chief desiderata, military achievement was honoured above all other things, so now, when the chief desideratum is industrial growth, honour is most conspicuously given to that which generally indicates the aiding of national growth.' These sentences are eminently fitted to preface a consideration of commercial morality in a country which at the present time is exciting much interest by reason of its phenomenal progress. In Japan the military period was supplanted by the industrial period, not, as in other countries, by a process of natural evolution, but as the result of a sudden convulsion, which in less than ten years converted the State from feudalism and autocracy to industrialism and constitutional government. The results have been curious and striking, as well as instructive to the sociologist. The territorial noble or clan leader, of ancient lineage, holding his own court, and possessing with his army almost complete administrative autonomy, suddenly found himself a cipher, unless he chose to embrace politics and maintain a constant struggle for personal supremacy with his fellows. The samurai, accustomed to estimation by the common people as a hero, but with little education save in the art of war, found himself at the same time in a position where the military tactics he had learned were of no value to him, and where he must labour with hands or brain to save himself from starvation. On the other hand, the merchants, hitherto occupying the lowest rung on the social ladder-lower than the labourers who tilled the soil, and but little above the Eta, or pariah class-discovered that trade, erstwhile despised, was now a passport to position, industrial exploitation ranked as a virtue, and wealth conferred honour and power. But though trade now became an honourable and recognised profession, in which even the ancient territorial aristocracy could engage without losing caste, but little change occurred in the methods which characterised it in the centuries of military supremacy, when trader was but another name for trickster, and the pursuit of commerce practically argued lack of integrity. To recognise a low ideal in one class, and to speak and act as if in the circumstances there could be no higher ideal, is to originate and encourage a defective standard which no sudden change of environment can immediately alter. And thus we find it the unanimous opinion of those in a position to judge, that Japanese commercial morality is of a defective type when compared even with the standard prevailing in China, where trade has never been stamped as degrading, or with the standard of those nations which, amid all the trickery immemorially associated with trade, have yet kept before them a certain standard of integrity in business as in other walks of life. It is, indeed, a common belief among those who have investigated the conditions of trade in Japan, that commercial morality there stands almost on the lowest plane possible to a civilised people, and that, with few excep tions, even Japanese who prove estimable and high-minded in every other matter are not to be trusted when business transactions are in question. As a direct outcome of the contempt and degradation visited upon trade in feudal days, all classes now appear to regard commerce simply as a game of 'besting,' and the man who fails to take advantage of his neighbour when opportunity serves is looked upon rather as a fool than as one whose example should be praised and imitated. It is well, therefore, at a time when Japanese merchants are endeavouring to enter into direct relations with firms abroad, that the position should be clearly understood; and as a page of illustration is worth more than a volume of comment, I propose to relate some facts of recent occurrence, from which the reader will be able to draw his own conclusions. A case decided by the Japanese courts last year affords a good insight into Japanese methods of carrying on business. It has attracted much attention locally, in view of the fact that by the Revised Treaty with Japan which has now been signed the foreign merchant will come under Japanese law and Japanese administration, and mercantile transactions will consequently be decided by Japanese custom. A firm of British merchants last year imported a hundred bales of yarn to the order of a well-known and wealthy Japanese trader, who at the time was president of the Yokohama Yarn Guild. By the time the goods arrived, however, the market had declined, and the transaction promised to result in a loss to the Japanese importer. He therefore adopted a course which foreign merchants bitterly complain is a common practice with the Japanese trader in similar cases, and refused to take delivery of his goods, his pretext for not fulfilling his engagement being that he had ordered goods with a purple and not a red chop' or mark. Finding that their customer obstinately refused to take delivery of the goods he had ordered, the British firm brought an action against him in the Japanese court, and eventually judgment was given in their favour, the Japanese yarn importer being ordered to pay the full claim of 29,528 dollars, together with insurance, interest, and warehouse rent. This was so far satisfactory, but the sequel was far otherwise. Some days before the judgment was delivered a deputation from the Yarn Guild waited upon the representative of the British firm in Yokohama, and proposed a compromise very favourable to the defendant, and proportionately against the interests of the plaintiffs. The foreign merchants refused to entertain it; whereupon they were told that unless they agreed to the proposal and stopped proceedings, they would be placed under a boycott, and none of the Japanese yarn merchants would have any dealings with them in future. Refusing to be intimidated, the firm allowed the case to proceed to judgment, and instructed their counsel—a Japanese who is a barrister of the Inner Temple-to inform the court of this attempt to interfere by threats with the administration of justice. He did so, but without effect, for the judges, while giving a decision for the plaintiffs, refused to take any notice of the gross contempt of court which had been committed by the defendant. Naturally, the fact of the judges declining to pass any comment on their conduct, or to take any action against them, emboldened the Japanese merchant and his business friends, and the threat of boycotting was renewed in more precise terms than before. The British firm found themselves in a position where there appeared no hope of any protection from the law, while they were aware, from previous cases of this nature, that the boycott would be strictly carried out, and might mean ruin to their business. After anxious consideration, it was at last decided to give way to the pressure of the Guild and accept the so-called compromise, by the terms of which they were losers to the extent of 2,150 dollars. Thus the Japanese business men of Yokohama were able to thrust an unfair and wholly inequitable arrangement upon the firm of foreign merchants, in sheer defiance of the law, and without the shadow of excuse or justification in any code of commercial morality. The case is only one of many, differing in details, but alike in illustrating the standing complaint among foreign merchants in Japan, that the native trader will not honourably fulfil his engagements if by so doing he is likely to suffer loss. On the one hand, orders given and contracts signed are regarded by Japanese as so much waste paper when the market declines; while, on the other, the foreign merchant is held strictly to his agreement should the prospective loss be his. The serious point is, that we have here an example of a Japanese court giving an equitable decision, but remaining absolutely passive in the face of information as to deliberate measures taken to nullify its judgment. Another very significant feature is that in the discussion which ensued not a single Japanese journal expressed any condemnation of the methods pursued by the defendant and his Yarn Guild; several, indeed, went so far as to justify them, and a correspondent, who appeared to voice the general feeling of the native traders, wrote to a Japanese journal a quaint sentence in English that will be found very instructive. as follows:-The saibansho (court) had its say from a legal point of view of the question, but the trade practices long established at Yokohama [i.e. of holding native traders to their contracts], so often objected to by Japanese merchants, but maintained with dogged obstinacy by some of the foreign merchants, are not such as would justify, in the name of equity, an appeal to court in every case of differences between the parties.' The meaning of which is, that the decisions of the courts are to be ignored and rendered of no effect because they are not approved by the persons supposed to be subject to them! Thus has evil been worked by the practice of placing commerce outside the sphere of morality, and making the position of the trader one of degradation. The merchant class is now constantly being recruited from among those who, fifty years ago, would have considered themselves disgraced by any connection with trade; but, unfortunately for the hope that a better state of things will be brought about in the near future, even the higher walks of what may be called commercialism are not free from the questionable methods developed by a long period of commercial debasement. For example, it might have been supposed that the promoters of last year's industrial exhibition at Kioto, held under the sanction and patronage of the Government, and associated with the name of the Emperor, would have aimed at setting a good example to merchants in general. It was not so, however, as the following incident shows. A visitor who saw some articles at the exhibition which took his fancy, and found they were marked 'sold,' went to the shop of the exhibitors in Kioto, and attempted to purchase similar goods direct. To his surprise, he was asked a price just fifty per cent. above the figure marked on the goods in the exhibition. On asking for an explanation, he was told that had the firm's goods in the exhibition been marked at their actual retail price they would have been refused by the committee, which insisted on the manufactured articles being all marked at low figures; consequently, it was necessary for exhibitors to place a fictitious price on their goods, and then to send agents on the first day the exhibition opened and purchase them back, so as to avoid loss. If the statement is correct-and it came to me on the very best authority--it is possible we have here some explanation of the remarkably low price marked on Japanese manufactured goods exhibited at Kioto : a fact to which attention was called by articles in the commercial journals of every manufacturing country in the world, and which was especially commented upon in England, as exemplifying the competition with which British manufacturers would have shortly to contend. Yet it seems much of the argument was founded on false information, suggested and encouraged by the exhibition committee, and Japanese goods have thus secured an advertisement for cheapness which they do not deserve, and which can be of no practical benefit to Japanese trade in the long run. Even if we go higher in the social scale than exhibition commissioners, we are still confronted with conduct in commercial matters seriously lacking in integrity. Quite accidentally it was discovered some time ago by foreign merchants that, notwithstanding definite provisions in the Treaties placing them on an equality with Japanese in the matter of Customs duties, the Government was secretly discriminating against the foreigner. The Customs tariff provides that specific duties upon certain articles of import and export shall be paid in boo, an ancient Japanese silver coin defined as weighing 134 grains and containing not less than nine parts of pure silver. Article VI. of the Convention made with Japan by Great Britain (1866) and other Powers, provided that, in conformity with those articles of the Treaties which stipulated for the circulation of foreign coin at its corresponding weight in native coin, dollars were to be received in payment of duties at the rate of 311 boos per hundred dollars, and this method of calculating the amount of duties still remains in force. About ten years ago there was issued an Imperial Rescript, countersigned by the Minister for Finance, which stated that hereafter the exchange would be calculated at the rate of 31 sen per boo, or boos 317-44 per hundred dollars; but, strange to say, no copy of this Imperial Rescript found its way into any foreign Legation or Consulate, and foreigners continued to be charged duties at the old and higher rate of exchange, while Japanese were permitted to pass their goods through the Customs at the new and lower rate. The Chairman of the Hiogo and Osaka Foreign Chamber of Commerce has compiled the following table, showing amounts that were actually paid by Japanese importers, and contrasting them with what foreigners would have been charged: Imports Paid by Japanese If Foreigners had Importers passed Goods 973.35 993.57 Showing an advantage in favour of the Japanese of more than 2 per cent. upon the total duty paid-an advantage which is not to be despised in these days of close competition. Now this discrimination against foreigners and in favour of Japanese had been going on for some nine or ten years, and it is difficult to believe that it was unknown to the high authorities, or was the result of any misunderstanding. The secrecy shown by the issue of the Rescript to Customhouse officials only, the fact that not a single Legation or Consulate managed to get hold of a copy, and that the only foreign employé at the time in the Customs was kept in ignorance of its provisions, all go to show that the Japanese Government was knowingly concerned in a trick to 'best' the foreigner by placing the native 'direct' importer at an advantage, not only over his foreign rival, but over the Japanese merchant who imported his goods through a foreign firm. As the result of a memorial addressed to the foreign Consuls, upon which action was taken by the various Legations in Tokio, the Japanese Government has abandoned this method of discriminating between foreign and native importers, and the former as well as the latter now pay duties at the uniform rate of 31 sen per boo. But the Government has not attempted to clear itself of the charges brought against |
