Generations of scholarly and academic opinion has claimed that, for all its pitfalls, the assignat “saved” the French Revolution. On the contrary, writes Scott Trask, it helped bring on the Terror and set French progress back a generation, exactly as Edmund Burke had predicted. And so Burke too continues to be accused by clueless academics and ignorant pundits either of inconsistency or deviationism. [More]
Source link: http://blog.mises.org/1926/inflation-and-the-french-revolution-the-story-of-a-monetary-catastrophe/
Inflation and the French Revolution: The Story of a Monetary Catastrophe
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Can anyone fill me in regarding this particular passage?
“Burke should get credit for a remarkably accurate and precise prediction. He believed that the rise of prices, consequent to assignat inflation, would render it unprofitable for farmers to take their crops to market. They would stay home and produce only for themselves or for barter with their neighbors. The government would then send troops into the countryside to confiscate grain and other foodstuffs. It happened exactly as he foretold.”
At some point during the inflation, I would think commodity producers–particularly those producing daily necessities–would benefit disproportionately from the inflation. Of course, once price controls were inevitably instituted by government thugs that would all change. And obviously, once the currency totally broke down it would no longer be profitable to produce. Nevertheless, I would think there might be a relatively substantial period where farmers would reap a windfall from the inflation.
My meager knowledge of this hyperflationary episode is derived from Professor White’s slim volume on the subject. Can anyone comment on the sequence of events? The particulars of these historical episodes strike me as quite relevant to today’s world.
Price control Mr Salyer.
Governments that introduce fiat money tend to be governments that will be likely to introduce price controls as well. If political power (rather than the quanity of gold) determines matters of money then the revolutionary authorities (who depended on urban “intellectuals” and other such) would be likely to stand with city against country.
Farmers will be told “you must sell your products at X price” and this price will be less that the market price. And if they refused to sell their products, their output would be taken by force.
It was a fine post. I noted only one error “the swinish multitude” – that was what Burke’s foes claimed he had written (rather than what he actually wrote).
Edmund Burke wrote “a swinish multitude” he was not showing any contempt for people in general, only for a particular group of people (the supporters of the revolution).
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