Short Term Causes - Financial Crisis Flashcards
What was the main short-term cause of the French Revolution?
The financial crisis
What was by far the most important aspect of the financial crisis?
The huge deficit (expenditure greater than income) that the government was building up
When did Calonne, the Controller-General of finances, tell Louis XVI that the government was on the verge of bankruptcy?
20th August 1786
What would revenue and expenditure be for 1786? What was this a deficit of?
475 million livres
587 million livres
Deficit of 112 million livres - almost a quarter of total income
By 1788 what had the deficit increased to?
126 million livres - 20% of total expenditure
What were receipts (money taken in) anticipated to amount to in 1789? What % of the receipts would the interest payments on the deficit amount to?
325 million livres
62%
What were the 2 reasons why there was a deficit and financial crisis in France?
War
Tax
Between 1740 and 1783, what wars were France involved in?
War of Austrian Succession (1740-48)
Seven Years’ War (1756-63)
American War of Independence (1778-83)
What was the cost of helping the American colonists defeat the British government?
1066 million livres
How did Jacques Necker fund the AWI? Why was this popular?
Raising loans
Avoided creating new taxes
When did Necker draw up the Compte rendu au roi (report to the king)?
1781
Necker was very selective in the figures included in the Compte rendu au roi so he could claim what?
They showed a surplus (income greater than expenditure) of 10 million livres
What did the positive figures reported by Necker mean lenders had more confidence in? What would they therefore continue to do?
The financial outlook of France
Continue to lend money to the crown
What was the Crown not receiving much of?
Tax revenue
What could not occur until France recovered control of its finances?
Basic reforms
