The French Revolution's disastrous money experiment - Part 2

Robin Wigglesworth (0:00)

Today, on the story of money, how the French Revolutions fight for liberty, also, was they fight over money. So the reign of terror is now kicking off.

Rebecca Spang (0:10)

They do not want to keep producing chaos. They want the chaos to end. But since they have chaos, they say, oh well, how about if we try this?

Robin Wigglesworth (0:19)

So they do start printing tons and tons of assignat-

Rebecca Spang (0:21)

The assignat very, very quickly loses value.

Robin Wigglesworth (0:26)

Napoleon becomes France's leader, and I'm curious whether you think the roots of his power, whether that essentially grew out of all this economic chaos.

In today's episode, we're going to be talking about the French Revolution. If you want to hear all about the lead up to the infamous moment of the storming of the Bastille, you can find out about it on our last episode. But today, we're going to get stuck into the time of the executions of Louis XVI and Marie Antoinette, when the reign of terror paralyzed France. Already creaking under economic instability, despite the introduction of a whole new currency, there's a huge amount of political and social unrest. Did all this economic chaos lead to the rise of Napoleon and his empire? We'll be finding out.

This is The Story of Money. Gillian's away this week and I'm Robin Wigglesworth. And to tell this story, we have Rebecca Spang back once again. Rebecca is the Professor of History at Indiana University. She's also the author of The Wonderful Stuff and Money in the Time of the French Revolution, which this time I have now brought down from my bookshelf upstairs. Rebecca, welcome back to The Story of Money. It is so great to have you here with us again.

Rebecca Spang (1:46)

Well, thank you. I wasn't going to leave you hanging in 1790

Robin Wigglesworth (1:50)

No, no, that would be terrible. It was such a cliffhanger moment to end on, so I'm glad we can tackle, frankly, the reign of terror. We can't really do the French Revolution without tackling the reign of terror. So Rebecca, we ended last week's episode in the summer of 1790 It was a hot and sticky summer in Paris. There's so much going on. There's a National Assembly meeting to figure out what to do with the country, and nobody really knows. King Louis XVI, our rather overweight monarch, is still the head of state, at least in theory. But his power is damaged and France is on its way to establishing a constitutional monarchy.

The government has started issuing assignats, a nifty financial innovation that began as an interest-bearing short-term debt instrument, but is fast being used as paper money.

But France is broke, so the big question is, how can the country pay off its debts?

Rebecca Spang (2:47)

In the summer of 1789, they vowed the abolished privilege and they passed something called the Declaration of the Rights of Man and the Citizen. The knock-on effect is suddenly they realize they have to redo the entire country. They have to create administrative districts, they have to figure out what the administration is going to look like, they have to figure out how social services are going to run, they have to figure out how the judiciary is going to work, they have to figure out everything, and they have to figure out the money and the debt.

Robin Wigglesworth (3:20)

But I'm curious, I mean, these are big, important questions that frankly many countries have wrestled with. How do they figure out what to do with these assignats that we talked about last week?

This kind of this proto-currency or slash short-term debt that they issued back by nationalized church property that they seized and used as a security collateral for these assignats. What do they decide to do about this?

Rebecca Spang (3:51)

So there's an extremely heated, extremely long debate in 1790 They finally vote on it. And you can tell what a hot button issue this was, is because it's one of the three votes in the National Assembly, where they actually take a roll call vote. And that may seem like, oh, sure, that's fine. But remember, you know, this is 1,200 people.

And it's, there's no computers. You've got to call out the names one by one, 1,200 of them, and say, how do you vote on this? And then there's actually a printed record of who votes for issuing more Asinia to pay off the short-term debt and who votes against it. So there's gonna be a permanent record of where you were on this issue, which gives you some indication of just what a major source of contention it was. And by a quite small margin, the votes that say, let's issue more Asinia carry the day.