[The Financial State of France]

Paris, April 13, 1858

By mere force of circumstances the restored Empire finds itself more and more compelled to throw up its adventitious graces and show its real features in their native hideousness. The hour of confessions has broken in upon it unexpectedly. It had already dropped every pretense of being a regular Government, or the offspring of the "suffrage universel". It had proclaimed itself the régime of the upstart, the informer and the 12-pounder[528] It goes now a step further, and avows itself the régime of the swindler The Moniteur of April 11 contains a note stating that certain journals have announced prematurely the fixation of the dividend upon the shares of certain railway companies and other industrial societies, and have attributed to this dividend a lower figure than that which has been since determined by the Councils of Administration.

"These are maneuvers against which the industry and the capital of the country must be protected. The editors of the journals referred to have been called before the Procureur Impérial, and warned that such facts will for the future be sent before the tribunals, as constituting the offense of publishing false views. The duty of the press is to enlighten the public, and not deceive it."[a]

In other words, it is the duty of the press writers, at the peril of being transported to Cayenne[529] to bolster up the Crédit Mobilier[530] instead of warning the public of the impending breaking up of that monster imposture, as they have done of late, although in very timid and subdued tones. The Crédit Mobilier is to hold its general annual meeting April 29 and declare its dividend for the past year. While its directors shrouded themselves in impenetrable mystery, most disastrous reports were circulated as to the way in which the expected dividend was to be "cooked," and one paper dared to hint at the fact that at the meeting of one company, connected with the Crédit Mobilier, held some time before, the manager coolly announced that though he could only declare a dividend of 8 per cent, the company was in a far better position than the year before, when he gave 25. The writer ventured upon expressing his suspicion whether any dividend of this "and other" companies were not paid out of the capital rather than the profits realized. Hence the wrath of the Moniteur. The shares of the Crédit Mobilier, quoted from 957 to 960 frs. on Feb. 10, from 820 to 860 frs. on March 10, had fallen to from 715 to 720 frs. on April 10, and even this latter quotation was merely nominal. There was no means of concealing the ugly fact that Austrian and Prussian holders had resolved upon selling no fewer than 6,000 shares, and that the "Maritime Générale Compagnie," one of the fantastic creations of the Péreires, was in articulo mortis[b], from having engaged in speculations anything but "maritime"[c]. It is a fine notion, quite worthy of a political economist of the force of General Espinasse, to imagine that menaces in the Moniteur will enforce credit as well as silence. The warning will act, but quite in the opposite direction, the more so since it emanates from a Government whose financial frauds have become a topic of general conversation. It is known that the budget drawn up by M. Magne, the Minister of Finance, represented a surplus, but, by the indiscretion of some member of the Cour de Révision, it oozed out that it showed in fact a deficit of some 100,000,000 francs[d]. When summoned to the "savior of property"[e][531] for an explanation, M. Magne had the grave impudence to tell his master that knowing his predilections for a "surplus," he had "cooked up" a budget, as the Ministers of Louis Philippe had done before him. There the matter rested, but the notoriety given to this incident drove the Government into a confession. Having pompously announced in the Moniteur[f] that an augmentation had taken place in the customs receipts for the month of February, it dared not stand by its own statement. The monthly customs returns, published at the end of March[g]. show the import duties in February last to be, even in the official version, but 13,614,251 francs, while they amounted, in the corresponding month of 1857, to 14,160,013 francs; and to be for the months of January and February united only 25,842,256 francs, against 28,044,478 for the same months of 1857. Such is the official meaning of "protecting the industry and the capital of the country against maneuvers," and of "enlightening the public," instead of "deceiving it."

The re-enactment of the coup d'état on an enlarged scale, the wholesale transportations, the parceling out of France into Praetorian camps, the rumors of war, the complications without and the conspiracies within—in one word, the convulsive spasms of the lesser Empire since the attempt of Jan. 14[532], have somewhat distracted the general attention from the financial state of France. Otherwise the public would have become aware that during that same epoch the factitious prosperity of the Bonapartist regime has already resolved itself into its elementary principles of peculation and jobbery. In proof of this proposition, I will content myself with enumerating such facts as have from time to time found their way into the European press. There is first M. Prost, the chief of the Compagnie Générale de Caisses d'Escompte, which not only engaged in all sorts of Bourse speculations, but took upon itself to establish banks of discount all over France. The capital was $6,000,000, in 60,000 shares. It had effected an amalgamation with the Portuguese Crédit Mobilier, and was magna pars[h] of the Crédit Mobilier of Madrid. All the capital is gone, and the liabilities amount to about $3,000,000[i] M. Damonieu, of the Compagnie Parisienne des Equipages de grandes Remises, was condemned by the tribunal of police correctionelle for having swindled his shareholders out of $100,000 in cash and shares, having plunged them into debt to the amount of $400,000, and squandered all the capital, amounting to $1,600,000[j]. The manager of another company—the Lignéenne—professing to make paper from wood, has also been condemned for embezzling the capital of $800,000. Two other Bonapartist "saviors of property" were convicted for having entered into an arrangement with some bankers to palm off on the public, for $10,000,000 or $15,000,000, some forests and mines far off on the banks of the Danube, which they had purchased for $200,000. In another case, it appeared that the managers of a mining company near Aix-la-Chapelle had sold to their shareholders for $500,000 mines which they were afterward obliged to admit were worth only $200,000. In consequence of these and other similar revelations, the shares of the Messageries Générales, once quoted at 1,510 francs, fell to about 500 francs. The shares of the Compagnie des Petites Voitures, shortly after their issue maneuvered up to 210 francs, have sunk to 40 francs. The shares of the Union Company have dwindled down from 500 to 65 francs. The shares in the Franco-American Navigation Company, once at 750 francs, may now be had at 30 francs. The Amalgamated Gas Company shares have receded from 1,120 francs to 720 francs. The shareholders of the Caisse des Actionnaires have been told by M. Millaud, their director, one of the mushroom millionaires of the lesser Empire, that

"the operations of the last half-year have produced no profits at all, so that it would not be possible to declare a dividend, nor even to pay the ordinary half-year's interest, but that he would pay this interest out of his own pocket."[k]

Thus the social ulcers of the lesser Empire are breaking up. The ridiculous conferences of Louis Bonaparte with the principal stock-jobbers as to the remedies to be applied to French commerce and industry have, of course, resulted in nothing. The Bank of France finds itself in a bad plight, since it is unable to sell the bonds of the railway companies, on the security of which it has been obliged to provide them with the money for carrying out their works. Nobody wants to buy these bonds at a moment when all railway property is rapidly depreciating in France, and the weekly railway returns exhibit a continuous falling off in receipts.

"With respect to the state of French trade," remarks the Paris correspondent of The London Economist, "it remains what it was; that is to say manifesting a tendency to improve, but not improving."[l]

Meanwhile, Bonaparte clings to his old way of sinking capital in unproductive works, but which, as Mr. Hausmann, the Prefect of the Seine, has the frankness to impart to the Paris people, are important in "a strategical point of view," and calculated to guard against "unforeseen events which may always arise to put society in danger." Thus Paris is condemned to erect new boulevards and streets, the cost of which is estimated at 180,000,000 francs, in order to protect it from its own ebullitions. The opening of the continuation of the boulevard of Sevastopol was quite in keeping with this "strategical point of view." Originally intended to be a purely civil and municipal ceremony, it was all of a sudden converted into a military demonstration, it being pretended that a fresh plot for the assassination of Bonaparte had been discovered. To explain away this quid pro quo the Moniteur says:

"It was quite right that a muster of troops should mark the inauguration of such an artery of the capital, and, after the Emperor, our soldiers were the first who ought to have trodden a soil bearing the name of so glorious a victory."[m]

Notes