694 REFORM OF GOVERNMENT ORGANIZATION
ital in the tenth century, and that system had been carried over and extended to
more provincial districts in the Chason dynasty in the fifteenth century, but by
Yu's time in the mid-seventeenth century not one local district retained its ever-
normal granary.
The best way, therefore, to solve current Korean problems was to establish
ever-normal granaries to stabilize prices through their purchase-and-sale oper-
ations, and encourage the elders of every village to establish village granaries
and run them themselves, thereby ensuring the fair and just distribution of loans
and relief. "Let the people and gentry of the village manage the granary pub-
licly but only allow the official yamen to give aid and encouragement; it will
not be able to supervise or excise jurisdiction [over the granary J."
Yu rejected any arguments that corruption could occur in the village granaries
after they were established because of the greed of local administrators, or that
they might be abandoned by the villagers. He was certain that once established,
the villagers would be won over by the obvious advantages of the system, and
once the village granaries were accepted, they would become a standard insti-
tution. If in the worst instance, village granaries could either not be established
or fell into disuse after they were created, no harm would be done and things
would still he better off than under the current hwanja system of government
grain loans because the peasants themselves would have to take responsibility
for accumulating their own famine reserve, and the ever-normal granaries could
provide relief grants in an emergency.4^0
Chu Hsi's Village Granary System
In addition to the ever-normal granary system, Yu was also a great admirer of
the village granary system that Chu Hsi first instituted as district magistrate in
I 168 during a great famine. Yu described how Chu Hsi borrowed 600 shih (piculs)
from the prefectural magistrate, charged 20 percent interest on the loans but
with provision for interest rate reduction or no interest at all if the crop yield
was too small. By I 176 he repaid the initial capitalization and accumulated an
additional reserve of 3,000 shih, and then ceased all interest except for the 3
percent wastage surcharge. The head of the village shrine (she-shou) and the
chief of the pao mutual aid unit (pao-chang), were to keep the loan records and
divide the village population in pao units, but the decisions about the initial
funding would be calculated by the both permanent and temporary residents of
the village, and the disbursement and collection of loans would be conducted
by the village elders. Loans would not be forced on anyone who did not want
them, and the prefectural and district magistrates would be forbidden from inter-
fering with the management of the loans.
Later Chu Hsi was summoned to court and asked by Emperor Hsiao-tsung to
extend the system to a broader area, and to order that the ever-normal granaries
in the prefectures and districts and also private wealthy individuals provide a
capital rice fund for the establishment of the village granaries (she-t.\· 'ang). Not