Fiat Money Inflation in France | Page 9

states."[20]
Boutidoux, resorting to phrasemaking, called the assignats _"un papier
terre,"_ or "land converted into paper." Boislandry answered vigorously
and foretold evil results. Pamphlets continued to be issued,--among
them, one so pungent that it was brought into the Assembly and read
there,--the truth which it presented with great clearness being simply
that doubling the quantity of money or substitutes for money in a nation
simply increases prices, disturbs values, alarms capital, diminishes
legitimate enterprise, and so decreases the demand both for products
and for labor; that the only persons to be helped by it are the rich who
have large debts to pay. This pamphlet was signed "A Friend of the
People," and was received with great applause by the thoughtful
minority in the Assembly. Du Pont de Nemours, who had stood by

Necker in the debate on the first issue of _assignats_, arose, avowed the
pamphlet to be his, and said sturdily that he had always voted against
the emission of irredeemable paper and always would.[21]
Far more important than any other argument against inflation was the
speech of Talleyrand. He had been among the boldest and most radical
French statesmen. He it was,--a former bishop,--who, more than any
other, had carried the extreme measure of taking into the possession of
the nation the great landed estates of the, Church, and he had supported
the first issue of four hundred millions. But he now adopted a judicial
tone--attempted to show to the Assembly the very simple truth that the
effect of a second issue of assignats may be different from that of the
first; that the first was evidently needed; that the second may be as
injurious as the first was useful. He exhibited various weak points in
the inflation fallacies and presented forcibly the trite truth that no laws
and no decrees can keep large issues of irredeemable paper at par with
specie.
In his speech occur these words: "You can, indeed, arrange it so that
the people shall be forced to take a thousand livres in paper for a
thousand livres in specie; but you can never arrange it so that a man
shall be obliged to give a thousand livres in specie for a thousand livres
in paper,--in that fact is embedded the entire question; and on account
of that fact the whole system fails."[22]
The nation at large now began to take part in the debate; thoughtful
men saw that here was the turning Point between good and evil, that the
nation stood at the parting of the ways. Most of the great commercial
cities bestirred themselves and sent up remonstrances against the new
emission,--twenty-five being opposed and seven in favor of it.
But eloquent theorists arose to glorify paper and among these, Royer,
who on September 14, 1790, put forth a pamphlet entitled "Reflections
of a patriotic Citizen on the issue of _Assignats_," in which he gave
many specious reasons of the why the assignats could not be depressed,
and spoke of the argument against them as "vile clamors of people
bribed to affect public opinion." He said to the National Assembly, "If
it is necessary to create five thousand millions, and more, of the paper,
decree such a creation gladly." He, too, predicted, as many others had
done, a time when gold was to lose all its value, since all exchanges
would be made with this admirable, guaranteed paper, and therefore

that coin would come out from the places where it was hoarded. He
foretold prosperous times to France in case these great issues of paper
were continued and declared these "the only means to insure happiness,
glory and liberty to the French nation." Speeches like this gave courage
to a new swarm of theorists,--it began to be especially noted that men
who had never shown any ability to make or increase fortunes for
themselves abounded in brilliant plans for creating and increasing
wealth for the country at large.
Greatest force of all, on September 27, 1790, came Mirabeau's final
speech. The most sober and conservative of his modern opponents
speaks of its eloquence as "prodigious." In this the great orator dwelt
first on the political necessity involved, declaring that the most pressing
need was to get the government lands into the hands of the people, and
so to commit to the nation and against the old privileged classes the
class of landholders thus created.
Through the whole course of his arguments there is one leading point
enforced with all his eloquence and ingenuity--the excellence of the
proposed currency, its stability and its security. He declares that, being
based on the pledge of public lands and convertible into them, the notes
are better secured than if redeemable in specie; that the precious metals
are only employed in the secondary arts, while the French paper money