May 26, 2017

Puzzle of Growth: Rich Countries and Poor Countries

Filed under: China, Economics — Tags: , , , — Nicholas @ 02:00

Published on 16 Feb 2016

Throughout this section of the course, we’ve been trying to solve a complicated economic puzzle — why are some countries rich and others poor?

There are various factors at play, interacting in a dynamic, and changing environment. And the final answer to the puzzle differs depending on the perspective you’re looking from. In this video, you’ll examine different pieces of the wealth puzzle, and learn about how they fit.

The first piece of the puzzle, is about productivity.

You’ll learn how physical capital, human capital, technological knowledge, and entrepreneurs all fit together to spur higher productivity in a population. From this perspective, you’ll see economic growth as a function of a country’s factors of production. You’ll also learn what investments can be made to improve and increase these production factors.

Still, even that is too simplistic to explain everything.

So we’ll also introduce you to another piece of the puzzle: incentives.

In previous videos, you learned about the incentives presented by different economic, cultural, and political models. In this video, we’ll stay on that track, showing how different incentives produce different results.

As an example, you’ll learn why something as simple as agriculture isn’t nearly so simple at all. We’ll put you in the shoes of a hypothetical farmer, for a bit. In those shoes, you’ll see how incentives can mean the difference between getting to keep a whole bag of potatoes from your farm, or just a hundredth of a bag from a collective farm.

(Trust us, the potatoes explain a lot.)

Potatoes aside, you’re also going to see how different incentives shaped China’s economic landscape during the “Great Leap Forward” of the 1950s and 60s. With incentives as a lens, you’ll see why China’s supposed leap forward ended in starvation for tens of millions.

Hold on — incentives still aren’t the end of it. After all, incentives have to come from somewhere.

That “somewhere” is institutions.

As we showed you before, institutions dictate incentives. Things like property rights, cultural norms, honest governments, dependable laws, and political stability, all create incentives of different kinds. Remember our hypothetical farmer? Through that farmer, you’ll learn how different institutions affect all of us. You’ll see how institutions help dictate how hard a person works, and how likely he or she is to invest in the economy, beyond that work.

Then, once you understand the full effect of institutions, you’ll go beyond that, to the final piece of the wealth puzzle. And it’s the most mysterious piece, too.


Because the final piece of the puzzle is the amorphous combination of a country’s history, ideas, culture, geography, and even a little luck. These things aren’t as direct as the previous pieces, but they matter all the same.

You’ll see why the US constitution is the way it is, and you’ll learn about people like Adam Smith and John Locke, whose ideas helped inform it.

And if all this talk of pieces makes you think that the wealth puzzle is a complex one, you’d be right.

Because the truth is, the question of “what creates wealth?” really is complex. Even the puzzle pieces you’ll learn about don’t constitute every variable at play. And as we mentioned earlier, not only are the factors complex, but they’re also constantly changing as they bump against each other.

Luckily, while the quest to finish the wealth puzzle isn’t over, at least we have some of the pieces in hand.

So take the time to dive in and listen to this video and let us know if you have questions along the way. After that, we’ll soon head into a new section of the course: we’ll tackle the factors of production so we can further explore what leads to economic growth.

May 23, 2017

The Ally From The Far East – Japan in World War 1 I THE GREAT WAR Special

Filed under: Asia, China, History, Japan, Military, Pacific — Tags: , , , , — Nicholas @ 05:00

Published on 22 May 2017

Japan’s participation in World War 1 is an often overlooked part of their history – even in Japan itself. Their service as one of the members of the Entente marked the climax of a development that started with the Meiji Restoration, a way out of isolation and into the global alliance system. This brought Japan more power and was also very lucrative. And after fighting in the Pacific Theatre of World War 1, the Siege of Tsingtao and contributing the Japanese Navy to the war effort, Japan had a seat at the table of the Versailles peace negotiations.

April 6, 2017

American “isolationism” between the wars

Filed under: Americas, China, Europe, History, USA — Tags: , , , , — Nicholas @ 05:00

Reason‘s Jesse Walker linked to this article by Andrew Bacevich which helps to debunk the routine description of US foreign policy between the first and second world wars as “isolationism”:

… McCain is worried about the direction of world events, with Russian provocations offering but one concern among many. Patterson shares McCain’s apprehensions, compounded by what he sees as a revival of “the isolationism in Europe and America that precipitated World War II.”

Now as an explanation for the origins of the war of 1939-1945, American “isolationism” is as familiar as the sweet-and-sour pork featured at your local Chinese takeout joint. Its authenticity is equally dubious. Yet Patterson’s assertion has this virtue: It captures in less than a sentence a prime obstacle to instituting a realistic, fact-based approach to foreign policy.

In truth, isolationism is to history what fake news is to journalism. The oft-repeated claim that in the 1920s and 1930s the United States raised the drawbridges, stuck its head in the sand, and turned its back on the world is not only misleading, but also unhelpful. Citing a penchant for isolationism as a defect afflicting the American character is like suggesting that members of Congress suffer from a lack of self-esteem. The charge just doesn’t square with the facts, no matter how often repeated.

Here, by way of illustrating some of those relevant facts, is a partial list of places beyond the boundaries of North America, where the United States stationed military forces during the interval between the two world wars: China, the Philippines, Guam, Hawaii, Panama, Cuba, and Puerto Rico. That’s not counting the U.S. Marine occupations of Nicaragua, Haiti, and the Dominican Republic during a portion of this period. Choose whatever term you like to describe the U.S military posture during this era — incoherent comes to mind — but isolationism doesn’t fill the bill.

As for Patterson’s suggestion that the behavior of the United States “precipitated” World War II, the claim is simply laughable. World War I precipitated World War II, or more specifically the European malaise resulting from the bloodletting of 1914-1918, compounded by the Bolshevik Revolution and the spread of fascism, and further exacerbated by profoundly shortsighted policies pursued by Great Britain and France. Throw into the mix the Great Depression, Japanese imperial ambitions, and the diabolical plotting of Adolf Hitler and his henchmen, and you have the makings of a catastrophe. Some few observers foresaw that catastrophe, but preventing it lay well beyond the ability of the United States, even if U.S. leaders had been clairvoyant.

March 30, 2017

Another Japanese “destroyer” joins the fleet

Filed under: China, History, Japan, Military — Tags: , — Nicholas @ 03:00

Due to a long-standing aversion to calling certain kinds of vessels by their most appropriate name, the Japanese Maritime Self-Defence Force (because Japan’s constitution prohibits the country having a “navy”, post-1945) commissioned their latest “destroyer” last week:

JS Izumo DDH-183, sister-ship of the just-commisioned JS Kaga DDH-184, both helicopter-equipped destroyers, officially.

I know what you’re thinking … “That doesn’t look like a destroyer to me” … but that’s what Japan officially designates ships like this to be, so that’s what they’re called. Strategy Page has more:

On March 22nd Japan put into service a second 27,000 ton “destroyer” (the Kaga, DDH 184) that looks exactly like an aircraft carrier. Actually it looks like an LPH (Landing Platform Helicopter) an amphibious ship type that first appeared in the 1950s. This was noted when Izumo, the first Japanese LPH was launched in 2012 (it entered service in 2015). The Izumos can carry up to 28 aircraft and are armed only with two 20mm Phalanx anti-missile cannon and launcher with sixteen ESSM missiles for anti-missile defense.

LPHs had no (or relatively few) landing craft but did carry a thousand or more troops who were moved ashore using the dozen or more helicopters carried. The first American LPH (the USS Iwo Jima) was an 18,400 ton ship that entered service in 1961, and carried 2,000 troops and twenty-five helicopters. Until Izumo showed up, several nations operated LPHs, and Britain and South Korea still do. The U.S. retired its last LPHs in the 1990s, but still have a dozen similar ships that include landing craft (and a well deck in the rear to float them out of) as well as helicopters. A few other nations have small carriers that mostly operate helicopters but carry few, if any troops.

The Izumos are the largest LPHs to ever to enter service. It differs from previous LPHs in not having accommodations for lots of troops and having more powerful engines (capable of destroyer-like speeds of over fifty-four kilometers an hour). Izumo does have considerable cargo capacity, which is intended for moving disaster relief supplies quickly to where they are needed. Apparently some of these cargo spaces can be converted to berthing spaces for troops, disaster relief personnel, or people rescued from disasters. There are also more medical facilities than one would expect for a ship of this size. More worrisome (to the Chinese) is the fact that the Izumo could carry and operate the vertical take-off F-35B stealth fighter, although Japan has made no mention of buying that aircraft or modifying the LPH flight decks to handle the very high temperatures generated by the F-35B when taking off or landing vertically. The Chinese are also upset with the name of this new destroyer. Izumo was the name of a Japanese cruiser that was a third the size of the new “destroyer” and led the naval portion of a 1937 operation against Shanghai that left over two-hundred-thousand Chinese dead. The Chinese remember all this, especially the war with Japan that began unofficially in 1931 and officially in 1937.

IJNS Izumo at anchor 1932 (Colourized), via Wikimedia

How Germany’s Victories weakened the Japanese in World War 2

Filed under: China, Europe, Germany, History, Japan, Military — Tags: , , , — Nicholas @ 02:00

Published on 24 Mar 2017

This video gives you a short glimpse on how the war in Europe had a detrimental effect on the Japanese Economy.

Military History Visualized provides a series of short narrative and visual presentations like documentaries based on academic literature or sometimes primary sources. Videos are intended as introduction to military history, but also contain a lot of details for history buffs. Since the aim is to keep the episodes short and comprehensive some details are often cut.

March 16, 2017

Origins of the Silk Road

Filed under: Asia, China, Europe, History, Middle East — Tags: , — Nicholas @ 03:00

I’ve been quietly fascinated by the ancient Silk Road trading route spanning from the Middle East to China since I first heard about it as a kid. (The most recent book I read on the topic, Foreign Devils on the Silk Road, blended bits of the history of the route with the activities of European spies in the area preceding the start of the First World War.) At Ars Technica, Annalee Newitz summarizes some recent work in Nature that pushes back the origins of the Silk Road more than two millennia:

The Silk Road was a series of ancient trading routes that spanned Asia, reaching as far as the Middle East and Europe. Self-organizing and vast, it fell under the control of various empires — but never for long. The polyglot civilizations of traders who lived along its routes are the subject of legends, and more recently the Silk Road lent its name to an infamous darknet market. Historians usually date the Silk Road from roughly the 200s to the 1400s. But a new study in Nature suggests the trade routes may be 2,500 years older than previously believed and its origins much humbler than the rich cities it spawned.

Historical accounts of the Silk Road begin in China in the 100s, when the Han Dynasty used its many routes to trade with the peoples of Central and South Asia. Han soldiers protected the roads and maintained regular outposts on them, allowing wealth and knowledge to flow across the continent. Monks wandering the Silk Road brought Buddhism from India to China, while merchants brought spices, gems, textiles, books, horses, and other valuables from one part of the continent to the other. Great Silk Road cities such as Chang’an (today called Xi’an) and Samarkand grew fat on wealth from the routes that passed outside their walls.

But Washington University in St. Louis anthropologist Michael Frachetti and his colleagues wondered how people traversed the many difficult stretches of the Silk Road that switchbacked through the mountains of Central Asia. Even though these routes weren’t urban or under the protection of soldiers, people used them all the time to pass between Asia and the Middle East. We can see where these travelers camped at over 600 archaeological sites in the mountains. Writing in Nature, Frachetti and his colleagues describe how they had to devise a new approach to track the routes people took between these camps.

The problem was that previous scholars assumed people took routes that resembled what a “least cost” algorithm would draw — essentially the easiest path. This is “largely effective in lowland zones where economic networks and mobility between urban centers are consistent with ease of travel,” the researchers write in their paper. But those algorithms won’t work in the mountains, on uneven terrain that was often barren.

NHK and CCTV did a 12-part documentary on the Silk Road, with beautiful theme music by Kitaro:

Published on 18 Sep 2013

Camels plodding across the desert, and a sense of timelessness evoked by Kitaro’s theme music… NHK devoted 17 years to the planning, shooting and production of The Silk Road, which unearthed trade routes linking long-lost civilizations of East and West. A landmark in broadcasting history, this series told the story of the rise and fall of ancient civilizations.
The NHK Tokushu and China’s CCTV documentary series The Silk Road began on April 7, 1980. The program started with the memorable scene of a camel caravan crossing the desert against the setting sun, with Kitaro’s music and a sense of timelessness. It was the start of an epic televisual poem.

The first journey described in the series began in Chang’an (now Xi’an), at the eastern end of the ancient route. On 450,000 feet of film, the NHK crew recorded the path westward to the Pamir Heights at the Pakistan border and this material was edited to make 12 monthly broadcasts. In response to viewers’ requests that the series be extended to cover the Silk Road all the way to Rome, sequels were made over the next 10 years. Seventeen years after the program was conceived, the project was completed.

1) The Glories of Ancient Chang-An
Chang-An – China’s old center. The journey begins from Chang-An, current Xi-an that was more than 1,000 years a capital in China, and the melting pot of international influences.

March 1, 2017

The different “flavours” of propaganda

Filed under: China, Media, Politics, Russia, USA — Tags: , , , , — Nicholas @ 03:00

Cory Doctorow on the various types of propaganda in use around the world:

Jonathan Stray summarizes three different strains of propaganda, analyzing why they work, and suggesting counter-tactics: in Russia, it’s about flooding the channel with a mix of lies and truth, crowding out other stories; in China, it’s about suffocating arguments with happy-talk distractions, and for trolls like Milo Yiannopoulos, it’s weaponizing hate, outraging people so they spread your message to the small, diffused minority of broken people who welcome your message and would otherwise be uneconomical to reach.

Stray cites some of the same sources I’ve written about here: Tucker Max’s analysis of Yiannopoulos’s weaponized hate and The Harvard Institute for Quantitative Science team’s first-of-its kind analysis of leaked messages directing the activities of the “50-cent army, which overwhelms online Chinese conversation with upbeat cheerleading (think of Animal Farm‘s sheep-bleating, or Nineteen Eighty-Four‘s quackspeak).

But I’d never encountered the work he references on Russian propaganda, by RAND scholar Christopher Paul, who calls Russian disinformation a “firehose of falsehood.” This tactic involves having huge numbers of channels at your disposal: fake and real social media accounts, tactical leaks to journalists, state media channels like RT, which are able to convey narrative at higher volume than the counternarrative, which becomes compelling just by dint of being everywhere (“quantity does indeed have a quality all its own”).

Mixing outright lies with a large dollop of truth is key to this tactic, as it surrounds the lies with a penumbra of truthfulness. This is a time-honored tactic, of course: think of the Christian Science Monitor‘s history of outstanding international coverage, accompanied by editorials about God’s ability to heal through prayer; or Voice of America‘s mixture of excellent reporting on (again) international politics and glaring silence on US crises (see also: Al Jazeera as a reliable source on everything except corruption in the UAE; the BBC World Service‘s top-notch journalism on everything except UK complicity in disasters like the Gulf War, etc).

In addition to this excellent taxonomy of propaganda, Stray proposes countermeasures for each strain: for Russia-style “firehoses of falsehood,” you have to reach the audience first with an alternative narrative; once the firehose is on, it’s too late. For Chinese quackspeak floods, you need “organized, visible resistance” in the streets. For pathetic attention-whores like Yiannopoulos, Stray says Tucker Max is right: you have to ignore him.

January 1, 2017

QotD: Currency Manipulation

Filed under: China, Economics, Politics, Quotations — Tags: , , , , — Nicholas @ 01:00

One of the critiques of any trade deal of late is that there should be penalties for countries guilty of “currency manipulation.” The concern is that countries will devalue their currency in an effort to make their own exports cheaper to other nations while making it harder for other countries to export back to them. As an example, if the Chinese were to do something that cuts the value of the Yuan in half vs. the dollar, their products look very cheap to American consumers while American-produced goods suddenly look a lot more expensive to Chinese consumers.

I have two brief responses to this:

  1. I find it hilarious that anyone in the United States government, which has a Federal Reserve that has added nearly $2 trillion to its balance sheet in the service of cramming down the value of the dollar, can with a straight face accuse other nations of currency manipulation. In practice in today’s QEconomy, currency manipulation means another country is doing exactly what we are doing, but just doing it faster.
  2. As an American consumer, to such currency manipulation by other countries I say, Bring it On! If China wants to hammer its own citizens with higher prices and lower purchasing power just to subsidize lower prices for me, I am happy to let them do it. Yes, a few specific politically-connected export businesses lose revenues, but trying to prop them up is pure cronyism. Which is one reason I think Elizabeth Warren is a total hypocrite. The constituency of the poor and lower middle class she presumes to speak for are the exact folks who shop at Walmart and need very price break on everyday goods they can get. Senator Warren’s preferences for protectionist trade policies and a weak dollar will hurt these folks the most.

Warren Meyer, “Currency Manipulation”, Coyote Blog, 2015-05-26.

October 31, 2016

The History of Paper Money – II: Not Just Noodles – Extra History

Filed under: China, Economics, Europe, History — Tags: , , , — Nicholas @ 03:00

Published on Oct 8, 2016

How does paper money get introduced? Who has to lose their head to do so? And what does Marco Polo have to do with anything???

October 9, 2016

The Chinese Labour Corps in Russia During World War 1 I OUT OF THE ETHER

Filed under: China, Europe, History, Military, Russia — Tags: , , , — Nicholas @ 02:00

Published on 8 Oct 2016

In another exiting episode of Out Of The Ether, Indy reads a great comment by a Russian fan about the situation of Chinese workers in Russia.

July 30, 2016

First Opium War – Lies – Extra History

Filed under: Britain, China, History — Tags: , , — Nicholas @ 03:00

Published on 23 Jul 2016

Order the limited edition Opium Wars wall scroll before it leaves forever on July 27! http://bit.ly/2a138ur
James talks about our mistakes, and adds additional stories, for Federico da Montefeltro and the First Opium War!

Quick story about Federico da Montefeltro: after losing an eye in a jousting accident, he ordered his doctor to cut a divot out of his nose so that his remaining eye had a better view and he could still fight in battles.

Now on to the Opium War! The Macartney expedition did not draw on the knowledge of Jesuit missionaries or even merchants who were familiar with Chinese court customs, because the British felt that a noble like Macartney was the only fitting representative. He didn’t come prepared to handle the kowtow, and he didn’t understand that the Chinese would have been more interested in British agricultural tech than they were in trinkets. James reads the disdainful letter which the Daoguang Emperor wrote to King George III in response to the embassy. There also happened to be a political upheaval in the Chinese palace at the time, so if the British had arrived sooner, they may have met with a different result and avoided the Opium Wars entirely. Once the war came to a head, it caused great division in Britain. Even though it was a war to sell illegal drugs, it was often recast as a war the Chinese provoked by insisting on the kowtow and treating other nations as vassals. Two traders by the names of James Matheson and William Jardine helped tip the scales for war because it helped their business, which had gotten a huge start in the opium trade. The Jardine-Matheson trading firm still exists today, and is a multibillion dollar company. Back in China, the British blockade of Canton’s port led to an odd first confrontation. A British ship called the Royal Saxon ran the blockade, so the British fired a warning shot to make it turn back. The Chinese, to prove they still controlled their sovereign waters, took this as an opportunity to challenge the blockade. Thus, their defense of a British smuggler led them into a war that, ironically, was about stopping British smugglers. The British official directing the war efforts, Charles Elliot, found himself in an awkward situation. He loved his country, but he morally objected to the British agenda in China. He tried to pave a moderate path, only to be fired and reviled as a failure. But after he left, the war truly got vicious. The British committed many atrocities in their campaign. They never sought to hold China, however, because their wars in India had taught them how impossible such an undertaking would be. Thus they settled on the unequal treaty. And as for Walpole… well, he started it, of course. Tea became such a large part of Britain’s economy because of the large tax levied on it. And who levied that tax? It was Walpole. He actually repealed an earlier, heavily resented tax and got political accolades for doing so, then introduced a much higher tax under a different name that flew under the radar even while it brought in hundreds of thousands of pounds for the government every year. The government’s reliance on tea for funding would later propel them to take such extraordinary measures to secure access to tea via Chinese trade. So who really started the Opium War? Well. It was Walpole.

July 23, 2016

The First Opium War – IV: Conflagration and Surrender – Extra History

Filed under: Britain, China, History — Tags: , , — Nicholas @ 02:00

Published on 9 Jul 2016

The Chinese attempt to retake Canton by force failed. New British commanders took charge and would accept nothing less than total Chinese capitulation. They captured cities all the way up to Nanking, forcing the Emperor to negotiate. He had no choice but to accept an unequal treaty, kicking off a period of subservience to Europe which China still remembers today as the Century of Humiliation.

Disappointed in the treaty, the Daoguang Emperor replaced Qishan with three new commanders. One of them wanted to buy time and modernize the army, but the Emperor insisted the British be repelled immediately. They assaulted Canton from across the river, firing cannons and sailing fire ships at the British fleet. Their efforts fell far short, and soon the British controlled the river again. The Chinese were forced to pay them an indemnity to leave Canton, but in their wake riots and looting plagued the city anyway. Elliot still led the British forces, but upon returning to Hong Kong, he learned that he was now being replaced. His replacements had no interest in the compromises he’d tried to establish. They pushed immediately towards Beijing. In each new fort they captured, they found evidence that the Chinese resistance had ironically been weakened by crippling opium addiction. As the Chinese attacks grew more desperate, British retaliation grew more brutal. Finally, they stood ready to seize Nanking. With it would come control of the Yangtze River on which all of China depended, so the Emperor was forced to negotiate. They had no bargaining power, and gave the British nearly everything they wanted: a huge indemnity, new trade ports, no more Hong monopoly, generous tariffs, consulates, and sovereignty over Hong Kong. The only two matters they refused were Christian missionaries and legalizing opium, but the latter would only lead to the Second Opium War with similar results. These “unequal treaties” would go down in Chinese history as the beginning of what the Communist government later called “The Century of Humiliation.” The spectre of this shame and forced subservience to European interests continues to shape politics today, as this history is often invoked or used as a rallying cry during dealings with the West.

July 20, 2016

First Opium War – III: Gunboat Diplomacy – Extra History

Filed under: Britain, China, History — Tags: , , , — Nicholas @ 04:00

Published on 2 Jul 2016

The British set up a blockade outside Canton, but one of their own private merchant ships tried to run through it. When the Chinese came to its defense, war began in earnest. Since the British had far superior firepower, they easily conquered Chuenpee and Chusan. Elliot and the Emperor’s new envoy, Qishan, soon sought a treaty and agreed on generous terms… which their overseers harshly rejected.

The British responded to the Chinese halting their ships by erecting a blockade outside Canton. They fired a warning shot to turn back a private British merchant ship, the Royal Saxon, which attempted a blockade run, and the Chinese sent out their own navy to defend the runner. They were demolished. The British had better ships and better firepower. They made to discuss a treaty, but the Chinese refused to give in to the British demands regarding ownership of Hong Kong. The British moved on to capture Chusan, an island near Shanghai. Then a rumor prompted them to believe that China planned to strike against them, so they acted pre-emptively and kicked off the Battle of Chuenpee. Again they won, but the slaughter was so horrifying that Superintendent Elliot was glad to seek a peace treaty with the emperor’s envoy, Qishan. Finally Qishan agreed to give up Hong Kong, to give the British better trade status, in exchange for which Britain returned the land they’d taken. But Elliot’s supervisor back in London, Lord Palmerston, felt the treaty didn’t go far enough, especially since it didn’t re-establsih opium trading rights. And the Emperor found Qishan’s capitulation disgraceful, even threatened to have him hanged for it. What had looked like moderate wins for both sides suddenly threatened to fall apart.

July 11, 2016

First Opium War – II: The Righteous Minister – Extra History

Filed under: Britain, China, History, India — Tags: , , — Nicholas @ 02:00

Published on 25 Jun 2016

Opium was illegal in China, but that didn’t stop the East India Company from manufacturing it for the black market. The Chinese emperor appointed an official, Lin Zexu, to stop it. He seized and burned huge opium caches held by British merchants, and ultimately ordered the British out of China entirely. Instead, they set up base on a barren island that would become known as Hong Kong.

The tea trade flowing from China had left the British government in staggering debt. They had loaned huge amounts to the Honourable East India Company (EIC) to conquer India, and to pay their debts, the EIC turned that land into poppy fields and manufactured opium in huge quantities. Since China had banned the opium trade, the EIC set up a market in Calcutta (part of their Indian territory) and turned a blind eye to the black market traders who smuggled it into China. By 1839, over 6.6 million pounds of opium were being smuggled into China every year. The Chinese DaoGuang Emperor appointed an upright official named Lin Zexu to halt this opium trade. Lin orchestrated a massive campaign to arrest opium traders, force addicts into rehab, and confiscate pipes. He even laid siege to British warehouses when the merchants refused to turn over their opium supply, instead taking it all by force and burning it. The outraged merchants sought redress from their government, but although the Chief Superintendant Charles Elliot promised them restitution, the government never had any intention of paying them back. Amid the unrest, two British sailors brutally murdered a Chinese man. Lin Zexu demanded their extradition, but Elliot insisted on trying them aboard his ship and sentencing them himself. Lin Zexu had enough. He halted the British food supply and ordered the Portuguese to eject them from Macau. They retreated to a barren island off the coast (now known as Hong Kong). Since the island could not support them, Elliot petitioned the Chinese to sell them food again. He received no response. Then he sent men to collect it directly, but on their way back they were halted by the Chinese navy, and the first engagement of the Opium Wars began.

July 7, 2016

First Opium War – I: Trade Deficits and the Macartney Embassy – Extra History

Filed under: Britain, China, History — Tags: , , — Nicholas @ 03:00

Published on 18 Jun 2016

The British Empire’s grasp on the Americas was slipping right at the time when they needed those resources most. The massive amounts of tea they imported from China had created a huge trade deficit, but the Chinese were reluctant to let any Europeans trade outside of the Canton port strictly controlled by the Hong. So Britain sent a formal embassy led by Earl George Macartney.

In 1792, Great Britain had just come out of an expensive war that cost them their control over many of their colonies in North America. Other wars had also cost them their access to the silver mines of South America, which had been helping fund so much of their trade with the Qing Dynasty of China. European traders all wanted greater access to China, but the Emperor was wary of letting outsiders too far into his country and kept them all penned up at the port of Canton, which was strictly regulated by the Hong business group. A flourishing blackmarket trade grew, but Britain wanted more. One trader, acting on his own initiative, grew bold enough to approach Beijing and attempt to get a hearing over his trade grievances, but the Chinese considered this a huge breach of protocal and an offense to the Emperor. Britain had to do something, however: they imported over 10 million pounds of tea each year, equal to 10% of the government’s annual spending, and the fact that China did not have anywhere near as great an interest in British products meant that they were running an enormous trade deficit they could no longer sustain. The Crown appointed an official envoy, Earl George Macartney, with orders to end the Canton system, establish an embassy, and acquire rights to an island that would be under British control in the same way that the Porutuguese controlled Macao. The mission failed spectacularly. Although Macartney got permission to sail north and meet the Qianlong Emperor in his summer palace at Jehol, he refused to perform the traditional kowtow which was required upon meeting the Emperor. He presented gifts from the British court, but the Chinese interpreted these gifts as tribute, not trade enticements, and decided they had no need for nor interest in what he offered. Since he failed to get them to agree to any of his three requests, Britain wanted to find another way to address the trade imbalance with China. Soon, this would lead them to start bringing in opium.

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