145, thus leaving three millions of surplus. But then there was a debt of 3000 millions, for which this surplus was the only sum provided to discharge the interest. The Duke of Orleans, who was appointed regent during the minority of Louis XV., then only seventeen years old, assumed the power of the throne, with no other faculties for its guidance than a great deal of wit, a great deal of gayety, and a passion for pleasure astonishing even to the French themselves.

We have already observed, that "there is nothing new under the sun;" and the condition of France, the king, and the finances, at the beginning of the reign of the unfortunate Louis XVI., has the strongest imaginable similitude to that of France at the commencement of the regency. The remedy for the evil in both instances was also the same; for the purpose of rescuing the government from the responsibilities of a national bankruptcy, the calling of the StatesGeneral was advised. But the catastrophe of the French monarchy was destined to the delay of nearly a century. The Duc de Noailles, a man of penetration, and wise beyond his time, resisted the revival of a power so undefined, and suggested the hazards of popular legislation so powerfully, that the regent, shrewd with all his dissoluteness, shrank from the experiment, and put off a day which might thereby have anticipated the horrors of the Revolution.

By

But money must be found to pay the public creditor; and the first expedient showed at once the dishonesty and the ignorance of the French financiers. The coinage was called in, and a new coinage issued to the holders, at a depreciation of one-fifth. this operation, a sudden gain was made of twenty-two millions of livres. But every holder of 1000 livres was cheated of 200. This was of course instantly felt in the price of corn, and commodities of all kinds, as also in the exchanges; and on the whole, France probably lost ten times the amount which the minister gained; but the immediate evil was lightened, and the fraud was forgotten.

The Government having fallen in popular estimation by cheating the people, now made an attempt to re

cover popularity, by giving up its servants to public vengeance. The farmers-general had long been an obnoxious class; contracting for the receipt of the revenues, they were naturally tempted to deal severely with reluctant payers of taxes. Obloquy naturally directed itself against them, and their employment, unpopular from its circumstances, was pronounced to involve every subtlety of chicane, and every atrocity of oppression. Some of them had grown immensely rich, and might justly be suspected of fraud, but the Government fell with indiscriminate violence upon them all. We see in this act, how closely the Revolution of 1789 copied the regency, The iniquitous decree which flung all the bankers and moneyed men of Paris and the provinces into dungeons, within our memory, was only a repetition, though on a more sweeping scale, of the persecution which assailed the moneyed men of almost a century before. Informers were encouraged to give evidence against them, by the promise of a fifth of their fines. A tenth of all their goods dis covered was given to the discoverers. The innkeepers were commanded to refuse horses to them, when in their fright they endeavoured to escape from France. As they were actually the collectors of the whole revenue, and of course employed a vast number of subordinate officers, all those officers sharing the same odium were exposed to the same punishment. The Bastile was crowded with the principals, the provincial prisons were equally crowded with their dependents. fortunate distinction between this period and that of the Revolution was, that the populace were not yet the executioners of the law; and out of their whole number, but one, Samuel Bernard, a farmer-general, was put to death. He was so opulent, that he was able to offer six millions of livres for his life. But he must have been remarkable for oppression or atrocity of some kind; for, tempting as the offer was to a prodigal court, it dared not remit his sentence. The remaining criminals, if such they were, expiated their offences in the pillory, the galleys, or the dungeon. But the hint of fine, perhaps adopted from the offer of the unfortunate farmer-general, became soon realized in the practice of the government. The offence

The

of the rich, whatever it might be, was atoned for by a sum of money; and by this single contrivance, the government squeezed out of the collectors of the revenue not less than 180 millions of livres. Nothing could be more popular than this mode of raising money; for it at once spared the pockets of the people, and punished the most unpopular class in France. But the use of this enormous sum was the reverse of popular. The regent was notoriously the most profligate individual in the most profligate country of Europe. Prodigality and proffigacy are twins in every country. A hundred millions of this money were lavished no one could tell how, unless it was in extravagant largesses to the companions of the regent's pleasures, or in personal excess. The example of the court, always contagious, produced corruption in every act, and every organ of the state. It produced corruption even in the infliction of the penalties. Fines were sold, even before they were raised. The story is told of a nobleman of the court, who came to one of those rich culprits, then under sentence of a heavy fine, and offered to obtain his acquittance for a bribe of a hundred thousand crowns. The answer was, "You are too late, my lord; your wife has been here already, and made a bargain with me for fifty thousand." But remedies of this order were obviously temporary, and must end in general ruin. The money disappeared not only from the farmers-general, but from every class of commerce. The regent was slowly roused from his lethargy, but the time was come when he could sleep no longer; and when at last he opened his eyes, he saw the whole country on the eve of famine and rebellion.

This was the time for charlatans, and the most complete of charlatans suddenly appeared. John Law was born in Edinburgh in 1671, the son of a goldsmith, who gradually acquired wealth sufficient for the purchase of an estate, from which he was designated Law of Lauriston. The goldsmith of his day was generally a banker, and young Law acquired his first knowledge of banking in his father's counting-house. But the vivacity of his disposition, and the shapeliness of his figure, introducing him into society, where he was even called Beau Law, he at length grew weary of the desk,

and the death of his father in 1688, making him master of the estate, he set out for London and the world. In London his life was what might be expected from a man of great personal vanity, no principle, and a passion for indulgence of every kind. Gaming was the fashionable vice of the age. Law soon became a most dexterous gamester. But fortune is proverbially à coquette, and after some years of remarkable success, suddenly every thing went wrong with him, and he was forced to mortgage Lauriston. His gallantries, still more culpable, brought him into still more serious hazard. He was engaged in a duel; and though he escaped, yet, having killed his adversary, he was tried for murder, and sentenced to death. The sentence was commuted to a fine, on an application to the court, which regarded his act only as manslaughter. But, on an appeal from the family of the deceased, he was detained in prison. From this confinement he contrived to make his way to the continent; a reward was offered for his apprehension, but in vain, and he remained abroad, pursuing a rambling, but evidently an unprincipled career, gambling and speculating in every country from Flanders to Hungary. His ultra-dexterity at play was so remarkable as even to attract the notice of the higher powers, and he was successively expelled by the magistracy from Venice, Genoa, and Paris.

But during all this period of idleness, and often of personal distress, Law had not forgotten the lessons of his early life; and finance, and its application to the various necessities of the European states, was the frequent study of a mind, evidently subtle and inventive by nature. In an early part of his exile, he is said to have even ventured back to Scotland, for the purpose of urging the plan of a Scottish Land Bank-the notes issued by which were never to exceed the value of all the lands of the kingdom. The principle of all Law's projects was, "that no country can grow rich which limits itself to a circulation in specie; and that paper is essential to the development of the national resources ;" an assertion which, in that day, and especially on the continent, was looked on by the multitude with unbelief and horror, by some as a brilliant discovery, and by all as a

novelty, involving the most unlimited consequences, whether for good or evil. By the caution or timidity of the Scottish legislature it was rejected, a resolution being put upon the journals, "that to establish any kind of paper credit, so as to force it to pass, was an improper expedient."

In France, perhaps so early as 1708, Law proposed his plan to the Finance Minister. But the King was probably startled at its boldness, and got rid of it, on the easy plea of his being a heretic-an objection which was fatal in the most superstitious, yet most immoral, court of Europe.

He

Law was never able to remain long in one place. The vocation of a gamester is locomotive, and when he has plucked his dupes sufficiently in one quarter, he naturally looks for fresh plunder wherever he can. now made his way into Italy; but, on the road, he attempted the credulity of the Duke of Savoy. It is remarkable, and yet only a common instance of the advantages of difficulty to sovereigns as well as their inferiors, that the dukes of Savoy during the last two centuries, with scarcely an exception, had been able princes. The secret seems to have lain in the hazard of their thrones, placed on the frontier of Italy, and always involved in the attacks and intrigues carried on by France on the one side, and Austria and the Italian States on the other. Savoy was kept in perpetual peril, of course compelled to use all its skill to save its existence, and thus the dukes became diplomatists and warriors malgré. The general quietude of Italy towards the close of the last century relaxed the fears of the Piedmontaise Government, and probably relaxed the activity; for nothing can be more certain, than that when Napoleon, at the head of his ragged republicans, dashed into the duchy, he swept every thing before him, as the horse's tail sweeps flies. Piedmont and Savoy, the strongest countries in Europe, a continued fortress of mountain, torrent, and precipice, was overrun as if it had been a sheepfoldking, court, and all, were hurried off as if the French army had been an inundation, and the Piedmontaise royalty stubble floating on its surface. The mountaineer army was beaten by the rabble of the French cities, and the monarch was glad to make his

escape to the last remnant of his dominions, and be king over the melancholy soil and half savages of Sardinia.

Law proposed to the Duke to establish a land bank. But Victor Amadeus laughed at the charlatan, and pleasantly told him that he was too poor a sovereign to afford to be ruined. With equal keenness he recommended him to try the French again, for there "novelty was every thing." advice, however, given in jest, was adopted in earnest; and no sooner was Louis XIV. dead, than Law flew back to Paris, and the year 1715 saw him make his debut under the auspices of sovereignty itself.

The

The difficulties of the Regent have been already stated. Law offered to relieve them at once; and he was received as if he had come invested with the mantle of Plutus. On the 5th of May 1716, by a royal edict, he was authorized to establish a bank, under the firm of "Law and Company," whose notes should be received in payment of the taxes. His capital was fixed at six millions of livres, in 12,000 shares of 500 livres each, purchasable one-fourth in specie, and the remainder in billets d'état.

Law was certainly, if not profound in the mystery of banking clever in the art of making his schemes popular. His first stroke was masterly. The people had been peculiarly fretted by the changes of the coinage. The late depreciation had made every man distrustful of the cir culating coin. Law made all s notes payable at sight, and in the current at the time of their The result instantly was, that s notes, being regarded as repea nent, obtained a higher edu than the coin, and were i of one per cent. Tink ben storing the languid £zeme merce of the nation in si that they were ca and thus rapidly roma fifteen per c

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But when was a projector content with success? he must have been a miracle. Like the shell thrown from the mortar, if his fortunes sweep above the heads of men, it is only preparatory to their bursting-it is their character to explode. Law was, like the rest of his compeers, born to be undone.

The French traders in America had penetrated to the Mississippi, and they had brought back romantic tales of the prairies; they were a paradise, covered with boundless luxuriance, and even filled with gold and diamond mines. The romance pleased the French, as it has always done, and Law now offered himself as the man to realize it. He had already done so much, that he got credit for being able to do every thing, and his proposal to form a "Company," which should have the exclusive privilege of trading with the vast and redundant region of the west, and making the Mississippi its canal, was embraced with national rapture. Two hundred thousand shares of 500 livres each, were to form the capital, the whole of which might be paid in billets d'etat at their nominal value, though that value was now at a depreciation of seventy or eighty per cent. The effect of this measure was of course to raise the value of the billets d'etat, and thus relieve the government. To give greater force to Law's operations, the regent gave his

bank the monopoly of tobacco, and the sole refinage of the gold and silver; thus, undoubtedly giving additional wealth and stability to the bank. But the regent was himself a gamester, and he resolved to dabble in the precarious play on public credulity. Law had hitherto conducted his operations within a limit of comparative moderation; his issues of paper had never exceeded sixty millions. The regent suddenly erected his bank into a royal establishment, and called it the Royal Bank of France. The title might have been advantageous, by giving it an additional claim to national confidence. But it was dearly purchased by the extraordinary and profligate issue of paper, to the amount of one thousand millions of livres.

Without going into the minutiae of these remote transactions, they are curious as a part of the history of public credit, itself the most curious and characteristic product of modern Europe. They have also a political importance in exhibiting nearly the first example of that resistance of the French parliaments to the will of the court, which was the preliminary to the great revolution of 1789. The Chancellor D'Aguesseau had so strongly expressed his alarm at the repeated issues of paper, and depreciation of the coin, that he was dismissed by the regent, and D'Argenson, a more com. plying minister, was put in his place. The new official instantly showed his zeal by a new project for extinguishing the billets d'etat; and it was this singular one, that each depositor of 4000 livres of the old standard, and 1000 livres in billets d'etat, should receive 5000 new livres. By this piece of dexterity, it is evident that the government would gain the extinction of the 1000 notes, while it would lose nothing by the exchange of the coin; 5000 of the new, by the depreciation already mentioned, being exactly equal to 4000 of the old.

But others were to the full as keen on the subject as the minister; and the measure was instantly met by a strong remonstrance from the parliament. The regent refused to listen to it. But the parliament felt that it was backed by the nation, and boldly ordered that no money should be received in payment but that of the old standard. Thus began the battle; the regent annulled the order; the par