Like others who have been prominent in the making of modern Japan, Count Inouye was a soldier before he became a statesman. To most of the foreign residents in Japan at the period immediately following the Restoration of Imperial rule he was best known as the Finance Minister, Inouye Bunda. To his countrymen he was the dashing Choshiu leader who had commanded the samurai troops of the southern clan in the fierce and prolonged strife of pre-Restoration days between his lord and the Bakufu, or Government of the Shogun. He and many of his colleagues in the first Imperial Government had made names for themselves as deft wielders of the long keen swords that they wore in their belts rather than for sage advice in the council chamber, but they speedily gave proof of exceptional ability in directions far removed from the ordinary path of the bushi, whose province it was of old “to follow his chief to the field.” But prior to his defeat of the Tokugawa forces the future financier had spent more than a year in England and the capitals of the Continent, having contrived to make his escape from his own land when foreign travel was still interdicted. A batch of students left Japan in 1863 intending to remain abroad for a five years’ course of study, but Inouye heard of the troubles that were thickening in connection with his own province consequent upon the attitude of its lord towards foreign intercourse, and having had opportunities of judging of the military strength of the Occidental nations in the course of his journey through Europe resolved in company with his friend Ito Shunsuke to return forthwith and warn the Choshiu baron of the risks that were being incurred by the clan. They left their fellow-students behind them in Europe and hastened to Yokohama, where they found the combined squadron on the point of sailing for Shimonoseki, to punish the daimio of Choshiu for firing on passing ships. Armed with letters from the Foreign Ministers to the baron Mori, their lord, Ito and Inouye took passage in one of the warships, and were at their own desire landed at a point on the coast, in the Suwo Nada, as that part of the Inland Sea is termed, and made their way by road to Hagi, where the daimio was then in residence. Hagi is some forty miles across country from the Suwo Nada, and Inouye and his companion ran considerable risk of being discovered and brought to book for having quitted the province without leave. They assumed the disguise of medical men, who were permitted in those days to wear one sword, and were thus not wholly without means of defence had they been attacked in the mountains, and they succeeded in reaching the castle town to which they were bound without being delayed on the road. But they found the baron Mori entirely averse to the proposition that he should withdraw his standing order to the forts to fire on strangers, and on the other hand, though their reception had not been unkindly, they were ordered to return with a message of defiance to the squadron they had left in the Inland Sea. Three days in all had elapsed when they rejoined the British man-of-war Barrosa and communicated the purport of their lord’s reply. One course only remained open to the British and other commanders, and the vessels steamed to a selected position in the straits, just out of the strong current, and early the next morning prepared for the assault. Not without warning, however, for due notice was given of the intention, failing surrender. The Choshiu batteries were eight in number, beginning at Chofu, three miles east of the town of Shimonoseki,—and now the first railway station on the Sanyo line towards Kobé,—and extending thence to the hill, opposite Moji Point, where the main street of Bakan—another name for Shimonoseki, and in general use—begins. Seventy-four guns were mounted in the eight batteries, and the instant that the guns of the squadron opened fire, on the expiration of the allotted time, the most vigorous response was made by the Japanese gunners. The most powerful of Choshiu’s ordnance was mounted at Maita-mura, a village midway between Bakan and Chofu. After some severe fighting, in the course of which the town of Bakan took fire and burned fiercely, the batteries were silenced, and the British ship Barrosa landed a party of bluejackets and marines to aid in extinguishing the conflagration. During the engagement one man on board a foreign ship was killed by an arrow, the Choshiu men having fallen back on archery to help them in the defence of their positions. On the surrender of the forts a document was drawn up for the baron’s signature, agreeing to certain conditions for the withdrawal of the attacking squadron, and Ito and Inouye were once more despatched at the request of the local government to represent the utter impossibility of holding out against superior force. The envoys returned two days later with the agreement sealed, and seventy-two guns, then supposed to be the total number in use, were taken on board the allied vessels. Two guns were unwittingly left in position on the hillside, commanding the straits, for the writer found them there when surveying the locality ten years afterwards, all but hidden in the dense undergrowth. The Choshiu samurai were not a little proud of the resistance which they had been able to offer to the foreign ships’ attack, and the townspeople never forgot the magnanimous behaviour of the victors in going ashore to quench the flames that the battle had originated.

The men of Choshiu, some fifty or more in all, who fell in the memorable fight were interred in a special cemetery situated on rising ground in the rear of the town, and the graves are still tended with that loving care which is invariably bestowed everywhere in Japan on the burial-places of relatives and friends. The Frenchmen,—it is said there were three,—who were killed aboard the French warships, were taken ashore on the Moji side for interment, and at a later date the French admiral visited the spot, and, according to report, discovered that the graves had been wilfully desecrated, indeed,—as it was said,—wholly destroyed. That some misapprehension must have existed on this point is certain, since the writer was conducted by a farmer, who dwelt near Moji point, to the spot where the three sailors had been buried, and to all appearances the graves, though surrounded by dense vegetation, were intact. This was in the year 1873, when a submarine cable was being laid across the Straits to form part of the Japanese telegraph system. The farmer knew that those who fell on the side of the allies lay in that secluded spot, and expressed his regret that being a poor man he could do nothing to show his respect for those who had perished at the post of duty. The undergrowth was cleared away, and the soil had been purposely left untouched by rake or hoe. This was more than thirty years ago, and it is impossible for the writer to say whether or not some suitable memorial to the French victims of the battle has since been set up at the place indicated, but in any case there must still be people dwelling near it who know where the interments took place, as the story of the combined attack on the forts and the incidents of the struggle is told with zest by father to son, and on the Shimonoseki side the festival of the dead is regularly held at the tiny graveyard at the back of the main street.

Only a little while before the date of the Shimonoseki bombardment the Choshiu retainers at the baronial mansion in Kioto had engaged in hostilities with the Shogun’s supporters at the capital, and so close to the imperial palace were the combatants that the walls were repeatedly struck by bullets. This was during the lifetime of the Emperor Komei, and the now reigning sovereign was then only ten years of age, this early experience of hearing shots fired in anger, and particularly in the immediate vicinity of the imperial palace, though indicative of the pitch to which clan jealousy and animosity had at that period attained, being such as his Majesty was not likely to forget.

As to Choshiu, the sequel to the attack made by the clansmen on the Shogun’s troops was that the Emperor Komei issued an edict deposing the lord Mori and directing the Shogun, as Commander-in-chief of the forces, to punish him for his rebellious behaviour. The Choshiu clan thus found itself in a position of antagonism to the imperial house, as well as to the Bakufu, and as at the same moment it was assailed by the combined foreign fleets at the Straits of Shimonoseki, in consequence of its attacks on passing vessels, the head of the clan was driven to the necessity of defending both flanks as best he could. He contrived to stall off the assault of the Shogun’s troops for the few days that he was engaged at Shimonoseki, where his forts were demolished by the fire of Admiral Kuper’s men-of-war and their allies, and when that trouble was past he raised the standard of rebellion in real earnest and defied the Shogun openly. Discipline and drill (for they were armed with Tower rifles, and had been partially trained on a Western system) served the men of Choshiu well, and they succeeded in inflicting a severe defeat on the forces of Iyemochi, who led his men in person. In this encounter between the forces of Choshiu and the Shogun the Satsuma clan stood aloof, possibly as the result of private negotiations between the clan leaders, for there were at this time several persons making their way to the front who were destined at no very remote date to play the most important parts in the affairs of the nation. On the Choshiu side were Ito and Inouye, on the Satsuma side were Saigo and Okubo, all men whose names will never fade in the history of their country’s emancipation from feudalism. The leaders of the two clans were united, moreover, by a bond of common interest, inasmuch as all desired to bring about the abolition of the Shogunate and secure the revival of direct imperial rule by the Emperor himself. The future Marquis Ito and Count Inouye had at this time only just returned from their first visit to Europe, as already recorded, and they lost no time in impressing upon their fellow-clansmen of Choshiu the advantages of military preparation for the coming struggle. The spirit of loyalty to the clan with which they were animated prompted them to ensure, as far as was practicable, that it should be in a position to do itself justice in the final effort which was then about to be made to restore the personal authority of the Ten-shi.

Inouye Bunda was invested with the control of the Choshiu forces in the field, and many engagements took place in the region bordering the Inland Sea. After the death of the Shogun Iyemochi in 1866, however, the encounters between the Bakufu troops and those of Choshiu became less frequent, and there was practically a truce during the later months of the year 1867, the situation in October being such as to prompt the Shogun Keiki, whose tenure of the office had been but brief, to prefer a request to be relieved of duties which circumstances had made it all but impossible for him to fulfil. The lord Mori made his submission to the Court, at Kioto, but the hostility of the clan to the Bakufu remained latent, notwithstanding its temporary suppression, and when, at the close of December 1867, the supremacy of the southern clans was established at the capital, followed by the departure, on the 3rd of January, of the Shogun Keiki for Osaka, the Choshiu clan was prepared to play a very active part in the restoration of direct imperial rule in substitution for that delegated authority which the Tokugawa house had so long wielded.

But Inouye Bunda had shown capacity of a different kind to that which had so far been demanded of him as a military leader, and he at once took his place as one of the most well-informed members of the new administration, particularly on matters of finance, which he had made his especial study.

It became necessary for the Imperial Government to undertake works of public utility, more especially railways, and on this account money had to be obtained from abroad, the first loan being negotiated through the agency of the Oriental Banking Corporation, while Count Inouye, as he subsequently became, was at the Finance Department. The interest on this loan was 9 per cent., and on a subsequent one 7 per cent., both being extinguished very early in the Meiji era. In the fifth year (A.D. 1872) the wise step was taken by Inouye, then Vice-Minister of Finance, of laying by a Reserve Fund comprised of extraordinary incomes, obtained in the first place from the sale of certain Government articles which had ceased to be of any use. The idea of inaugurating such a reserve had been borne in upon the Government by the trying financial experiences of the preceding four years of the reign, consequent on the new administration having had to shoulder the responsibilities of the provincial Governments or Hans, by which in many instances a flood of paper money had been issued to circulate in merely their own territories, and not current beyond their boundaries. The extinction of the Hans obliged the new Government to undertake the liabilities so incurred to the agricultural and other population. The Vice-minister had also in view the resumption of specie payments at the earliest possible moment, though it was long ere his wishes were realised. Altogether he found it practicable to create the “Treasury Reserve Fund” by appropriating 11,330,000 yen,—adding together 11,230,000 yen of specie and 99,000 odd of paper money, which had been accumulating in the Government treasury. The Rules framed by him and issued in connection with this Reserve Fund are evidence of the clear perception the Vice-Minister had of the necessities of the hour, for he pointed out the urgent demand that then existed for giving support to the policy of the Government by saving up specie as a reserve, and arranging for its utilisation in a definite and unequivocal manner, in order that the circulation of paper money and the redemption of bills might be effectively provided for. A set of rules, twelve in number, was laid down for determining the method of the utilisation of the fund, in June 1872, and with slight modifications to suit changed conditions these regulations held good throughout the period antecedent to the introduction of Parliamentary Government. Such reserve funds as were in the possession of the Hans, kept for the redemption of the notes issued by them,—for they were not all indifferent to this obvious duty,—were added to the Government’s reserve, according to the actual sums received. And as the New Treasury’s convertible bills then totalled 6,800,000 yen, it was arranged that the amount thereof should be withdrawn at any time from the reserve fund of over 11,000,000 and paid in exchange for those bills whenever the demand might be made. By the following December the Reserve fund, in the Vice-minister’s management, had reached the sum of over 16,000,000 yen, and as the yen was the equivalent of the dollar, at that time valued at from forty to forty-four pence English, the Reserve Fund was roughly £3,000,000 sterling.

But when every liability had been taken into consideration it was the Vice-minister’s somewhat mournful conviction that the Reserve was not equal to even one-tenth of the total of the bills and various other kinds of paper money in existence, for there were 20,000,000 yen worth of the Hans notes out somewhere, and 55,000,000 worth of the Dai-jo-kwan paper, issued to meet the unavoidable cost of setting up the new administration in 1868. This financial difficulty, indeed, was but one of the many problems that the Government of the Restored Imperial Rule was faced with at the beginning of its career, apart from all considerations of the opposition that it had to expect from those who were averse to the change and resolved to appeal to arms in support of their convictions. Indeed, the insight which even a superficial examination of the financial position in the early years of Meiji is apt to afford the student must tend to add to the wonder always experienced that the marvellous results which it is on all sides acknowledged were achieved by the men in power were attained with no greater sacrifices than those which had to be recorded. The spirit in which the individual members of the administration set about their tasks is, however, well exemplified by the tone of the memorandum addressed by the Department to the Government in December 1872. These were its terms:—

From that time forward the Government never neglected any opportunity of augmenting the Reserve Fund, and when at a later date the change to the adoption of a gold standard was in preparation the fund which had been so wisely initiated in 1872 was of the greatest help in partly paving the way for the resumption of specie payments by Count Matsukata.

In 1878 it was decided that a sum of 10,000,000 yen in gold should be kept, as part of the Reserve Fund, in the Government Treasury, the remainder being turned into floating capital, and it was ordered at the same time that 20,000,000 yen should be added annually out of the general account to the Sinking Fund, having for its object the redemption of public debts, both domestic and foreign.

It would be very difficult to set forth in detail the many services rendered to his country by Count Inouye in the domain of finance, but enough has been adduced already in the way of proof that his guiding hand was of immense value to the nation in the critical period which followed on the Restoration of Imperial Rule, and for many years after while the national finances were being gradually established on the substantial footing they have in later years been shown to possess. It was as Foreign Minister in several administrations that Count Inouye also distinguished himself, having held that portfolio at various times during the existence of the Dai-jo-kwan, which only gave place to the Cabinet in 1886. It was while he was Minister for Foreign Affairs in 1882 that a systematic attempt was made to bring about an amicable adjustment of the outstanding questions relative to the position of foreigners in Japan, a conference of representatives of the treaty powers meeting at Tokio to seriously consider revision in all its bearings. Minister Inouye, who had some time previously changed his name from Bunda to Kaoru, had throughout held it to be impossible for the nation to preserve the attitude which the advocates of an exclusive policy had sought to maintain towards the Occidental powers, and at the conference he boldly stood up for the wholesale opening of the ports to foreign trade, with a corresponding abandonment of consular jurisdiction on the part of the Western nations, in recognition of the Emperor of Japan’s sovereign rights over every foot of Japanese soil. The agreements to be entered into on this give-and-take basis were to be valid for twelve years, though there was a suggestion that the tariff, and the regulations in general as to foreign commerce, should be subject to alteration at the end of eight years. Some of the foreign delegates were dissatisfied with this proposal, while on the side of the Japanese there was no little repugnance evinced even in high quarters to the idea of throwing the whole country open to trade. There were other difficulties, too, in regard to the period that should elapse before the provisions respecting the admission of foreigners to the interior should come into force, and the suggested appointment of foreign judges to the Japanese Courts after the style of the Mixed Courts in China. Finally the conference broke up without reaching any conclusions on these knotty questions, though it was something to reflect upon that a genuine effort had been made on both sides to remove the obstacles to a better understanding. In 1884 there were clear indications that the Foreign Minister’s policy was gaining ground, symptoms of a disposition to welcome foreigners being manifested where previously there had been violent antagonism to the project.

In 1885 the war party in Japan conceived the notion of an alliance between their country and France against China, there being at the time extreme bitterness of feeling between the French and the Government of Peking, which culminated in the bombardment of Foochow. The reversal of Japan’s traditional policy towards the neighbouring empire which an alliance of the kind at that moment would have entailed was fully appreciated by Japan’s Foreign Minister, who had by this time been raised to the peerage as Count Inouye. It was by his tact that Japan was enabled to steer clear of complications at this juncture, and to retain her influence in affairs at the Chinese capital.

The year following Count Inouye was again immersed in the excessively complicated problem of treaty revision, which it had been Japan’s object to effect for fully fifteen years past. The conferences began in May and lasted throughout the year and well into the next. By the summer of 1887 Count Inouye had by his patience and urbanity brought the negotiations to a stage wherein it really seemed that nothing was requisite beyond the actual signature of the agreements. But at that moment the Cabinet decided, notwithstanding that the British and German representatives were urging on their colleagues the advisability of forthwith surrendering the consular jurisdictions, without any transitional stage, that it was premature to adopt Count Inouye’s views with regard to the opening of the country unrestrictedly to commerce and travel, mainly because it was felt that the safeguards which it was still deemed needful by some of the delegates to insist upon were destructive of the judicial independence of the State. While such were the opinions entertained in some degree even in official circles the hope of adjusting the differences became more than ever slender, and popular antagonism to the grant of any concessions of the kind was once more revived, to the extent that in July 1887 Count Inouye terminated the conference in the conviction that it could serve no useful purpose to prolong its sittings. More than twelve months had been consumed in a fruitless endeavour to reach a satisfactory settlement, and the end seemed to be as far off as ever.

In August, however, the Emperor invited the British Minister, Sir F. Plunkett, to a private audience, and warmly eulogised the part which Great Britain had taken in the prolonged effort to revise the treaties on a basis acceptable to Japan, also intimating his intention of sending to the then Prince of Wales—now his Majesty King Edward VII.—the Grand Cross of the Order of the Chrysanthemum, by the hand of the Imperial Prince Komatsu. The ceremony of investiture subsequently took place at Marlborough House, and the German Emperor was simultaneously the recipient of the order named, likewise in recognition of the friendly part played towards Japan in connection with the Revision Conference.

Count Inouye resigned his post of Foreign Minister, as a matter of course, when the Cabinet refused to endorse his proposition, but he remained in the Government for the time being, his place at the Foreign Office being taken by Count Ito, who was also at that time Prime Minister. Count Inouye became Court Councillor, but in the ensuing summer he was again in the Cabinet as Minister for Commerce and Agriculture, the portfolio of Foreign Affairs having in the previous February been assumed by Count Okuma, on the retirement of Count Ito to become President of the Sumitsu-In, or Privy Council, then newly created as his Majesty’s highest resort of counsel. Ten Cabinet Ministers were given seats as ex-officio members of this council, one of them of course being Count Okuma whose return to official life, after seven years’ retirement following his long service as Minister of Finance between 1873 and 1881, was a source of immense gratification to the people at large as well as to his colleagues in the Ministry, implying as it did a fusion of the interests of the Progressives (Kai-shin-to) and the Government party represented by Counts Inouye and Ito, at a rather critical period in the history of the nation’s affairs. At the Foreign Office the policy of Count Inouye was ably and steadfastly pursued in respect of treaty revision by Count Okuma, who on receiving the congratulations of the Yokohama Chamber of Commerce in 1889 on the promulgation of the Constitution, took occasion to say that “one national aspiration yet remained unsatisfied,—the revision of the treaties.”

In 1890 Count Inouye became a Lord-in-waiting, which office had never previously been filled by other than a member of the old Court nobility, and in bestowing this unusual honour on one of the Elder Statesmen the Emperor gave signal proof of his appreciation of Count Inouye’s matured judgment and ability.

By 1892 a disruption of the Cabinet had become inevitable, and at the Election of February the Opposition gained a victory, which brought about the return of Count Ito to power, and with him Count Inouye, in his old position at the Foreign Office. On the 1st of December he made a memorable speech in the House of Representatives in reference to the necessity of increasing the naval armaments of the empire,—a speech which was remarked upon both inside the House and out of it as having been one of his most telling efforts,—powerful in argument, lucid in theory, convincing in its array of facts. It was the prelude to a request from the Finance Department for a credit of 16,000,000 yen, to be spread over a period of seventeen years, and which the Diet forthwith granted.

During the subsequent war with China Count Inouye continued to be a leading member of the Government, but in 1897 he was in opposition to the Coalition Cabinet of Counts Okuma and Itagaki, and when that was succeeded by the Administration of Marquis Yamagata he still remained out of office. But towards the close of the year 1900 a ministerial crisis arose which resulted in the overthrow of the Yamagata Cabinet and its place was taken for a brief space of time, scarcely seven months in all, by a Ministry of which Ito (now Marquis) was the Premier. Contrary to expectation, the post of Finance Minister in this was allotted to Viscount Watanabe, who had previously served as Vice-minister with both Count Inouye and Count Matsukata, though it was commonly believed that Count Inouye had been invited to accept the post. Whatever may have been the real situation at this time, it is a fact that there had been eleven different Cabinets between December 1886 and the end of 1900, the collapse in every case having been due to internal dissension rather than to external pressure, and this may be accepted as an indication of the difficulty which was experienced by statesmen of even the front rank to unite on a general scheme of domestic as distinguished from foreign policy. In relation to foreign affairs the patriotism of the nation has ensured a reasonable continuity, but on home questions there has frequently been wide divergence of opinion. It was generally expected that in May 1901, when the last Ito Cabinet went out of office, Count Inouye would be successful in forming a Ministry, or that he would join a Ministry with Marquis Saionji as Premier, on the basis of the Ito party. But in the end the Cabinet of Count Katsura was established, and it continued until January 1906 to hold office, having guided the destinies of the nation with conspicuous success through the long and anxious period of the war against Russia.

Although he has not held a portfolio, therefore, in any recent administration, the influence of Count Inouye is always felt and his wise and sure guidance sought for in times when the financial outlook in Japan is more than ordinarily complicated, as was the case shortly before the formation of the existing Government in 1901. There seems to be a consensus of opinion in the country that among the “Elder Statesmen” three in particular are most conversant with financial matters,—Counts Inouye, Okuma, and Matsukata,—and to one or other of them it always turns in the hope of being extricated from its difficulties and relieved of its anxieties in a monetary crisis. In business circles the prestige which Count Inouye enjoys has never waned, from the period of his earliest assumption of the duties appertaining to the office of Finance Minister, and his views on those matters with which he has been more particularly connected during his long and diversified career, as soldier financier, and diplomatist will never cease to command the highest respect and attention of the nation.