These are the economic principles of Chi Jan. After Fan Li had successfully applied these principles to the state, he wanted to apply them to his family; hence, he became a rich merchant. His methods were to select the right men, and to seize the right times. In fact, it was speculative. In a period of nineteen years, he accumulated wealth three times, and he distributed it to the poor twice. The amount of his wealth was over one hundred millions; hence, he distinguished himself by his wealth.

About the time of Mencius, there was Pai Kuei.1 He was called the father of economics, but he looked upon economics as an art rather than as a science. He was mostly pleased to speculate upon the changes of times. His policy was: "Take what others throw away, and give away what others take." He was able to lessen food and drink, to restrain the passions and desires, to simplify dress, and to share both hardship and pleasure with his working servants But when he was going to seize the right times, it was like the start of the cruel beast and the terrible bird. Therefore, he compared his economic principles with the politics of the greatest statesmen, the strategy of the founders of the military school, and the laws of the founder of the law school. He said:

If either his wisdom cannot see the changes of a thing, or his bravery cannot make out a decision, or his kindness is not enough for the giving of some thing, or his firmness is not strong enough to hold the principle, I shall never tell him. about my methods, even though he may want to learn them from me.

Therefore, we are told by Ssu-ma Chien that the economists of the Chinese world recognized Pai Kuei as the father of

1 He was accordingly a Confucian.

economics. He says: "Indeed, Pai Kuei had proved his good practice. He possessed special genius, and his practical success was not by chance." 1

1

1 Tzů-kung had become minister in the states of Lu and Wei after his commercial enterprise. Fan Li had become the minister of Yüeh before his commercial enterprise, and became also the minister of Ch'i afterward. Pai Kuei was a commander of Marquis Wên of Wei, and conquered the state named Chungshan in 144 A. K. (408 B C.); but he was also a merchant. They were the representatives of the prominent merchants of that time. In fact, these three men were really the founders of the commercial school.

During the Ch'in dynasty, the position of merchants was also very prominent. Lü Pu-wei, a great merchant, gained the state of Ch'in, and became the true father of the First Emperor (292 A. K. or 260 B. C.). Historical Record, ch. lxxxv. The First Emperor (306-342 A. K. or 246-210 B. C.) made a shepherd named Lo equal to the feudal prince; and he treated a widow named Ts'ing as a guest, and built a tower for her. They were both distinguished by their wealth. Ibid., ch. cxxix. These illustrations prove that the position of the merchants was very honorable and powerful.

BOOK VII. DISTRIBUTION

CHAPTER XXIV

GENERAL PRINCIPLES OF DISTRIBUTION: Rent, Interest AND PROFITS

I. GENERAL PRINCIPLES OF DISTRIBUTION

IN the economic theories of the Confucians, more importance is attached to the problems of distribution than to those of production, because the Confucians are more socialistic than individualistic. There are many principles in regard to the distribution of wealth, but we may classify them under three heads, namely, equality, productivity, and need.

1. Distribution According to the Principle of Equality

First, wealth should be distributed equally. By an equal distribution, it is not meant that everyone should have the same amount of income, but that everyone should have the same opportunity from which he will be enabled to get the same amount of income. Therefore, there is the minority of men who receive justly an unequal amount of wealth on account of their ability and service. But, as soon as the majority of men can have equal opportunity of production, and can live at the social standard without the suffering of poverty, it is an equal distribution. In fact, there never can be an absolute equality, but only a proximate equality.

Hsun Tzu says:

Now, to be as dignified as an emperor, and as rich as possessing the whole empire, are objects for which all men, ac

cording to human nature, have a common desire. But if we indulge the desires of men, there is no room for so many desires, and there is no sufficiency of things to satisfy them. The ancient kings accordingly established rites and justice for men in order to distribute wealth. They distinguished the classes between the honorable and the mean, the difference between the old and the young, and the separation between the wise and the ignorant, and between the able and the incapable. They made all men take up their work and get their justice respectively. Then, the different amounts of income either great or small, were all made suitable to everyone. This is the principle of harmony and unity of a society. Therefore, when the benevolent man is on the throne, the farmers will give all their strength to the farms; the mercha.its, their sagacity to wealth; the artisans, their skill to the articles; and all the officials, from the students up to the dukes, their virtue and abilities to their official duties. This is what is called perfect equality. Therefore, some receive income from the whole empire, [as an emperor], but they do not think that it is too much; and some receive it as a doorkeeper, or a waiter on a traveller, or a guard along the gate, or a watchman, but they do not think that it is too little. It is said: "Although it looks unequal, it is equal; although it looks partial, it is just; although it looks different, it is uniform." This is what are called social relations.1

According to the social principles of Confucius, there are two divisions of men. The one is in the honorable position, such as the emperor, the princes, the great officials, and the students, while the other is in the mean position, the common people. The class of honorable men should be rich, and the class of common people poor. Hence, the word rich comes together with the word honorable, and the word poor with the word mean. But there is nothing to confine

1 Bk. iv.

anyone to either class, and he will either rise or fall according to his own ability. Among the five classes of menthe emperor, the princes, the great officials, the students and the common people-there is no equality of wealth. But among the common people themselves, the greatest number of men, wealth must be equally distributed. On the one hand, no one of them is enabled to get any special advantage over his fellow-members for the increasing of his income; and on the other, the upper classes are not allowed to take up any gainful occupation for competition with the common people. This is what Confucius means by an equal distribution.

We must understand that, according to the principles of Confucius, the two classes, rich and poor, should not be widely separated. They are simply comparatively rich and poor, but they should not have too much difference. During the Chou dynasty, there was a class struggle, and it is shown in the Canon of Poetry. It says:

They have their good spirits,

And their fine viands along with them.

They assemble their neighbors,

And their relatives are full of their praise.

When I think of my loneliness,

My sorrowing heart is full of distress.

The first four lines describe the wealth and jollity of the unworthy favorites of the court; the last two, the writer's distress in thinking of the existing disorder, and the coming ruin. It continues:

Mean-like, those have their houses;

Abject, they have their salary.

But the people now have no maintenance.

For Heaven is pounding them with its calamities.

Those rich enjoy themselves;

But alas for the helpless and solitary! 1

1 Classics, vol. iv, pt. ii, pp. 319-320.