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A sudden stock market crash turned out to be the "last straw" that crushed the Qing Dynasty

Comrade Guevara

When talking about the history before the fall of the Qing Dynasty, the Wuchang Uprising, launched by the Hubei New Army, is often seen as the "last straw" that overwhelmed the empire, but this was not the case. Because, a few months before the Wuchang Uprising, a huge "Baolu Movement" broke out in Sichuan, and this movement was the last "straw" that really ended the empire. But what is ironic is that this "straw" that led to the collapse of the empire was triggered by a stock market crash.

01 Deficit caused by the stock market crash

After the end of the Eight-Nation Alliance's war of aggression against China, the Empress Dowager Cixi finally realized the urgency of reform, and for this reason, she announced the implementation of the "New Deal" while she was still in Xi'an, covering various aspects such as political system, economy, military, education, and bureaucracy, including the large-scale construction of railways. In fact, as early as 1876, China's first railway, the Wusong Railway, had been built, but the progress of the road construction movement for many years was extremely slow, and it was not until the promulgation of the "New Deal" measures that it really ushered in a period of great development.

A sudden stock market crash turned out to be the "last straw" that crushed the Qing Dynasty

Old photo of the Empress Dowager Cixi

However, the cost of building the railway was high, and the Qing government, which had suffered two disastrous defeats in the Sino-Japanese War and the Eight-Nation Alliance's war of aggression against China, owed more than one billion taels of silver in foreign debts, had no money to invest in railway construction. However, against the backdrop of many humiliations and hatred of foreigners throughout the country, although it is very cost-effective to borrow debts from foreign powers to build railways, it will bear the infamy of "betraying the country". Therefore, after weighing it again and again, the Qing court decided to take the road of "official supervision and business management".

Due to the huge return on investment in railway construction, in just a few years, including Hunan, Guangdong, Sichuan and other provinces, there has been an upsurge of commercial railway movement in various places. In Sichuan alone, the Sichuan-Han Railway Company, a semi-state-owned enterprise established in 1903, obtained the right to build the Sichuan-Han Railway and raised 14 million taels of silver for this purpose. However, due to the backward technology and chaotic management of the Sichuan-Han Railway Company, after spending 7 years and 7 million taels of silver, it finally completed only a 30-mile-long section of the railway between Yichang in Hubei Province and Wanxian County in Sichuan, which was eye-popping in efficiency.

A sudden stock market crash turned out to be the "last straw" that crushed the Qing Dynasty

Shares of the Sichuan-Han Railway Company

What is even more outrageous is that during the construction of the road, Shi Dianzhang, who served as a member of the total revenue and expenditure of the Sichuan-Han Railway Corporation and the guarantee fund of the Shanghai office, for speculative purposes, colluded with the company's senior management to embezzle 3.5 million taels of silver to purchase rubber stocks listed in Shanghai and rising steadily. Just when Shi Dianzhang and others were dreaming of fame and fortune, the Shanghai stock market suddenly collapsed in July 1910, and in a very short period of time, it led to the destruction of the 3 million taels of silver investment funds embezzled by the railway company.

02 The truth about the pro-road movement

The commercial railway project took many years and cost a lot of money, not only did not build a railway, but also exposed serious management problems, the Qing government could not bear it, so Sheng Xuanhuai, minister of the Ministry of Posts and Telecommunications, stepped forward and launched the "railway state-owned" plan in 1910, that is, the state came forward to build the road, as for the road repair cost and professional personnel, it needed to be imported from foreign countries. To this end, Sheng Xuanhuai signed a loan contract of about 6 million pounds with a consortium of banks from the United States, Britain, France, and Germany, and actively recruited foreign engineers, preparing to borrow foreign debts to build roads.

A sudden stock market crash turned out to be the "last straw" that crushed the Qing Dynasty

Sheng Xuan's nostalgic photos

In all fairness, Sheng Xuanhuai's "state-owned railways" plan was based on the national conditions at that time, and it was a remedial measure that had to be taken after weighing the pros and cons, and it was undoubtedly the best plan at that time in order to speed up the construction of the railway. However, in the late Qing Dynasty, when nationalism was on an unprecedented high and the revolutionary movement was raging, the "nationalized railways" plan was undoubtedly "politically incorrect" and was suspected of betraying the country's right of way to foreigners, thus providing some people with a pretext for attack.

Since Sheng Xuanhuai has made up his mind that the state will come forward to build the road, how should he deal with the original private fundraising? His response was to "redeem at the original price", in which the state bought back the railway shares held by the shareholders at the original price. Since the number of shareholders in Guangdong, Hunan and other provinces was small, and the vast majority of them were upper-class gentry, they knew that there was no good fruit to eat in confrontation with the imperial court, and the policy of "redemption at the original price" did not cause any loss to themselves, so they did not raise objections. However, the situation in Sichuan is very different.

A sudden stock market crash turned out to be the "last straw" that crushed the Qing Dynasty

The people of Chengdu in the late Qing Dynasty

First of all, the vast majority of the railway funds raised in Sichuan do not come from the upper class gentry, but through the form of a national tax increase, so theoretically speaking, all taxpayers in Sichuan, including farmers and small traders, are shareholders of the Sichuan-Han Railway Company. What's more, the Sichuan-Han Railway Company also left a deficit of 3 million taels of silver, and who should take this money is also a big problem.

In Sheng Xuanhuai's view, the deficit of 3 million taels of silver should be borne by the senior management of the railway company, and the imperial court had no obligation to "wipe their butts" for them, but the latter insisted that the imperial court should cover the bottom. In the stalemate, Sheng Xuanhuai proposed a compromise plan, that is, the imperial court would issue all shareholders with shares of the national railway, but the original funds raised would not be returned. Of course, the top management of the railway company could not accept this plan, because then the truth about their loss of 3 million taels of silver would be exposed, and the angry Sichuan people would definitely tear them to pieces.

A sudden stock market crash turned out to be the "last straw" that crushed the Qing Dynasty

Situation map of the Baolu movement

In order to survive, the top management of the Sichuan-Han Railway Company simply incited the people who did not know the truth and shouted the slogan of "refuse to borrow foreign money, abolish the contract and protect the road" in order to divert doubts from all walks of life about the whereabouts of the raised funds and blackmail the imperial court to "wipe their butts" for them. Under these circumstances, the Sichuan "Baolu Comrades Association" was established on June 17, 1911, and the vigorous "Baolu Movement" broke out. History is such a paradox, once these "moths" who harm the public and private interests play the banner of patriotism, they actually turn into "heroes" who ask for the lives of the people.

03 The Butterfly Effect

The follow-up development must be clear to friends who are familiar with history. After the outbreak of the "Baolu Movement", the Qing court appointed Zhao Erfeng, the minister stationed in Tibet, as the governor of Sichuan, and sat in Chengdu to calm the situation, but soon the "Chengdu Bloody Incident" occurred that shocked the whole country, and dozens of peaceful petitioners were shot and killed by the governor's guards. After the bloody incident, the channel for negotiations between the government and the people was completely blocked, and the "Comrade Army of Baolu" in various localities heard the news and took action, and within ten months they captured most of the prefectures and counties in the province, and even the capital Chengdu was also under siege.

A sudden stock market crash turned out to be the "last straw" that crushed the Qing Dynasty

Oil painting of the Wuchang Uprising

In the face of the crisis, the Qing court could only adopt the strategy of "demolishing the east wall and making up for the west wall", and urgently dispatched reinforcements from six provinces, including Hubei and Hunan provinces, to Sichuan to suppress it, especially the Hubei New Army under the command of Duanfang, the governor of Huguang, was the most elite. But what the Qing court never expected was that just when Duan Fang and others were suppressing the chaos in Sichuan, Wuhan, which was empty in defense, was seized by the revolutionary army, and the Xinhai Revolution broke out. In order to extinguish the revolution, the Qing court had no choice but to appoint Yuan Shikai as prime minister, and the latter was the "gravedigger" who ended the rule of the Aixin Jueluo family.

04 Brick Home Reviews

If history can assume that the Qing court could foresee that the deficit of 3 million taels of silver would become the "last straw" that overwhelmed the empire, then even if this number was expanded by 100 times, I am afraid it would willingly fill it. After all, you can earn it again when the money is gone, but it is difficult to recover it if you lose it. It's a pity that history can't assume that the Qing Dynasty, which was founded nearly 300 years ago, was finally swept into the garbage heap of history because of only 3 million taels of silver.

A sudden stock market crash turned out to be the "last straw" that crushed the Qing Dynasty

Yiwan Railway

A digression. The construction of the Sichuan-Han railway has gone through the Qing Dynasty, the Republic of China, the Republic of China three periods, although more than 100 years have passed, but still has not been completed, only from the end of the Qing Dynasty began to build the railway from Yichang, Hubei to Chongqing Wanzhou, finally completed, but it was not officially opened until 2012. To put it mildly, what the Sichuan people desperately defended back then turned out to be a "big pie" right of way that took more than 100 years to complete.

bibliography

Xie Qing, Wu Hongying, et al., "Sichuan Baolu Movement Historical Materials Book and Shadow Compilation", Sichuan University Press, 2014.

Kui Yingtao, History of Sichuan Baolu Movement, Sichuan University Press, 1981.

Zhao Erxun: Qing Historical Manuscript, Zhonghua Book Company, 1998.

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