THE MISSISSIPPI SCHEME 1716-1721
CHAPTER FOUR – SANITY AND SCORN
John Law’s “easy money” policy ushers in hyperinflation and political chaos in France. He is turned out of the government in fear for his life. A formerly disgraced chancellor is recalled to restore order. [Chapter 1] [Chapter 2] [Chapter 3]
Restoring Economic Sanity
When D’Aguesseau arrived in Paris, five counsellors conferred with the Commissary of Finance, and on June 1, their order abolished the law which made it criminal to have more than 500 livres in coin. Everyone could have as much coin as he pleased. To replace the banknotes, 25 million new notes at 2.5% interest were created, secured by the revenues of Paris. The old notes were publicly burned in front of the Hôtel de Ville. On June 10, the bank reopened with enough silver coin to meet withdrawals.
These measures brought good results. All of Paris hurried to the bank to get coin for their small notes. Silver being scarce, they were paid in copper, but few complained that the copper was too heavy. Still, poor fellows toiled along the street, loaded with fifty livres of coins, more copper than they could comfortably carry.
Greed Turns to Fear
Great crowds surrounded the bank, and hardly a day passed that someone was not pressed to death. On July 9th, the multitude was so dense and loud that the guards closed the gate and refused to admit any more. The crowd was incensed and threw stones at the soldiers. They, in their turn, threatened to fire on the crowd. One soldier was hit by a stone, and he fired into the crowd killing one man and severely wounding another. It appeared that the crowd would attack the bank, but the gates opened, and the crowd saw a troop of soldiers with fixed bayonets. The rioters settled to vent their anger with only yells and hisses.
Eight days later, fifteen people were squeezed to death at the doors of the bank. An angry crowd of 7,000 took 3 of the bodies to the Palais Royal. They wanted the regent to see the misfortune that he and Law had brought on the country. Law’s coachman, who was sitting at the box of his master’s carriage, in the courtyard of the palace, was more zealous than discrete. Not wanting the mob to abuse his master, he said, loud enough to be overheard, that they all deserved to be hanged. The mob set upon him, and thinking that Law was in the carriage, broke it to pieces. The coachman barely escaped with his life. Troops appeared, and after the regent assured that the three bodies would be decently buried at his expense, the crowd quietly dispersed.
The parliament was sitting during this uproar, and the president went out to see what was happening. On returning, he told the councilors that the mob had destroyed Law’s carriage. All the members rose and shouted with joy. One, showing his hatred, exclaimed, “And Law himself, is he torn to pieces?”
Solving the monetary crisis depended on the credit of the Indies Company, and any relief for the Company would help the country. With this in mind, the council issued a decree that all maritime commerce should be given exclusively to the Company. But they unfortunately forgot that this would ruin all the merchants in France.
Parliament was flooded with petitions demanding that they refuse to approve the decree, which they did. The regent, saying that this only fanned the flame of sedition, exiled them to a suburb of Paris. There they stayed, determined to defy the regent. Their temporary exile was made as comfortable as possible. The president gave them elegant suppers, inviting all the wittiest company of Paris. Every night there was a concert and ball for the ladies. The usually grave and solemn judges and councilors played cards and for several weeks led an extravagant life. They wanted to show the regent how little they cared about being banished, and that they could make their exile more pleasant than Paris.
Failure Admitted
The French were renowned for expressing grievances with satire and songs. When Law’s plans utterly failed, caricatures appeared everywhere. The streets were filled with songs, ridiculing the regent and Law. Many of these songs, far from decent, could be heard for months all over Paris.
The caricatures showed that France had awakened to its folly. One was titled “The ‘Goddess of Shares,’ in her triumphal car, driven by the Goddess of Folly. Drawing the car are the Mississippi Company, the Bank of England, and others. To move the car faster, the company agents, with long foxtails and cunning looks, turn the spokes of the wheels, marked with the names of stocks and their prices, sometimes high and sometimes low. On the ground are the ledgers of legitimate business, crushed under the chariot of Folly. Behind is a crowd clamoring after Fortune, fighting to get some of the shares she is handing out. In the clouds sits a demon, blowing soap bubbles. The crowd climb on one another’s backs to reach them before they burst. In the path of the car stands a large building, with three doors for the crowd to pass through. Over the first door are the words, ‘Hôpital des Foux (Fools),’ over the second, ‘Hôpital des Malades (Sick),’ and over the third, ‘Hôpital des Gueux (Beggars).’”
Another caricature showed Law in a cauldron, boiling over the flames of popular madness, surrounded by a mob, pouring all their gold and silver into it, and receiving, gladly in exchange, bits of paper which he gave them by handfuls.
During this time, Law was cautious about his wellbeing. In the regent’s apartments, he was safe from attack; and whenever he went out, it was either incognito, or in a royal carriage with a powerful escort. An incident showed how much the people detested Law and what they would have done if he had fallen into their hands. A gentleman was passing in his carriage down the Rue St. Antoine where a hackney-coach blocked the road. His servant called impatiently to the hackney-coachman to get out of the way. When he refused, the servant struck him on the face. A crowd soon gathered, and the gentleman got out of his carriage to restore order. The hackney-coachman thought this was another attacker, and he shouted, “Help! help! murder! murder! Here are Law and his servant, going to kill me!” At this, the people came out of their shops, armed with sticks and other weapons, while the mob gathered stones to at last have revenge on the supposed financier. Lucky for the two, the Jesuits’ church door was open, and they ran in. They mob pursued and would have ill-treated them even at the altar if the two had not found the sacristy door open and sprang through, closing it after them. The indignant priests persuaded the mob to leave. They found the carriage still in the streets and vented their anger on it, tearing it apart.