So, Taoist philosophy, as regards its basic innovative ideas — let us put it as gently as we can — is not entirely free (to say the least) from extraneous influences. The twofold source of that influence is the Indo-Iranian metaphysical thought. The content of the most widely known work of Taoist philosophy, the Tao-te ching ascribed to Lao-tzu, attests to the same. The pithy dicta of that extremely profound and structurally complex text are really impressive. Most likely, it was written later than the Chuang-tzu, though there are several versions that allow of different opinions. However, what really deserves attention is the problem of its authorship.
The work is attributed to Lao-tzu, there are no other "claimants" to its authorship. In this connection, it is extremely interesting that Lao-tzu — allegedly a senior contemporary of Confucius — seems to be, most likely, a figment of Chuang-tzu's imagination. No text mentions Lao-tzu's name prior to the work of Chuang-tzu. But there is more to it than just that. It is more important to realize why Chuang-tzu needed that old man, who subsequently became wrapped in legend. This is not difficult to realize. Chuang-tzu (like Tsou Yan, for that matter) put forward some ideas that were completely unheard-of in China. However, unlike Tsou Yan's ideas — that were, for all their cardinal importance, easy to understand, — Chuang-tzu's suggestions seemed rather vague. It appears that, initially, even the wisest ones were unable to grasp his ideas. So Chuang-tzu experienced an urgent need for a valid basis that would have very ancient roots, for the Chinese highly valued nothing but old tradition. So he invented a certain "Old Man" who was nearly Confucius' precursor (this temporal tie-in is most important), who had the nerve to lecture the Master haughtily, while the latter allegedly accepted with meekness wisdom thus imparted.
On the other hand, the above-mentioned does not mean that the new ideas were solely the result of extraneous influence. Two important additions must be made. Firstly, the Chinese, including Taoists, tended to mix foreign innovations with old, well-known stories and examples from Chou and even pre-Chou history, which greatly reduced the general bewilderment of those who read the Chuang-tzu for the first time. Secondly, they were expert in grasping and subtly perceiving extraneous ideas in their own individual way, making them Chinese "on the fly". Both the specifics of the hieroglyphic writing and Ле difficulty of rendering foreign words, let alone special terms, greatly contributed to this. Thus the Taoist philosophy, which was alien to the Ancient Chinese pragmatism, was establishing itself.
The latter half of the Changkuo period was not only the time of competition between different schools of Ancient Chinese thought but also the time of their co-operation. This resulted in a number of works of an encyclopedic nature different chapters of which were written by scholars of different schools. Among them are the Kuan-tzu and the Lui-shih ch'unch'iu encyclopedias. However, this did not lead to a success of Confucian ideas. It is noteworthy that the numerous followers of the ju school (this was a common name for Confucians) did everything humanly possible to increase the influence of their doctrine, which so complied with the spirit of tradition. However, the uncompromising stance taken by the most influential among them (especially Meng-tzu) put rulers of the states off Confucianism. It impeded the advance of Confucianism in comparison with other competing doctrines, primarily Legism, which demonstrated its advantages. It is hardly surprising, then, that Legism in a variety of versions — most often milder ones than Shang Yang's — occupied a very prominent place in the Kuan-tzu. This situation lead, in the late Chankuo period, to Hsiun-tzu's (the third greatest Confucian of Chinese antiquity) becoming nearly a direct opposite of Meng-tzu. The fact that the two sages differed on the vital issue of man's nature (Meng-tzu believed that man was essentially good but the hardships of life spoiled him; Hsiun-tzu, on the contrary, proceeded from the assumption that man was full of vice and only education made him decent) was only part of that opposition. What mattered much more was that Hsiun-tzu — as well as Meng-tzu, by the way, — perfectly realized that Confucianism was rapidly losing its former prestige at the end of the Chou era. Besides, Hsiun-tzu realized that the doctrine was going to disappear altogether, unless its adherents dropped the uncompromising attitude of Confucius and Meng-tzu. While Meng-tzu saw the salvation of the teaching in the harsh condemnation of its opponents, Hsiun-tzu managed to realize, just in time, that the true solution lay elsewhere.