Turgot's Gallant Failure
David Redfearn
[Reprinted from Land & Liberty,
January-February 1990]
THE PLACE was Compiegne, and the date the 24th August, 1774. Jacques
Turgot had recently had an interview with King Louis XVI of France, at
which he had accepted the post of Controller-General or Minister of
Finance.
His confidence in his ability to do the job was reasonably firm and
well-founded: in fact, he had described his proposals to the King in
some detail, and had received His Majesty's approval.
Yet his feelings were mixed. If the programme were to stand any
chance at all of success, Turgot would need the King's full and
continuing support; but would he get it? In order to make as sure of
it as he could, he decided, for the King's benefit as well as for his
own, to send him a written summary of his plans, and to follow it with
a warning of the difficulties they were likely to encounter. So he set
to work on a letter.[1]
Intended originally for the Church, Turgot had, in 1750, abandoned
his theological studies in favour of science and philosophy. In 1752,
he became substitut and later conseiller in the
parlement of Paris -- a set of law-courts rather than a parliament in
the British sense -- where he remained until August 1761, when he was
appointed to be intendant (or royal representative) of the
province of Limoges.
It was during this period in Paris that he met the leaders of the
physiocratic school of thought, Quesnay, Gournay, Dupont de Nemours,
the abbe Morellet and other economists, and was won over to their
ideas on freedom and the governing of human affairs according to
natural law.[2]
They advocated government by consent, a minimum of interference with
the life of the individual, and, as a corollary, his security in the
possession of the fruits of his labour. There should be complete
freedom of exchange, and unrestricted market competition, with no
monopolies or privileges.
According to their economic analysis, the only productive labours are
those of the farmer and the miner; for it is they who increase year by
year the quantity of raw materials available for man's well-being.
This annual increase to the wealth of the community consists of the
excess of the total product over its cost of production, and was named
by the physiocrats the produit net. The revenue of the state
should be derived simply and solely from this "net product"
by means of a tax on agricultural and mining land.[3]
Their reasoning was to this extent defective, that they did not
recognise that manufacture and exchange also involve productive labour
and the use of land; and this omission has undeservedly deprived them
of the credit for their main thesis that, with the growth of society,
there also grows a fund that is the natural provision for its material
needs. For this reason, Henry George has hailed them as the founders
of the true science of political economy.[4]
DETERMINED to put these physiocratic ideas into practice as far as
possible, Turgot proceeded to take up his first major official
appointment at Limoges. To alter the whole basis of the revenue was an
evident impossibility; but he did continue his predecessor's work on a
fresh survey of the land, to arrive at a fairer assessment of the taille,
a tax levied only on non-nobles.
He also substituted for the corvee (or forced labour on
public works) a more evenly distributed tax in money. The success of
such reforms must have added to the qualified confidence with which he
undertook, 13 years later, the much more exacting job of
Controller-General for the whole country.
We left him at Compiegne, op the 24th August, 1774, writing his
letter to Louis XVI. After the usual formal compliments, which he cut
as short as he decently could, he reminded the King of the nature of
his reforms, which the two of them must already have discussed. First,
there was to be no national bankruptcy. Secondly, there was to be no
increase in taxation. Thirdly, there were to be no more loans.
An indispensable condition for the fulfilment of these three aims was
economy in both spending and collecting revenue.
Expenditure was to be reduced below receipts to the tune of 20m. livres
per annum, in order that debts previously incurred might be paid off.
This absolute necessity was to override any protests by
administrators responsible for spending, who were in future to make
prior reference to the Controller-General.
The King himself, so he was tactfully informed, was to restrain his
own liberality to hangers-on at Court, and to think instead of "the
misery of those from whom exactions sometimes have to be made by the
most rigorous processes
" Private profit from the collection
of taxes was a source of corruption among the nobility, and was to be
discouraged.
Thus far any prudent Controller-General might have gone; but Turgot
the physiocrat went further. What he wanted, and probably above all
else, was "a more equitable distribution of taxation, in
order that the people may be appreciably relieved, without much
diminution of the public revenue". In fact, he wanted the
impot unique, or single tax on land.
Then came the rub. Not only, he wrote finally, would the reform of an
unjust system be bitterly resisted by those who profited from the
injustice, but the King's own generosity, and that of the persons most
dear to him (i.e. his wife and his brothers) might well attach them to
a universal opposition.
This was putting it mildly. In the event, Marie Antoinette and the
future Kings Louis XVIII and Charles X all unhesitatingly espoused the
cause of privilege; and Turgot, though he won the struggle for
internal free trade in corn, ran into more serious trouble with his
attempt to make both nobility and clergy subject to taxation.
He never got round to concentrating the revenue on the land tax at
all. The King remained convinced of the rightness of Turgot's views,
but, giving in to pressures that might in any case have proved to be
irresistible, dismissed him. His term of office had lasted 20 months.
So France went down the slippery slope to bankruptcy, revolution and
the most appalling series of wars the world had yet known. The problem
that Turgot attempted to resolve still faces us today.
Though we now have the benefit of the more accurate economic analysis
of Henry George, will there ever be another statesman of the integrity
and general moral stature of Jacques Turgot to try to put it into
practice by means of the taxation of the value of all land? Only the
future will tell.
REFERENCES
- Lanson, G. (editor), Choix
de Lettres du XVIII - Siecle, Librairie Hachette, 1928.
- Encyclopaedia Britannica, 11th
edition, vol. 27, article Turgot, Anne Robert Jacques
- Encyclopaedia Britannica, 11th
edition, vol. 21, article Physiocratic School
- Henry George, The Science
of Political Economy, bk II, ch lV, 1897
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