赤色黎明 (English Translation)

— "The horizon before dawn shall be red as blood"

Chapter 109: The Xinhai Upheaval (Part 7)

Volume 4: Parties Rise Together · Chapter 109

"Chairman Chen, may I take it this way: in order to prevent Yuan Shikai from borrowing money from the foreign devils, we are going to help him secure an even larger sum of money?" Chen Tianhua felt he had a basic understanding of Chen Ke's thinking.

"We aren't simply giving Yuan Shikai money; we are going to improve his ability to do business with the foreign devils. Currently, he is almost entirely being exploited by them. What he earns from them is nothing more than a few customs duties, which are negligible. In contrast, our base area exports heavy industrial products like small hardware, and heavy chemicals like soda ash and various industrial acids—not to mention light industrial goods like raw silk and finished silk. There's also tea, porcelain, and pig bristles; all these products can earn massive profits. We use this money to buy equipment and raw materials, then continue to produce and make more money. The goal of this negotiation is to pull Yuan Shikai onto such a track."

At this explanation, Chen Tianhua laughed. "Chairman Chen, the comrades are going to want to fight you for this. Doesn't this amount to letting Yuan Shikai profit off us?"

"If we earned 100 before Yuan Shikai joined, and we can earn 400 after he joins, what harm is there in letting him earn an extra 100?" Chen Ke explained patiently. "To achieve this goal, we must first seize actual control of the customs from the foreign devils. What is imported and what is exported must be decided by our own customs. Without the cooperation of the Beiyang group under Yuan Shikai, we cannot control the entire customs system. Therefore, we must cooperate with him."

As long as Chen Ke could provide a logical reason, even if the comrades couldn't fully grasp it for the time being, they could accept his arrangements. After all, Chen Ke's previous "strange ideas" had stood the test of reality. Hearing this clear and precise explanation, even if he was reluctant to let Yuan Shikai profit too much, Chen Tianhua no longer raised objections.

"If we negotiate with Yuan Shikai, will he be willing to cooperate?" Chen Tianhua asked.

"As the newly elected President, Yuan Shikai is naturally willing to control the customs. This is a matter that gains him both prestige and practical benefit. If there's any reluctance, it's only that he might not want to share the fruits of victory with others."

Yan Fu did not interject. He preferred strong leaders, and Chen Ke's model of almost single-handedly deciding the direction of foreign policy perfectly matched Yan Fu's philosophy. Party Committee meetings were necessary, but only for deciding local work. For major affairs that determined the direction of the entire People's Party, Yan Fu hoped Chen Ke would continue to act with such "arbitrary authority."

Since the comrades had collectively elected Chen Ke as the Chairman of the People's Party, they had to accept his arrangements. This was the "organizational principle" that Yan Fu endorsed.

"If Yuan Shikai is too narrow-minded and ultimately refuses to cooperate for his own personal gain, what do we do?" Chen Tianhua asked. He still felt uneasy about Chen Ke's optimistic attitude.

"If Yuan Shikai is that narrow-minded, then he is no more than a Dong Zhuo—a man who chases small profits at the cost of his life and hesitates before major decisions out of self-preservation. We will just make him realize that at this stage, he doesn't need to pay much to secure easy benefits. Human beings die for wealth as birds die for food; that's the nature of that Beiyang crowd." Chen Ke was very confident.

The People's Party delegation rattled on the train for over two days before arriving in Beijing. Before they even disembarked, they saw the station filled with Beiyang troops, sentries posted everywhere, and soldiers armed with live ammunition.

"It seems Yuan Shikai holds us in high regard," Chen Tianhua remarked, unsurprised by the display.

"Mhm, that's right. This is a good omen," Chen Ke nodded repeatedly.

The one who came to welcome Chen Ke was Tang Shaoyi, who acted quite warmly. "Mr. Chen, after the hospitality you showed me in Anhui last time, it's my turn to oversee the accommodations for your group. It's only right that I look after all of you."

"Then I'll leave everything to Mr. Tang," Chen Ke laughed.

Obviously, these were just pleasantries. Tang Shaoyi's schedule was tight, and on the very day they arrived, Yuan Shikai received Chen Ke.

"President Yuan, hello." Chen Ke took the initiative to step forward and shake hands. This caused those around Yuan Shikai to frown.

Yuan Shikai himself didn't care much. He casually shook Chen Ke's hand and invited the delegation to sit. The representatives on Yuan's side included Vice Premier Xu Shichang, Minister of Industry and Commerce Zhang Jian, and Minister of the Army Wang Shizhen. Once everyone was seated, the negotiations went straight to the point. Yuan Shikai asked Chen Ke what plan he had prepared to solve the central government's current financial crisis.

"President Yuan, you have likely heard that the British once wanted to reach a quota import-export agreement with us, with a total trade volume of one hundred million pounds per year. Setting aside how much each side could earn from this trade agreement, in terms of customs revenue alone, it could generate five million pounds a year. I'm sure you can imagine that, President Yuan."

The high-ranking Beiyang officials sitting near Yuan Shikai felt this was simply nonsense. Zhang Jian couldn't help but say, "Five million pounds a year would certainly solve the central government's current problems. However, given our current difficulties with exports, how can we easily reach a trade volume of fifty million pounds in exports a year?"

"Regarding exports, I believe there is only one key issue at the moment: the customs have not been properly managed. In major import-export trade, we are too fragmented across every industry," Chen Ke replied. "The foreigners want to treat China as a dumping ground, and we want to treat them as a dumping ground too. Since both sides have this intention, it would be better for the central government to simply take control. Every industry should have a leader that dominates the domestic market. This way, exports can be easily controlled, and both internal and external taxes can be easily managed."

This was Chen Ke's plan. The People's Party had sufficient strength to control considerable industries, so they might as well form complete monopolies in those sectors.

Yuan Shikai and most of the Beiyang side had no objections. Ever since the Manchu Qing was forced to open its doors, "state-owned economy" had held a dominant position in the Qing Dynasty. Government investment in establishing industries had always been the mainstream model, and Chen Ke's proposal was not unconventional. Only the scale of it was truly massive.

"The key lies in the standardization of export quality," Chen Ke offered his own view. "That is to say, our exported products must have uniform standards. For example, for raw silk—the silkworm species, the length and thickness of the silk. There must be a standard for all of these. Furthermore, we must develop varieties suitable for export. China is huge, after all; both the North and the South have their own specialties, and the number of products we can export is certainly not small. If we agree on these standards and produce products according to a unified scale, there will be no problem reaching fifty million in exports per year."

Yuan Shikai listened patiently, though he was also growing somewhat restless. He had invited Chen Ke here to talk about him putting up money to repay the debts, but Chen Ke was talking at length about how to make money. This was clearly going off on a tangent. However, Yuan could understand; if Chen Ke couldn't make money, how could he provide the funds?

Zhang Jian was completely against Chen Ke's ideas. He was a major figure in private enterprise and had always supported the development of the private sector. Not to mention that his own industries had been heavily hit by the People's Party. Seeing Chen Ke's enthusiasm for the state's total control over various industries, he couldn't help but try to dampen it. "Mr. Chen, what we are discussing is the central financial crisis. What brilliant insights do you have on this point?"

"I have no brilliant insights. Regarding contributing to the national treasury, we do have some money. However, we cannot simply sit back and watch our resources be exhausted. The national revenue is like a large pancake; you must make it bigger and bigger so that everyone can get a larger share. Minister Zhang, do you find this reasonable?" Chen Ke replied.

During the first meeting, Yuan Shikai said almost nothing, while Chen Ke and Zhang Jian engaged in a heated debate over their differences. Chen Ke insisted on state leadership, while Zhang Jian believed local leadership was more appropriate. Although both sides had their own stances, to Yuan Shikai, it seemed almost reversed. Zhang Jian was, after all, a central official, while Chen Ke was a local power. It should have been Chen Ke advocating for local leadership and Zhang Jian for state leadership.

Seeing that Zhang Jian was truly going off-track, Yuan Shikai had to speak up. "Wenqing, you've had a long journey; take a rest for now."

Once the formal meeting ended, that very evening, Yuan Shikai privately invited Chen Ke to bring his wife and children to his home for an informal dinner. The one who came to welcome them was Yuan Shikai's eldest son, Yuan Keding, who was quite hostile toward Chen Ke. Chen Ke himself didn't have a high opinion of this son who had vigorously encouraged Yuan Shikai to declare himself emperor.

Chen Ke wasn't the only one "visiting"; Xu Shichang also brought his family to pay a visit to Yuan Shikai. The real negotiations thus began around the President of the Beiyang government, the de facto Premier, and the largest local power, the People's Party.

However, everyone had to follow the formalities first, meeting and exchanging pleasantries. The Yuan family had many descendants, dozens of them. Compared to them, Chen Ke's family of three truly seemed lonely and outnumbered. However, Yuan Shikai didn't shout for them to be surrounded and attacked. When Chen Ke's wife, He Ying, was a child, Yuan Shikai had seen her several times at the He family home. As an elder and the one who had once proposed a match, when He Ying stepped forward to greet him, Yuan Shikai naturally reminisced about the past and the previous connections between the Yuan and He families.

After the pleasantries were over, the women went with He Ying and Chen Ke's daughter, Chen Qianru, to talk. The three heads of households went to the study to continue the negotiations.

"Wenqing, you have always acted straightforwardly. I like that about you. Since you've come personally, why not speak the truth?" Yuan Shikai said, not with a stern face, but in a gentle tone of an elder to a junior.

"I want to work with you, Mr. President, to reclaim the customs," Chen Ke replied immediately and bluntly.

Yuan Shikai's eyes lit up instantly. Reclaiming the customs would be a major event that he could fully justify to the entire nation. Economically, it would also bring massive returns. On this point, Yuan Shikai would not object.

However, for Yuan Shikai, he had seen too many who tried to deceive with grand words. Forget about talking of reclaiming the customs—even the rhetoric of driving the foreign devils out of China was something more than a few people had said. He smiled and asked, "I wonder what brilliant strategy you have, Wenqing, for reclaiming the customs."

"The foreign devils could open China's doors with guns and cannons, but after expending so much effort, they can hardly sell many products to China—this is their Achilles' heel. What Britain, France, Germany, and America want now is to sell things to China; so we might as well buy them. I'm sure you already know the situation in our base area, Mr. President. We import European and American machinery on the basis of trade balance and export goods to their colonies in Southeast Asia. That trade scale alone is considerable. If we reach an agreement with the customs in this manner, we can certainly regain control." Chen Ke was never against global trade. China was undoubtedly one of the winners of 21st-century global trade, while in the 20th century, it was the British who dominated. Chen Ke didn't think the British could be more troublesome than the Americans.

Yuan Shikai was somewhat disappointed by this; it was the same content Chen Ke had spoken of during the day. He had thought Chen Ke would have something else to say in private. "Wenqing, you are in the South, controlling the trade in raw silk and the like; naturally, you have the confidence to say such things. But we in Beiyang don't have your convenience. Isn't this talk of expanding trade a bit like talking big without any burden?"

"Haha, Mr. President, those are just jokes. The North naturally has its own advantages, which the South cannot compare with. If developed, they would be quite extraordinary too. For instance, the soybeans in the Northeast—no matter how we in the South try, we can't grow them like that."

Upon hearing this, Xu Shichang's spirits immediately lifted.

Yuan Shikai was also a bit surprised. He asked, "Juren, is it truly so beyond the pass?"

"It is indeed so," Xu Shichang replied immediately. "In a few days, I'll have some soybeans brought in for the President to taste."

Chen Ke quickly seized the opportunity. "The quality of Northeast soybeans is excellent. They haven't been exported on a large scale yet, and the main reason is that we've never truly put these good things up for sale. I have a modest suggestion: foreign countries have international expos; we might as well hold an expo in China every year. And this expo must be presided over by the central government."

The Canton Fair was a good thing, and China could undoubtedly host one itself. After Chen Ke explained the details of an export fair, Yuan Shikai and Xu Shichang began to understand the characteristics of his proposal. Unlike ordinary market buying and selling, the purpose of an expo was to have everyone bring out their best goods and then do business openly. The purpose of government leadership was nothing more than one thing: since it was held by the government, the government would naturally take a cut in the middle.

"This tax alone might still be too little, and too slow," Xu Shichang remarked.

"Whether it's slow or not depends on how it's managed. If it's left only to the enterprises themselves, there won't be much business. But what if the government is willing to invest?" Chen Ke replied.

"Government investment?"

"Yes. For example, the Northeast soybeans I mentioned are actually just common things in the Northeast. But if the government is willing to invest and support them, and the annual yield increases significantly, the returns would be quite extraordinary. Furthermore, with an expo, we'll know clearly what the foreign devils want to buy, so the direction of investment won't easily go wrong. That's the benefit of it," Chen Ke answered.

"Then what does this have to do with reclaiming the customs?" Xu Shichang still didn't quite understand.

"Once we reclaim the customs, what business is done will naturally be determined by us. So I still suggest implementing the quota trade agreement I mentioned during the day." After circling so far, Chen Ke finally brought back the key issue.

"A quota trade agreement has two main characteristics. First, the foreign devils must feel it's profitable. Second, the state must support the products the foreigners are willing to buy. This is an export-oriented trade model."

Export-oriented trade theory was extremely simple in the 21st century; the only difference was that in the late 20th century, China could rely on foreign investment, while now China had to work desperately to uncover its own advantageous products. Along the way, Chen Ke had to consider Beiyang's interests, and he only found the single business of Northeast soybeans. However, in history, Zhang Zuolin relied on exporting soybeans to earn at least thirty million US dollars a year; in this earlier era, Northeast soybeans would surely have even more of a market.

"To make the foreign devils feel it's profitable, we must ensure a trade balance. For the Center, making money relies on customs duties. Furthermore, imported products must be controlled. We cannot import consumer goods—by which I mean cloth, grain, and luxury items. What must be imported are factory equipment and things that can improve our own strength. This point must be established."

Chen Ke wasn't afraid that Beiyang would truly achieve industrialization. If industrialization could be achieved simply by buying, there should be many more industrial nations in the 21st-century world. But clearly, since World War II, only New China has truly become an industrial power. Whether the system is a match is a key issue.

However, Chen Ke couldn't keep anything hidden; he had to at least make Beiyang feel the People's Party wasn't lying. To deceive someone, you must make the deceived party have enough confidence in the deceiver. Thus, telling the truth was the most basic point.

Sure enough, Yuan Shikai was "deceived." Beiyang had already thoroughly investigated what Chen Ke was saying. The People's Party exported raw silk, pig bristles, porcelain, and tea. They bought factory equipment. They opened mines and built railways, and their economy was thriving. Regarding the People's Party's actions of striking local tyrants and distributing land, the Beiyang group didn't believe that was the key to their success. Yuan Shikai also didn't believe it was Chen Ke's sole magic formula.

Hearing Chen Ke's introduction, Yuan Shikai felt a certain degree of trust. Even if he believed Chen Ke still harbored revolutionary intentions, at least in the matter of developing the economy, he felt Chen Ke was indeed "frank."

"But regarding the matter of reclaiming the customs, according to what Wenqing says, they haven't been reclaimed at all," Yuan Shikai asked.

"Reclaiming the customs depends on whose hands they are reclaimed into. If they are reclaimed by the Center, the local provinces will naturally feel unhappy. They believe that only when the power over customs is in the hands of the provincial governments can it be called reclaiming the customs." Chen Ke maintained a purely pragmatic attitude on this.

Hearing such a sharp remark, a trace of a smile appeared on Yuan Shikai's face, and Xu Shichang couldn't help but laugh out loud. Xu Shichang had never dealt with Chen Ke before, and this was their first true negotiation. He felt he understood somewhat why Chen Ke could have such "revolutionary achievements" just past thirty—this fearless attitude was indeed something people like Xu Shichang quite appreciated.