Cyclopædia of Political Science, Political Economy, and the Political History of the United States

Edited by: Lalor, John J.
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New York: Maynard, Merrill, and Co.
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Includes articles by Frédéric Bastiat, Gustave de Molinari, Henry George, J. B. Say, Francis A. Walker, and more.
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ASSIGNATS. Every one knows what the assignats were during the French revolution. We shall limit ourselves here to a brief review of the historical facts relating to them. As to the economical questions connected with this subject, they will be amply treated of under the term. PAPER MONEY. When the French revolution broke out in 1789, the state succumbed under the weight of its debts. The total, which would seem light enough to-day, surpassed, by far, all the resources the state then possessed. The reforms effected by the constituent assembly, reforms salutary in themselves, far from decreasing the burthen immediately, tended rather to increase it. Such was especially the effect of the laws, which, while abolishing the sale of offices, accorded indemnities to former incumbents. The ordinary resources were, therefore, far from meeting the demands upon them. It was necessary to have resort to extraordinary means to provide for them.


—It was then thought to make use of the immense estates formerly possessed by the clergy, and which a recent decree had added to the public domain. The sale of these estates was ordered, and the communes were intrusted with the task of selling them in their respective districts. But the sales could not be effected quickly, because of the scarcity of capital; and the fear of a counter-revolution, which might restore their property to the clergy, considerably diminished the number of purchasers. And as the need was pressing, it was decreed to issue immediately paper money, representing the value of this property, which the communes were to be obliged to receive as payment in all the sales which they might make. By reason of this last provision the bills issued were first called municipal paper, but this name was soon changed to that of assignats, which they afterward retained.


—The first issue, decreed April 1, 1790, was for 400,000,000 francs.


—It is evident that at first the assignats were nothing but an assignment of national property which served as security for them. They were apparently intended to be received only in payment for these estates from those who had acquired them. On this basis, they would have preserved a pretty stable value, in spite of the depreciation of the security, but they would have had but a small circulation; they would have found no other purchasers than those who had the real intention of buying some of the land offered for sale. The greatness and urgency of the need, probably also the scarcity of coin, an ordinary result of political agitation, caused a decree to be made that the assignats should circulate as money, and they consequently had compulsory circulation. From this time these bills assumed the character of paper money and partook of its variations in value.


—The issues were successively increased afterward in proportion to the increase of the wants of the state. In September, 1792, they were 2,700,000,000 francs, a year later they went as high as 5,000,000,000. The convention tried, for a certain time, to reduce their amount and a forced loan to which it had recourse, having procured it extraordinary resources, it called into the treasury and burned 840,000,000 francs. But this system of reduction was not long-lived. The issues of assignats soon began again, and they were larger in proportion as the assignats became more and more depreciated in value. At the commencement of 1794, the issue again exceeded 5,000,000,000. Another 1,000,000,000 was issued in the month of June following. The issues became then so rapid, that in March, 1795, they attained 8,000,000,000, and reached the sum of more than 20,000,000,000 in the same year. At the commencement of 1796, when the assignats were finally abandoned and replaced partly by territorial mandats, the sum total put in circulation up to that period was not less than 45,000,000,000 francs. Therefore, in the month of February of that same year, the engraved plates were broken by order of the government.


—We can well understand that the state had not really received more than a small part of the sum represented by this enormous amount of paper. The assignats which had never been received in public for their face value, depreciated from day to day, in proportion as the institution was abused. As early as the month of August, 1793, they were accepted for only a sixth part of their value. Vainly did the convention try to keep them in circulation by violent and despotic means, such as the proscription of coin, fixing a maximum price of goods, and imposing, under severe penalties, the obligation on all private citizens, to take the assignats at a fixed rate. All these measures and others, more violent still, were powerless to arrest the depreciation which kept on increasing. For a moment their value rose, when, in 1793 a part of the bills were called in, but it fell again soon after to such an extent that in March, 1795, they represented only the ninth part of their nominal value, and this was not the limit of their depreciation.


—More than once the government, although it struggled with all its strength against this depreciation, was obliged to recognize and sanction it. The most significant fact in this connection was that which happened in 1795. In the new forced loan to which it had recourse in that year, the assignats were received only for a hundredth part of their nominal value. At this point it would seem that the use of paper, thus de graded even by those who issued it, would have been abandoned; and yet at this very juncture, there were issues still more numerous than those which preceded. Thus the assignats fell to a half a hundredth part of their value, and soon after became entirely worthless.


—The history of the assignats is as significant as it is sad; but it is necessary to treat it in conjunction with other facts of the same nature, in order to draw the legitimate consequences which flow from it, with proper force. (See BANKS; BANKRUPTCY, NATIONAL, PAPER MONEY.)


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