The King was facing financial ruin in the early 1780s. One problem seemed to lead to another and it was difficult to find a way out. The French government was spending more than it could afford. Louis needed money to pay for his court, his government officials, his solicitors and his debts. If he couldn’t find the money there was a real danger that government might break down, or that the King might have to depend too much on the nobles or on people he owed money to.

The King could raise money by taxation, but the first two Estates didn’t pay many taxes and the Third Estate had to pay more than most of its members could afford.

Another way in which the king raised money was by selling offices. These were government jobs which allowed the holder of the job to have a title, which could be passed on from father to son. In 18th century France, between 30,000 and 50,000 people are thought to have entered the nobility in this way.
In the past the King and his government had got hold of money by borrowing it from wealthy people. When the government paid back the loan, it had to pay interest on it. This meant the government paid back more money than it originally borrowed. Lenders made money by charging high interest.

Over the years the King had borrowed huge amounts of money. In 1788 50% of all the government’s spending went just on paying interest to people who had loaned it money. This cost twice as much money as running the French army and navy. Things were getting out of control.

TASK.
In your book record the different ways in which Louis could raise money.

METHOD USED: ........
Underneath each one describe the problems with the method.
PROBLEMS CREATED: ......

10 marks.