INFLATION AND DEFLATION 955
among the people has declined, the mores of the people have become worse.
state finances have been depleted. The harm done has been plain to sec except
that some think that it is beneficial because it makes it easier to collect taxes.
But if the people have suffered harm, how could it be possible that the state
might benefit"He conceded that if cash were replaced with cloth and grain for taxes, the
cloth might be woven too thinly and the grain might rot in storage, but faced
with a choice of evils, these problems were far less damaging than the evils
wrought by cashY
Nevertheless, Yi recognized that cash had become so widespread by the 1720s
that it would be impossible to outlaw its use overnight, primarily because both
officials and private wealthy individuals would resist any attempt to rob them
of their wealth. Instead he thought the government should first issue a decree
that it would abolish cash entirely ten years hence, and that in the interim it
should ban tax payments in cash. He assumed that this measure would drive
the value of cash down to the level of copper and tin so that final abolition of
cash would not cause any serious loss of wealth either to the rich or the gov-
ernment agencies)'
Curiously this was the same tactic that was proposed by several officials who
sought to solve the cash shortage and reduce the high value of cash by freeing
more cash for the market given Y6ngjo's reluctance to spend more resources to
import either cash or copper from abroad. In fact, the measure to ban cash from
tax collections and replace them with grain and cloth was adopted in 1726 but
discontinued six months later. Yi Ik's plan to force the depreciation of cash by
this means might well have taken a decade at the least.
After the ban on cash for tax payments was dropped in 1727, Yi proposed
minting a hu·ge. multiple-denomination coin weighing .5 rang, equivalent in value
to fifty coins, but marked on the face with a value of sixty coins. to yield a sur-
plus of ten coins for each new large coin over the cost of the metal. This sur-
plus would then be used to cover the cost of the metalworkers engaged in minting
the cash so that the face value of the new large coin would be exactly equiva-
lent to the cost of production, an idea proposed earlier by Yu Hyongw6n, not
for the purpose of destroying the value of coins, but to maintain the constancy
of their value and enable them to function as a perpetual medium of exchange.
Assuming that Yi had read Yu's work, Yi turned Yu's idea on its head because
he wanted to mint a coin with a face value exactly equivalent to its production
value, not to ensure the stability of cash in the market, but rather to cause its
demise. He calculated that if the government confined its expenditures exclu-
sively to the new large fifty-cash coin while absorbing all the small coins in the
possession of the people through tax collections, the small coins would even-
tually disappear from the market first. Then, as the large coins proved too
unwieldy and yielded no profit from minting, people would abandon their use