Financial And Economic Problems Flashcards
What reform was meant to produce increase revenue from the land tax introduced by the Constituent Assembly?
1807: the new land register (cadastre). This meant to produce increased revenue from the land tax introduced of new, more scientific agricultural methods. However only 1/5 of land was assessed by 1815.
What reform involved consumer goods?
1803: towns and cities permitted to levy an octrois on consumer goods.
Why did Napoleon need high levels of taxation?
Due to the continuing costs of war. As well as taxes he inherited from previous regimes (e.g. The Directory’s land tax contribution foncière) he introduced measures to make tax collection more efficient.
Who passed on tax receipts?
Tax collectors and inspectors were appointed for each department.
How was the handling and auditing of the states finances changed?
In 1807, the Cour de Comptes was set up which was the central bureau for handling and auditing of state’s finances. It kept detailed accounts and ministries had to have its authorisation before it spent money.
What were increasingly used to finance war?
Indirect taxes which had a disproportionate impact on the working classes. Goods such as alcohol, salt, tobacco and even playing cards were taxed.
How was money supply reformed?
- Napoleon refused to honour agreements paid for in worthless paper money so declared that metal coinage would be the only legal tender (new currency introduced in 1803). The value of money would now directly correspond to the value of gold/silver from which it was made.
- 1800: Banque de France set up in Paris which would provide credit for the government and entrepreneurs; it would also produce a controlled national currency of gold and silver coins (along with a small issue of paper money, limited to high value 500 and 1000 franc notes for use by businessmen).
- 1808: sub-branches of Banque de France established in other French towns.
How was economic growth changed?
- Responsibility for expanding the French economy was given to the Minister of the Interior, Jean-Antoine Chaptal (a chemist and industrialist, who had also been responsible for reorganising the education system).
- Wool production had increased by 400%.
- Napoleon was more interested in increasing production of luxury goods (especially silk-exports increased from 26million francs in 1790 to 64million in 1812). This provided more prestige for his regime.
How did Chaptal expanded the French economy?
- Bureau of Statistics - collected data on population, trade, industry and agriculture.
- Councils of Agriculture, Arts and Commerce in each department.
- Chambers of Commerce set up in the 23 largest cities.
- Encouraged increased mechanisation and technical innovation.
How did Agriculture change?
- This improved in areas where there were large landowners willing to spend time and money introducing new, more scientific methods (e.g. Animal breeding, crop rotation).
- However, most land in France was owned by peasants who owned small tracts of land and who were barely subsisting, therefore couldn’t afford to improve.
- The government tried to encourage the growth of crops that were usually imported from the colonies but could not be due to the war (e.g. Cotton, coffee, tobacco and sugar). This policy had some positive effects but not really until after 1815.
- People felt more prosperous, due to a run of good harvests (except 1806 and 1809) - some areas reported that they produced so much they could actually export butter and cheese abroad (previously, they had been imported).
- However the reports of increased production isn’t reliable. The figures reported are by department officials to the central government (so would want to appear to be successful, even if they weren’t).
What effect did the war have on the economy?
- Workers had to join the army (reduced labour force).
- Fewer workers meant less prosperity and a reduced demand for consumer goods.
- Trade with colonies/other European countries were affected by the British naval blockade (especially in the west of the country). Port cities such as Le Havre and Rouen were badly hit.
How did Napoleon try to raise revenue?
- Louisiana was sold to the USA in 1803 for 50 million francs and the cancellation of 18 billion francs of debt. This had been a French territory from 1699 to 1762, when it was ceded to Spain.
- Tried to boost trade by introducing a continental blockade, known as the continental system. This banned all French trade with Britain and insisted that France’s allies and neutral countries would do the same. If they did not, they would be treated as enemies of France. Napoleon hoped that, by weakening Britain’s economy, she would ask to make peace. This meant the British blockade would be lifted and France could trade across the Atlantic again. In addition French traders would trade with Europe in absence of English. However the navy was too weak to enforce it and smuggling was rife. France fared worse off than the British who traded with North and South America instead.
What factors limited the extent of economic change?
- Limited consumer demand-the majority of the population were agricultural workers and were being heavily taxed, so had a limited amount of money to spend on non-essentials.
- Working in industry was not attractive to most rural dwellers - working conditions were poor (due to ban on trade unions) and town and cities were overcrowded and unhygienic.
- Loss of markets due to the war meant there was no incentive for businesses to invest.
- French had no rich ‘middle’ class with a desire to invest in industry.
- Poor communications/transport.
- Many farms were small and unprofitable - state control of prices and food supplies gave farmers little incentive to innovate and improve their techniques.
