NA/6 5 I Cornell University Library HG 978.2.W65 Paper-money Inflation In France:How It c 3 1924 014 049 823 / PAPER-MON ' INFLATION IN PEANCE ■/' HOW IT CAME, WHAT rr BROUGHT, AND HOW IT ENDED. A PAPER BEAD BEFORE SEVEBAl SENATORS AND MEJUBESS OP THE SOUSE OP- REPRESENTATIVES, OF BOTH PO- LITICAL PARTIES, AT WASHINGTON, APRIL 12, AND BEFORE THE UNION LEAGUE CLUB, AT NEW YORK, APRIL 18, 1878. ANDREW D. WHITE. DEC 18 19^; N^EW YORK: ^^ ^ ,_ D. APPLETON AND COMP/*:^,''^ - - 549 AND 551 BEOADWAY. ^ E.Afi+wl..V- 1876. ^'^.C-b.fyi:f-^ 9^^ Si The most ccrm-plet& and eleganUy Illustrated Work on Ewrope ever - produced. PICTURESQUE EUROPE: A DELINEATION BY PEN AND PENCIL OF The Mountains, River^, Lakes, Phores, Forests, and' other Natural Features, and. the Ancient Ruins, Cathedrals, Castles, Palaces, Qld Structures, and other Picturesque and Historical Places of GREAT BRITAIN AND THE CONTINENT. Edited by BAYARD TAYLOR. This trnly superb work, which has now been for several years in active preparation, will cdnbist of a complete description and elaborate pictorial illaatration of the greater part of the European Continent. It will portray the great monntain-ranges, the superb lakes, the lieantifnl valleys, the grand forests, the cascades, the, great rivers, with their fascinating historical associations, and with these the temples and ruins of ancient Greece and Eome° the grand Gothic catlwdrals, the qnaint old churches, the splendid palaces, the grim old castles, the strange towns, and other places and objects of note, it being the purpose of the publishers to illustrate the varied picturesque and historic scenes in that storied land with a fullness and artistic effect beyond anything hitherto attempted. THE ENGEATINGS 0:<^ THIS WOHK^AEE ALL NiiW, having been executed from sketches by American and English artists, who for two years past have been traveling over every part of Europe, in order to secure accurate and the latest views of picturesque places. No labor and no cost have been spared to render the illustrations in eveiy particular not only eiitirely trustworthy hut valuable for their artistic excellence. T(j_ those who have visited Europe it will be a lasting pleasure, as a souvenir of the places they have seen; to others it will, in its minute and thorough delineation by artist and writer, afford an idea of the great historic ground of the Old Worid, scarcely less vivid than that of actual personal observation. The engravings will consist of steel and wood. The steel plates will be printed on heavy, toned, plate-paper; the wood illustrations will be of the finest character, and abundantly in- terspersed through the text, which will be printed on heavy., extra-calendered, toned paper In all particulars of manufacture, care will be-takcn to secure a truly elegant and sumptuous work. PioTtTREsquE EtJKOPE is uniform with and is designed to form f^ companion work to CONDITIONS OF PUBLICATION. This work will be published by subscription, in parts, at Fifty Cents each, payable on delivery ; the carrier not being allowed to receive money in advance, or to give credit Each part will contain one highly-finished engraving on steel, and a large nnmbir of finely-executed woodcuts. The work will probably be completed in Sixty Parts; it will poaUivdy not exceed Sixty- SIX Parts; the size imperial quarto. It will be printed on heavy, toned, highly-calendered . paper, made expressly for this work, in the best manner known tp the art. Subscriptions received only for the entire work. P. APPLETOW & 00, PulUshers, 549 & 551 Broadway, N. Y. • PAPER-MONEY INFLATION IN FRANCE: HOW IT CAME, WHAT IT BROUGHT, AND HOW IT ENDED. A PAPEB BEAD BEFORE SEVERAL SENATORS AND MEMBERS OF THE EOUSE OF REPRESENTATIVES, OF BOTH PO- LITICAL PARTIES, AT WASHINGTON, APRIL 12, AND BEFORE THE UNION LEAGUE CLUB, AT NEW YORK, APRIL 13, 1876. BY ANDREW D. WHITE. NEW YOEK: D. APPLETON AND COMPANY, 549 AND 551 BEOADWAY. 1876. Ebiebed, according to Act of Congress, in the yearl8T6, By D. APPLETON & CO., In the Office of the Librarian of Congress, at Washington. PAPER-MONEY INFLATION IN FRANCE : HOW IT CAME, WHAT IT BROUGHT, AND HOW IT ENDED.' Neae the end of the year 1789 the French nation found itself in deep financial embarrassment; there was a heavy debt and a serious deficit. The vast reforms of that year, though a , lasting blessing politically, were a temporary evil financially. There was a general, want of confidence in business circles; capital had shown its proverbial timidity by retiring out of sight as far as possible ; but little money was in circulation ; throughout the land was temporary stagnation. Statesman-like measures, careful watching,^ and wise management, would probably have led, ere long, to a return of confidence, a reappearance of money, and re- sumption of business ; " but this involved waiting, self denial, and self-saci-ifice ; and thus far in human history those are the rarest products of an improved political ' A paper read before a meeting of Senators and members of the House of Representatives of both political parties, at Washington, April 12 ; and before the Union League Club, at Nevr York, AprU 13, 1876. " For proof that the financial situation of France at that time was by no means hopeless, see Storch, " ficonomie Politique," vol. iv., p. 159. 4 PAPER-MONEY INFLATION IN FRANCE. condition. Few nations, up to this time, have been able to exercise these virtues ; and France was not then one of those few. There was a general looking about for some short road to prosperity, and, ere long, the idea was set afloat that the great want of the country was more of the circulating medium ; and this was speedily followed by calls for an issue of paper-money. The Minister of Finance at this period was Keeker. In financial ability he was acknowledged among the great bankers of Europe; but he had something more than financial ability — he had a deep feeling of patriotism and a high sense of personal honor. The difficulties in his way were great, but he steadily endeavored to keep France faithful to those financial principles which the general experience of modern times had established as the only path to national safety. As difficulties arose, the Na- tional Assembly drew away from him, and soon came among the members muttered praises of paper-money ; members like Allarde and Gouy held it up as a pa- nacea — as a way of " securing resources without paying interest.". This was echoed outside; the journalist Loustalot caught it up and proclaimed its beauties ; Marat, in his newspaper, also joined the cri^ against Necker, picturing him — a man who gave up health and fortune for the sake of France — as a wretch seeking only to enrich himself from the public purse. Against the tendency to the issue of irredeemable paper Necker contended as best he might. He knew well to what it had always led, even when surrounded by the most skillful guarantees. Among those who PAPER-MONEY INFLATION IN FRANCE. 5 \ struggled to aid Nfecker outside the National Assem- bly was ^rgasse, e^ deputy from Lyons. His pam- phlets agaiMt-fliB-ifredeemable paper exerted, perhaps, a wider influence than any others ; parts of them seem fairly inspired. Any one to-day reading his prophecies of the evils sure to follow such a currency would cer- tainly ascribe to him a miraculous foresight, were it not that we can see that this prophetic power was simply due to a knowledge of natural laws.' But the current was too strong; on the 19th of April, 1790, the Finance Conunittee of the Assembly reported that " the people demand a new circulating medium ; " that " the circulation of paper-money is the best of operations ; " that " it is the most ' free because it reposes on the will of the people ; " that " it will bind the interests of the citizens to the public good." The report appealed to the patriotism of the French people with the following exhortation : " Let us show to Europe that we understand our own resources ; let us immediately take the broad road to our liberation, instead of dragging ourselves along the tortuous and obscure paths of fragmentary loans ; " it concluded by recommending an issue of paper-money, carefully guarded, to the amount of four hundred million francs. The next day the debate begins. M. Mar- tineau is loud and long for paper-money. His only ' See Bucliez and Eoux, " Histoire ParMmentaire de la Revolution Fran- Caiae," vol. iii., pp. 364, 365 ; also p. 405. For pamphlet itself, see "A. D. W. Collection;" for the effect pro- duced by it, see Ohallamel, "Les Fran^ais sous la E6volution." Also, De Goncourt, " La Soci6t6 Fran? aise pendant la K6volution." 6 PAPEE-MONET INFLATION IN FRANCE. fear is, tliat tlie committee has not authorized enough, of it; he declares that business is. stagnant, and that the sole cause is a want of more of the circulating me- dium; that paper-money ought to be made a legal tender ; that the Assembly should rise above the preju- dices which the failure of John Law's paper-money had caused. Like every supporter of irredeemable paper-money, before or since, he thinks that circum- stances are not the same at the time and place of the issue proposed as at previous disastrous issues. He says: " Paper-money under a despotism is. dangerous ; it favors corruption ; but in a nation constitutionally gov- erned, which itself takes care of the emission of its notes, which determines their number and use, that danger no longer exists." He insists that John Law's notes at first restored prosperity, but the wretchedness and wrong they caused resulted from their over-issue, and that such an over-issue is possible only under a despotism.' M. de la Kochefoucauld gives his opinion that " the assignats will draw specie out of the coffers where it is now hoarded." ' On the other hand, Cazal^s and Maury show that the result can only be disastrous. Never, perhaps, did a political prophecy meet with more exact fulfillment in eveiy line than the terrible picture drawn in one of Cazal^s's speeches in this debate. Still the cuiTent ran stronger and stronger; Petion makes a brilliant ' See Mbnitev/r, sitting of April 10, 1T90. ' Ibid., sitting of April 15, 1790. PAPER-MONET INFLATION IN FRANCE. 7 oration in favor of the report, and Necker's influence and experience are gradually worn away. But mingled with the financial argument was a very strong political argument. The nation had just taken as its own the vast real property of the French Church, the pious accumulations of thirteen hundred years. There were princely estates in the country, sumptuous palaces and conventual buildings in the towns ; these formed more than one-third of the entire real property of France, and amounted in value to about four thou- sand million francs, yielding a yearly income of about two hundred millions.' By one sweeping stroke all this had become the property of the nation; never, apparently, did a nation secure a more solid basis for a great financial future. There were, therefore, two great reasons why French statesmen desired speedily to sell these lands. First, a financial reason — to obtain money to relieve the Govern- ment. Secondly, a political reason — to get this land distributed among a great number of 'the thriftj' middle class, and so to commit them to the Revolution and to the Government which gave their title. It was urged, then, that the issue of four hundred millions of paper would give the treasury something to pay out immediately, and relieve .the national neces- sities ; that, having been put into circulation, this paper- money would stimulate business ; that it would give to all capitalists, large or small, the means for buying of the nation the ecclesiastical real estate, and that from the proceeds of this real estate the nation would again • See De Fervo, "Finances Francaises," vol. ii., p. 236 ; also Alison, vol. i. 8 PAPER-MONEY INFLATION IN FRANCE. i Obtain new fands for new necessities : never was theory more seductive both to financiers and statesmen. But it would be a great mistake to suppose that the statesmen of France, or the French people, were igno- rant of the dangers of issuing irredeemable paper-money. No matter how skillfully the bright side of such a cur- rency was exhibited, all thoughtful men in France knew something of its dark side. They knew too well, from that fearful experience in John Law's time, tha^difficul ties ,and..daiigfira,Qf, a. currency nol_based„npon specie, They had then learned how easy it is to issue it how difficult it is to check an over-issue ; how seductive ly it leads to the absorption of the means of the work- ingmen and men of small fortunes ; how surely it im- poverishes all men living on fixed incomes, salaries, or wages ; how it creates on the ruins of the prosperity of all workingmen a small class of debauched specula- tors, the most injurious class that a nation can harbor, more injurious, indeed, than professional criminals whom the law recognizes and can throttle ; how it stimulates over-production at first, and leaves every industry flac- cid afterward ; how it breaks down the idea of thrift, and develops political and social immorality. All this France had been thoroughly taught by experience. Many then living, had seen the experiment fully tried; they had seen that issue of paper-money un- der John Law, a man in his own time, and to this day, acknowledged one of the most ingenious finan- ciers the world has ever known ; and there were then sitting in the National Assembly of France many who owed the poverty of their families to those issues of PAPEK-MONET INFLATION IN FRANCE. 9 paper. Hardly a child in the country had not heard the men who issued that paper cursed as the authors of the most frightful catastrophe France had then known/ It was no mere attempt at theatrical display, but a natural impulse, which led a thoughtful states- man, during this debate, to hold up in the Assembly a piece of paper-money, and to declare that it was moist- ened with the blood and tears of their fathers. And it would also be a mistake to suppose that the National Assembly which discussed this matter was composed of mere wild revolutionists; no supposition could be more wide of the fact. Whatever may have been the character of the men who legislated for France after- ward, no thoughtful student of history can deny, de- spite all the arguments and sneers of English Tory statesmen and historians, that few more keen-sighted and patriotic legislative bodies have ever sat upon this earth than this first French Constituent Assembly. In it were such men as Sieyes, Bailly, Necker, Mirabeau, Talleyrand, Dupont, and a multitude of others who, in various sciences and in the political world, had already shown, and were destined afterward to show, themselves among the keenest and strongest men that Europe has yet seen. But the current toward paper-money had become irresistible. It was constantly urged, and with a great show of force, that if any nation could safely issue pa- ' For striking pictures of tMs feeling among the younger generation of Frenchmen, see Challamel, " Sur la B6volntion," p. 305. For general history of John Law's paper-money, see Henri Martin, "Histoirede France;" also, Blanqni, "Histoire de I'fioonomie Politique,'' vol. ii., pp. 65-87; also, "Se- nior on Paper Money," section iii., Part I. /< 10 PAPEE-MONET INFLATION IN FRANCE. per-money, France was now tliat nation ; that slie was fully warned by a severe experience ; that slie was now a constitutional government, controlled by an enlight- ened, patriotic people ; not as in the days of the former issue of paper-money, an absolute monarchy controlled by politicians and adventurers ; that she was able to secure every franc of her paper-money by a virtual mortgage of a landed domain of vastly greater value than the entire issue ; that, with men like Bailly, Mira- beau, and Necker, at her head, she could not commit the financial mistakes and crimes from which France had suffered when at the head stood John Law, and the regent, and Cardinal Dubois. Oratory prevailed over experience and science. In December, 1789, came the first decree. After much dis- cussion it was decided to issue four hundred million francs in paper-money, based upon the landed property of the nation as its security. The deliberations on this first decree, and on the bill carrying it into effect, were most interesting ; prominent in the debate were Necker, Dupont, Maury, Cazal^s, Bailly, and many oth- ers hardly inferior. The discussion was certainly very able ; no person can read it at length in the Moni- tewr, or even in the summaries of the Parliamentary History, without feeling that English historians have done wretched injustice to those men who were then endeavoring to stand between France and ruin. At last, in April, 1790, the four hundred million francs were issued in assignats — ^paper-money secured by a pledge of productive real estate, and bearing interest to the holder at three per cent. No irredeem- PAPER-MONET INFLATION IN FRANCE. H able currency lias ever claimed a more scientific and practical guarantee for its goodness and for its proper action on public finances. On one side it had wbat the world universally recognized as the most practical se- curity — a mortgage on productive real estate of vastly greater value than the issue. On the other hand, as the notes bore interest, there was every reason for their being withdrawn from circulation whenever they be- came redundant.' As speedily as possible the notes were put in circu- lation. Unlike those issued in John Law's time, they were engraved in the best style of the art. To stimu- late loyalty, the portrait of the king was placed in the centre ; to stimulate patriotism, patriotic legends and emblems surrounded him ; to stimulate public cupidity, the amount of interest which the note would yield each day to its holder was printed in the margin ; and the whole was duly garnished with stamps and signatures, showing that it was under careful registration and con- trol. Having thus given France a new currency, the National Assembly, to explain its advantages, issued an address to the French people. In this address the As- sembly spoke of the nation as " delivered by this grand means from all uncertainty, and from all ruinous results of the credit system — ^incessantly, a prey to the caprices of cupidity." It foretold that this issue " would bring back into the public treasury, into commerce, and into ' See Buchez and Eoux, " Histoire ParlGmentaire," vol. v., p. 321, etseq. For an argument to prove that the assignats were after all not so Tvell se- cured as John Law's mone7, see Storch, " Economie Politique," vol. iv., p. 160. 12 PAPEK-MONET INFLATION IN FRANCE. all branches of industry, strength, abundance, and pros- perity." ' Some of tlie arguments used in this address are worth recalling : " Paper-money is without inherent value, unless it represents some special property. Without represent- ing some special property it is inadmissible in trade to compete with a metallic currency, which has a value real and independent of the public action ; therefore it is that, the paper-money which has only the public authority as its basis has always caused ruin where it has been established ; that is the reason why the bank- notes of 1720, issued by John Law, after having caused terrible evils, have only left frightful memories. There- fore it is that the National Assembly has not wished to expose you to tTiis danger, but has given this new pa- per-money, not only a value derived from the national authority, but a value real, immutahle ; a value which permits it to sustain, advantageously, a competition with the precious metals themselves." ' But the final declaration is perhaps the most inter- esting, as showing the attempt to rely on interest-bear- ing notes, or an irredeemable issue of notes based upon valuable securities. It argues : " These assignats, bearing interest as they do, will soon be considered better than the coin now hoarded, and will again bring it out into circulation." This legislation caused great joy. Among the vari- ' See " Addresse de 1' Assemble Nationale sur les EmissioiiB d' Assignats Monnaies," p. 5. " Ibid., p. 10. PAPER-MONET INFLATION IN FRANCE. 13 OU8 utterances of this feeling was tlie public letter of M. Sarot directed to tlie editor of tlie Journal of the National Assembly^ and scattered througliout France. M. Sarot is hardly able to contain himself as he anticipates the prosperity and glory that this issue of paper is to bring to his country. One thing only embarrasses him, and that is, the pamphlet of M. Ber- gasse against the assignats ; therefore it is that after a long serigs of arguments and protestations, in order to give a final proof of his confidence in the paper-money, and his entire skepticism as to the evils predicted by Bergasse and others, M. Sarot solemnly lays his house, garden, and furniture, upon the altar of his country, and offers to sell them for paper-money alone.' The first result of this issue was apparently all that the most sanguine could desire ; the treasury was at once greatly relieved ; a portion of the public debt was paid ; creditors were encouraged ; credit revived ; or- dinary expenses were met, and the paper-money having thus been passed from the Government into the midst of the people, trade was revived, and all difficulties seemed past. The anxieties of Necker, the prophe- cies of Bergasse, Maury, and Cazal^s, seemed proven utterly futile. And, indeed, it is not impossible that, if the national authorities had stopped with this issue, few of the evils which afterward arose would have been severely felt ; the four hundred millions of paper- money then issued had simply taken the place of a similar amount of specie ; but soon there came another ^'See "Lettre de M. Sarot," Paria, April 19, 1790. 14 PAPER-MONET INFLATION IN FEANCE. result more disquieting : times grew less easy : by the end of August; within four months after the issue of the four hundred million assignats, the Government had spent them, and was again in distress.' The old remedy immediately and naturally occurred to the minds of men. Thoughtless persons throughout the country began to cry out for another issue of paper; thoughtful men then began to recall what their fathers had told them about the seductive path of paper-money issues in John Law's time, and to remember the proph- ecies that they themselves had heard in the debate on the first issue of assignats less than six months before. In that debate, as we have seen, Maury and Cazal^s foretold trouble and dangers. Necker, who was less suspected of reactionary tendencies, had certainly feared many. The strong opponents of paper had prophecied, at that time, that, once on the downward path of inflation, the nation could not be restrained, and that more issues would follow. The supporters of the first issue had asserted that this was a calumny ; that France could and would check these issues when- ever she desired. The condition of opinion in the Assembly was, therefore, chaotic ; a few schemers and dreamers were loud and outspoken for paper-money ; many of the more shallow and easy-going were inclined to yield; the more thoughtful endeavored manfully to breast the current. One man there was who had strength to stand this pressure : that man was Mirabeau. He was the popu- ' Von Sybel, " History of the French Revolution," vol. i., p. 252. PAPER-MONEY INFLATION IN PRANCE. 15 lar idol, the great orator of the Assembly ; and he was something more than a great orator; he had carried the nation through some of its greatest dangers by a boldness almost godlike; in the various conflicts, he had shown not only oratorical boldness, but a certain shrewdness, of great value at the beginning of a revolu- tion. As to his real opinion upon an irredeemable cur- rency, there can be no doubt. It was the opinion which all statesmen have held, before his time and since, in his own country, in England, and in America. In his letter to Cerutti, written in January, 1789, hard- ly six months before, he spoke of paper-money as " a nursery of tyranny, corruption, and delusion ; a verita- ble debauch of authority in delirium," In his private letters written at this very time, which were revealed at a later period, he showed that he was fully aware of the dangers of inflation, but he yielded to the press- ure ; partly because he thought it important to relieve the Treasury at once, partly because he thought it im- portant to sell the Government lands rapidly to the people, and so develop speedily a large class of small landholders, pledged to stand by the Government which gave them their titles ; partly, doubtless, from a love of immediate rather than remote applause ; and wholly, probably, in a vague hope that the severe, inexorable laws of finance, which had brought heavy punishment to governments emitting an irredeemable currency in other lands, at other times, might, in some way, be warded off from France, at this time.' ' For Mirabeau's real opinioa on irredeemable paper, see letter to Oe- rutti, in leading article of the Moniteur; alao " M6moires de Mirabeau,'' vol. vil., pp. 23, 24, and elsewhere. 16 PAPER-MONEY INFLATION IN FRANCE. The question was brotiglit up by Montesquieu's re- port on tlie 27t]i of August. This report, though some- what non-committal, leaned, on the whole, toward an additional issue of paper. It goes on to declare that the original issue of four hundred millions, though op- posed at the beginning, had proved successful ; that as- signats are the most economical method, though they have dangers; and as a climax came the declaration, " We must save the country." Still the committee hesi- tated to advise the issue of more paper-money." Upon this report, on the 27th of August, 1790, Mirabeau made his first speech. He confessed that he had at first feared the issue of assignats, but that he now dared urge it ; that experience had shown that the issue of paper-money had served its purpose well ; that the report proved, despite the prophecies of vari- ous opponents, that the first issue of assignats had been a great success ; that public affairs had come out of dis- tress satisfactorily; that ruin had been averted, and credit established. He then argues that there is a dif- ference between the paper-money of the old sort, from which the nation had suffered so much in John Law's time, and the paper-money of the new issue; he de- clares that the French nation is now enlightened, and says, " Deceptive subtleties can no longer deceive patri- ots and men of sense in this matter." He then goes on to say, " We must accomplish that which we have be- gun," declaring that there is demanded another large issue of paper, guaranteed by the national lands and by the good faith of the French nation. To show how ' See Moniteur, August 27, 1790. PAPEE-MONET INFLATION IN FRANCE. 17 practical tlie system is, lie insists that just as soon as paper-money shall become too abundant it will be ab- sorbed in rapid purchases of national lands ; and a very striking comparison is made between this self-adjusting, self-converting system and the rains descending in show- ers upon the earth, then in swelling rivers discharged into the sea, then drawn up in vapor, and gradu- ally scattered over the earth again in rapidly-fertilizing showers. He predicts that the members will be sur- prised at the astonishing success of this paper-money, and that there will be no superabundance of it.' His theory grows by what it feeds upon, as the pa- per-money theory has always done ; toward the dose, in a burst of eloquence, he suggests that assignats be created to an amount sufficient to cover the national debt, and that all the national lands be exposed for sale immediately, predicting that prosperity will thus return to the nation, and that all classes will find this addi- tional issue of papgjjgig ney a gr eat blessing. This speech was frequently interrupted by applause ; by a unanimous vote it was ordered printed, and copies were spread throughout France. The impulse given by it can be seen throughout all the discussion afterward. Gouy arises and proposes to liquidate the debt of twen- ty-four hundred millions, to use his own words, "by one single operation — grand, simple, magnificent.'" He supports an emission of twenty-four hundred millions in legal-tender notes, and a law that specie be not ac- cepted in purchasing national lands. His demagogism ' Monitew, August 28, 1790. ' "Par une seule operation, grande, simple, magnifique" (see Monitew). % 18 PAPER-MONET INTLATION IN FRANCE. blooms fortli magniflcently. He advocates an appeal to the people, who, to use his flattering expression, " ought alone to give the law in a matter so interesting." The newspapers of the period, in reporting his speech, note it with the very significant remark, "This discourse was loudly applauded." To him replies Savarin, He calls attention to the depreciation of assignats already felt. He tries to make the Assembly see that natural laws work as certainly in France as elsewhere ; and predicts that if this new issue be made there will come a depreciation of thirty per cent. He is followed by the Abb6 Gouttes, who de- clares — what seems very grotesque to those who have read the history of an irredeemable paper currency in any country — that new issues of paper-money "will supply a circulating material which will protect public morals from corruption." ' Into the midst of this debate is brought a report by Necker. Most earnestly he endeavors to dissuade the Assembly from the proposed issue ; suggests that other means can be found for accomplishing the result, and predicts terrible evils. But the current is again running too fast. The only result is, that Necker is spurned as a man of the past.' He at last sends in his resignation, and leaves France forever. The paper-money demagogues shout for joy at his departure ; their chorus rings througji the journalism of the time. No words can express their contempt for a man who cannot see the advantages of filling the Treasury with the issues of a printing-press. ' Mbrdteur, August 29, 1790. ' See LacreteUe, "18- Sifecle," vol. viii., pp. 84-87; also Thiers and Mignet. PAPER-MONEY INFLATION IN FEANCE. 19 Marat, H«^bert, and Camille Desmoulins, are especially jubilant.' A curious parallel may perhaps be drawn between Necker, the Finance Minister at the beginning of the French Revolution, and the Secretary of the Treasury at the beginning of the recent struggle in our own country. Each had shown his ability to build up a fortune for himself before he entered public life ; each had shown great financial skill and integrity ; each had thus secured the confidence of the thoughtful part of the nation in the time of national difficulty ; each had proposed measures and carried them out, M^hich resulted in great good ; each attempted to stop the nation on the downward path of inflation ; each was at last obliged to succumb ; and each retired from the country which he had endeavored to save — Necker to Switzerland, Hugh McCullo*igfe to England. Continuing the debate, Eewbell attacks Necker, saying that assignats are not at par because there is not money enough ; he asks that payments for public lands be received in assignats alone ; and suggests that for the making of change the church-bells of the king- dom be melted down into small money. Le Brun attacks the whole scheme in the Assembly, as he had done in the committee ; declaring that the proposal, instead of relieving the nation, will kill it. The pa- pers of the time very significantly say that at this arose many murmurs. Chabroux comes to the rescue. He says that the issue of assignats will relieve the dis- tress of the people, and presents very neatly the new ' See Hatin, " Histoire de la Presse en France," vols. v. and vi. 20 PAPER-MONEY INFLATION IN FKANOE. theory of paper-money and its basis in the following words : " The earth is the source of value ; you cannot distribute the earth in a circulating value, but this paper becomes representative of that value, and it is evident that the creditors of the nation will not be injured by taking it." On the other hand, appeared in the leading paper, the Moniteur, a very thoughtful article against pa- per-money, which sums up all by saying, " It is, then, evi- dent that all paper which cannot at the will of the bearer be converted into specie cannot discharge the functions of money," and goes on to cite Mirabeau's former opin- ion in his letter to Cerutti, published in 1789 ; the famous opinion that "^aperjmoney is a nursery of tyr- anny, corruption, and delusions; a veritable , orgy of authority in delirium" "lablache, in the Assembly, quotes the saying that "paper-money is the emetic of great states." ' Boutidoux follows in favor of paper-money, and calls the assignats " un papier terre^'' or land converted into paper. Boisandry answers vigorously, and fore- tells someevil results clearly. Pamphlets continue to be issued, among them one so pungent that it is brought into the Assembly and read there. The truth which it brings out with great clearness is that doubling the quantity of money or substitutes for money in a n^ioiLsimply increases prices, disturbs val- ues, alarms capital, diminishes legitimate enterprise, and so decreases the demand both for products and for labor ; that the only persons to be helped by it are the rich who have large debts to pay. This pamphlet was ' See Moniteur, August 29, 1790. PAPER-MONEY INFLATION IN FRANCE. 21 signed " A Friend of tlie People." It was received witla great applause by tlie thoughtful part of the Assembly. Dupont, who had stood by iffecker in the debate on the first issue of assignats, arises, avows the pamphlet to be his, and says sturdily that he has always voted against the emission of irredeemable paper and always will. But far more important than any other argument against inflation was the speech of Talleyrand. He had been among the boldest and most radical French states- men. He it was who, more than any other, had car- ried the extreme measure of taking into the possession of the nation the great landed estates of the Church. He now takes a judicial tone — attempts to show to the Assembly the very simple truth that the effect of a sec- ond issue of assignats may be different from the first ; that the first was evidently needed ; that the second may be as injurious as ijie first was useful. He exhib- its various weak points in the inflation fallacies, and presents forcibly the trite truth that no laws and no de- crees can keep large issues of irredeemable paper at a par -with specie. In his speech occur these words : " You can, indeed, arrange it so that the people shall be forced to take a thousand francs in paper for a thousand francs in spe- cie ; but you can never arrange it so that a man shall be obliged to give a thousand francs in specie for a thousand francs in paper. In that fact is imbedded the enUre question; and on account of that fact the whole system fails." ' ' See speech in Moniteur ; also in Appendix to Thiors's "History of the French Eevolution.'' ■ 22 PAPER-MONET INFLATION IN FEANCE. The nation at large now began to take part in the debate ; thoughtful men saw that here was the turning- point between good and evil ; that the nation stood at the parting of the ways. Most of the great commer- cial cities bestirred themselves and sent up remon- strances against the new emission, twenty-five being opposed and seven in favor of it. But on Septem- ber 27, 1790, came Mirabeau's great final speech. In this he dwelt first on the political_necfiaai|;y involved, declaring that the most pressing need was to get the government lands into the hands of the peo- ple, and so to commit the class of landholders thus created to the nation, and against the old privileged classes. Through the rest of the speech there is one lead- ing point enforced with all his eloquence and inge- nuity — the thorough excellence of the proposed cur- rency and the stability of its , security. He declares that, being based on the pledge of public lands, and convertible into them, the notes are better secured than if redeemable in specie ; that the precious metals are only employed in the secondary arts, while the French paper-money represents the first and most real of all property, the source of all production, the Icmd itself; that, while other nations have been obliged to emit paper-money, none has ever been so fortunate as the French nation, for never has any other nation been able to give landed security for its paper; that whoever takes French paper-money has practically a mortgage to secure it, on landed property which can be easily sold to satisfy his claims, while other nations have only PAPEK-MONET INFLATION IN FRANCE. 23 been able to give a vague claim on tlie entire nation. " And," he cries, " I would rather have a mortgage on a garden than on a kingdom ! " Other arguments of his are more demagogical. He declares that the only interests affected will be those of bankers and capitalists, but that manufacturers will see prosperity restored to them. Some of his argu- ments seem almost puerile, as when he says, " If gold has been hoarded through timidity or malignity, the issue of paper will show that gold is not necessary, and it will then come forth." But as a w;hole the speech was brilliant ; it was often interrupted by applause ; it settled the question. People did not stop to consider that this was the dashing speech of a bold orator, and not the matured judgment of an expert in finance ; they did not see that calling Mirabeau to decide upon a financial policy, because he had shown boldness in danger and strength in conflict, was like calling a suc- cessful blacksmith to mend a watch. In vain did Maury show that John Law's paper had done well in its first issues ; that the first issues had brought apparent prosperity* while those that followed brought certain misery ; in vain did he quote from a book published in John Law's time, showing that Law was at first considered as a patriot, and friend of hu- manity ; in vain did he hold up to the Assembly one of Law's bills, and appeal to their memories of the wretchedness brought on France by that last great issue of paper-money; nothing could resist the eloquence of Mirabeau. Barnave follows; shows that "Law's paper was based upon the phantoms of the Mississippi ; 24 PAPEE-MONET INFLATION IN FKANOE. ours upon tlie solid basis of ecclesiastical lands," and proves that the assignats cannot depreciate farther. Prudhomme's newspaper pours contempt over gold as coin or security for the currency, extols real estate as the only true basis, and is fervent in praise of the con- vertibility and self-adjusting features of the scheme. In spite of all this plausibility and eloquence, a large mi^ nority stood firm to their earlier principles ; but on the 29th of September, by a vote of 508 to 423, the deed was done : a bill was passed authorizing the issue of eight hundred millions of new assignats, but solemn- ly declaring that in no case should the entire amount put in circulation exceed twelve hundred millions. To mate assurance doubly sure, it also provided that, as fast as the assignats were paid into the Treasury for land, they should be bttrned ; and thus a healthful con- traction be constantly maintained. Great were the plaudits of the nation at this relief. Rejoicings were heard on every side. Among the mul- titudes of pamphlets expressing this joy, which have come down to us, the " Friend of the Revolution " is the most interesting. It begins as follows : " Citizens, the deed is done. The assignats are the keystone of the arch. It has just been happily put in position. Now I can announce to you that the Revolution is finished, and there only remain one or two important questions. All the rest is but a matter of detail which cannot de- prive us any longer of the pleasure of admiring in its entirety this important work. The provinces and the commercial cities which were at first alarmed at the proposal to issue so much paper-money, now send ex- PAPEE-MONEY INFLATION IN FRANCE. 25 pressions of their thanks ; specie is coming out to be joined witli paper-money. Foreigners come to us from all parts of Europe to seek their happiness under laws which they admire ; and soon France, enriched by her new property and by the national industry which is preparing for fruitfnlness, will demand still another creation of paper-money." ^ To make these prophecies good, every means was taken to keep up the credit of this second issue of assig- nats. Among the multitudes of pamphlets issued for this purpose was one by Royer ; it appeared Septem- ber 14, 1790, and was entitled " Reflections of a Patri- otic Citizen upon the Emission of Assignats." In this Royer gives many excellent reasons why the assignats cannot be depressed ; speaks of the argument against them as " vile clamors of people bribed to affect public opinion." He says to the National Assembly, " If it is necessary to create five thousand millions and more of this paper, decree such a creation gladly." He, too, predicts, as Mirabeau and others had done, the time when gold will lose all its value, since all exchanges will be made with this admirably guaranteed paper, and therefore that coin will come out from the places where it is hoarded. He foretells prosperous times to France in case these great issues of paper are continued, and de- clares this " the only means to insure happiness, glory, and liberty, to the French nation." The nation was now fully committed to a policy of inflation ; and, if there had been any doubt of this be- fore, it was soon proved by an act of the Government, very plausible, but none the less significant, as showing 26 PAPEK-MONEY INFLATION IN FKANCE. the exceeding difficulty of stopping a nation once in tlie full tide of a depreciated currency. The old cry of the. " lack of a circulating medium" broke forth again ; and especially loud were the clamors as to the need of more small bills. This resulted in an evasion of the solemn pledge that the circulation should not go above twelve hundred millions, and that all assignats returned to the Treasury for land should immediately be bur^ed. With- in a short time there had been received into the Treasury for lands one hundred and sixty million francs in paper. By the terms of the previous acts this amount ought to have been retired and taken out of circulation. Instead of this, under the plea of necessity, one hundred mill- ions were reissued in the form of small notes.' Yet this was but as a drop of cold water to a parched throat. Although there was already a rise in prices which showed that the amount needed for circulation had been exceeded, the cry for " more circulating medium " was continued. The pressure for new issues became more and more strong. The Parisian populace and the Jacobin Club were especially loud in their declarations ; and a few months later, with few speeches, in a si- lence very ominous, on June 19, 1791, a new issue was made of six hundred millions more; less than nine months after the former great issue, with its solemn pledges as to keeping down the amount in circulation. With the exception of a few thoughtful men, the whole nation again sang paeans. In this comparative ease of a new issue is seen the action of a law in finance as certain as the action of a ' See Von Sybel, " History of the Eeyolution," vol. i, p. 265. PAPER-MONEY INFLATION IN FRANCE. 27 similar law in natural pHlosopliy. If a material body be allowed to fall from a height, in obedience to gravita- tion, its velocity is accelerated, by a well-known law in physics, in a constantly-increasing ratio : so in issues of irredeemable currency, in obedience to the theories or interests of a legislative body, or of the people at large, there is a natural law of rapidly-increasing issue and depreciation. The first inflation bill was passed with great difficulty, after a very sturdy resistance, and by a majority of a few score- out of nearly a thousand votes cast; but you observe now that new inflation measures are passed more and more easily, and you will have occasion to see the working of this same law in a more striking degree as this history develops itself. Nearly all Frenchmen now became desperate opti- mists, declaring that inflation is prosperity. Throughout France there came temporary good feeling. The nation was becoming fairly inebriated with paper-money. The good feeling was that of a drunkard after his draught ; and it is to be noted, as a simple historical fact, corre- sponding to a physiological fact, that, as the draughts of paper-money came faster ,*the periods of succeeding good feeling grew shorter. Various bad signs had begun to appear. Immedi- ately after this last issue came a depreciation of from eight to ten per cent. ; but it is very curious to note the general reluctance to assign the right reason. The de- cline in the purchasing power of paper-money was in obedience to one of the simplest laws -in social physics ; but France had now gone beyond her thoughtful states- men, taking refuge in unwavering optimism, and giv- 28 PAPER-MONET INFLATION IN FRANCE. ing any explanation of the new difficulties rather than the light one. A leading member of the Assembly in- sisted, in an elaborate speech, that the cause of depre- ciation was simply want of knowledge and confidence in the rural districts, and proposed means of enlighten- ing them. La Rochefoucauld proposed to issue an ad- dress to the people, showing the goodness of the cur- rency and the absurdity of preferring coin. The address was unanimously voted. As well might they have at- tempted to show that, if, from the liquid made up by mixing a quart of wine and two quarts of water, a gill be taken, this gill will possess all the exhilarating value of the original, undiluted beverage. Attention was next aroused by another menacing fact — specie was fast disappearing. The explanations for this fact were also wonderful in displaying the in- genuity of the people at large in finding false reasons and evading the true one. A very common explanation may be found in Prudhomme's newspaper, Les JRevo- lutions de Paris, of January 17, 1791, where it is de- clared that " coin will keep rising until the people have hung a broker." ' Another popular theory was that the Bourbon family were in some miraculous way drawing off all solid money to the chief centres of their intrigues ia Germany." Still another favorite idea was that English emis- saries were in the midst of the people, instilling notions hostile to paper. Great efforts were made to find these emissaries, and more than one innocent person expe- ' See also De Goncotirt, " Soci6t6 FranQaise," for other explanations. ° See Lea Bivolutiona de Paris, vol. ii., p. 216. PAPER-MONET INFLATION IN FRANCE. 29 nenced the popular wrath, under the supposition that he was engaged in raising gold and depressing paper." Even Talleyrand, shrewd as he was, insisted that the ' cause was simply that the imports were too great and , the exports too little.' As well might he explain the fact that, when oil is mingled with water, water sinks to the bottom, by saying that it is because the oil rises to the top. This disappearance of specie was the result of a natural law as simple and sure in its action as gravi- tation : the superior currency had been withdrawn be- cause an inferior could be used.' Some efforts were made to remedy this. In the municipality of Quilleboeuf the sum of 817 marks in specie having been found in the possession of a citizen, the money was seized and sent to the Assembly. The good people of that town treated this hoarded gold as the result of some singularly unpatri- otic wickedness or madness, instead of seeing that it | was but the sure result of a law, working in every] land and time, when certain causes are present. Marat followed out this theory by asserting that death was the proper penalty for persons who thus hid their money. In order to supply the specie required a great number of church -bells were melted down; but this proved delusive. StUl another troublesome fact began now to appear. Though paper-money had increased in amount, prosperi- ' See Challamel, "Les Frangais sous la Eevolution ; " also, Senior, " On some Effects of Paper-Money," p. 82. = See Buchez and Eoux, vol. x., p. 216. = For an admirable statement and illustration of the general action of this law, see Sumner, "History of American Currency," pp. 157, 158 ; also Jevons, on " Money," p. 80. 30 PAPEK-MONET INFLATION IN FRANCE. ty Lad steadily diminislied. In spite of all the paper issues busiaess activity grew more and more spas- modic. Enterprise was soon chilled, and stagnation followed. Mirabeau, in Ms speecli wMcli decided the second great issue of paper, had insisted that, though bankers might suffer, this issue would be of great service to manufacturers and restore ■ their prosper- ity. The manufacturers were for a time deluded, but were at last rudely awakened from their delu- sions. The plenty of currency had at first stimulated production, and created a great activity in manufact- ures ; but soon the markets were glutted, and the de- mand was vastly diminished. In spite of the wretched financial policy of years gone by, and especially in spite of the Edict of Nantes, by which religious bigotry had driven out of the kingdom thousands of its most skill- ful workmen, the manufactures of France had again come into full bloom. In the finer woolen and cotton goods, in silk and satin fabrics of all sorts, in choice pottery and porcelain, in manufactures of iron, steel, and copper, they had again taken their old place upon the Continent. All the previous changes had, at the worst, done no more than to inflict a momentary check on this highly-developed system of manufactures ; but what the bigotry of Louis XIV. and the shiffclessness of Louis XV. could not do in nearly a century, was accomplished by this tampering with the currency in a few months. One manufactory after another stopped. At one town, Lo- dfeve, five thousand workmen were discharged from the cloth-manufactories. Every cause, except the right one, was assigned for this. Heavy duties were put upon PAPER-MONET INFLATION IN FRANCE. 31 foreign goods. Everything tliat tariffs and custom- houses could do ,was done. Still the great manufacto- ries of Normandy were closed, those of the rest of the kingdom speedily followed, and vast numbers of work- men, in all parts of the country, were thrown out of em- ployment.' Nor was this the case alone in regard to home demand. The foreign demand, which had been at first stimulated, soon fell off. In no way can this be better stated than by one of the most thoughtful histo- rians of modern times : " It is true that at first the assignats gave the same impulse to business in the city as in the country, but the apparent improvement had no firm foundation even in the towns. Whenever a great quantity of paper-money is suddenly issued, we invariably see a rapid increase of trade. The great quantity of the circulating medium sets in motion all the energies of commerce and manufactures ; capital for investment is more easily found than usual, and trade perpetually receives fresh nutriment. If this paper represents real credit, founded upon order and legal security, from which it can derive a firm and lasting value, such a movement may be the starting-point of a great and widely-extended prosperity, as, for instance, the mast splendid improvements in English agriculture were undoubtedly owing to the emancipation of the country bankers. If, on the contrary, the new paper is of precarious value, as was clearly seen to be the case with the French assignats as early as February, 1791, it can have no lasting, beneficial fruits. For the mo ment, perhaps, business receives an impulse, all th ' See De Gonoourt, "Soci6t6 Frangaise," p. 214. 32 PAPER-MONEY INFLATION IN FRANCE. more violent, because every one endeavors to invest nis doubtful paper in buildings, macbines, and goods, wbicb under all circumstances retain some intrinsic value. Such a movement was witnessed in France in 1791, and from every quarter tbere came satisfactory reports of tbe activity of manufactures. " But for tbe moment tbe Frencb manufacturers de- rived great advantage from tbis state of tbings. Aa tbeir products could be so cbeaply paid for, -orders poured in from foreign countries to sucb a degree tbat it was often difficult for tbe manufacturers to sat- isfy tbeir customers. It is easy to see tbat prosperity of tbis kind must very soon find its limit. It was not founded upon any actual and permanent want of tbose wbo gave tbe order, and could only last until tbe in- creased exports from France bad restored tbe balance of tbe exchange. Tbis factitious prosperity was not calculated to lead to lasting investments of capital and costly extensions of business ; and wben a further fall in the assignats took place it would necessarily collapse at once, and be succeeded by a crisis all tbe more de- structive tbe more deeply men bad engaged in specu- lation under tbe influence of tbe first favorable pros- pects." ' Then came a collapse in manufacturing and com- merce, just as it had come before in France ; just as it came afterward in Austria, Eussia, America, and all other countries where men have tried to build up pros- perity on irredeemable paper." '/See Von Sybel, "History of the French Revolution," vol. 1., pp. 281, 283. " For proofs that issues of irredeemable paper at first stimulated manu- PAPER-MONET INFLATION IN FRANCE. 33 All this breaking down of tlie manufactures and commerce of the nation made fearful inroads on tlie greater fortunes ; but upon the lesser fortunes, and the little accumulated properties of the masses of the nation who relied upon their labor, it pressed with intense severity. Still another difficulty appeared. There had come a complete uncertainty as to the future. In the spring of 1791 no one knew whether a piece of paper-money representing a hundred francs would, a month later, have a purchasing power of a hundred francs, or ninety francs, or eighty, or sixty. The result was, that capital- ists declined to embark their means in business. En- terprise received a mortal blow. Demand for labor was still further diminished ; and here came an addi- tional cause of misery. By this uncertainty all far- reaching undertakings were killed. The business of France dwindled into a mere living from hand to mouth. This state of things, too, while it bore heavily against the interests of the moneyed classes, was still more ruinous to those in more moderate and most of all to those in straitened circumstances. With the masses of the people, the purchase of every article of supply became a speculation-^a speculation in which the professional speculator had an immense advantage over the buyer. Says the most brilliant of apologists factures and commerce in Austria, and afterward ruined them, see Storch's "Eoonomie Politique," vol. iv., p. 223, note; and for the same effect pro- duced by the same causes in Eussia, see ibid., end of vol. iv. Fpr the same effects in America, see Sumner's " History of American Currency." For general statement of effect of inconvertible issues on foreign exchanges, see MoLeod on "Banking," p. 186. 3 34 PAPER-MONEY INFLATION IN FRANCE. for Frencli revolutionary statesmanship, "Commerce was dead ; betting took its place." ' Nor was there any compensating advantage to the mercantile classes. The merchant was forced to add to his ordinary profit a sum sufficient to cover probable or possible fluctuations in value. And while prices of products thus went higher, the wages of labor, owing to the number of workmen who were thrown out of employ, went lower. But these evils, though very great, were small com- pared to those far more deep-seated signs of disease which now showed themselvea throughout the country. The first of these was the qbliieration of thrift in the minds of the French people. The French are naturally a thrifty people ; but, with plenty of money and with uncertainty as to its future value, the ordinary mo- tives for saving and care diminished, and a loose luxury spread throughout the country. A still worse outgrowth of this feeling was the increase of specu- lation and gambling. With the plethora of paper- currency in 1791 appeared the first evidences of that cancerous disease which always follows large issues of irredeemable currency — a disease more perma- nently injurious to a nation than war, pestilence, or famine. At the great metropolitan centres grew a luxurious, speculative, stock-gambling body, which, like a malignant tumor, absorbed into itself the strength of the nation, and sent out its cancerous fibres to the remotest hamlets. At these centres abundant wealth ' See Louia Blanc, " Histoire de la Kevolution Frangaise," tome xil p. 113. ' PAPER-MONEY INFLATION IN FRANCE. • 35 was piled up. In the country at large there grew dislike of steady labor, and contempt for moderate gains and simple living. In a pamphlet published May, 1791, we see how, in regard to this also, public opinion was blinded. The author ^calls attention to the fright- ful increase of gambling in values of all sorts in these words: "What shall I say of the stock-jobbing, as frightful as it is scandalous, which goes on in Paris under the very eyes of our legislators, a most terrible evil, yet under the present circumstances a necessary evil ? " The author also speaks of these stock-gamblers as using the most insidious means to influence public opinion in favor of their measures ; and then proposes, seriously, a change in various matters of detail, thinking that this would prove a sufficient remedy for an evil which had its roots far down in the whole system of irredeemable currency." Now began to be seen more plainly some of the many ways in which an mflat jon policy robs Jhe work- ing-classes. As these knots of plotting schemers at the city centres were becoming bloated with sudden wealth, the producing classes of the country, though having in their possession more currency than before, grew lean. In the schemes and speculations put forth by stock-job- bers, and stimulated by the printing of more currency, multitudes of small fortunes throughout the country were absorbed, and, while these many small fortunes were lost, a few swollen fortunes were rapidly aggre- gated in the city centres. This crippled a large class 1 See " Extrait du Eegistre des Delib6ratioii8 de la Section de la Biblio- , thSque," May 3, 1791, pp. 4, 5. 36 PAPEE-MONET INFLATION IN FRANCE. in tlie country districts, wMch had employed a great number of workmen; and created a small class, in the cities, which employed a great number of lackeys. In the cities now arose a luxury and license whidi is a greater evil even than the plundering which min- isters to it. In the country the gambling spirit spread more and more. Says the same thoughtful historian whom I have already quoted : " What a. prospect for a country when its rural population was changed into a great band of_gamblers ! " ' Nor was this reckless and corrupt spirit confined to business-men ; it began to break- out in offici al^circles, and public men who, a few years before, had been pure in motive and above all probability of taint, became luxurious, reckless, cynical, and finally corrupt, Mira- beau himself, who, not many months before, had risked imprisonment and even death to establish constitutional government, was now — at this very time — secretly re- ceiving heavy bribes : when at the downfall of the monarchy, a few years later, the famous iron chest of the Tuileries was opened; there were found evidences that, in this carnival of inflation and corruption, Mira- beau himself had been a regularly paid servant of the court." The artful plundering of the people at large ' Von Sybel, vol. i., p. 273. ' For general account, see Thiers's " Revolution," chapter xiv. ; also Laoretelle, vol. viii., p. 109 ; also " Memoirs of Mallet Du Pan." For a good account of the intrigues between the court and Mirabeau, and of the prices paid him, see Eeeve, "Democracy and Monarchy in France," vol. i., pp. 213-220. For a very striking caricature published after the iron chest in the Tuileries was opened, and the evidences of bribery of Mirabeau re- vealed, see Ohallamel, " Mus^e de la E^vdlution Franjaise," vol. i., p. 341. Mirabeau is represented as a skeleton sitting on a pile of letters, holding the French crown in one hand and a purse of gold in the other. PAPER-MONEY INFLATION IN FRANCE. 37 was bad enougli, but worse still was this growing cor- ruption in official and legislative circles. Out of the speculating and gambling of tlie inflation period grew; luxury, and out of tMs grew corruption. It grew as naturally as fungus on a muck-lieap. It was first felt in business operations, but soon began to be seen in tlie legislative body and in journalism. Mirabeau was by no means the only example. Such members of the legislative body as Jullien, of Toulouse, Delaunay, of Angers, Fabre d'Eglantine, and their disciples, were among the most noxious of those conspiring by legisla- tive action to raise and depress securities for stock-job- bing purposes. Bribery of legislators followed as a matter of course. Delaunay, Jullien, and Chabot, ac- cepted a bribe of five hundred thousand francs for aid- ing legislation calculated to promote the purposes of certain stock-jobbers. It is some comfort to know that nearly all concerned lost their heads for it.' It is true that the number of these corrupt legisla- tors was small, far less than alarmists led the nation to suppose, but there were enough to cause wide-spread distrust, cynicism, and want of faith in any patriotism or any virtue. Even worse than this was the breaking down of morals in the country at large, resulting from the sud- den building up . of ostentatious wealth in a few large cities, and the gambling, speculative spirit fostered in the small towns and rural districts. Yet even a more openly disgraceful result of this paper-money was to come, and this was the decay ' Thiers, chapter ix. 38 PAPEKr-MONET INFLATION IN FRANCE. of any true sense of national honor or good faith^ The patriotism wHcli the fear of the absolute mon- archy, the machinations of a court party, the display of the army, and the threats of all monarchical Eu- rope, had been unable to shake, was gradually disin- tegrated by this same stock-jobbing, speculative habit fostered by the new currency. At the outset, in the discussions preliminary to the first issue of papei-- money, Mirabeau and others who had favored it had insisted that patriotism, as well as an enlight- ened self-interestj would lead the people to keep up the value of paper-money. The very opposite of this was now found to be_ the case. There now ap- peared, as another outgrowth of this disease, what has always been seen under similar circumstances. It is a result of previous evils and a cause of future evils. This outgrowth was the creation^_a-gr-eat debtor class in the nation, directly interested in the depreciation of | the currency in which their debts were to be paid. I The nucleus of this debtor class was formed by those who had purchased the church-lands from the Govern- ment. Only small payments down had been required, and the remainder was to be paid in small installments spread over much time : an indebtedness had thus been created, by a large number of people, to the amount of hundreds of millions. This large body of debtors, of course, soon saw that their interest was to depreciate the currency in which their debts were to be paid ; and soon they were joined by a far more influential class ; by that class whose speculative tendencies had been stim- ulated by the abundance of paper-money, and had gone PAPER-MONEY INFLATION IN FRANCE. 39 largely into debt, looking for a rise in nominal values. Soon demagogues of the viler sort' in the clubs be- gan to pander to this debtor class; soon important members of this debtor class were to be found in- triguing in the Assembly — often on the seats of the Assembly and in places of public trust. Before long, the debtor class became a powerful body, extending through all ranks of society. From the stock-gambler who sat in the Assembly to the small land-speculator in the rural districts ; from the sleek inventor of canards on the Paris Exchange to the lying stock- jobber in the market-town, all pressed vigorously. for new issues of paper ; all were able, apparently, to de- monstrate to the people that in new issues of paper lay the only chance for national prosperity. This great debtor class, relying on the multitude who could be approached by superficial arguments, soon gained control. Strange as it may seem, to those who have not watched the same causes at work at a previous period in France, and at various periods in other countries, while every issue of paper-money really made matters worse, a superstition steadily gained ground among the people at large that, if only enough paper-money were issued and more cunningly handled, the poor would be made rich. Henceforth all opposi- tion was futile. In December, 1791, a report was made in the Assembly in favor of a fourth great issue of three hundred millions more of paper-money. In regard to this report, Chambon says that more money is needed, but asks, " Will you, in a moment when stock-jobbing is carried on with such fury, give it new power in adding 40 PAPER-MONET INFLATION IN FBANCE. SO mucli more money to the circulation ? " But sucn Mgh considerations were now little regarded. Dorisy declares that " there is not enough money yet in circu- lation ; that, if there were more, the sales of national lands would be more rapid." And the official report of his speech declares that these words were applauded. Dorisy declares that the Government lands are worth at least thirty-five hundred million francs, and asks: " Why should memhers ascend the tribune and disquiet France ? Fear nothing ; your currency reposes upon a sound mortgage." Then follows a glorification of the patriotism of the French people, which, he asserts, will carry the nation through all its difficulties. Becquet follows, declaring that the " circulation is becoming more rare eveiy day." On December 17, 1791, a new issue was ordered of three hundred millions more, making in all twenty-one hundred millions authorized. Coupled with this was the declaration that the total amount of circulation should never reach more than sixteen hundred millions. What this proviso was worth may be judged from the fact that not only had the declaration made hardly a year before, limiting the amount in circulation to twelve hundred millions, been violated, but the declaration, made hardly a month before^ in which the Assembly had as solemnly limited the amount of circulation to fourteen hundred millions, had also been repudiated. The evils which we have already seen arising from the earlier issues were now aggravated. But the most curious thing evolved out of all this^baos_ is a new system of political economy. In the speeches PAPER-MONEY INFLATION IN FRANCE. 41 about this time, we begin to find it declared that, after all, a depreciated currency is a blessing ; that gold and silver form an lansatisfactory standard for measuring values ; that it is a good thing to have a currency that will not go out of the kingdom, and which separates France from other nations; that thus shall manufact- ui'es be encouraged ; that commerce with other nations is a curse, and every hinderance to it a blessing ; that the laws of political economy, however applicable in other times, are not applicable to that particular time, and, however operative in other nations, are not opera- tive in Prance; that the ordinary rules of political economy are perhaps suited to the minions of despot- ism, but not to the enfranchised inhabitants of France at the close of the eighteenth century ; that the whole present- state of things, so far from being an evil, is a blessing. All these ideas, and others quite as striking, are brought to the surface in the debates on the various new issues.' Within four months comes another report to the Assembly as ingenious as those preceding. It declares : "Your committee are thoroughly persuaded that the amount of circulating medium before the Revolution was greater than that of the assignats to-day ; but then the money circulated slowly, and now it passes rapidly, so that one thousand million assignats do the work of two thousand millions of specie." The report foretells further increase in prices, but by some curious • See especially " Dlsoours de Fabre d'Eglantine," in Moniteur for August 11, 1793; also debate in J/brai<«Mr of September 15, 1793; also Prudliomme's Revolutions de Paris. 42 PAPER-MONET INTLATION IN FKANCE. jugglery reaches a conclusion, favorable to farther in- flation. The result was, that on April 30, 1792, came the fifth great issue of paper-money, amounting to three hundred millions ; and at about the same time Cambon sneered ominously at public creditors as " rich people, old financiers, and bankers." Soon payment was sus- pended on dues to public creditors for all amounts ex- ceeding ten thousand francs. This was hailed by many as a measure in the inter- ests of the poorer classes of people, but the result was that it injured them most of alL Henceforward, until the end of this history, capital was taken from labor and locked up in all the ways that financial in- genuity could devise. All that saved thousands of la- borers in France from starvation was that they were drafted off into the army and sent to be killed on foreign battle-fields. In February, 1792, assignats were over thirty per cent below par,' On the last day of July, 1792, came another brill- iant report from Fouquet, showing that the total amount already issued was about twenty-four hundred millions, but claiming that the national lands were worth a little more than this sum. Though it was easy for any shrewd mind to find out the fallacy of this, and to show that the paper-money already issued far exceeded the amount that could be obtained from the national lands, a decree was passed issuing three hundred millions more. By this the prices of everything were again enhanced ' Von Sybel, vol. i., pp. 509, 510. PAPER-MONET INFLATION IN FRANCE. 43 save one thing, and that one thing was labor. Strange as it may at first appear, while all products had bepn raised enormously in price by the depreciation of the currency, the stoppage of so many manufactories, and the withdrawal of capital, caused wages in the summer pf 1792, after all the inflation, to be as small as they had been four years before, namely, fifteen sous per day.' No more striking example can be seen of the truth uttered by Webster, that " of all the contrivances for cheating the laboring-class of mankind, none has been more effectual than that which deludes them with paper-money." Issue after issue followed at intervals of a few months until on December 14, 1792, we have an official state- ment to the effect that thirty-four hundred millions had been put forth, of which six hundred millions had been burned, leaving in circulation twenty-eight hundred millions. When it is remembered that there was little business to do, and that the purchasing power of the franc, when judged by the staple products of the countiy, was about equal to half the present purchasing power of our own dollar, it will be seen into what evils France had drifted." As this mania for paper ran its course, even the bell-metal sous, obtained by melting down the bells, appear to have been driven out of cir- culation; parchment-money from twenty sous to five was issued, and at last bills of one sou, and even of half a sou, were put in circulation.' ' See Von Sybel, vol. i., p. 515 ; also Villeneuve Bargemont, " Histoire de I'Eoonomie Politique," vol. ii. p. 213. ^ As to purchasing power of money at that time, see Arthur Young, " Travels in France during the Years 1787, 1788, and 1789." ' For notices of this small currency, with examples of satirical verses 4i PAPER-MONEY INFLATION IN FRANCE. But now another source of wealtli opens to the na- tion. There comes a confiscation of the large estates of nohles and landed proprietors who had fled the country. An estimate in 1793 makes the value of these estates three billion francs. As a consequence, the issues of paper-money were continued in increased amounts, on the old theory that they were guaran- teed by the solemn pledge of these lands belonging to the state. Early in^ 1793 the consequences of over- issue of paper began to be more painfully evident to the people at large. Articles of common consump- tion became enormously dear, and the price was con- stantly rising. Orators m the clubs, local meetyigs, and elsewhere, endeavored to enlighten people by assign- ing every reason except the true one. They declaimed against the corruption of the ministry, the want of pa- triotism among the moderates, the intrigues of the emi- grant nobles, the hard-heartedness of the rich, the mo- nopolizing spirit of the merchants, the perversity of the shopkeepers, and named these as causes of the diffi- culty.' The washer-women of Paris, finding soap so dear that they could scarcely purchase it, insisted that all the merchants who were endeavoring to save something of their little property by refusing to sell their goods for the worthless currency with which France was flooded, should be punished with death; the women of the written upon it, see Challamel, " Les Francais sous la Revolution," pp. 307 308. See also Mercier, " Le Nouveau Paris," edition of 1800, chapter ccv., entitled " Parchemin Monnoie." ' For Ohaumette's brilliant argument to this effect, see Thiers, Shoberl'a translation, published by Bentley, vol. iii., p. 248. PAPER-MONET INFLATION IN FRANCE. 4.5 markets, and the hangers-on of the Jacobin Club, called loudly for a law " to equalize the value of paper-money and silver coin." It was also demanded that a tax be laid especially on the rich, to the amount of four hundred million francs, to buy bread ; and the National Convention, which was now the legislative body of the French Republic, ordered that such a tax be levied. Marat declared loudly that the peo- ple, by hanging a few shopkeepers and plundering their stores, could easily remove the trouble. The result was, that on the 28th of February, 1793, at eight o'clock in the evening, a mob of men and women in disguise began plundering the stores and shops of Paris. At first they demanded only bread ; soon they insisted on coffee and rice and sugar ; at last they seized every thing on which they could lay their hands, cloth, cloth- ing, groceries, and luxuries of every kind. Two hundred shops and. stores were plundered. This was endured for six hours, and finally order was restored only by a grant of seven million francs to buy off the mob. The new political economy was beginning to bear its fruits. One of its minor growths appeared at the City Hall of Paiis, where, in response to the com- plaints of the plundered merchants, Eoux declared, in the midst of great applause, that " the shopkeepers were only giving back to the people what they had hitherto robbed them of," This mob was suppressed, but now came the most monstrous of all financial outgrowths of paper-money, and yet it was an outgrowth perfectly logical. Maxi- mum laws were passed — laws making the sales of 46 PAPER-MONEY INFLATION IN FRANCE. goods compulsory, and .fixing their price in paper- money. As Von Sybel declares, " it was the most com- prehensive attack on the rights of property, as far as our historical knowledge reaches, which was ever made in Western Europe — an attack made in the heart of a great and civilized nation, and one which was not con- fined to the brains of a few idle dreamers, but practi- cally carried out in all its terrible consequences. It was made with fiery fanaticism and unbridled passion, and yet with systematic calculation. Its originators — victorious at home and abroad — were perfectly free in their deliberations, and did not adopt their measures under the pressure of necessity or despair, but from deliberate choice. These are facts of universal signifi- cance, on which we ought to fix our attention all the more earnestly, because they have been disregarded, although they are fraught with the most important consequences.*' ' I have said that these maximum laws were perfectly I logical ; they were so. Whenever any nation intrusts to its legislators the issue of a currency not based on the idea of possible redemption in coin, it intrusts to them the power to raise or depress the value of every article in the possession of every citizen. Louis XIV. claimed that all property in France was his own, and " See Von Sybel, vol. iii., pp. 11, 12. For general statements of theo- ries underlying the maximum, see Thiers. For a very interesting picture by an eye-witness, of the absurdities and miseries it caused, see Mercier, " Nouveau Paris," edition of 1800, chapter xliv. For summary of the Ee- port of the Committee, with list of articles embraced under it, and for various interesting details, see Villeneuve Bargemont, " Histoire de I'Eco- nomie Politique," vol. ii., pp. 218-39. Far curious examples of severe penalties for very slight infringements of the law on this subject, see Louis Blanc, " Histoire de la Edvolution Francaise," tome x., p. 144. PAPER-MONEY INFLATION IN FBANOE. 47 that what private persons held was as much his as if it were in his coffers.' But even this falls short of the reality of the confiscating power exercised in a country where, instead of leaving values to be measured by a standard common to the whole world, they are left to be depressed or raised at the whim, caprice, or interest, of a body of legislators." When this power is given, the power of fixing prices is naturally included in it, as the less is included in the greater. The first result of the maximum was, that every means was taken to evade the fixed price imposed ; the farmers brought in as little produce as they possi- bly could. This caused scarcity, and the people of the large cities were put on an allowance. V Tickets were issued authorizing the bearer to obtain /at the maximum prices a certain amount of bread, or / sugar, or soap, or wood, or coal, to cover immediate ne- cessities.' It may be said that these measures were the result of the war then going on. Nothing could be more baseless than such an objection. The war was generally success- ful. It was pushed mainly upon foreign soil. Numer- ous contributions were levied upon the subjugated countries to support the French armies. The war was one of those of which the loss, falling apparently upon future generations, stimulates, in a sad way, trade and production in the generation in being. The main > See "Memoirs of Louis XIV." for the instruction of the dauphin. ' For a simple exposition of the way in which the exercise of this power became simply confiscation of all private property in France, see Mallet Du Pan's " Memoirs," London, 1852, vol. ii., p. 14. ' See specimens of these tickets in A. D. W. collection. 48 PAPER-MONEY INFLATION IN FKANCE. cause of these evils was the old false system of confis- cating the property of an entire nation; keeping all values in fluctuation ; discouraging all enterprise ; par- alyzing all energy ; undermining sober habits ; obliter- ating thrift ; promoting extravagance and wild riot, by the issue of an irredeemable currency. It has also been argued that the assignats sank in value because they were not well secured — that securing them on Government real estate was as futile as if the United States were to secure notes on its real estate 'in distant Territories. This objection is utterly fallacious. The Government lands of our own country are remote from the centres of capital, and difficult to examine : the French national real estate was near those centres — even in them — and easy to examine. Our na- tional real estate is unimproved and unproductive: theirs was improved and productive ; the average pro- ductiveness of that in market was quite five per cent., in ordinary times.' It has also been objected that the attempt to secure the assignats on Government real estate failed because of the general want of confidence in the title derived by the purchasers from the new Government. Every thorough student of that period must know that this is a misleading statement. Everything shows that the French people generally had the most unwavering con- fidence in the stability of the new Government during the greater part of the Kevolution. There were disbe- ' Louis Blanc calls attention to this very fact in showing the superiority of the French assignats to onr Continental currency. See Louis Blanc, " Histoire de la Edvolution Fransaise," tome xii., p. 98. PAPER-MONET INFLATION IN FRANCE. 49 lievers in tlie perpetuity of it, just as there were dislbe- lievers in the perpetuity of the United States through- out our recent civil war ; but they were a small minor- ity. Even granting that there was a doubt as to invest- ments in French lands, the French people had certainly as much confidence in the secure ^possession of Govern- ment lands as any people can ever have in large issues of Government bonds ; indeed, it is certain that they had far more confidence in their lands as a security than any modem nation can have in large issues of con- vertible bonds obtained by payments of irredeemable paper. The simple fact, as stated by John Stuart Mill, which made assign ats convertible into real estate unsuc- cessful was that the vast majority of people could not \ afford to make investments outside their business ; and this fact is just as fatal to any attempt to contract large issues of irredeemable paper by making such issues' con- vertible into bonds bearing low interest — save, perhaps, a bold, statesman-like attempt, which seizes the best time and presses every advantage, eschewing all " in- terconvertibility " devices, and sacrificing everything to regain a sound currency based on standards common to the entire financial world. On April 11, 1793, a law was passed to meet the case of those who bought specie with paper. Nothing could be more natural than such purchases. Husbands who wished to make provision for their wives, fathers who wished to make provision for their children, de- sired to accumulate something of acknowledged value, and enormous prices in paper were paid for gold. The new law forbade the sale or exchange of specie for 4 50 PAPEK-MONET INFLATION IN FRANCE. more than its nominal value in paper, with a penalty of six years' imprisonment in irons.' It will doubtless astonish many to learn that, in spite of these evident results of too much currency, the old cry of a " scarcity of circulating medium " was not stilled ; it_ap.p£axed not long after each issue, no matter how. large, and reappeared now. But every thoughtful student of financial history knows that this cry always comes after such issues — nay, that it must come — because in obedience to a natural law there is a scarcity, or rather msuffioiency, of currency just as soon as prices become adjusted to the new volume, and there comes some "little revival of business with the usual increase of credit. The cry of " insufficient amount of circulating me- dium " was again raised. The needs of the Government were pressing, and within a month after the passage of the fearful penal laws made necessary by the old issues, twelve hundred millions more were sent forth." About ten days after this a law was passed making a forced loan of one thousand millions from the rich. In August, 1793, appears a report by Cambon. No one can read it without being struck by its perverted ability. But while Cambon's plan of dealing with the public debt has outlasted all revolutions since, his plan of dealing with the inflated currency came to speedy and wretched failure. ' See Von Sybel, vol. iii., p. 26 ; also Montgaillard, " Histoire de la K6volution FraiiQaise," p. 196. ° For an excellent statement of the action of this law in our own conn- try, see Sumner, p. 220. PAPER-MONEY INPLATIOjS^ IN FRANCE. 51 Very carefully he had devised a funding scheme which, taken in connection with his system of issues, was, in effect, what in these days would be called an " inter- convert ih Hit y scheme:'' By various degrees of persua- sion or force, holders of assignats were urged to convert them into evidences of national debt, bearing interest at five per cent.,' with the understanding that if more paper were afterward needed, more would be issued. All in vain. The official tables of depreciation show that the assignats continued to fall ; soon a forced loan calling in a billion of these checked this fall, but for a moment.' The " interconvertibility scheme" between currency and bonds failed as dismally as the " intercon- vertibility scheme" between currency and land had failed. Soon after came a law confiscating the property of all Frenchmen who left France before July 14, 1789, and who had not returned. This gave new land\ to be mortgaged for the security of paper-money. Month after month, year after year, this went on. Meanwhile every thing possible was done to keep up the value of paper. In obedience to those who be- lieved, with the market-women of Paris, as stated in their famous petition, that "laws should be passed making paper as good as gold," Couthon, on August 1, 1793, proposed and carried a law punishing any person who should sell assignats at less than their nominal val- ' See Oambon's " Report," August 15, 1753, pp. 49-60 ; also Decree of August 15-24, 1793, § 31, chapters zcvi.-ciii. '' See " Tableau de Depreciation du Papier-Monnaie dans le D6parte- ment de la Seine." 52 PAPER-MONET INFLATION IN FRANCE. ue, with imprisonment for twenty years in chains. Two years later Coutlion carried a law making investments in foreign countries, by Frenchmen, punishable with death ; and to make this series of measures complete, to keep up paper at all hazards, on August 15, 1793, the national debt was virtually repudiated.' But, to the surprise of the great majority of the people in France, after the momentary spasm of fear had passed, the value of the assignats was found not to have been increased by these measures ;_Qn the contrary, thej^ persisted in obeying the natural laws of finance, and, as new issues increased, their value decreased in a cqh:^ stant ratio. Nor did the most lavish aid of Nature avail to help matters. The paper-money of the nation seemed to possess a magic power to transmute prosper- ity into adversity. The year 1794 was exceptionally fruitful ; crops were abundant ; and yet with the au- tumn came scarcity of provisions, and with the winter came famine. The reason is perfectly simple. The -^equences in that whole history are absolutely logical. -^irst, the Legislature had inflated the currency and raised prices enormously. Next, it had been forced to establish an arbitrary maximum price for produce. But this price, large as it seemed, was not equal to the real value of produce ; many of the farmers, therefore, raised less produce or refrained from bringing what they ■ had to market." But, as is usual in such cases, the P trouble was ascribed to everything rather than the real cause, and the most severe measures were established ' See Von Sybel, vol. iii., p. 172. = Ibid., p. 173. PAPER-MONET INFLATION IN PRANCE. 53 in all parts of t\e country to force farmers to bring produce to market, the millers to grind it, and the shop- keepers to sell it.' The issues of paper-money continued. Toward the end of 1794, seven thousand million assi- gnats were m circulation." By the end of May, 1795, the circulation Avas increased to ten thousand millions; at the end of July to fourteen thousand millions ; at the end of July to sixteen thousand millions ; and the value of one hundred francs in paper fell steadily, first to four francs in gold, then to three, then to two and a half." But,, curiously enough, when this depieciatiomgas -rapidly g o- ing on, as at various other periods when depreciation was rapid, there came an apparent revival of business. The hopes of many were revived by the fact that, in spite of the decline of paper, there was an exceedingly brisk trade in all kinds of permanent property. Whatever articles of permanent value certain people were willing to sell, certain other people were willing to buy and pay largely for in assignats. At this, hope revived for a time in certain quarters. But ere long it was discov- ered that this was one of the most terrible results of a natural law which is sure to come into play under such circumstances. It was simply a feverish activity caused by the intense desire of a large number of the more shrewd class to convert their paper-money into any- thing and everything which they could hold and hoard until the collapse which they foresaw should take place. • See Thiers ; also, for curious details of measures taken to compel farmers and. merchants, see Senior, "Lectures on Results of Paper-Money," pp. 86, 87. " See Von Sybel, vol. iv., p. 231. = See Von Sybel, vol. iv., p. 330 ; also, tables of depreciation in Moni- teur; also, official reports in A. D. W. collection. 54 PAPEE-MONET INFLATION IN FRANCE. This very activity in business was simply the result of disease. It was simply legal robbery of the more en- \thusiastic and trusting by the more cold-hearted and Tieen. It was the " unloading " of the assignats by the cunning upon the mass of the people.' But even this could not stop the madness of infla- tion. New issues continued, until at the beginning of 1796 over forty-five thousand million francs had been issued, of which over thirty-six thousand millions were in actual circulation." It is very interesting to note, in the midst of all this, the steady action of another simple law in finance. The Government, with its prisons and its guillotines, with its laws inflicting twenty years' imprisonment in chains upon the buyers of gold, and death upon investors in foreign securities, was utterly powerless against this law. The louis d'or stood in the market as a mon- itor, noting each day, with unerring fidelity, the decline in value of the assignat ; a monitor not to be bribed, not to be scared. As well might the National Convention try to bribe, or scare away, the polarity of the mariner's compass. On August 1, 1795, the gold louis of 25 francs was worth. 920 francs ; September 1st, 1,200 francs; on November 1st, 2,600 francs; on De- cember 1st, 3,050 francs. In February, 1796, it was worth in market 7,200 francs, or one franc in gold was ' For a life-like sketch of the vigorous way in which these exchanges of assignats for valuable property went on at periods of the rapid depreciation of paper, see Challamel, " Lea Frangais sous la E6volution," p. 809 ; also, Say, " Eoonomie Politique," septieme 6dition, p. 147. ' See De Nervo, "Finances Franfaises,'' p. 280. PAPER-MONEY INFLATION IN FRANCE. 55 wortli 288 francs in paper-money. Prices of all com- modities went up in proportion.' The writings of tlie period give curious' details of these prices. Thibaudeau, in his " Memoirs," speaks of sugar as 500 francs a pound, soap 230 francs, candles 140 francs." Mercier, in his life-like pictures of the French metropolis at that period, mentions 600 francs as carriage-hire for a single drive, and 6,000 francs for an entire day.' Everything was inflated in about the same proportion, except the wages of labor ; as man- ufactories closed, wages had fallen, until all that kept them up at all was the fact that so many laborers were drafted into the army. From this state of things came grievous wrong and gross fraud. Men who had foreseen these results fully, and had gone into debt, were of course jubilant. He who in 1790 had borrowed 10,000 francs could pay his debts in 1796 for about 35 francs. Laws were made to meet these abuses. As far back as 1794 a plan was devised for publishing official " tables of depreciation " to be used in making equi-l table settlements of debts, but all such machinery*! proved fatile. On the 18th of May, 1796, a young man complained to the National Convention that his elder brother, who had been acting' as administrator of his deceased father's estate, had paid the heirs in assignats, > For a very complete table of the depreciation from day to day, see Supplement to the Moniteur, of October 2, 1797. For the market prices of the louis d'or at the first of each month, as the collapse approached, see MontgaiUard. See also official lists in the A. D. W. collection. '' See "M6moires de Thibaudeau," vol. ii., p. 26. = See " Le Nouveau Paris," vol. ii., p. 90. *For curious examples of these "scales of depreciation," see the A. D. "W. collection. 56 PAPER-MONEY INFLATION IN FRANCE. and that lie received scarcely one three-Lundredtli part of the real value of Ms share,' To meet cases like this, a law was passed establishing a " scale of proportion." Taking as a standard the value of the assignat when there were two billions in circulation, this law declared that, in the payment of debts, one quarter should be added to the amount originally borrowed for every five hundred millions added to the circulation. In obedience to this law a man who borrowed two thou- sand francs when there were two billions in circulation would have to pay his creditors twenty-five hundred francs when half a billion more was added to the cur- rency, and over thirty thousand francs before the emis- sions of paper reached their final amount. This brought new evils, worse, if possible, than the old." But, wide-spread as these evil were, they were small compared with the universal distress. The question will naturally be asked. On whom did this vast depreciation mainly fall, at last ? "When this currency had sunk to about one three-hundredth part of its nominal value, and, after that, to nothing, in whose hands was the bulk of it? The answer is simple. I will give it in the exact words of that thoughtful historian from whom I have already quoted : " Before the end of the year 1795 the paper-money was almost exclusively in the hands of the working-classes, employes, and men of small means, whose property was not large enough to invest ' For a striking similar case in our own country, see Sumner, " History of American Currency,'' p. 47. ' See Villeneuve Bargemont, " Histoire de I'fioonomio Politique," vol. iL, p. 229. PAPER-MONEY INFLATION IN FRANCE. 57 in stores of goods or national lands/ The financiers and men of large means, ttough they suffered terribly, were shrewd enough to put mucli of their property into objects of permanent value. Tbe working-classes had[/ no such foresight, or skill, or means. On them finally .' came tke great, crushing weigM of the loss. After tbe first collapse came up the cries of the starving. Eoads and bridges were neglected ; manufactures were gener- j ally given up in utter helplessness." To continue, in j the words of the historian already cited : " None felt any confidence in the future in any respect ; none dared to make an investment for any length of time, and it was accounted a folly to curtail the pleasures of the moment, to accumulate or save for an uncertain future." " While this system was thus running on, a new Gov- ernment had been established. In October, 1795, came into power the "Directory." It found the country ut- terly impoverished, and its only resource at first was to print more paper-money, and issue it even while wet from the press. The next attempt of the Directory was to secure ai forced loan of six hundred million francs from the' wealthier classes ; but this was found fruitless. Next a National Bank was proposed ; but capital was loath to embark in banking, while the howls of the mob against all who had anything to do with money re- sounded in the ears of capitalists. At last the Directory • See Von Sybel, vol. iv., pp. 337, 338. See, also, for confirmation, Ohal- lamel, "Histoire Mus^e," vol. ii., p. 179. For a thoughtful statement of the reasons why such paper was not invested in lands by men of moderate means, and working-men, see Mill, "Political Economy," vol. ii., pp. 81, 82. » See Von Sybel, vol. iv., p. 222. 58 PAPER-MONEY INFLATION IN FRANCE. bettouglit themselves of another expedient. It was by- no means new. It was fully tried on our own conti- nent twice before that time, and once since — first, in our coloni3,l period ; next, during our Confederation ; last, by the recent " Southern Confederacy " — and here, as elsewhere, always in vain. But experience yielded to theory — ^plain business sense to financial metaphysics. It was determined to issue a new paper which should be " fully secured " and " as good as gold." On February 19, 1796, the copper plates of the as- signats were broken up, and it was decreed that no more assignats he issued ; instead of them, it was de- creed that a new paper-money, "fully secured, and as good as gold," be issued, under the name of " man- dats.^'' In order that these notes should be " fully se- cured," choice public real estate was set apart to an amount fully equal to the nominal value of the issue, and any one possessing any quantity of the mandats could at once take possession of Government lands to their full face value ; the price of the lands to be determined according to their actual rental, and without the formalities and delays previously es- tablished in regard to the purchase of lands with as- signats. In order to make the mandats " as good as gold," it was planned by forced loans and other means to reduce the quantity of assignats in circulation so that the value of each assignat should be raised to one- thirtieth of the value of gold, then to make mandats legal tender, and to substitute them for assignats at the rate of one for thirty.' Never were great expectations ' For details of this plan very thoroughly given, see Thiers's " History of the French Revolution," Bentley's edition, vol. iv., pp. 410-412. PAPER-MONEY INFLATION IN FRANCE. 59 more cruelly disappointed. Even before they could be issued from the press, the mandats fell to thirty per cent, of their nominal value ; from this they speedily fell to fifteen per cent., and soon after to five per cent. This plan failed— just as it failed in New England in 1737 ; just as it failed under our own Confederation in 1781; just as it failed under the "Southern vConfed- eracy " within the past few years.' To sustain this new currency the Government resort- ed to every method that ingenuity could devise. Pam- phlets were published explaining their advantages so as to be understood by people of every capacity. Never was there more skillful puflfing of a financial scheme. A pamphlet, signed " Marchant," and , dedicated to " People of Good Faith," was widely circulated. In this Marchant toot pains to show the great advantage of the mandats as compared with the assignats : how land could be more easily acquired with them than with assignats; how their security was better; how they could not by any possibility sink in value as the as- signats had done. Even before the pamphlet was dry from the press, the depreciation of mandats had re- futed his entire argument." Then, too, we have at work again the old superstition that there is some way of keeping up the value of paper-money other than by hav- ing gold ready to redeem as much of it as may be presented. The old plan of penal measures is again ' For an account of " new tenor bills " and their failure in 1737, see Sumner, pp. 27-31 ; for their failure in 1781, see Morse, " Life of Alexander Hamilton," vol. i., pp. 86, 87. Tor similar failure in Austria, see Sumner, p. 314. " See Marchant, " Lettre aux Gens de Bonne Foi." 60 PAPER-MONET INFLATION IN PEANCE. pressed. Monot leads off by proposing penalties against those who shall 8;peah publicly against the mandats, Talot thinks the penalties ought to be made especially severe ; but finally it is agreed that any persons " who by their discourse or writing shall decry the mandats shall be condemned to a fine of not less than one thou- sand livres, or more than ten thousand ; and in case of a repetition of the offense, to four years in irons." It was also decreed that those who refase to receive the Tnandats be fined the first time the exact sum which they refuse ; the second time, ten times as much ; and the third time, be punished with two years in prison. But here, too, were seen those laws in France which are alike inexorable in all countries. This attempt proved fatile in France, just as it had proved futile, less than twenty years before, in America.' No enactments could stop the downward tendency of this new paper, "fally secured," " as good, as -gold: " the laws that finally govern finance are not made in conventions or congresses. On July 16, 1796, the great blow was struck. It was decreed that all paper, mandats and assignats, should be taken at its real value, and that bargains might be made in whatever currency the people chose. The real value of the mandats at this time was about five per cent, of their nominal value." The reign of paper-money in France was over. The twenty-five hundred million mandats went into the common heap of refuse with the previous thirty-six ' See Sumner, p. 44. ° See I)e Nervo, " Finances Franpaises," p. 282. / PAPllInrONET INFLATION IN FRANCE, Qi billion assignats. The whole vast issue was repu- diated. The collapse had come at last ; the whole nation was plunged into financial distress and debauchery from one end to the other. To this general distress there was, indeed, one ex- ception. In Paris and in a few of the greater cities, men, like Tallien, of the heartless, debauched, luxurious, speculator, contractor, and stock-gambler classes, had' risen above the ruins of the multitudes of smaller for- tunes. Tallien, one of the worst of the demagogue "reformers," and a certain number of men like him, had been skillful enough to become millionaires, while their dupes, who had clamored for issues of irredeem- able paper-money, had become paupers. The luxury and extravagance of these men and their families form one of the most significant features in any picture of the social condition of that period.' A few years before this the leading women in French society showed a nobleness of character, and a simplicity in dress, worthy of Roman matrons. Of these were Madame Eoland and Madame Desmoulins ; but now all was changed. At the head of society stood Madame Tallien, and others like her, wild in extrava- gance, seeking, daily, new refinements in luxury, and demanding of their husbands and lovers vast sums to array them, and feed their ■vxii™^- If such sums could ' Among the many striking accounts of the debasing effects of " infla- tion " upon. France under the Directory, perhaps the best is that of Lacre- telle vol. xiii., pp. 32-36. For similar effect, produced by same cause in our own country in 1819, see statement from Mles'a Register in Sumnor, p. 80. 62 PAPEK-MONET INFLATION IN FRANCE. I not be obtained honestly, they must be obtained dis- honestly. The more closely one examines that period, the more clearly it is seen that the pictures given by Thibaudeau, and Challamel, and De Goncourt, are not at all exaggerated." But when all was over with paper-money, specie began to reappear — at first in sufficient sums to do the small amount of business which remained after the col- lapse. Then, as the business demand increased, the amount of specie flowed in from the world at large to meet it, and the nation gradually recovered from her long paper-money debauch. Thibaudeau, a very thoughtful observer, tells us in his " Memoirs " that great fears were felt as to a want of circulating medium between the time when paper should go out and coin should come in ; but that no such want was ever felt — that coin came in as if by magic — that the nation rapidly recovered from its paper-money debauch, and, within a year, business en- tered a new current of prosperity." Nothing could better exemplify the saying of one of the most shrewd of modern statesmen, that " there will always be money." ' Such, briefly sketched in its leading features, is the history of the most skillful, vigorous, and persistent attempt ever made to substitute for natural laws in ' For Madame Tallien and luxury of the stock-gambler classes, see OhaUamel, "Les Frangais sous la Revolution,'' pp. 30, 33; also De Goncourt, "Les Pranfais sous le Directoire." ° For similar expectation of a " shock," which did not occur, at the re- sumption of specie payments in Massachusetts, eee Sumner, " History of American Currency," p. 34. = See Thiers. PAPER-MONET INFLATION IN FEANCE. 63 finance the abilij^of .aJegisktiveJbodj, and to substi- tute^or^a standard of valu e, recognized throughout the -^"orld, a national standard devised by theorists and ma- nipulated by schemers. Every other attempt of the same kind in human history, under whatever circumstances, has reached similar results in kind if not in degree ; all of them show the existence in the world of financial laws as sure in their operation as those laws which hold the planets in their courses.' I have now presented this history in its chronologi- cal order — the order of events : let me, in conclusion, sum it up in its logical order — the order of causes and effects. '" And, first, in the economic development. From the first careful issues of paper-money, irredeemable but moderate, we saw, as an immediate result, apparent im- provement and activity in business. Then arose the clamor for more paper-money. At first, new issues were made with great difficulty; but, the (dike, once broken, the current of irredeemable currency poured through ; and, the breach thus enlarging, this currency, was soon swollen beyond control. It was urged on by speculators for a rise in values ; by a thoughtless mob, who .^thought that a nation, by its simple fiat, could stamp real value upon a valueless object : as a conse- ' For examples of similar effects in Russia, Austria, and Denmark, tee Storoh, "Economie Politique," vol. iv. ; for similar effects in the United States see Gouge, "Paper Money and Bankers in the United States;" also, Sumner, " History of American Currency." For working out of the same principles in England, depicted in a masterly way, see Maoaulay, " History of England," chapter xxi. ; and for curious exhihition of same causes pro- ducing same results in ancient Greece, see curious quotation by Macaulay in same chapter. 64: PAPEE-MONET INFLATION IN FRANCE. quence, a great debtor class grew rapidly and naturally, and this class gave its influence to depreciate more and more the currency in which its debts were to be paid.' All the energy of the Government was devoted to grinding out still more paper ; commerce was at first stimulated by the difference in exchange; but this cause soon ceased to operate, and commerce, having been stimulated unhealthfully, wasted away. Manufactures at first received a great impulse ; but, ere long, this over-production and over-stimulus proved as fatal to them as to commerce. From time to time there was a revival of hope by an apparent revival of busi- ness ; but this revival of business was at last seen to be simply caused by the desire of the more far-seeing and cunning to exchange paper-money for objects of per- manent value. As to the people at large, the classes living on fixed incomes or salaries felt the pressure first, as soon as the purchasing, power of their fixed in- comes was reduced. Soon the great class living on wages felt it even more sadly. Prices of the necessities of life increased ; merchants were obliged to increase them, not only to cover depreciation of their merchandise, but also to cover -^ their risk of loss from fluctuation; while the prices of products thus rose, wages, which had gone up at first under the general stimulus, fell. Under the universal doubt and discouragement, commerce and manufactures were checked or destroyed. As a consequence, the de- mand for labor was stopped ; laboring-men were thrown ' For parallel cases in early history of onr own country, see Sumner, p. 21, and elsewhere. PAPER-MONEY INFLATION IN FRANCE. 65 out of employment, and, under tlie operation of the sim- plest law of supply and demand, the price of labor — tlie daily wages of the laboring class — went down until, at a time when prices of food, clothing, and various arti- cles of consumption were enormous, wages were as low as at the time preceding the first issue of irredeemable currency. The mercantile classes at first thought themselves exempt from the general misfortune. They were delighted at the apparent advance in the value of the goods on their shelves. But they soon found that, as they increased prices to cover the inflation of currency and the risk from fluctuation and uncertainty, pur- chasers were fewer, purchases less, and payments less sure; a feeling of insecurity spread throughout the country; enterprise was deadened and general stag- nation followed. New issues of paper were clamored for as a new ; dram is called for by a drunkard. The new issues only increased the evil ; capitalists were all the more reluctant to embark their money on such a sea of doubt. Workmen of all sorts were more and more cast out of employment. Issue after issue of currency came ; but no relief save a momentary stimulus, which aggra- vated the disease. The most ingenious evasions of natural laws in finance which the most subtle theorists could contrive were tried— all in vain ; the most brilliant substitutes for those laws were tried; self regulating schemes, " interconverting " schemes— all equally vain." ' For a review of some of these attempts, with eloquent statement of their evil resnlts, see "Mgmoires de Durand de Maillane," pp. 166-169. 5 66 PAPEE-MONEY INFLATION IN FKANCE. All tliouglitful men had lost confidence. All men were waiting ; stagnation became worse and worse. At last came the collapse, and then a return by a shock to real values and a future which presented some ele- ments of certainty of remuneration to capital and labor. Then, and not until then, came the beginning of a new era of prosperity. Just as dependent on the law of cause and effect was the moral development. Out of the. inflation of prices grew a speculating class; and, in the complete uncertainty as to the future, all business became a game of chance, and all business-men unintentional gamblers. In city centres came a quick growth of stock-jobbers and speculators; and these set a debasing fashion in business which spread to the remotest parts of the country. Instead of satisfaction with legitimate gains came admiration for cheatery. Then, too, as values became more and more uncertain, there was no longer any motive for care or economy, but every motive for immediate expenditure and present enjoyment. So came upon the nation the dbliteraUon of the idea of thrift. In this mania for yielding to present enjoyment_ rather than providing for future comfort were the seeds of new growths of wretchedness ; and luxury, senseless and extravagant, set in, and this, too, sjDread as a fash- ion. To feed it, there came cheating in the nation at large, and corruption among officials and persons hold- ing trusts ; while the men set such fashions in business, private and official, women like Madame Tallien set fashions of extravagance in dress and living that added to the incentives to corruption. Faith in moral consid- PAPER-MONET INFLATION IN FRANCE. 67 erations, or even in good impulses, yielded to general distrust. National honor was thought a fiction cherislied only by enthusiasts. Patriotism was eaten out by cyni- cism. Such was the history of France as logically de- veloped in obedience to natural laws ; such has, to a greater or less degree, always been the result, of ir- redeemable paper issues, created according to the whim or interest of legislative assemblies rather than based upon standards of value permanent in their nature and agreed upon throughout the entire commercial world ; such, we may fairly expect, will be always the result of them until the fiat of the Almighty shall evolve laws in the universe radically different from those which at present obtain.' And, finally, as to the general development of the theory and practice which all this history records. My subject has been "Paper-Money Inflation in France ; How it came ; What it brought ; and How it ended." It came, as you saw, by seeking a remedy, for a comparatively small evil, in an evil infinitely more dan- gerous. To cure a disease temporary in its character a corrosive poison was administered which ate out the vitals of French prosperity. It progressed according to a law in social physics which we may call the law of accelerating issue and de- preciation. It was comparatively easy to refrain from ■ For similar effect of an inflated currency in enervating and undermin- ing trade, husbandry, manufactures, and morals, in our own country, in 1779, see Webster, cited in Sumner, pp. 45-50. Eor similar effects in other coun- tries see Senior, Storch, Maeaulay, and others, already eited. g8 PAPER-MONEY INFLATION IN FRANCE. the first issue ; it was exceedingly difficult to refrain from the second ; to refrain from the third and those following was impossible. It brought, as you have seen, to commerce and manufactures, the mercantile interest, the agricultural interest, utter ruin. It brought on these the same de- struction which would come to a Hollander opening the dikes of the sea to irrigate his land in a dry sum- mer. It ended in the complete financial, moral, and politi- cal prostration of France — a prostration from which a great absolute monarch alone was able to draw it. But this history would be incomplete without a brief sequel showing how that monarch profited by this frightful experience. When Bonaparte took the con- sulship the condition of fiscal affairs was appalling. The Government was bankrupt; an immense debt was unpaid. The further collection of taxes seemed impos- sible ; the assessments were in hopeless confusion. War was going on in the East, on the Rhine, and in Italy, and civil war in La Vendue. All the armies had been long unpaid, and the largest loan that could for a mo- ment be effected was for a sum hardly meeting the ex- penses of the Government for a single day. At therfirst cabinet council Bonaparte was asked what he intended to do. He rej)lied, " I will pay cash or pay nothing." From this time he conducted all his operations on this basis. He arranged the assessments, funded the debt, and made every payment in cash ; and from this time — during all the campaigns of Marengo, Austerlitz, Jena, Eylau, Friedland, down to the Peace of Tilsit in 1807 — PAPER-MONEY INFLATION IN FRANCE. gg there was but one suspension of specie payment, and this only for a few days. When the first great Euro- pean coalition was formed against the empire, Napoleon was hard pressed financially, and it was proposed to resort to paper-money ; but he wrote to his minister, " While I live I will never resort to irredeemable paper." He never did, and France under this determination commanded all the gold she needed. When Waterloo came, with the invasion of the allies, with war on her own soil, with a change of dynasty, and heavy expenses for war and indemnities, France, on a specie basis, ex- perienced no severe financial distress. If we glance at the financial history of France during the recent Franco-Prussian War and the Communist struggle, in which a far more terrible pressure was brought upon French finance than our own recent civil war put upon American finance, and yet with no national stagnation or distress, but with a steady progress in prosperity, we shall see still more clearly the advantage of meeting a financial crisis in an honest and manly way, and by methods sanctioned by the world's most costly experience, rather than by yielding to the schemes of speculators, or to the dreams of theorists involved in financial metaphysics.' There is a lesson in all this which it behooves every thinking man to ponder. ' For facts regarding Frenoli finance under the emperor, I am indebted to Hon. David A. Wells. For the recent triumph of financial common- sense in France, see Bonnet's articles, translated by George Walker, Esq. THE END. APPLETONS' AMERICAN CYCLOPEDIA. NEW REVISED EDITION. Entirely rewritten by the ablest writers on every subject. Printed from new type, and illustrated with Several Thousand Engravings and Maps. The work originally published under the title of The New American Cyclopedia was com- pleted in 1863, since which time the wide circulation whieh it has attained in all parts of the United states, and the signal developments which have taken place in every branch of science, literature and art, have induced the editors and publishers to submit it to an exact and thoroueh revision and to issue a new edition entitled The American Cyclopedia. Within the last ten years the progress of discovery in every department of knowledge has mad 3 a new work of reference an imperative want The movement of political affairs has kept pace vnth the discoveries of science, and their fruitful application to the industrial and useful arts and the convenience and refinement of social hfe. Great wars and consequent revolutions have occurred, involving national" changes of peculiar moment. The avil war of our own country, which was at its height when the last volume of the old work appeared, has happily been ended, and a new course of commercial and industrial activity has been commenced. Large accessions to our geograplucal knowledge have been made by the indefatigable explorers of Africa. The great political revolutions of the last decade, with the natural result of the lapse of time, have brought into public view a multitude of new men, whose names are in every one's mouth, and of whose hyes every one is curious to know the particulars. Great batties have been fought and important sieges maintained, of which the details are as yet preserved only in the newspapers or in the transient publications of the day, but which ought now to take their place in permanent and authentic history. _ In preparing the present edition for the press, it has accordingly been the aim of the editors to bring down the information to the latest possible dates, and to furnish an accurate account of the most recent discoveries in science, of every fresh production In literature, and the newest inventions in the practical arts, as well as to give a succinct and original record of the progress of political and historical events. , The work has been begun after long and careful preliminary labor, and with the most ample resources for carrying it on to a successful termination. None of the original stereotype plates have been used, but every page has been printed on new type, forming in fact a new Cyclopaedia, with the same plan and compass as its predecessor, but with a far greater pecuniary expenditure, and with such improvements in its composition as have been suggested by longer experience and enlarged knowledge. The illustrations, which are introduced for the first time in the present edition, have been added not for the sake of pictorial effect, but to ^ve greater lucidity and force to the explanations in the text. They embrace all branches of science and of natural history, and depict the most famous and remarkable features of scenery, architecture, and art, as well as the various processes of mechanics and manufactures. Although intended for Instruction rather than embellishment, no painshave been spared to insure their artistic excellence; the cost of their execution is enormous, and it Is be- lieved they will find a welcome reception as an admirable feature of the Cyclopaedia, and worthy of its high character. This work is sold to subscribers only, payable on delivery of each volume. It will be completed in sixteen large octavo volumes, each containing about 800 pages, fully illustrated with several thousand Wood Engravings, and with numerous colored Lithographic Maps. Price and Style of Binding. In^xtra cloth, per vol. . . . $5*00 In library leather, per vol. . . . 6-oo In half turkey morocco, per vol. . 7-°° In half russia, extra gilt, per vol. , $8,00 In full morocco antique, gilt edges, per vol. 10.00 In full russia, per voL ... zo.oa Fourteen volumes now ready. Succeeding volumes, until completion, will be Issued once in three months. *** Specimen pages of the American Cyclopaedia, showing type, illustrations, etc., will be seat gratis, on application. D. Appleton & Co., Publishers, 549 & 551 Broadway, N. Y. THE Popular Science Monthly. PflliMei li a large octavo, laidsomely rrliteil on clear type, Ain>, WHEN THE StTEJECTB ADMIT, Each Number contains 138 pages. Conducted ly PROFESSOR E. L. YOUMAXS. TEMMS, $5.00 per Annunhf or SO Cents per dumber. The Popular Science Monthly was started to promote the difiusion of ral- uable scientific knowledge in a readable and attractive form among all classes of the community. It has met with unexampled success, and it is universally ad- mitted that its plan has been faithfully carried out, and that it meets a want sup- plied by no other periodical in the United States. It contains instructive and attractive articles, and abstracts of articles, original, selected, translated, and illustrated, from the leading scientific men of different countries, giving the latest interpretations of natural phenomena, explaining the applications of science to the practical arts, and to the operations of domestic life. It will also contain accounts of all the new scientific discoveries, and its pages will form a complete record of the progress of the age. It is designed to give especial prominence to those branches of science which help to a better understanding of the nature of man ; to present the claims of scientific education ; and the bearings of science upon questions of society and government. How the various subjects of current opinion are affected by the ad- vance of scientific inquiry will also be considered. In its literary character, this periodical aims to be popular, without being super- ficial, and appeals to the intelligent reading-classes of the community. It seeks to procure authentic statements from men who know their subjects, and who will ad- dress the non-scientific public for purposes of exposition and explanation. The Popular Science Monthly is the organ of no sect, party, or school, but will be devoted to the broad interests of advancing knowledge, as it is expounded by the emment thinkers of England, France, Germany, and the United States, each writer being responsible for his own views. OPINIONS OF THE PRESS. " Just the pnhlication needed at the present A&y."— Montreal Gazette. " It is, heyond comparison, the best attempt at joumalism of the kind ever made In this country."— jBbm^ Journal. " The initial number is admirably constituted." — Evening MaU, " In our opioion, the right idea has been happily liit in the plan of this new monthly." Bvffalo Courier. " A jonmal which promises to be of eminent value to the cause of popular education in this country."— iy. Y. Tribune. t IMPOBTANT TO CLUBS. The Popular Science Monthly will be supplied at reduced rates with any pe- riodical published in this country or Europe. ' Payment, in all cases, must he in advance. D. APPLETON & CO., 549 & 551 Broadway, New York. THE ART JOURNAL. AN INTERNATIONAL GALLERY OF ENGRAVINGS, By Distinguisliiid Artists of Enropo aad America. WITH ILLUSTRATED PAPERS IN THE VARIOUS BRANCHES OF ART. The Art Journal is a monthly publication, specially devoted to the world of Art— Painting, bculptme. Architecture, Decoration, Engraving, Etching, Enameling, and Designing in all its branches— having in view the double purposg of supplying a complete illustrated record of progress m the Arts, and of affordmg a means for the cultivation of Art-taste among the people. Each num- ber IS richly and abundandy illustrated on both steel and wood. It contains the Steel Plates and Il- lustrations of the London Art Jourital; apublicalionof world-wide fame (the exclusive right of *jVS' ™'C^adaand the United States, has been purchased by the publishers); with extensi-ue adthhons devoted prhtcipally to A merican A rt and A merican toMcs. Among the features are the following : I, The Homes of America. Tke Stately Homes of England have fortned a very in^ ieresiing feature of the LonuoS Art Journal for vtany years ; as a companion to this series, we are giving views and descrifitiojis of the Hmnes of A merica, including the *^ stately'^ mansions of the more vjealthy, and some of the picturesque residences ofthepeople. These views are frojn drawings made for the purpose by competent artists. n. The Par "West ; Colorado and the Pacific Railway. A sdperhly illus- trated jour^tey through Colorado, and over the Pacific Railway ^ derivedfrom sketches made last summer by Mr. J. D. Woodward, and e?igraved in the very best manner. m, ^Americaii Artists and their Works. The series of articles in the volume for 1875, 071 American artists, accompanied by examples of their works, were very popular^ andivill be -continued ditring the ensimig year. The e7igravings in this series afford some of the best exatnples of wood-cutting er/er given to the public. IV. Household Art. By Charles Wyllis Elliott. ' This valuable series of illus- trated papers on domestic art will be cotitinued until the subject is fully covered. V. American Art-Itlannfactures. Illustrations of interesting productions in the practical arts are given. VI. New American Churches and Ameritian Architecture, , " We are pre- paring papers, with views of some of the finest examples of church architecture, and also of picturesque features in our pitblic and domestic buildings. VII. The French Painters and their "Works. The Americati addenda to the Art Journal contain exantples of French Art, executed in a superior manner^ luhich are not give7i in the London issue. Vm. British Artists and their "Works. This i7iteresting feature will be continued. IX. Art in Japan, by Sir Rutherford Alcock; Art in India^ by Dr. Hunter; and A.Tt in Palestine, by M. E. Rogers. Papers on these subjects will occasioti- ally appear. X. British Art-Manufactiires. XI. Illustrations of Art-Ohjects in the Centennial Exhibition. IVe shall illustrate selections of the more striki7ig afid 7toteworthy objects of an A rt-character displayed at the Exhibitioii. XII. The Stately Homes of lEng-land. By"^. C. Hall, This popular series of pa- pers, descriptive of famous old places in England, is continued. XIII. Illustrated Papers on various Productions in Art, and %ipojt Art-tkemes of popular interest. XIV. Original Papers from Paris and Rome, on Art-matters i?i. these capitals. The Steel Illustrations will continue to justify the reputation of the Art Journal. Each num- ber contains Three Steel Plates, in many instances a single plate being worth much more than the entire price of the number. Published monthly. Price, seventy-five cents per number, or nine dollars per annum. SOLD ONLY BY SUBSCRIPTION, either by yearly. subscription, delivered through the post, pre- paid, or payable monthly on deliveiy by the carrier. Subscriptions received by the Publishers, or their Agents. Agencies: 22 Hawley St., Boston; Q22 Chestnut St., Philadelphia; 22 Post-Office Avenue, Baltimore; 100 State St., Albany; 42 State St., Rochester; 103 State St., Chicago; 30 W. 4th St., Cincinnati; 305 Locust St., St. Louis; 20 St.' Charles St, New Orleans ; 230 Sutter St., San Francisco. D. APPLETON & CO., Publishers, 549 & 551 Broadway, New York. APPLiZSTOIffS^ American Cyclopedia. NEW. REVISED EDITION. ' Entirely rewritten by the ablest writers on every auldeot. Printed fcoih new type, and illustrated with Severaf Thousand,,EngTaving3 and Uajjs. The work originally published under the title of The New Ambbioan CYOLOP^s^^i was completed iu 1 863, since which time the wide circulation, which it has attaiufd in all parts of the United States, and the signal developments which have taken place in every branch of science, literature, and art, have induced the editor^ and^ publishers to submit it to an exact and thorough revision, and to issue a new editie most recent discoveries in sciSnce, of every fresh I production iu literature, and of the new;est inventions in the practical arts, as well': as to give a succinct and oHginar record of the progress of political and historical events.. The illustrations, which are Introduced for the first time. in the present edition, have been added not for the sake of pictorial effect, but to give greater lu(»dity aiid force to the explanations in the text. They embrace all branches of science and of natural history, and depict the most famous and remarkable featureS;Of scenery, >; architecture, and. art, as well as the various processes of* mechanics and {nanu&ct-' . ures. .Vlthough intended for instruction rather than embellishment, no pains have been ^spared to insure their artistic excellence; the cost of their execution is enor- pious, and, it. is believed they will find a welcome reception as an admirable feature of til e ^S^^^JssiIl, and worthy of its high character. This wofP'fcgold to Subscribers only, payable on delivery of each volume. It. will be completed in sixteen large octavo volumes, each containing about eight hun- dred pages, fuUy illusti'ated with several thousand Wood Engravings, and with numerous colored Lithographic Maps. PRICE A.ND STYLE OF BINDINO. In Extra Cloth, - - per vol., $3 00 In Library Leather, - - " 6 00 In Half Turkey Morocco, - " 7 00 in Half Russia, extra gilt, - per vol., $8 00 In Full Morocco, antique, glltedges, '' ' 10 00 In Full Russia, - ■ "10 00 %* Specimen pages of The Amebican Gtolop.sdia, showing type, illustratioDB, ' etc., will be sent gratis, on application. D. APPLETON & CO., Publishers, 549 \ 551 Broadway, New York.