A Discussion On The Success Or Failure Of Xianfeng Paper Currency

Money is a social relationship of trust.The issuance and circulation of paper money require credit support,and credit behavior cannot be separated from the pursuit and balance of interests.Under the complex and pluralistic monetary system of the Qing Dynasty,the paper money circulating in the market was private paper money based on commercial credit,while official paper money based on national credit was absent in the circulation field.During the reign of Xianfeng,with the rise of The Taiping Rebellion,the national finance faced tremendous pressure.The old monetary and financial system could no longer support financial needs,and currency reform was imminent.The Qing Dynasty began to discuss the implementation of paper money.In the past,academic research on Xianfeng paper currency was mostly discussed from the perspective of monetary ideology and policy.The research on monetary ideology mainly focuses on the ideological concepts of the people in cloth clothing,and there was less research on the monetary ideology of the elite class.The research on monetary policy mainly focused on the beginning and end of the issuance of banknotes,without a detailed exploration of the credit and interest relationship behind the paper currency system,the game situation among various parties,and the fiscal and financial system.The analysis of paper currency credit was relatively simple,and there was no in-depth discussion on the reasons for insufficient credit.Additionally,there was a lack of comprehensive analysis of the overall monetary and financial market situation and market regulation role at that time.This article explores the interest relationships and game situations of various parties behind the Xianfeng paper currency system from the perspectives of credit and interests,monetary ideology and monetary policy.It ponders on the country’s monetary policy,monetary system,fiscal system,financial system,and government credit,and explores the role of the government and the market in monetary regulation.The implementation of Xianfeng paper currency was accompanied by intense discussions between the government and the public.The elite class proposed different plans from different positions and ideas,and the alternative plans were often mutually exclusive,resulting in a game phenomenon.The implementation of paper currency was the result of interaction,negotiation,and compromise among various political forces.The decision of Emperor Xianfeng to negotiate the implementation of paper currency was not entirely rational analysis,which involved the political and economic situation at that time,adherence to ideological concepts,judgment of timing,and balancing of relevant interests.Institutional change involves the distribution of wealth throughout society,and for the sake of maximizing one’s own interests,there are conflicts and cooperation between different interest groups.The implementation of paper currency involves the central government,local governments,officials,private financial institutions,and ordinary soldiers,businessmen,and civilians.The connections between them are highly close and complex,and they are very sensitive to the benefits and losses brought about by the paper currency system.Therefore,a game of interests between national power and diverse entities has formed.The conflict between the top-level design of the central government and local interests,the refusal of officials to privately buy paper currency for rent seeking behavior,the speculative activities of official financial institutions guided by national finance,the resistance of private financial institutions to paper currency and competition with them,the selling and violent behavior of grassroots soldiers,businessmen,and civilians facing the risk of paper currency depreciation,and the direct participation of various interest groups in paper currency operation,their behavior has changed the direction of paper currency policy,destroyed the credit relationship of paper currency.The failure of Xianfeng paper currency to transform into a modern credit currency is closely related to government credit,monetary policy,fiscal system,financial system,government intervention,market regulation,and historical inertia.Firstly,the government has failed to effectively establish a credit mechanism,and the difficulty in establishing government credit is mainly due to: the game between the government and various interest groups has weakened the credit foundation;The government credit shows obvious unidirectionality and polarization;The government’s credit management system is lacking,and the state power lacks institutional constraints.Secondly,monetary policy cannot exceed the limits of metallism,and policies clearly exhibit fiscal preferences.The financial system is highly silvery,and the paper currency system is difficult to adapt to the rigid financial system.The financial system is not sound,and the paper currency system lacks financial market support.Thirdly,the government’s regulation of currency has failed to be market-oriented,resulting in ineffective government intervention and spontaneous market regulation.Good currency drives out bad currency.Fourthly,the original monetary system carries instability,and the existence of currency usage habits to some extent hinders the process of monetary system change.Fifth,under feudal autocratic rule,the paper currency system found it difficult to break free from the path dependence of political power as a historical heritage.