The Great Qing Treasure Note () or Da-Qing Baochao refers to a series of Qing dynasty government notes issued under the reign of the Xianfeng Emperor issued between the years 1853 (Xianfeng 3) and 1859 (Xianfeng 9). These government notes were all denominated in wén and were usually introduced to the general market through the salaries of soldiers and government officials.
After the Taiping Rebellion had depleted the imperial treasury of the Qing dynasty the government reformed the cash coin system to include higher denominations with low intrinsic values essentially creating a fiat currency; this was a radical departure from China's past where the value of cash coins was dependent on their weight rather than any denominations. The same developments which lead to the creation of the new Xianfeng coinage had also necessitated the reintroduction of paper money in China after it was absent for two centuries. The new paper currency came in two forms, one was the copper-alloy cash coins-based Great Qing Treasure Note and the other was the silver sycee-based Hubu Guanpiao (戶部官票) which were both introduced simultaneously with the new debased cash coinage.
However, the government did not keep adequate reserves of hard currency to back the new notes up. Many provincial governments didn't allow for taxes to be paid using paper money, and after a few years the government started refusing to convert the new paper money into hard currency; consequently, the Chinese people started to distrust it as a valid medium of exchange. In response to the ever more expensive military expenditures caused by the Taiping Rebellion, the government produced more and more high denomination notes, which were not convertible. This caused hyperinflation; by the year Xianfeng 9 (1859) the currency had become completely depreciated and was abolished.
History
Earlier Qing dynasty notes
During the transition from Ming to Qing the Manchu government-issued notes known as Hubu Guanpiao (戶部官票) or Shunzhi Guanpiao (順治官票) or Shunzhi Chaoguan (順治鈔貫) which were first issued in the year 1651 on initiative of the Minister of Revenue, Wei Xiangshu (魏象樞) during the war with the remnants of the Ming dynasty to cover the more immediate expenses of the Manchus as the finances of the Qing during this period were in dire distress, these notes were declared void only a decade after their issued. An annual amount of 128,000 guàn (貫) of these early Manchu notes were issued, with a total sum of 1.28 million guàn being produced before they were abolished. The denominations of the Hubu Guanpiao followed the pattern of the Ming dynasty period paper notes, but as historiographical sources about the early Qing era paper money are scarce, not much can be known about them.Nei Menggu – Inner Mongolian numismatics (1992): Pl. 16. (in Mandarin Chinese).Nei Menggu qianbi yanjiu hui (內蒙古錢幣研究會), Zhongguo qianbi bianjibu (《中國錢幣》編輯部), ed. (1992); Cai Mingxin (蔡明信) (transl.). Zhongguo guchao tuji (Beijing: Zhongguo jinrong chubanshe). (in Mandarin Chinese).
Peng Xinwei suggested that the Manchu rulers of the Qing were very much atavistic towards the inflationary pressure that the earlier Jurchen Empire experienced after they had abused their ability to print Jiaochao notes. Modern scholars argue that the notes issued during the Shunzhi period, while only brief, likely entrenched the reluctance of the Qing dynasty to issue notes because this issue also proved inflationary confirming their fears.Wei Jianyou (魏建猷) (1986) Zhongguo jindai huobisi (中國近代貨幣史). Huangshan shushechuban, p. 83. (in Mandarin Chinese).Peng Xinwei (彭信威) (1958) [rev. 1970, 1988, 2007] Zhongguo huobishi (中國貨幤史). Shanghai renmin chubanshe, Shanghai, pp. 556–559. (in Mandarin Chinese).
It has been suggested by Taiwanese economic historian Lin Man-houng that Chinese money shops did not start with the production of their own private notes until the end of the Qianlong period, these shops were very likely to have been more developed in Northern China, where these money shops produced notes which were mostly denominated in cash coins while notes from Southern China tended to be denominated in taels of silver.Lin Man-houng (2006) China upside down: currency, society and ideologies. Harvard University Press, Cambridge, Massachusetts, pp 1808–1856, pp. 36–37. It is also possible that private-order notes could have emerged earlier in the 18th century and that their presence would become very common by the 1820s.Hou Houji (侯厚吉), Wu Qijing (吴其敬) (1982) Zhongguo jindai jingji sixiang shigao (中國近代經濟思想史稿). Heilongjiang renminchubanshe, Harbin, vol. 1, p. 11. (in Mandarin Chinese).
Economic and monetary background
The precursor of paper money (紙幣) known as "flying cash" were issued by the Tang dynasty; however, these bills of exchange could in no way be considered to be a form of paper money as they weren't meant to be a medium of exchange and were only negotiable between two distant points.Kann, Eduard: The Currencies of China, Shanghai, 1926, Kelly and Walsh, Ltd. The first true paper money in the world was issued under the Song dynasty, these were promissory notes issued by merchants in Sichuan known as the Jiaozi,Glahn, Richard von (2006). "Re-Examining the Authenticity of Song Paper Money Specimens", Journal of Song-Yuan Studies, 36: 79-106. under the reign of Emperor Zhenzong (997–1022) the government of the Song dynasty granted a monopoly for the production of Jiaozi notes to sixteen wealthy merchants in Sichuan, as these merchants were slow to redeem their notes and inflation started affecting these private notes the government nationalised paper money in the year 1023 under the Bureau of Exchange. As these paper notes were backed by the government they were instantly successful and the people regarded them to be equally trustworthy as cash coins, other types of paper notes issued under the Song dynasty include the Huizi and the Guanzi.Chen, Chau-Nan, Chang Pin-Tsun, Chen, Shikuan. "The Sung and Ming Paper Monies: Currency Competition and Currency Bubbles", Journal of Macroeconomics, 17/2: 273-288. Before the Mongol Empire conquered China the Jin dynasty also issued paper money.
Before the establishment of the Ming dynasty the Mongol Yuan dynasty had suffered from a severe case of hyperinflation which made the paper money issued by them worthless.Bernholz, Peter (1997). "Paper Money Inflation, Prices, Gresham's Law and Exchange Rates in Ming China", Kredit und Kapital, 30/1: 35-51. Under the reign of the Yuan dynasty copper cash coins remained in circulation with the inscriptions Zhida Tongbao (至大通寶), Dayuan Tongbao (大元通寶), and Zhizheng Tongbao (至正通寶) forming the majority of the circulating issues and "strings of cash coins" remaining a currency unit.Glahn, Richard von (2010). "Monies of Account and Monetary Transition in China, Twelfth to Fourteenth Centuries", Journal of the Economic and Social History of the Orient, 53/3: 463-505.Yang, Lien-Sheng (1975). "Monetary Terms in Chinese History", T'ung Pao: Journal of the Society for Oriental Numismatics, 1/2: 47-54 [reprinted from Chinese Culture, 1/4 (1958)]. Silver then started to occupy a paramount place in the Mongol economy and was supplemented by government issued paper money.Li, Kangying (2007). "A Study on the Song, Yuan and Ming Monetary Policies against the Context of Worldwide Hard Currency Flows during the 11th-16th Centuries, and their Impact on Ming Institutions and Changes", in Angela Schottenhammer, ed. The East Asian Maritime World 1400-1800: Its Fabrics of Power and Dynamics of Exchanges (Wiesbaden: Harrassowitz), 99-136. Under the reign of Kublai Khan the Zhongtong Jiaochao (中統交鈔) was issued whose value was based on the fabric silk. Under the reign of Külüg Khan in the year 1308 the Zhiyuan Baochao (至元寶鈔) was issued which was supplemented with the silver-based Zhida Yinchao (至大銀鈔), but these circulated only for a year. The final series of paper money issued by the government of the Yuan dynasty from 1350 were the Zhizheng Jiaochao (至正交鈔). A major difference between how paper money was used under the Mongols and under the Song dynasty was that, in certain regions of the Yuan dynasty, paper notes were the only acceptable form of currency and could not be exchanged in either copper cash coins or silver sycees. Exchanging paper money into copper or silver was known as duìxiàn (兌現, "convert into specie") which was the main reason why earlier forms of paper money were deemed reliable. As these regions were completely dependent on paper money inflation hit them more severely as their notes could not be converted into a currency based on any intrinsic value, for this reason the Mongols allowed their subjects to continue using copper-alloy cash coins and issued new ones every now and then. During the last few decades of the Yuan dynasty the inflation caused people to lose their trust in paper money and barter became the most common means of exchange.Williams, S. Wells (1975). "Paper Money among the Chinese", T'ung Pao: Journal of the Society for Oriental Numismatics, 1/2: 38-40 [reprinted from The Chinese Repository, 20 (1851)].Davis, Andrew McFarland : Certain Old Chinese Notes, Boston, 1915, George Emory Littlefield Company.
During the beginning of Manchu rule over China in the year 1644, the total imperial revenues of the Qing dynasty were an approximated 30,000,000 taels. Imperial Government expenditures at the time were correspondingly modest. During the balanced periods in Qing dynasty history of the 17th and 18th centuries imperial revenue consistently exceeded government expenditures, which resulted in a tidy cash surplus in the Imperial Chinese Treasury. The vastness of China created poor communications across government offices and a general looseness of administration encouraged all sorts of irregularities across the country. During the course of the Taiping Rebellion China would see a third of its people die utterly devastating its economy in the process. Of China's 18 wealthiest provinces 12 were left in ruins, this would put a heavy strain on the resources of the government of the Qing dynasty putting it near breaking point as the rebellion had sown the seeds for further calamities which would hurt the economy of China even more and ultimately led to the downfall of the Qing dynasty during the next century. The main source of income for the government of the Qing dynasty was taxation.
The Taiping Rebellion was the largest civil war that China had experienced up until that point. The Qing dynasty Army of the Green Standard and its bannermen had long since fallen into decay, revealing the decrepit state of the Chinese military. Near the end of the year 1851, the Ministry of Revenue in Beijing promulgated the Statutes for Raising Military Funds (餉事例).Lin Man-houng, China Upside Down: Currency, Society, and Ideologies, 1808–1856 (Cambridge, Ma.: Harvard University Asia Center, 2006), pp. 147–201.Richard von Glahn, Fountain of Fortune: Money and Monetary Policy in China, 1000–1700.