FINANCIAL CONDITIONS
into the clutches of foreign bond-holders. Japan did not wish to fetter herself with foreign debts while struggling to emerge from the rank of Oriental Powers. After all, nothing succeeds like success. Japanese financiers made a signal success. Having undertaken to re-organise the administration of an empire, and to inaugurate a vast programme of reform, they met the difficulty of an empty treasury by issuing fiat notes, and then, fourteen years later, grappling boldly with the problem of this inflated and heavily depreciated currency, they restored its value to par and resumed specie payments in the brief space of four years.
It is advisable at this point to examine the question of the national debt incurred by Japan since the unification of the Empire.
As already stated, when the fiefs were surrendered to the sovereign, it was decided to provide for the feudal nobles and the samurai generally by the payment of lump sums in commutation, or by handing to them public bonds the interest on which should constitute a source of income. The result of this transaction, the details of which need not be set forth, was that bonds having a total face value of 191,500,000 yen were issued, and ready-money payments aggregating 21,250,000 yen were made.[1] This was the foundation of Japan's national debt. Indeed, these public bonds may be said to have repre-
- ↑ See Appendix, note 2.
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