French Financial Crisis and Political Revolution: Key Events and Figures

Jacques Turgot

Important dates: Appointed finance minister in 1774; the first finance minister to recognise the failing tax system, proposing cuts to expenditure and fairer taxation; warned Louis XVI that involvement in the American War of Independence would drive the state into bankruptcy; dismissed in May 1776 and his reforms were abandoned. Significance: His dismissal ended the only early attempt to restrain spending and reform taxation, so the Crown instead financed the American war through massive borrowing that produced the virtual bankruptcy of August 1788 and made radical tax reform unavoidable.

French involvement in American war of independance

Causes: France committed substantial financial and military aid to the American colonists against Britain from 1776, putting enormous strain on the French economy; the Treaty of Alliance and Treaty of Amity and Commerce with the United States were signed in February 1778 and France declared war on Britain in June 1778; Turgot warned that the war would drive the state into bankruptcy. Effects: The war cost 1.3 billion livres between 1776 and 1783, with 91% of funds raised through loans and more than 8,000 troops sent; the vingtieme direct tax was levied during the war and not removed until 1785; the Treaty of Paris in September 1783 ended the conflict with France gaining little but pride and a huge debt; the national debt reached 3.3 billion livres by 1786 and debt servicing consumed almost 50% of current revenues by 1788. Significance: The cost of the alliance turned a fiscal problem into state bankruptcy and forced the Crown towards tax reform and the Estates-General; Doyle (Revisionist) observed that the American example led French subjects to question why popular sovereignty was not considered appropriate in France, while Schama (Revisionist) argued the war alone did not set France on the path to Revolution.

Jacques Necker

Important dates: Named Director General of Finances in June 1777; published the Compte Rendu au Roi, the first public account of the French state, in February 1781, falsely claiming a 10 million livre surplus and selling over 20,000 copies; borrowed 520 million livres at high interest rates to finance the American war; demoted in May 1781; recalled in August 1788 after Brienne resigned; dismissed again in July 1789, with news reaching Paris on 12 July prompting calls for armed insurrection; reappointed in mid-July 1789 after the fall of the Bastille. Significance: His fabricated surplus reassured bankers and enabled massive wartime borrowing, while its later exposure deepened distrust of royal finance; his recall restored confidence ahead of the Estates-General, and his dismissal in July 1789 was the immediate trigger for the storming of the Bastille. Historian interpretation: Furet (Revisionist) regarded the King's dismissal of Necker as a form of abdication by Louis XVI.

Calonne

Important dates: Appointed Controller General of Finances in November 1783; borrowed a further 653 million livres; presented his Plan for the Improvement of Finances to Louis XVI in August 1786, proposing a new direct land tax on all landowners, abolition of tax privileges, taxes collected through assemblies and removal of controls on the grain trade; persuaded the King to summon the Assembly of Notables, which met in February 1787; dismissed in April 1787 after the Notables refused to endorse his reforms. Significance: He recognised that the privileged exemption from taxation lay at the core of the fiscal crisis and that his reforms would relieve the Third Estate of the sole tax burden; the Notables' rejection of his plan opened the Aristocratic Revolt and turned the financial crisis into a political crisis over consent and representation. Historian interpretation: Doyle (Revisionist) argued that if Calonne's proposals had come from anyone else the Notables would have welcomed them more warmly.

Assembly of the Notables

Important dates: Convened by Louis XVI in February 1787 to approve Calonne's tax reforms; 144 handpicked members with fewer than 30 from the Third Estate, although commoners made up over 90% of the population; rejected the land tax and demanded to see the full state of royal accounts; dissolved by the King in May 1787; reconvened in October and November 1788. Significance: By demanding accountability the Assembly made the King responsible to it rather than the reverse, beginning the Aristocratic Revolt and shifting political debate from royal prerogative to accountability and national representation. Historian interpretation: Schama (Revisionist) regarded the Notables as revolutionaries before the Revolution had formally begun, Soboul (Marxist) saw them as defending their fiscal immunity while demanding the treasury accounts, and Doyle (Revisionist) treated the Assembly of Notables as the start of the revolution.

Aristocratic revolt

Causes: The Notables' refusal in February 1787 to endorse Calonne's land tax and their demand for royal accounts; the Parlement of Paris's claim in July 1787 that only an Estates-General could consent to tax reform; Louis XVI's lit de justice of August 1787 forcing registration; the exile of the Parlement to Troyes in August 1787; the Royal Session of November 1787 compelling registration of a 420 million livre loan; the Parlement's proclamation of fundamental laws in May 1788; the King's attempt to disempower the parlements through a new Plenary Court in May 1788. Effects: Provincial parlements refused registration and magistrates were arrested; the Day of Tiles at Grenoble in June 1788; the clergy paid only a minimal don gratuit in protest; the Estates-General was announced in July 1788 and called in August 1788; this first phase of the Revolution became known as the Aristocratic or Noble Revolt. Significance: The revolt paralysed royal government at the moment of bankruptcy and shifted debate from royal prerogative to accountability, consent and representation; Soboul (Marxist) argued the quarrel between King and nobility caused the paralysis of monarchy that led to Revolution, and Sutherland argued absolutism collapsed during the Aristocratic Revolt as the lawyers of the Third Estate became revolutionaries.

Brienne

Important dates: Led the opposition to Calonne in the Assembly of Notables; appointed Director General of Finances in April 1787; proposed his own modified reform program in July 1787; forced registration through a lit de justice in August 1787; exiled the Parlement of Paris to Troyes in August 1787; held the Royal Session of November 1787 demanding immediate registration of a 420 million livre loan; proposed replacing the parlements with a Plenary Court in May 1788; announced that the Estates-General would be called in July 1788; resigned in August 1788 after the treasury suspended payments, with the more popular Necker recalled. Significance: His failure showed that absolutism could no longer reform taxation without the consent of the nation; the virtual bankruptcy under his watch destroyed confidence in royal government, and his concession of the Estates-General transformed the fiscal dispute into a constitutional revolution.

The Royal session, 1787

Causes: Brienne needed the Parlement of Paris to authorise loans of 420 million livres between 1788 and 1792 to pay off debts, alongside cutbacks to the monarchy, bureaucracy and military and the promise of an Estates-General; the Parlement refused to register the loans; Louis XVI summoned a Royal Session to exert his absolute authority. Effects: At the Royal Session of November 1787 the King demanded immediate registration of the loan without debate; the duc d'Orleans protested the registration as illegal and was exiled with other magistrates by lettres de cachet; the loan was forcibly registered late in 1787; provincial parlements refused to register it and the Parlement of Paris ordered tax collectors not to collect new taxes; the Parlement proclaimed fundamental laws in May 1788 asserting that new taxes required the consent of the nation through the Estates-General. Significance: The open assertion of absolutism converted a financial dispute into a constitutional conflict over consent and fundamental law, hardening the Aristocratic Revolt and making the demand for an Estates-General irreversible.

Brienne's reform program

Causes: Proposed by Brienne in July 1787 as a modification of Calonne's rejected reforms, retaining the land tax while modifying the other measures, with financial cutbacks to the monarchy, bureaucracy and army and concessions including the promise of an Estates-General. Effects: Rejected by the Parlement of Paris in July 1787 on the grounds that only an Estates-General could consent to tax reform; Louis XVI imposed registration by lit de justice in August 1787; the Parlement declared the registration invalid and was exiled to Troyes in August 1787; a compromise of September 1787 recalled the Parlement and modified the reforms again, but the direct land tax was never legalised and the vingtieme continued. Significance: The program demonstrated the political paralysis of absolutism, since even modified reform could not be registered without national consent, pushing the Crown to concede the Estates-General in August 1788 and confirming that taxation now required representation.

Day of Tiles

Causes: Resistance to the King's May 1788 attempt to disempower the parlements through a new Plenary Court; the arrest of local magistrates in Grenoble. Effects: In June 1788 men and women in Grenoble hurled roof tiles at soldiers sent to arrest the magistrates, and when the regiment opened fire people were killed and injured; similar riots broke out in Paris, Rennes, Pau and Dijon; the government announced the calling of the Estates-General in July 1788 and set the date in August 1788. Significance: Marked the genesis of revolutionary violence in France and the breakdown of royal authority; Schama (Revisionist) argued that by 1788 the government had abandoned fiscal fine-tuning for drastic political solutions that turned out to be revolutionary.

Bankruptcy of the royalty

Causes: The American war cost 1.3 billion livres between 1776 and 1783 with 91% raised through loans; the national debt reached 3.3 billion livres by 1786; state income of 377 million livres against expenditure of 411 million left a deficit of about 34 million livres in 1775; debt servicing consumed almost 38% of revenue in 1775 and the deficit reached 112 million livres in 1786; successive ministers borrowed 520 million livres through Necker, 252 million through Joly de Fleury and 653 million through Calonne. Effects: The royal treasury suspended all payments in August 1788, virtually equivalent to bankruptcy; Brienne resigned and Necker was recalled in August 1788; the Estates-General was called in August 1788 for May 1789. Significance: Bankruptcy made fiscal reform unavoidable and forced the Crown to summon the Estates-General, converting the financial crisis into a political revolution over consent and representation; Soboul (Marxist) argued the economic crisis provoked an escalating and unresolvable constitutional conflict.

Cahiers de Doleances

Causes: After the Third Estate's deputies were doubled to 600 in December 1788, elections commenced in January 1789 and ledgers of grievances were compiled by electors in almost all provinces on the King's orders, to be submitted to the Estates-General and direct it to issues requiring reform. Effects: About 25,000 cahiers were drawn up; of 282 cahiers from the nobility, 90% supported liberal ideals and a readiness to forgo fiscal immunities, while 40% supported voting by head; the pamphlet war, opened by relaxed censorship from August 1788, rallied public opinion behind the Third Estate's political program, guided by Sieyes' What is the Third Estate?, published in February 1789. Significance: McPhee described the drawing up of the cahiers amid subsistence crisis, political uncertainty and fiscal chaos as a decisive moment of the Revolution, with the cahiers of all three orders acknowledging that absolute monarchy was moribund.

Harvest crisis

Causes: A run of poor harvests in 1785, 1786 and 1787 culminating in severe storms and hail that flattened grain and grape crops in July 1788, combined with France's economic downturn; popular suspicion that the nobility were hoarding grain while living in luxury at Versailles. Effects: Wheat prices rose 60% between 1776 and 1789; by 1788 the average worker spent three quarters of income on bread, rising to 80% by 1789; the four-pound loaf consumed by three quarters of the population rose from 8 sous in summer 1787 to 15 sous by the start of 1789; unemployment, unrest and riots fed the Reveillon riots in April 1789 and the Great Fear in July 1789. Significance: Hunger fused with political rumour to generate popular violence, as food shortages became associated in people's minds with the taxation crisis and plots to dismiss the Estates-General; Schama (Revisionist) argued the connection of anger with hunger made the Revolution possible, and McPhee saw shortages as providing the heat for revolutionary action.

Society of Thirty

Important dates: Formed in November 1788 after the calling of the Estates-General; an informal gathering of about 50 liberal nobles and bourgeois figures including Lafayette, Mirabeau, Bailly, Sieyes, Condorcet, the duc de Noailles and the duc de la Rochefoucauld; campaigned for a new French constitution and for doubling Third Estate representation with voting by head, achieved in December 1788; many members became deputies to the Estates-General in May 1789. Significance: Organised elite agitation for a constitution built on Enlightenment ideas of consent and popular sovereignty, legitimising the Third Estate's demands and helping to convert the Estates-General into a national assembly.

The Pamphlet War

Causes: Censorship laws were relaxed from August 1788 following the calling of an Estates-General for May 1789; the Parlement of Paris's demand of September 1788 that the Estates-General be constituted as in 1614 alienated the Third Estate and intensified public debate; the doubling of Third Estate deputies in December 1788 raised the political stakes. Effects: Over 4,000 pamphlets had been published by April 1789; the most influential was Sieyes' What is the Third Estate?, published in February 1789; pamphlets rallied public opinion and guided the political program of Third Estate deputies. Significance: Created a national political audience united behind demands for national representation and voting by head, preparing deputies and public to reject voting by order when the Estates-General opened in May 1789.

Revellion riots

Causes: Soaring food prices in Paris and bitterness towards the nobility and monarch; remarks on economic conditions by the wallpaper manufacturer Reveillon, which a crowd of 3,000 took as a threat to cut workers' wages; rumours that the privileged were hoarding grain; tension ahead of the Estates-General. Effects: In April 1789 crowds attacked and destroyed the Reveillon factory and the mansion of another manufacturer, Henriot; about 300 people were killed, shot by household soldiers, and over 300 were injured. Significance: The first instance of militant crowd violence of the Revolution and a rehearsal for the fall of the Bastille on 14 July 1789; Doyle (Revisionist) argued the riots demonstrated that the government was uncertain how to deal with public disorder, while Garrioch saw them as a collision of two cultures rather than simple class conflict.

Estates General

Important dates: Called in August 1788 for May 1789 as bankruptcy loomed; Third Estate deputies doubled to 600 in December 1788; elections and the drafting of cahiers began in January 1789; opened at Versailles on 5 May 1789 with the King maintaining honorific distinctions between the orders; from May 1789 the Third Estate demanded voting by head while the nobility voted for separate verification of credentials; clergy began joining the Third Estate in June 1789; on 17 June 1789 the deputies declared themselves the National Assembly of France. Significance: Convened to solve the financial crisis, its deadlock over voting by order or by head destroyed the constitutional order, as the assertion of popular sovereignty by deputies representing over 96% of the population brought absolute monarchy to an end; McPhee argued the calling of the Estates-General facilitated the expression of tensions at every level of French society. Historian interpretation: Doyle (Revisionist) held that the convocation of a national representative assembly meant the end of absolute monarchy, since if the Nation was sovereign the King no longer was.

Decleration of National Assembly

Causes: Deadlock at the Estates-General from May 1789 over voting by order or by head; the Third Estate's insistence that the three orders verify credentials in common; Louis XVI's indecision while in mourning for his son in early June 1789; lower clergy beginning to join the Third Estate in June 1789. Effects: On 17 June 1789 the Third Estate deputies, with the clergy who had joined them, declared themselves the National Assembly of France, claiming to represent over 96% of the population, with the motion carried 491 votes to 89; the clergy endorsed the declaration in June 1789; locked out of their chamber, the deputies took the Tennis Court Oath on 20 June 1789 not to disband until France had a constitution; the King refused to recognise the Assembly at the Royal Session later in June 1789 before recognising it and ordering the three orders to unite by the end of June 1789. Significance: The first act of national sovereignty, transferring political authority from the King to the nation; Doyle (Revisionist) argued the convocation of a national representative assembly meant the end of absolute monarchy, and Fenwick and Anderson saw the declaration as the beginning of the real revolution, largely the result of Louis XVI's indecision.

The Royal session, 1789

Causes: The Third Estate's declaration of the National Assembly on 17 June 1789 and the Tennis Court Oath of 20 June 1789; the King's refusal to accept a body claiming national sovereignty; the locking of the Assembly's meeting hall. Effects: At the Royal Session in June 1789 Louis XVI declared the National Assembly an illegally formed body and ordered the estates to meet separately, while conceding that new taxes required the consent of the Estates-General, that privileged groups could relinquish tax exemption, that censorship would be forbidden and lettres de cachet abolished; when ordered to disperse, all but the Third Estate obeyed; soldiers sent to bar the Assembly supported it in June 1789, 47 nobles joined in June 1789, and Louis recognised the Assembly's validity and ordered the orders to unite in June 1789, then ordered regiments to Versailles and Paris. Significance: The King's failure to dissolve the Assembly confirmed that sovereignty had passed to the nation; his reliance on troops and the dismissal of Necker in July 1789 sent Paris towards the insurrection of 14 July 1789.

The Fall of the Bastille

Causes: The dismissal of Necker in July 1789, seen in Paris as a declaration of war; 18,000 soldiers, many of them German-speaking, ordered to Paris and Versailles; crowds seized muskets from the Hotel des Invalides; the Bastille, a symbol of royal power, was targeted for its gunpowder and weapons and its governor de Launay refused to surrender them. Effects: On 14 July 1789 about 98 civilians were killed and 78 injured before de Launay surrendered and was murdered, his severed head paraded on a pike; the seven prisoners were freed and the fortress was demolished brick by brick; the King recalled his troops and reinstated Necker in mid-July 1789; the electors created the National Guard and the Commune in July 1789, with Lafayette as commander and Bailly as mayor of Paris. Significance: Royal control over Paris was lost to an armed people, showing that authority now lay with the crowd; Doyle (Revisionist) saw the storming of the Bastille as the peak of the popular movement, Schama (Revisionist) treated the violence itself as the essence of the Revolution, and Lewis judged the ballot and the bullet equally important in revolution.

The Great Fear

Causes: Unrest in Paris combined with food shortages and rumours from July 1789; fear that the nobility had hired brigands to stop the Revolution and that the King intended to dismiss the Estates-General; rural refusal to pay taxes and attacks on grain stores. Effects: A wave of peasant riots across the provinces from late July 1789 into early August 1789, in which chateaux were attacked and manorial records burned; the intendant de Sauvigny and the King's minister Foulon were murdered by crowds in July 1789; the panic precipitated the Night of 4 August 1789, when the Assembly abolished feudal privileges. Significance: Demonstrated that the countryside was a revolutionary force and destroyed the seigneurial order from below; Lefebvre (Marxist) argued the Great Fear taught the peasants their own collective strength and arose from a universal fear of brigands, Schama (Revisionist) held that it exposed a vacuum of authority, and Doyle (Revisionist) identified hunger, hope and fear as the main ingredients of the rural crisis of 1789.

Night of Patriotic Delirium

Causes: The Great Fear and mounting rural violence from July 1789 into early August 1789, with peasants attacking chateaux and burning manorial records; the National Assembly's need to act decisively to appease the violence by conceding the privileges under attack. Effects: On the night of 4 August 1789 noblemen rose one by one to forfeit privileges and rights, with courtier pensions abolished, venal offices ended, manorial rights conceded, equal taxation accepted, justice declared free and bishops restricted to one parish; in August 1789 further decrees abolished the old regime without compensation, including seigneurial courts, financial privileges and tithes, and declared all citizens eligible for any office, although tithes were still paid until 1791 and seigneurial rights were still pursued by seigneurs. Significance: Centuries of feudal privilege ended in a single night, dismantling the absolutist, seigneurial and corporate structure of the old order; Furet (Revisionist) argued aristocratic society was destroyed from top to bottom along with its structure of dependencies and privileges, McPhee saw the August Decrees as a revolutionary proclamation of liberal principles, and Sutherland judged that 4 August was what made the French Revolution revolutionary.