At length the Convention, thinking that the depreciation might be stopped by laws, made it penal to exchange coin for paper, or to agree to give a higher price if reckoned in paper than if reckoned in win. Still the over-issue had its natural effects : in June, 1793, one franc in silver was worth three francs in paper ; in Au gust it was worth six. Prices rose still higher ; all creditors, annuitants, and mortgagees were defrauded of five-sixths of their legal rights ; and the wages of the the labourers were equal in value only to a part of their former earnings. The Convention, unable any longer to resist, in May, 1793, passed a decree which compelled all farmers to declare the quantity of corn in their possession, to take it to the markets, and sell it there only at a price to be fixed by each com mune, according to the prices of the first four months of 1793. No one was to buy more corn than would suffice for a month's consumption, and an infraction of the law was punished by forfeiture of the property bought and a fine of 300 to 1000 francs. The truth of the declara tion might be ascertained by domicili ary visits. The commune of Paris also regulated the selling of bread : no person could receive bread at a baker's shop without a certificate obtained from a re volutionary committee, and the quantity was proportioned to the number of the family. A rope was moreover fixed to the door of each baker's shop, so that as the purchasers successively came, they might lay hold of it, and be served in their just order. Many people in this way waited during the whole night ; but the tumults and disturbances were so great that they could often only be ap peased by force, nor were they at all di minished by a regulation that the last comers should be served first. A similar maximum of prices was soon established for all other necessaries, such as meat, wine, vegetables, wood, salt, leather, linen, woollen, and cotton goods, &c.; and any person who refused to sell them at the legal price was punished with death. Other measures were added to lower the prices of commodities. Every dealer was compelled to declare the amount of his stock ; and any one who save up trade, after having been engaged in it for a year, was imprisoned as a sus A new method of resit prices was likewise devised, by which a fixed sum was assumed for the cost of production, and certain per-cent ages were added for the expense of car riage, and for the profit of the wholesale and retail dealers. The excessive issue of paper had likewise produced its natural consequence, over-speculation, even in times so unfavourable for commercial undertakings. Numerous companies were established, of which the shares soon rose to more than double or treble their origi nal value. These shares, being transfer able, served in some measure as a paper currency ; upon which the Convention, thinking that they contributed still fur ther to discredit the assignats, suppressed all companies whose shares were trans ferable or negociable. The power of establishing such companies was reserved to the government alone.
In August, 1793, there were in circu lation 3776 millions of assignats ; and by a forced loan of 1000 millions, and by the collection of a year's taxes, this amount was subsequently reduced to less than two-thirds. The confidence moreover inspired by the recent successes of the republic against its foreign and domestic enemies, tended to increase the value of the securities on which the paper-money ultimately reposed : so that towards the end of 1793 the assignats are stated to have been at par. This effect is attributed by M. Thiers, in his History of the French Revolution' (vol. v. p. 407), to the severe penal laws against the use of coin: nevertheless we suspect that those who made this statement were deceived by false appearances, and that, neither at this nor any other time, not even at their first issue, did the real value of assignees agree with their nominal value. (Thiers, vol. v. pp. 145-62, 196-208, 399 413.) However, this restoration of the paper-currency, whether real or apparent, was of very short duration, as the wants of the government led to a fresh issue of assignees: so that in June, 1794, the quantity in circulation was 6536 millions. By this time the law of the maximum had become even more oppressive than at first, and it was found necessary to withdraw certain commodities from its operation. Nevertheless, the commission of pro visions, which had attempted to perform the part of a commissariat for the whole population of France, began to interfere in a more arbitrary manner with the vo luntary dealings of buyers and sellers, and to regulate not only the quantity of bread, but also the quantity of meat and wood which each person was to receive. (Thiers, vol. vi. pp. 146-51, 307-14.)
Other arbitrary measures connected with the supply of the army, as compulsory requisitions of food and horses, and the levying of large bodies of men, had con tributed to paralyse all industry. Thus, not only had all commerce and all manu factures ceased, but even the land was in many places untilled. After the fall of Robespierre, the Thermidorian party (as it was called), which then gained the ascendency, being guided by less violent principles, and being somewhat more en lightened on matters of political economy than their predecessors, induced the Con vention to relax a little of its former policy, and succeeded in first excepting all foreign imports from the maximum, and after wards abolishing it altogether. The transition to a natural system was, how ever, attended with great difficulty and danger, as the necessary consequence of the change was a sudden and immense rise of the avowed prices; and trade hav ing been so long prevented from acting for itself, did not at once resume its former habits ; so that Paris, in the middle of winter, was almost in danger of starvation, and wood was scarcely more abundant than bread. As at this time the power of the revolutionary government to retain possession of the lands which it had con fiscated and to give a permanently good title to purchasers, was not doubted, it I is evident that a fear lest the national lands might not ultimately prove a valu able security did not now tend to discredit the assignees : their depreciation was solely owing to their over-issue, as com pared with the wants of the country, and their inconvertibility with the precious metals. The government however began now to find that, although it might for' some time gain by issuing inconvertible paper in payment of its own obligations, yet when the depreciated paper came to return upon it in the shape of taxes, it obtained in fact a very small portion of the sum nominally paid. Consequently they argued that, as successive issues de preciated the currency in a regular ratio hick however is very far from being the case), it would be expedient to require a larger sum to be paid for taxes according to the amount of paper in circulation. It was therefore decreed that, taking a cur rency of 2000 millions as the standard, a fourth should be added for every 500 millions added to the circulation. Thus, if a sum of 2000 francs was due to the government, it would become 2500 francs when the currency was 2500 millions, 3000 francs when it was 3000 millions, and so on. This rule however was only applied to the taxes and arrears of taxes due to the government, and was not ex tended to payments made by the govern ment, as to public creditors or public functionaries. Nor did it comprehend any private dealings between individuals. (Thiers, vol. vii. pp. 40-51, 132-41, 232-89, 3,8-85, Iniquitous as this regu lation was, as employed solely in favour of the government, it would nevertheless have been ineffective if its operation had been more widely extended ; for the as signets, instead of being depreciated only a fifth, had now fallen to the 150th part of their nominal value. The taxes being levied in part only in commodities, and being chiefly paid in paper, produced scarcely anything to the government ; which had however undertaken the task of feeding the city of Paris. Had it not in fact furnished something more solid than depreciated assignees to the fund holders and public functionaries, they must have died of starvation. Many, In deed, notwithstanding the scanty and precarious supplies furnished by the gov ernment, were threatened with the horrors of famine; and numbers of persons threw themselves every evening into the Seine, iu order to save themselves from this ex tremity. (Storch, Economic Polit. voL iv. p. 168.) To such a state of utter pauperism had the nation been reduced by the mismanage ment of its finances and the rain of public credit by the excessive issues of paper, that when the five Directors went to the Luxembourg, in October, 1795, there was not a single piece of furniture in the office. The doorkeeper lent them a rickety table, a sheet of letter-paper, and an inkstand, in order to enable them to write their first message to announce to the two Councils of State that the Directory was established. There was not a single piece of coin in the treasury. The assignats necessary for the ensuing day were printed in the night, and issued in the morning wet from the press. Even before the entry of the Directors into office, the sum in circulation amounted to 19,000 millions: a sum un heard of in the annals of financial pro fligacy. One of their first measures, however, in order to procure silver, was to issue 3000 millions in addition, which produced not much more than 100 million francs.