Economic Problems and Royal Finance

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  • Created by: HazelF97
  • Created on: 31-05-17 15:34
What was Louis XVI's biggest problem in 1774?
Money. The monarchy was heavily in debt
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Why was the monarch in debt?
War of Austrian Succession. 1740-48- 1billion livres Seven Years War. 1756-63-1.8 billion livres
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Why couldn't Louis pay off the debt?
Royal income was not enough to cover the expenditure- size of interest payments. Short term- crown borrowed from banks. Made things worse in the long term
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Why was the tax system inefficent?
Most of the crowns income was from tax. 1. The nobles were exempt from taxes 2. tax collection was chaotic and incompletete- regional differences. 3. tax farming reduced the Crowns income
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Who were the Farmers-General?
Tax farmers. They paid an agreed sum in advanced for the right to collect certain taxes. What they collected above the sum was their profit.
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Who was the Controller General?
The minister responisible for financial reforms.
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When was Turgot appointed Controller General?
Controller general in 1774.
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What did Turgot belivee in?
Ideas of physicocrats- free trade, the government should not interfere in trade and buisness, equality of taxation.
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What did Turgot do?
Removed price control, abolished guilds and set up a new property tax
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Why did Turgot fail?
Bad harvests in 1774-5 saw the price of grain soar.Resulted in violent uprisings in some rural areas
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What were the Flour Wars
1774-5, in the rural Parisian basins. In 17 days, 180 towns/villages/hamlets, targeted bakeries and ware houses--> merchants and bourgouise were accused of hiding flour and bread
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Why did Louis order Turugot to resin in 1776?
Planned to introduce and edict banning corvee--> upset the first and second estates/
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Who was Necker?
Swis banker. Becamce Controller General in 1776- protestant so couldn't officially take the title.
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What did Necker do?
Increased the royal share of farmed taxes, tried to cut venal offices--> withdrawn due to hostility of the nobles. Advised Louis that France could enter the American revolutionary War of Independence, cost c. 1.6 billion livre--> increased debt.
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Why was Necker so popular?
1781, he issued the first public report of royal finance. He claimed there was a surplace of 10 million livres, actual deficit f 46 million.
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Why did Necker resign?
He lost the support of the royal court- reduction in venal sales.
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Who was Calonne?
1783= Louis chief minister.
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What did Calonne do?
Sold offices and lavish spending of the monarch to maintain peoples confidence in it.
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What were Calonne's suggested reforms?
free trade, universal land tax paid by all the states. Felt such changes to the ar needed approval
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When was France declared bankrupt?
1786. Calonne had failed to raise taxes and reform.
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Why was the Paris Parlement needed?
To approve the collection of new taxes. They had refused to agree to new taxes in 1785 and had no confidence in Calonne. Called after the AoN was dissolved.
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What was lit de justice?
Louis could overrule objections. Louis used it to force through new taxes
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Why was the Assembly of Notables called?
PP feared Louis would uses lit de justice, opposition would knock confidence in the monarchy and royal borrowing would be made difficult.
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What happened when the Paris parlements opposed?
Great opposition to a universal land tax, refused to sanction it in July 1787. PAris parlements were exiled in August. This backfired and Louis tried to impose a new rule to restrict the power to the parlements.
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What were the Aristocratic revolts?
Day of Tile, Grenoble June 1788. Similar events happened in other areas the parlements were dissolved.
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What was the result of the Aristocratic Revolts?
Louis reputation was seriously damaged and his position was threatened.
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When was bankrupcy declared?
August 1788. The treasury delcared that all payments o the treasry would be suspended. Breinne was pressured to resign
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What was the Assembly of Notables?
144 men selected by the King.
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Who made up the Assembly of Notables?
Leading members of the PArlements, the seven Princes of the Blood, important nobles, important churchmen.
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When did the Assembly meet?
Febraury 1787
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What did Louis expect of the Assembly?
To approve his new land tax with no exeptions, new wlwcted regional assemblies to implement new taxes, the economy to be stimulated by removing restrictions on trade such as international custom barriers. They rejected the proposals.
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Why were the proposals rejected?
self interest, principled stand against royal despotism, blaming Calonne, plotting against Marie Antoinette and her Plignac clique at court against Calonne.
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Who was Archbishop Brienne?
Calonnes sucessor as controler general
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What did Brienne do?
revised proposals for a new land tax for the AN to approve--> refused for a second time.
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What did the Assembly of Notables argue?
The whole French nation was in need of changes and that the Estates Generals should be called.
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When was the Estates Generals called?
May 1789
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What did Louis and Necker decide whilst waiting for the Estates Generals?
1) the Third Estate was to have twice as many deputies 2) let the Estates decide if they voted by head or by Estate. 3) Made no decision to influence the election. 4)Failed to set up any guidelines for when they met
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What were cahiers de dolerances?
List of grievances submitted by towns, regions and individuals.
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What did the chaiers reveal?
1) unhappy with absolutism and unfair tax system 2) corruption of the church caused resentment- the system of selling venality led to the corruption and blocked the advancement of those with talent.
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Why was their grievances because of the church?
Cures complained that they were poor because they did not receive the entire tithe, higher clergy enjoyed huge income
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Why did absenteeism and pluralism cause problems?
Personal gifts by the king and secured as careers for younger sons.
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Why was there an increase in rural poverty?
Bad harvests between 1770 and 1789. By 1789, 1/4 of French land was owned b small peasent farmers and much of it was rented out in small plots--> subsistence farming with no incentive to improve techniques.
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Why were there problems and tensions in rural populations?
Growth of towns due to the growth of industries. Most of Frances wealthy population lived in France. The majority of the population was poor unskilled workers
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Why was bread so important?
Fed most of the population and sudden increases in price led to tension and riots.
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What was the effect of the 1789 harvest?
led to a sharp increase in the price of bread and food.
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Card 2

Front

Why was the monarch in debt?

Back

War of Austrian Succession. 1740-48- 1billion livres Seven Years War. 1756-63-1.8 billion livres

Card 3

Front

Why couldn't Louis pay off the debt?

Back

Preview of the front of card 3

Card 4

Front

Why was the tax system inefficent?

Back

Preview of the front of card 4

Card 5

Front

Who were the Farmers-General?

Back

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