Financial crisis Flashcards
1
Q
Who was Jacques Necker?
A
- finance minister - funded war by raising loans
- wasn’t made controller general as he was foreign and protestant.
2
Q
Who was Charles Alexandre de Calonne?
A
- the controller general - controlled the money
- on 20th August 1786 he told Louis that the government was on the verge of bankruptcy.
3
Q
What was the state of the Crown finances by August 1786?
A
- revenue for 1786 would be 475M, while expenditure would be 587M, making a deficit of 112M livres.
4
Q
What was the situation by 1788?
A
- deficit had increased to 126M livres (20% of total expenditure)
5
Q
What was the projection for the situation by 1789?
A
- was anticipated that for 1789, reciepts would amount to only 325M livres.
- interest payments on the deficit would amount to 62% of the receipts.
6
Q
Why was there a deficit and financial crisis by 1788?
A
- war - amount of wars, cost of helping Americasns - 1066M livres, people kept on lending money to the crown.
- Tax - Crown not recieving much of tax revenue, powerful resistance against changed to taxation.
7
Q
compte rendu au roi (report to the King)
A
- claimed they were in surplus of 10 million in royal finances.
- made Calonne look bad when he told the truth.
8
Q
Between 1781-86 how had Joly de Fleury and Calonne sought to make good the shortfall in royal finances?
A
- undid much on Necker’s work by resuming the practice of selling offices ( many of which Necker had abolished). They both also borrowed much more heavily than Necker.
9
Q
What were the 3 elements of Calonne’s reform programme of 1786?
A
- replace the capitation and the vingtieme on landed property by a single tax land.
- stimulate the economy to ensure that future tax revenues would increase
- try to restore national confidence do that new loans for the short term could be raised
10
Q
Why was an Assembly of Notables called for Feb 1787?
A
- as it was anticipated that this would be a pliant body who would willingly agree to rubberstamp the reform package
11
Q
What was the make-up of the Assembly?
A
- 144 members
- members of parlaiment
- princes
- leading nobles
- important bishops
12
Q
Why did they reject Calonne’s plan?
A
- as respresentatives of the privileged order they had the most to lose from them
13
Q
What did they recomment Calonne to do instead?
A
- claimed that the approval of the nation was needed for Calonne’s reforms and urged summoning of the estates-general which last met in 1614
14
Q
What became of Calonne?
A
- realising the strength of opposition to Calonne, Louis dismissed him in April 1787
