A Political and Economic History of China, Part 14: The Most Corrupt Official in Chinese History Bankrupts the Qing Dynasty

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6 MIN READ - Given China’s multi-millennial tradition of government corruption, for anyone to earn the distinction of “irrefutably most corrupt official in Chinese history” is quite an achievement. In this column the Cautious Optimism Economics Correspondent describes how a single government minister became one of history’s richest men by completely draining the Qing dynasty’s treasury by 1799.

Qing Grand Councillor and Revenue Minister Heshen

Last post we discussed Qianlong, the longest reigning monarch in Chinese history (de facto r. 1735-1799) who is still viewed by some as one of the middle kingdom’s greatest emperors.

Two-plus decades ago when the Correspondent first read about Qianlong (pronounced “chien-long”) the emperor’s reputation was deemed stellar with history books making only passing mention of a few missteps late in his life.

Since then Qianlong’s reputation has declined among historians, in the Correspondent’s opinion for good reason. As we’ll see, completely avoidable mistakes not only inaugurated the early decline of the Qing but also signified the opening chapter of what would become two centuries of backslide and prostration for China.

We’ve already discussed his multiple wars, the “Ten Great Campaigns,” many of which were failures yet ultimately cost the Qing treasury over 150 million taels in silver.

However the monetary cost of the Ten Great Campaigns would prove minor compared to one domestic blunder Qianlong would make in his final years.

PAGAENTRY

One Qianlong vulnerability that would open the door to Qing decline was his love of pomp and grandiosity.  

Qianlong’s grandfather and father, the great Kangxi and Yongzheng emperors, strongly subscribed to (their words) “good government,” a “moral” imperial court, and “virtue” among officials with both emperors authoring edicts emphasizing constant vigilance against corruption while extolling the Confucian principle of leaders earning and maintaining the trust of their subjects.

Kangxi’s attitude regarding good governance was partly demonstrated on his royal excursions.

Kangxi embarked on several “grand tours” of southern China to inspect firsthand his dominions outside the Forbidden City. Although he brought an imperial entourage for security reasons, he preferred whenever possible to mingle incognito among the common people and listen to their candid thoughts about Qing rule.

By contrast Qianlong would have none of this discreetness. His tours were enormous, grandiose affairs where he reveled in large crowds bowing before his royal caravan. Modesty is a character trait Qianlong did not inherit from his ancestors and his vanity would ultimately cost the Qing and all of China dearly.

Later in life, an aging and venerable Qianlong began to lose interest in day-to-day state affairs. His favorite empress had just died leading him into desolation and apathy. He retreated into art, calligraphy, poetry (he’s said to have written 40,000 poems, more than all poets of the Tang dynasty combined) and earthly pleasures.

In 1772 a still-despondent Qianlong spotted a low-level imperial guard stationed at the Forbidden City’s gates. Heshen (pronounced “huh-shun”) was a young and ambitious Manchu who impressed Qianlong with his intelligence. Heshen was also an expert flatterer and within two years the 24-year old was appointed to a high-level cabinet post.

There are unconfirmed rumors that there may have been more than flattery involved, for Heshen was said to be a strikingly handsome man with a sibling resemblance to Qianlong’s recently deceased favorite consort, but there’s no question that he charmed the emperor into a career fast track.

Soon Heshen was placed in charge of the Ministry of Revenue. Older, more deserving officials resented being leapfrogged by the young Heshen, but knowing he was the emperor’s favorite they dared not complain.

From the Ministry of Revenue Heshen was in complete control of the Qing empire’s finances. Using his political influence he appointed loyal subordinates and began embezzling state funds on an astronomical scale. Senior Qing officials and even the crown prince, the future Jiaqing emperor, plainly saw Heshen’s brazen robbery but were forced to remain silent given his standing with the emperor.

Heshen also stole openly, as did his ministers, and after seeing them do so long enough with impunity other officials began stealing openly as well. Over the course of nearly twenty-five years corruption wormed its way into all levels of government including everyday peasants being squeezed by provincial bureaucrats. All the while the aging Qianlong was apathetic to the rot spreading through the empire, leaving Heshen to effectively run the government for over two decades.

FUNDS TO SUPPRESS REBELLION

Between corruption and steeper taxes imposed to fund the Ten Great Campaigns, majority ethnic Han Chinese resentment towards the Qing resurfaced. Back in 1644 Han Chinese were hardly thrilled about the new alien conquerors running their country but eventually accepted Manchurian authority under the enlightened administration of Kangxi and Yongzheng.

Now the animosity returned worse than ever. Secret societies were established to resist the Qing and open rebellion broke out in the 1790’s—most notably the southern Miao Rebellion in 1795 and the much larger White Lotus Rebellion in 1794.

By 1796 Qianlong was 84 and showing signs of dementia. Not to outshine his grandfather he officially abdicated after 60 years, one year short of Kangxi’s reign, but still held de facto power thereby leaving his son emperor in name only and allowing Heshen’s embezzlement to continue.

When domestic unrest shook the empire Heshen requested more funds to quell the revolts, reporting back to Qianlong that he was suppressing the insurrections with ease. In fact he simply pocketed the money while rebellion spread unchecked throughout the empire. Once again the emperor’s son was fully aware of Heshen’s corruption but could do nothing while his father was alive.

Qianlong finally died in 1799 at age 87. The Jiaqing emperor, having at last secured real power, arrested Heshen within a week. An investigation uncovered the extent of his embezzlement had surpassed anyone’s wildest estimates. An inventory of Heshen’s estate discovered multiple mansions with nearly 3,000 rooms, over 10,000 acres of land including farmland and animals, ownership of several banks and pawnbrokers, enormous hoards of gold, silver, precious jewels, and rare art, 24 beds made of solid gold and countless foreign mechanical devices including hundreds of novel European clocks.

The final tally of his fortune was calculated at 1.1 billion taels of silver. To place this number in perspective, Qianlong’s Ten Great Campaigns had cost the treasury 151 million taels. 1.1 billion taels also approximated 15 years of Qing government tax revenues—fiscal receipts for the most populous country in the world (China had 330 million people compared to 10.5 million in Great Britain and 49 million across the entire British Empire).

Given that we know the silver content of a Qing dynasty tael (1.3 ounces), the silver content of a 1799 U.S. dollar, and the silver equivalent of the British pound (which was on a de facto gold standard until 1797), it’s also possible to approximate Heshen’s fortune in western terms.

Staring with 1.1 billion taels of silver, a back of the napkin calculation yields an estimate of $1.5 billion compared to US nominal GDP of $447 million in 1799.

Heshen had embezzled more than three times the GDP of the United States.

Of course using U.S. GDP in 1799 is a bit misleading because the American economy, with only sixteen states, was much smaller back then. Instead we can compare Heshen’s fortune to a much larger country with three times the USA’s population.

In pounds sterling equivalent Heshen had embezzled 20% more than the GDP of Great Britain.

Discovering the scale of the larceny, the Jiaqing emperor had Heshen’s estate confiscated and ordered his execution by slow slicing. But since Heshen had married into the royal family—his son had married Qianlong’s favorite daughter—Jiaqing instead granted him the dignity of hanging himself with a silk rope.

Jiaqing would soon learn he needed every penny from the Heshen estate firesale, for he inherited imperial power to discover the Qing treasury had been completely emptied by theft. He also inherited an empire beset by unchecked rebellion across its periphery, a dilapidated military long starved for funds, and endemic corruption at every level of government.

It’s understandable that after so many decades running the enormous Qing empire Qianlong grew weary of governing and wished to retire from affairs of state. But the wise decision would have been to abdicate earlier and transfer power to his son who was eager to assume responsibility in earnest. 

Instead Qianlong clung to power for decades longer—to his last dying breath—and allowed China to backslide into bankruptcy during his old age.

Jiaqing would rule China from 1799 to 1820. As the 19th century commenced Beijing’s dire fiscal position would precipitate major frictions and conflict with many trading partners—most notably Great Britain—when the Qing embraced protectionist trade policies to refill its emptied coffers. 

But that’s a subject for another column.