Economic problems and royal finance

Question 1

what was the positives of the economy like?

Answer 1

Even though there were positives:

• late 1780s there 27 million. 3 times the population of GB
• France was united and politically stable unlike Italy and Germany
• France had suitable farming land
• France was using agricultural methods such as crop rotation and the use of fertiliser, and the cultivation of potatoes increased
• trade with the colonies quadrupled. Bordeaux thrived on handling goods to and from Spain
• Paris became France’s centre of backing the Caisse d’Escompte was founded in 1776 to discount bills of exchange

Question 2

what were the negatives of the economy

Answer 2

• only 15% lived in localities of more than 2000 inhabitants however the population lived backwards compared to GB
• yield from Farms was low, there was rural overpopulation and highly taxed peasantry persisted with backward agricultural practices
• lacked a network of canals and rivers to carry goods
• 1780s there was a decline in France’s textile industry in the face of British competition
• series of poor harvests and disastrous winters from 1785 to 89
• Many relied on relief or charity from the Church
• 1730-70- agriculture output has grown allowing growth
• bread price rises 50% between Aug 1788 to March 1789

Question 3

what were royal finances like?

Answer 3

• accounting procedures were limited and widespread corruption
• no central bank or treasury
• financial official and corporations purchased their positions and it was accepted they kept something of what they collected
• government forced to rely on loans and build a substantial royal debt
• 1715 national debt of 2 million livers
• wars of Austrian succession followed by 7 years of war cost around 1.3 billion livres and by 1764 France was 2.3 billion in debt
• in 1778 when he chose to join the AWI he signed the Treaty of Paris which concluded the war in 1783 and gave the French little reward of 3.3 billion livres

Question 4

who were tax farmers

Answer 4

• Indirect taxes were 55% of state income collected by tax farmers
• tax farmers had the right to confiscate property, use physical force, corruption,
• only 1.6% of tax was collected from taxation on land

Question 5

Taxation and Crown debt

Answer 5

• taille- direct- tax on land- 3rd estate
• capitation- direct-depending on income- 3rd estates
• vingtieme- direct- income tax- everyone but upper classes use exemptions
• gabelle- indirect -salt tax -3rd estate
• tabac- indirect- tobacco tax- anyone buying tobacco

Question 6

who was turgot from 1774-76

Answer 6

• introduced free trade
• from 1774-5, there were bad harvests causing food prices to rise. Led to the flour wars- violent unrest in over 180 areas
• 1776- introduced edict to ban the corvee abolish privilege and introduce property tax payable across all estates
• step too far for the 1st and 2nd estates so parlements rejected it and Louis asked turgot to resign
• Free trade and the 6 edicts- replacing, any indirect taxes with a property land tax was strongly opposed, establishing free trade in grain and ending the tolls and price controls was opposed, and abolishing of privileges. Paris parlements provided 2 remonstrances and it was registered a lit de Justice in March 1776

Question 7

who was necker in 1777-8

Answer 7

• reducing royal household and pensions, appointing salaried officials and removing vingtieme on industry
• restructured financial administration, reducing the number of separate collecting bodies and replacing venal accountants with paid secretaries
• reduced tax farmers from 60 to 40 and abolished the 48 posts of receivers general of direct taxes
• 1781 Compte Rendu au Roi was inaccurate and he needed to raise loans desperately for the debts of France so he disguised France’s high-interest payments as normal expenditure to suggest France was in a stronger financial position than was the case and showed that France was in surplus of 10million livres
• extremely popular with the people of France and many enemies at the Court including MA

Question 8

who was Calonne 1783-87

Answer 8

• support the provisions of pensions and extravagant public spending and took office with no plans to tackle the inconsistencies of the AR and opposed Neckers plan for reform
• the loans on which France had come to rely were drying up and the Paris Parrlements became less willing to endorse the borrowing of large sums at high interest which would add the french debrt
• 1786- reform package- general land tax, Establishment of provincial assemblies, extra indirect tax open legal documents
• the ministers opposed them and to overcome the political deadlock it was decided to put measures to an Assembly of Notables