IN THE OUTSKIRTS OF YEDO, NOW TŌKIO, THE CAPITAL OF JAPAN
The nation was divided into Shi, the nobility and gentry, the military, scholarly and administrative class; No, the agriculturists; Ko, the craftsmen, with whom the artists were counted; and Sho, the traders, placed below farmers and handicraftsmen as non-producers.
The natural consequence of this low place in the social scale was a lack of self-respect on the part of those engaged in commerce and finance that led them to be unmindful of their good repute. Trade and finance were looked upon by the majority as occupations unworthy of a gentleman and beneath the callings of the peasant and the workman; every trick was considered excusable when practised by the merchant, whose whole business was looked upon as a sort of warfare, in which cunning stratagem could be legitimately employed to the end of personal gain, a purpose appearing most unworthy to the classes swayed by the old knightly spirit. The evil effects, on a class as on an individual, of a bad reputation and consequent public contempt have, unfortunately, outlived the abolition of the old social divisions. The Japanese merchants and bankers no longer form a separate and despised class; the gentry, even members of the aristocracy, are engaging every day more and more in financial, industrial and commercial pursuits, many of them with marked success, yet the old taint adheres to the bulk of the trading community.
The Desire to Trick the Foreigner
There are, of course, many strictly honourable dealers in Japan, even amongst the smaller tradespeople and retailers. It is amongst the wholesale merchants and the brokers that lapses from the straight path of commercial integrity are still frequent, especially in their dealings with foreigners. It is, unfortunately, still the case that an advantage gained over the foreigner, even by the most shady methods, is looked upon as, in some way, a national victory. This deplorable point of view is likely to prevail as long as Japanese nationalism exists in its extreme form.
Japanese National Finance
The Japanese Government has, time after time, loudly proclaimed, by the mouths of its statesmen at home, and its representatives abroad, its desire to facilitate, in every way, the introduction of foreign capital, the vital influence so urgently required for the realisation of Japan’s bold schemes of industrial and commercial development. Strange to say, this cordial invitation, though energetically responded to by the capitalists of Europe, especially of Britain, and by those of America, has not, as yet, led to the investment of any very considerable sums in Japanese enterprises, although, as is well-known, the Japanese Government has easily borrowed many millions sterling in London, New York and Paris, for purposes of State. The chief obstacle to the investment on a large scale, of foreign capital in Japanese enterprises is to be found in the fact that, forgetting that capital is, after all, a commodity, therefore subject to the laws of supply and demand, the Japanese financial and industrial classes do not realise that the capitalist, being virtually the seller, controls the price of his property.
The Social Qualities of the Japanese
A mistaken impression appears to prevail in Japan that foreign capital is obliged to find an outlet in the Empire of the Rising Sun and must, therefore, submit to such conditions as may seem suitable to the Japanese and accept such security as the Japanese may deem sufficient. As long as this erroneous view obtains, there can be no considerable influx of foreign money into the coffers of Japanese industrial and commercial concerns. Experience is proverbially the best teacher; the dearth of funds that is certain to follow, in due time, the abnormal and feverish activity which is animating Japanese economic conditions, immediately after the successful issue of the great struggle with Russia, will undoubtedly induce a more reasonable appreciation of the circumstances. Once the Japanese have been taught by experience that they must regulate their demands by the lowest terms considered acceptable by the foreign holders of capital, a vast and profitable field will lie before those Occidental capitalists who have the advantage of expert advice in their selection of Japanese investments.