East Asia, The Modern Transformation notes

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Notes from

East Asia, The Modern Transformation
by John K. Fairbank, Edwin O. Reischauer, and Albert M. Craig

Houghton Mifflin Company, Boston, copyright 1965, hardcover

On these notes: The book is carefully pro-American, glossing over the U.S. genocide in the Philippines and minimizing and rationalizing U.S. interference in Asia. Its main value is in detailing Asian national responses to Western intrusion. Number in brackets are page references.

In the 1700s the Dutch East India Company began to lose its primacy in the Asian-European trade to Great Britain. However, in the East Indies the Netherlands administration gradually became a territorial government. The Dutch intervened in local wars on Java in 1704-1707, 1719-1723, and 1749-1757, and by 1770 Java was completely controlled by the Netherlands. "Coffee was introduced into Java from Mocha in Arabia as a new crop about 1700." In 1799 the Dutch East India Company was taken over by the government of the Netherlands. [68]

While occasional trade began earlier, the British first established a trading post in Canton, China in 1699. The English export trade was concentrated in silk and tea, and the British Crown became dependent on tea revenues. [71] But the Chinese were clearly in charge of the rules of trade in Canton during the 1700s, and all foreign trade was concentrated there. [74] By the late 18th century the British Company had a monopoly on tea and British tax rates on tea were as high as 100%, which not only led to the Boston Tea Party, but also encouraged smuggling, with perhaps half the tea in England smuggled in from continental Europe. The smugglers were ruined in 1784 when the tea duty was lowered to 12.5%. To pay for the tea and silk the British exported cotton and opium from India. [75-76]

"After 1785, enterprising young Americans began to compete in the Canton market." [77]

The British Macartney mission of 1793 begging to expand trade showed that China was still a wealthy empire. The Emperor Ch'ien-lung received the British gifts as tribute but pointed out that as China "possesses all things in prolific abundance," so the Canton trade was a sort of charity for foreigners, and would not be expanded. [77]

In 1800 there was little East Asian demand for Western products other than silver and clockworks; the main demand was still for cotton and opium, from India. [79]

China's money and accounting system, as well as governing philosophy, emphasized stability, not growth. Exports of tea tea and silk depended on intense labor. All currency was metallic, either copper or silver; there was almost no credit system. [93] "The methods for the application of abundant manpower to all the processes of the economy — irrigation, rice culture, transport, handicraft production of consumer goods, and the like — had been thoroughly worked out." [96]

But "the flow of silver into China through channels of foreign trade stimulated and made possible the growth of the modern money economy." The main source of silver was Mexico via the Philippines and India, but it also came from Japan. Between 1784 and the 1820s perhaps 50 million Mexican silver dollars passed through the hands of American merchants into China. [96-97]

The Shansi banks were part of a system in which credit was expanded and modernized in China in the nineteenth century. They were headquartered in P'ing-yao, T'ai-ku and Chi-hsien and helped transfer funds between Peking and the provinces. While they did transport silver, for the Canton trade they created a system of bank drafts that was far less expensive and thereby facilitated trade in tea, cotton, and opium.[97-98]

As early as the 1780s British traders learned to evade the East India Company monopoly by acting as nominal representatives in Canton of other European nations, while actually engaging in extensive private trade and banking. [129-130]

The opium trade had long existed, but between 1821 and 1838 the number of chests imported annually from India grew from about 4,500 to about 40,000. [131]

Some Hong merchants at Canton made great fortunes from their trade monopolies. One member of the Howqua family even invested in the U.S. through the Boston firm of Russell and Company. Law enforcement, both commercial and criminal, was a problem. The British refused to submit their subjects to Chinese jurisdiction in homicide cases after 1784, and the Americans followed suite after 1821, thus establishing extraterritoriality. [134]

[Perhaps] the first British attack on China was by Lord Napier, who did not like the failure of his trade mission in Canton in 1834. [135]

Continued on East Asia Transformation Page 2