FINANCIAL CONDITIONS
tion and proclaimed the equality of specie and paper. Now they promised to redeem the notes in thirteen years; then they shortened the period to five, and again they postponed it indefinitely. Nothing is more notable than the fact that, despite this bewilderment and vacillation, the Government's financial credit gradually acquired strength, so that within five years, though the issues of fiduciary paper aggregated nearly 60,000,000 yen, the notes circulated freely throughout the whole Empire at par with silver, and even commanded, at one time, a small premium. It is true that by this epoch the revenues of all the fiefs had become available for the service of the State, and that only one-tenth of their total had been appropriated for the support of the territorial nobles. But the Central Government, having diminished the taxes to about one-half of their former total, as will presently be shown, found the public income too small for the expenditures. The paper money of the fiefs, amounting to 25,000,000 yen, had been exchanged for treasury notes. The building of railways had been commenced. The foundations of an army and a navy had been laid. A postal system, a telegraph system, a prison system, a police system, and an educational system had been organised. The construction of roads, the improvement of harbours, the lighting and buoying of the coast, had been vigorously undertaken. A mercantile marine had been created.
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