💸 Was ‘40,000 for 1’ Terrible? Look at Japan’s Post-war Financial Massacre and You’ll Know How Lenient the Kuomintang Was
Recently, several drama series “creative fictions” have been brainwashing young Taiwanese under the guise of historical facts. For example, the recent series Gold Leaf is once again a piece of self-serving, one-sided propaganda claiming how bad the Kuomintang was, bullying Taiwanese by exchanging 40,000 old dollars for one new Taiwan dollar…
Chotto matte… if you look at the financial measures invented by Japan after the war—Japan being the culprit that sucked the financial lifeblood out of Taiwan for the war effort—such as New Yen Exchange and Deposit Blockage, you’ll realize how lenient and kind the Kuomintang was to the Taiwanese people.
This kind of “Taiwanese are so kind and were all bullied by the Kuomintang” fake news pops up every few days to brainwash everyone’s values. And at times like this, those “Fact-Check Centers,” which are essentially affiliate organizations, act like cowardly turtles and don’t dare to utter a word…
How Japan Wiped Out Inflation After the War? More Bloody than ‘40,000 for 1’
Some people say “40,000 for 1 was miserable; Japan wouldn’t have had such inflation and could control it.” Hearing these words, I went to look up what Japan actually did after 1945.
At the end of the war in 1945, Japan’s situation was extremely severe. The massive amount of national debt issued during the war had reached 266 times the national income by 1944. Naturally, what awaited Japan was Large-scale hyperinflation.
Japan adopted the following radical means to deal with it:
1. New Yen Exchange and Deposit Blockage (February 1946)
- Implemented “Shin-en kirikae” (exchanging old banknotes for new ones) and “Yokein fūsu” (blocking deposits/limiting monthly withdrawals per person). On the surface, this was to suppress inflation; in reality, it hid the purpose of canceling debts.
- After March 3, 1946, any old Japanese currency that hadn’t been exchanged for new money was simply repudiated by the government.
- [Note from Political Geek]: So when you hear someone saying things like the Bank of Taiwan notes and the Japanese Yen were 1:1, and how much they would be worth if they hadn’t been exchanged when it was 40,000 for 1, you know they are BSing. After March 3, 1946, all Japanese Yen and Bank of Taiwan notes circulating in Taiwan became scrap paper.
2. The “Poverty for All” Policy for Property and National Debt (August – November 1946)
The Japanese government promulgated three key laws to carry out a Large-scale redistribution of wealth and debt elimination:
| Decree Name | Core Content | Result |
|---|---|---|
| Wartime Compensation Special Measures Law | The government levied a 100% compensation tax on its wartime debts (compensations) to the munitions industry. | The Japanese government owed a company one million, paid you back one million, and then levied a tax of one million, effectively wiping the slate clean. |
| Financial/Enterprise Reconstruction and Reorganization Law | The Japanese government supported enterprise reconstruction, wiping out enterprise and bank debts using “Second Blocked Deposits.” | Ultimately compensated via “national debt,” but the national debt was paid by the citizens, resulting in loss of citizen property. |
| Property Tax Law (November 1946) | A comprehensive property tax—minimum 25%, maximum 90%—was levied on all movables, real estate, and savings of Japanese living in Japan as of March 3, 1946. | Effectively used a “Poor All” card on Japan. Those who couldn’t pay in cash had to use physical objects or savings to pay the debt. |
After using such radical methods to eliminate currency in the market, Japan’s inflation rates (compared to the previous year) in 1946, 1947, and 1948 were 432.9%, 195.9%, and 165.6%, respectively. Although inflation seemed high, prices “only” rose 14 times; these policies were effective.
…I just don’t know if many Japanese people jumped into the sea because of it.
So was 40,000 for 1 really that bad? Why don’t you see what the Great Empire of Japan did, hmm?