Editing Assignat (section)

===1790–1792===

[[Étienne Clavière]] lobbied for large issues of assignats representing national wealth and operating as legal tender.<ref name="Whatmore, Richard 1996">Whatmore, Richard (1996) "Commerce, Constitutions, and the Manners of a Nation: Etienne Clavière's Revolutionary Political Economy, 1788–1793". History of European Ideas 22.5–6 (1996): 351–368. Web.</ref> On 17 April 1790, the notes were declared legal tender but their interest was reduced to 3%.<ref>[https://books.google.com/books?id=dQWXXIcNI2oC&q=assignats+ The French Revolution: An Economic Interpretation by Florin Aftalion, p. xii]</ref> For daily life smaller denominations of 200 and 300 livres were needed. The assignats would compensate for the scarcity of coin and would revive industry and trade.<ref>[https://books.google.com/books?id=dQWXXIcNI2oC&q=assignats+ The French Revolution: An Economic Interpretation by Florin Aftalion, pp. 80, 95]</ref> Once the assignats were paid, they had to be burnt. A [[surety]] was prepared for future issues of paper money.<ref>[https://books.google.com/books?id=dQWXXIcNI2oC&q=assignats+ The French Revolution: An Economic Interpretation by Florin Aftalion, p. 76]</ref> As soon as the assignats started to circulate, their value decreased by 5 percent.<ref>{{Cite journal|last=Levasseur|first=E.|title=The Assignats: A Study in the Finances of the French Revolution|journal=Journal of Political Economy|year=1894 |volume=2|issue=2 |pages=182|doi=10.1086/250201|doi-access=free}}</ref> Du Pont de Nemours feared the emission of assignats would double the price of bread.<ref>[https://archive.org/details/moneyandfinance00dillgoog <!-- quote=assignat . --> The Money and the Finances of the French Revolution of 1789: Assignats and Mandats: A True History: Including an Examination of Dr. Andrew D. White's Paper Money Inflation in France by Stephen Devalson Dillaye, p. 18]</ref>

{{blockquote|[[Jacques Necker]] himself argued at the [[National Constituent Assembly (France)|National Assembly]] on 27 August that the assignats were a paper money which would bankrupt France.<ref>'Contre l'émission de dix-neuf cents millions d'assignats', Œuvres complètes de Jacques Necker
(Paris, 1821), vii, 430–447.</ref> Talleyrand had also attacked them on the grounds that they risked the same fate as [[John Law (economist)|John Law]]'s schemes. [[Armand-Gaston Camus|Camus]] stressed what he believed was the lesson of American experience of paper, which had undermined metal money and sent prices spiralling.<ref>De l'opinion de M. Camus, (Paris, 1789)</ref> [[Marquis de Condorcet|Nicolas de Condorcet]] and [[Pierre Samuel du Pont de Nemours]] argued that the assignats would drive out silver and other forms of coin, raise prices relative to paper, and thereby dangerously restrict commerce. All of these writers preferred the issue of [[treasury bills]] at interest through the Caisse d'Escompte, a revised tax-system, and increased loans.<ref name="Whatmore, Richard 1996">Whatmore, Richard (1996) "Commerce, Constitutions, and the Manners of a Nation: Etienne Clavière's Revolutionary Political Economy, 1788–1793". History of European Ideas 22.5–6 (1996): 351–368. Web.</ref>}}

On 27 August 1790 the Assembly decided another issue of 1,9 billion assignats which would become [[legal tender]] before the end of the year for all actions, c.q. banknotes, which could be acquired by anyone and used for ordinary business transactions. Necker, suspected of reactionary tendencies, resolutely against the transformation of the assignat into paper currency, handed in his resignation on 3 September.<ref>{{Cite book |url=https://archive.org/details/considerationso02holgoog |title=Considerations on the Principal Events of the French Revolution |publisher=Baldwin, Cradock, and Joy |year=1818 |last=Stael |first=Germaine de |pages=[https://archive.org/details/considerationso02holgoog/page/n270 256]–258 |language=English}}</ref> The massive and dangerous issue of 1,9 billion he succeeded to get down to 800 million, but the attacks may have influenced his resignation.<ref>Crouzet, F. (1993) La grande inflation, p. 115</ref><ref>[https://books.google.com/books?id=-41YAAAAcAAJ&q=assignats+&pg=PA17 Histoire de la révolution française: depuis l'Assemblée des notables ... by Jacques Necker, p. 35]</ref> Necker was not backed by [[Comte de Mirabeau]], his strongest opponent who called for "national money".<ref>[https://aadl.org/node/307527 A.D. White (1878) The Assignat|Ann Arbor Library]</ref>

{{blockquote|By September 1790, all authorized assignats had been paid out by the government. Supporters of the paper money argued that since the assignats were secured by land, more notes could be safely issued as long as they were retired and burned at the same rate that the lands securing them were sold. On 29 September 1790, the National Assembly authorized a further issue of 800 million livres and abolished interest on the assignats altogether.<ref>[https://www.lib.uchicago.edu/e/scrc/findingaids/view.php?eadid=ICU.SPCL.FRENCHCURRENCY Guide to the French Currency Collection 1791–1796. University of Chicago Library (2012)]</ref>)}}

Necker foretold that the paper money, with which the dividends were about to be paid, would soon be of no value. Since no one had truly the right to make assignats, everyone would soon begin to do so.<ref name="books.google.nl"/> [[François-Xavier-Marc-Antoine de Montesquiou-Fézensac|Montesquiou-Fézensac]], charged with the issue of assignats, feared [[stockjobbing]] and greed.<ref>[https://archive.org/details/opinion00unse_w41/page/8 <!-- quote=Montesquiou assignats. --> Opinion de M. de Montesquiou sur les assignats-monnoie..., p. 3]</ref>

{{blockquote|By September 1790, the assignat had become a true circulating paper currency, and 800 million livres worth of non-interest bearing notes were added to the initial issue, in denominations of 50, 60 70, 80, 90, 100, 500, and 2000 livres with legal-tender status. The lower denominations were produced in large numbers in order to ensure wide circulation. This change stimulated the economy but also increased inflationary pressures.<ref>[https://web.archive.org/web/20160403023155/https://www.money.org/blog/french-revolution-vault Tales from the Vault: Money of the French Revolution – the Assignat by Douglas Mudd, ANA Money Museum curator / museum director]</ref>}}

[[Image:Assignat de 15 sols.jpg|thumb|200px| ''Assignat'' of 4 Jan 1792, still bearing Royal markings: 15 [[French sol|sols]]]]

When the cost of reimbursing Old Regime venal office holders for their properties (judgeships, military ranks etc.) added yet more to the Revolution's inherited debts, the National Assembly voted by a narrow margin to issue additional assignats in September 1790,<ref>{{Cite book|title=Stuff and Money in the Time of the French Revolution|last=Spang|first=Rebecca|publisher=Harvard University Press|year=2015|location=Cambridge, MA and London|pages=57–96}}</ref> initially of an additional 800 million francs.{{sfn|Ingram|1911}} By September 1791, the value of the assignats had depreciated by 18–20 percent.<ref>{{Cite journal|last=Levasseur|first=E.|title=The Assignats: A Study in the Finances of the French Revolution.|journal=Journal of Political Economy|year=1894 |volume=2|issue=2 |pages=185|doi=10.1086/250201|doi-access=free}}</ref>

The properties backing the assignats were renamed ''[[biens nationaux]]'' ("national goods") and auctioned by district-level authorities. On 10 March 1790, on the proposition [[Pétion]], the administration of the church property was transferred to the municipalities.<ref>Crouzet, F. (1993) La grande inflation, p. 110</ref> Through the sale of these properties, assignats were used to successfully retire a significant portion of the [[Government debt|national debt]]. However, since these land sales were their original intent, the assignats were issued only in large denominations (50, 100, 200, and 1000 livres) that worked poorly as a daily medium of exchange. Moreover, the National Assembly never mandated that assignats and Old Regime coins (which remained in circulation) had to be exchanged on par. Already in fall 1790, the National Assembly itself was paying a 7.5% commission to exchange large denomination assignats for smaller coins. By the end of 1791, the discount rate was often 20% or more.<ref>{{Cite book|title=Stuff and Money in the Time of the French Revolution|last=Spang|first=Rebecca|publisher=Harvard University Press|year=2015|location=Cambridge, MA and London|pages=159}}</ref> These limits on the bills' practical use, and further issues eventually totalling 3.75 billion francs,{{sfn|Ingram|1911}} coupled with the organized opposition of counter-revolutionaries, led to their losing value. On 1 February 1792 the assignats depreciated almost with 50%.<ref>[https://books.google.com/books?id=y2vy9y9LDvwC&q=sans-culottes&pg=PA36 Press in the French Revolution by John Thomas Gilchrist, p. 261]</ref> Patriotic revolutionaries blamed the assignats' depreciation on foreign conspiracies. Clavière held the coalition of states responsible for the collapse of the assignat. [[Stephen D. Dillaye]], an American politician who referred to monetary policy history, wrote that the British, Belgian, and Swiss counterfeited the currency industrially: "Seventeen manufacturing establishments were in full operation in London, with a force of four hundred men devoted to the production of false and forged Assignats."<ref>Stephen D. Dillaye, ''Assignats and Mandats: A True History, Including an Examination of Dr. Andrew Dickson White's 'Paper Money in France{{'}}'', (Philadelphia: Henry Carey Baird & Co, 1877) p. 33</ref> On 17 October 1792, no less than 2,400 million assignations were in circulation.