INFLATION AND DEFLATION 953
Any officials who violated these limits to charge higher interest for their own,
"private" profit would be subject to criminal charges and exile. Yongjo climaxed
his decree on the issue with a stern moral warning against the rich moneylen-
ders who profited at the peasants' expense: "Though cash cannot be worn in the
cold nor eaten in hunger, still the rich get richer and the poor poorer because of
it. The rich accumulate cash and manipulate it at will while the poor are faced
with immediate crises without giving a thought to the profit from interest."
There were two aspects of Yi K wangjwa's plan that might have eventually
brought moneylending to an end and closed off access to credit by the ordi-
nary peasants. If the interest rate were set too low, creditors might choose to
redirect their savings elsewhere to obtain a higher rate of return. Furthermore,
the time limit on interest charges not only limited total interest payments, but
also deprived the creditor either of a year's interest charges or a significant pro-
portion of his capital itself. If the theoretical limit of interest paYl11ents were
restricted to the initial size of the loan, and the borrower failed to make any
further payments, the creditor would have received his capital back but not any
interest on the loan. Since private cash loans and grain loans, and official loans
(either cash or grain) were set at the 20 percent, 50 percent, and 10 percent
rates cited above, far lower than the TOO percent limit suggested by Yi
K wangjwa, if the borrower refused or failed to make any further payments after
ten months, the creditors would only have received back those percentages of
their initial capital investment and would in fact have lost all interest payments
for the ten-month period. Even if the peasants chose to repay their debts some
time in the future, the creditor would have no access to that capital and would
be deprived of interest income from loans to others. In short, Yi's measure would
have benefited peasant debtors at the expense of the rich moneylenders, but
Yongjo did not approve the idea.3D We do not know the reasons, but we might
speculate that Y6ngjo was not as moved to take direct action against money-
lenders and creditors since he was convinced that abolishing the use of cash
would solve the problem anyway.
Yi lk [Sangha}Between 1726 and 1727 a struggle was waged over Yongjo's desire to abolish
cash, his adoption of Hong's compromise plan, and the failure of that plan. While
Yongjo's hopes were frustrated by the strength and vigor of the opposition to
his conservative thinking on the role and nature of cash in the economy, he also
had some unwitting support from one of the leading examples of statecraft schol-
arship in the early eighteenth century, and a reputed admirer and follower of
Yu Hyongwon. Yi Ik (pen name, Songho), passed the highest level civil service
examination in 1705 and probably did the bulk of his writing on practical affairs
in the decade of the 1720S, but he was far more the product of his times rather
than the propagator of Yu's ideas. As we have seen, however, the 1720S per-
mitted a fairly wide and open debate on the pros and cons of cash, and by no