18oo-o2 were the system of direct taxation by central government, which
balanced the budget by 18oz; a sinking fund to diminish the National
Debt by buying back government stocks; a Bank of France which aimed
to mitigate the worst effects of the trade cycle by loans, discounts,
promissory notes, etc; and a new coinage and payment in cash of
government rents.
Napoleon's economic policy was a classic of state intervention. The
Bank of France, which controlled the National Debt, also had the
monopoly on the issue of paper currency. It was therefore possible to
reform the currency and abolish the worthless assignats. Heavier taxation
was avoided by the further sale of national property and the loot from the
second Italian campaign. Bonaparte's policy of state intervention led to an
upsurge in both agriculture and industry. Wool production increased by
400%. As far as possible tight control was kept on grain prices, which
were kept low and not allowed to find their market level. There were even
halting experiments with elementary health insurance schemes and
workhouses were modernized. Trade unions, however, were suppressed
as 'Jacobin' institutions: all workers had to carry a labour permit on pain
of imprisonment.
Yet under this veneer of welfarism Napoleon always feared the
common people. Mindful of his early experiences with food rioters,
Napoleon had something of a perennial obsession with the price of bread.
Suddenly, at the time of the peace of Amiens, the price started shooting
up, and rising unemployment served warning that the initial prosperity
might be a flash in the pan. For a while Napoleon confronted a grave
economic situation, with serious food shortages. After ordering a
newspaper blackout on the subject of famine and dearth, Napoleon
blatantly used the power of the state to prime the economy. He gave
concessions to a financial holding company, which was charged to buy up
all the bread in European ports and flood Paris with it. The price soon
came tumbling down beneath the danger level of eighteen sous a loaf;
famine and popular uprising were averted. Next he tried reflating the
economy by giving interest-free loans to manufacturers provided they
took on more hands. Further banks were set up to provide loans in the
different industries. The policy worked, and by his brilliant success in
handling the economy Napoleon secured a third triumph to set alongside
Marengo and the peace of Amiens.
The centralizing trends in economic policy were even more pro
nounced in public administration, where Napoleon was at the apex of a
pyramid. Ninety-eight prefects in each Department answered to him and
in turn transmitted orders to 420 under-prefects in the arrondissements,
marcin
(Marcin)
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