the revenue, and as the authorities there are held responsible for the peace, order, and good government of their respective territories, it follows that the necessary expenses of the provinces form a sort of first charge on the revenue. If the Peking Government asks for more than the province can afford, they simply cannot get it. The order is not, in so many words, refused, it is simply disregarded, and the Peking Government have no means of enforcing it. The method of working is as follows:-The Board of Revenue at Peking, which is charged with a general supervision of finance matters all over the empire, makes up at the end of the year a general estimate of the funds that will be required for imperial purposes during the ensuing year, and apportions the amount among the several provinces and the several collectorates in each province. The estimate is submitted to the Emperor, and, when sanctioned, instructions are sent to all the viceroys and governors in that sense, who, in turn, pass them on to their subordinate officers. In ordinary times these demands do not materially vary from year to year, and long practice has created a sort of equilibrium between imperial and provincial demands. The remittances to the capital are, as a rule, forwarded with reasonable regularity, mostly in the form of hard cash, and though there are frequent complaints of the falling-off of revenue, yet, by good luck, some other fund is found to have a little to spare, and the amount can be made up. It would, indeed, appear to be the cue of every governor to minimize the resources of his own province as much as possible, so as to stave off importunate demands from Peking, and get them foisted on to some other province. Hence the frequent references to the Taiping rebellion (a favourite stalking-horse, though now a generation old), the lamentations over the falling-off of revenue, and the decaying state of the province -all for the most part fictions of the imagination. There is thus a constant pull going on between Peking and the provinces-the former always asking for more, the latter resisting and pleading impecuniosity, yet generally able to find the amounts required, or at all events a percentage. Whatever the provinces can retain can be spent practically as they choose. The Peking control over local expenditure is very feeble, though nominal accounts are rendered. The expenses which the central Government has to meet are :— (1) Imperial household; (2) Pay of the Manchu garrison in and about Peking; (3) Costs of the civil administration in the capital; (4) Pay of the foreign drilled troops termed the army of the North as distinct from the provincial troops (vide "Army" below); (5) The admiralty so far as regards the northern squadron; (6) Naval dockyards, forts, guns, &c.; (7) Foreign loans-interest and sinking fund. To meet all these charges the Peking Government has, for some years past, drawn on the provinces for about taels 20,000,000 (£3,000,000), including the value of the tribute rice, which goes to the support of the Manchu bannermen. No estimates are furnished of the sums allowed under each heading. The imperial household appears to receive in silver about taels 1,500,000 (£225,000), but it draws besides large supplies in kind from the provinces, e.g., silks and satins from the imperial factories at Soochow and Hangchow, porcelain from the Kiangsi potteries, &c., the cost

of which is defrayed by the provinces. The imperial Government has also at its disposal the revenue of the Foreign Customs. Prior to the Japanese war this revenue, which, after allowing for the costs of collection, amounted to about 20,000,000 taels (£3,000,000), was nominally shared with the provinces in the proportion of four-tenths and six-tenths. It was from this fund mainly that means were found to equip and maintain the northern fleet (almost extinguished by the Japanese war), to build the forts of Port Arthur and Weihai-wei (now also lost to the nation), and to keep going the several arsenals recently established. But the whole of the customs revenue being now pledged to foreign bondholders (vide "External Debt "), and absorbed by the service of the several loans, funds for these and the like purposes must now be procured, if at all, elsewhere. An entire readjustment of revenue and expenditure is manifestly necessary, but what form it will take remains to be seen. But besides supplying its own wants the imperial Government has to provide for outlying portions of the empire which are unable to maintain themselves (1) Manchuria; (2) Kansuh and the central Asian dominion; (3) the south-western provinces of Yunnan and Kwaichow. Manchuria, or, as it is termed, the northeast frontier defence, costs about 2,000,000 taels over and above its own resources. The central Asian territories have from time to time absorbed enormous sums, and even yet constitute a drain on the imperial Government of about 4,000,000 taels a year. This is met by subsidies from Szechuen, Shansi, Honan, and other wealthy provinces. Yunnan, Kweichow, and Kwangsi require aids aggregating 2,000,000 taels to keep things going.

A rough analysis of the expenditure of the Chinese empire, as it stood at the commencement of the Japanese war, would show the following division:

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External Debt.-Prior to the Japanese war the foreign debt of China was almost nil. A few trifling loans had been contracted

at 7 and 8 per cent., but they had been punctually paid off, and only a fraction of one remained. The expenses of the war, however, and the large indemnity of 230,000,000 taels (£34,500,000) which Japan exacted, forced China for the first time into the European market as a serious borrower. The foreign loans contracted up to 1900 amounted altogether to £54,455,000, bearing interest mostly at 5 per cent. Some of the earlier and smaller issues carry 6 and 7 per cent., and one of £16,000,000 guaranteed by the Russian Government carries 4 per cent. This last was raised in Paris, the others were all made in London through the Hongkong and Shanghai Bank. The charges for interest and sinking fund, which amount to over £3,000,000, are secured on the revenue of the Maritime Customs, and on the likin taxes of certain specified provinces. At present the net income from these two sources amounts to over taels 24,000,000, equivalent at present rate of exchange to £3,400,000, which is amply sufficient. Besides the foregoing, the Chinese Government recently borrowed £2,300,000 för railway extension, also at 5 per cent., the charges on which are secured on the revenue of the Imperial Northern Railway (vide "Railways.")

There is no internal debt worth mentioning. The Chinese Government have several times attempted to borrow money in their own country, offering Government bonds as security, but uniformly without success. It is felt that no reliance can be placed on the good faith of the Government towards its own subjects, and no machinery exists whereby payment could be enforced in case of default.

Defence-Army.-The Chinese constitution provides for two independent sets of military organizations—namely, the Manchu army and the several provincial armies. On the establishment of the dynasty in 1644, the victorious troops, composed mainly of Manchus, but including also Mongols and Chinese, were permanently quartered in Peking, and constituted a hereditary national army. The force was divided into eight banners, and under one

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