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Failure to Reform - Coggle Diagram
Failure to Reform
Necker 1777-81
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Could not be made Controller General because he was a protestant and title only open to Catholics: Given the title Director-General of Finances in 1777
Necker continued Turgot's cost cutting measures by: Reducing royal household expenses and pensions: Appointing salaried officials rather than venal corporations, to run the royal estates: Removing the Vingtieme on industry
Tried to make the royal accounting system more professional. He restructured financial administration, reducing the number of separate collecting bodies and replacing venal accountants with paid secutaries. Reduced the number of tax farmers from 60 to 40 and abolished the 48 posts of 'receiver -general' of direct taxes, replacing them with 12 salaried officials who had to submit their receipts to Necker's own scrutiny
Necker's changes helped to reduce corruption by hitting the venality hard but also his reforms created another problem as traditionally the venal officers who lent money to the crown and their removal meant this was a vital source of lost money
Part of his move to professionalize the royal accounting system: Necker published France's first ever 'budget statement' of royal fiannces --> Compte Rendu which summarized expenditure and income
Within weeks 10,000 copies sold: It was suggested Necker wanted to encourage public debates, However in doing this he was at odds with the king who saw the book as a breach of royal protocal.
Necker was inaccurate in the book. He desperately needed to raise more loans ti deal with France's debt which grew signicatnyl following the entry into American war in 1778.
Determined not to raise taxes to high he disguised France in a stronger financial position than it was. did this by disguising high interest payments as normal expenditure --> Showed France had a surplus of 10 million livres rather than a large debt
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State of Economy
Good
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Transport was improving. in 1760 the 1,000KM between Paris and Tolouse took 15 days by the 1780's it took 8 days. Roads good quality maintained by the Corvee royale
Industrial production doubled between 1715 and 1771. Mechanization introduced and some factories appeared.
Bad
French economy primarly agriculutral based - only 15% of pop lived in localities of more than 2000 inhabitants
Yield from French farms was very low - rural overpopulation and high taxed peasantry persisted with backward agricultural practices. Food production could not keep up with population growth
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There was a downturn in the 1770s and the failure of the vintage of 1778 was followed by a series of poor harvests and disastrous winters from 1785 to 1789 which depressed peasants incomes. July 1788 a hailstorm destroyed crops and France had worst harvest in 40 years.
Downturn led to a trade slump which produced lay-offs in industry at a time of risining bread prices
Royal Finances
Gov finances by direct and indirect taxation supplemented by temporary expedients such as loans to meet the shortfall between income and expenditure
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Wars added to debt: seven year war 1756-63 added 1.3 billion livres and all coloniial possensions in North America
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The annual interest payment on the 2 billion livres debt in 1715 after Louis XVI died cost 165 million livres. This was more than the gov collected in taxes. Creating a Balance of Payment crisis
Turgot 1774-76
Held Physiocratic view that the French economy would work more efficiently and generate more crown revenue is privileges, regulations, customs duties and other restrictive controls were replaced by a freer system
Measures
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The demand that gov departments submit their expenses to the Controller-General and find ways of reducing their spending
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TURGOT MEASURES REDUCDED THE DEFICIT ALLWOING HIM TO NEGOTIATE A LOW-INTREST LOAN OF 4% WITH SOME DUTCH BANKERS IN 1776
Opposed french participation in American revolutoniary war on grounds of cost --> Unable to prevent some secreate deals
Unsuccessful measures
Idea of replacing many indirect taxes with a property tax was strongly opposed by 2nd estate nobles at court who would have lost from a measure like this
'Six Edicts; of 1776 produced a stronger response. It exposed his physiocrat desire to abolish privilege, to tax all and grant every man the right to work without restrictions. 4 of the edicts were concerned with suppressing dues and offices. However the 6 which abolished the corvee in favor of a land tax by landowners, was suppressed.
Six edicts eventually registered by a lit de justice in March 1776. However by then he had offended influential people such as Marie-Antoinette who favors to proteges he had opposed. In May 1776 he was ordered to send in his resignation and the edicts were forgotten
Calonne 1783-87
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Calonne originally had no plans for reforms but after the Paris Parment became less willing to endorse the borrowing of large sums at high interest rate which would add debt. He knew he needed a reform package
Programme included: General land tax accompanied by a survey and evaluation of land-holdings: Establishment of provincial assemblies: Extra indirect tax on legal documents (stamp duty): End of Corvee Royale - to be replaced with a land tax on landowners: removal of control on grain trade: removal of internal customs barriers to boost commerce
Louis backed the proposals but other ministers opposed them --> to overcome this it was decided to put the measures to an assembly of notables