Defeat in the Franco-Prussian War stimulated an overhaul of the fiscal-military system, but in a way that largely suited the notables. The government rebuffed considerable pressure for an income tax, instead largely opting to raise indirect taxes and a new tax on securities; the post-Revolutionary tax system survived, minimising the burden on the landed classes. The greatest changes were for the army, with the imposition of universal military service. Thus, this concluding chapter underscores the durability of the post-Revolutionary fiscal system that emerged in the early nineteenth century.

Following Napoleon’s final defeat at Waterloo in 1815, the victorious allies imposed 700 million francs of reparations on the French – around 10 per cent of GDP. To pay these, the Restoration developed the final element of the nineteenth-century French fiscal system: public credit, which the government modelled largely on that of Britain. With the payment of reparations, the Restoration reintegrated France into the international order, facilitating the stabilisation of Europe and thus that of France’s domestic politics. At the same time, Napoleonic conscription was overhauled, and replaced with a system of limited military service that lasted until the 1870s. Though often overlooked by historians, the Restoration therefore did much to facilitate the creation of a sustainable, stable post-revolutionary fiscal-military state.

While the foundations of the fiscal-military state changed little either side of 1830, the new Orleanist regime did much to extend the state’s developmental dimension. The government took responsibility for the development of the railway network, which entailed extensive public investment in the 1840s. In part, this extension of public works was motivated by a desire to manage the ‘social question’, the fear of a potentially subversive underclass; indeed, despite the limited extension of the franchise after 1830, the July Monarchy was attentive to public opinion. The desire for popular legitimation also pushed the regime to seek glory abroad through the conquest of Algeria, which entailed higher military expenditure, as did an international crisis in 1840. As under the Restoration, the growth of public expenditure was financed through credit, which enabled the government to avoid painful tax reforms, while increasing the numbers of people invested in public credit and thus with a stake in the social and political order.

The mid-1850s were years of economic boom, which gave way to a slump at the end of the decade. To maintain railway construction, the ongoing rebuilding of French cities and to counter economic malaise, government spending on public works rose. The regime also sought to stimulate the economy through fiscal reform; a trade treaty with Britain in 1860 formed part of a programme intended to reduce taxes and streamline the state. Affairs abroad, though, complicated this agenda. Profiting from the destabilisation of the international order that followed the Crimean War, France intervened militarily in support of Italian unification, while simultaneously seeking greater prestige through a policy of all-out global interventionism in the Middle and Far East and Mexico. The costs of interventionism abroad, combined with ongoing expenses in Algeria and on public works, eroded the regime’s latitude to lower taxes, straining the legitimacy of the fiscal system. Meanwhile, defeat in Mexico added to this discontent, producing a crisis of the fiscal-military system, which weakened the regime, easing its collapse in 1870 during the Franco-Prussian War.

Restored at the allies’ behest in 1814 and 1815, the Bourbons felt considerable pressure to bolster their legitimacy by asserting their nationalist credentials. Consequently, in the 1820s the French exploited the possibilities of public credit to finance a highly aggressive foreign policy, intervening in Spain in 1823, Greece in 1827–9 and Algeria in 1830. Thus, Restoration France became a quintessential fiscal-military state on the model of eighteenth-century Britain. Moreover, the growing French reliance on public credit stimulated the rise of the Paris Bourse as a major international financial centre. French governments thereby gained a new diplomatic tool that facilitated foreign government loans in Paris. The restored Bourbons also sought to use public credit to reinforce the regime by ‘closing the last wound of the Revolution’, compensating those who had lost property following the Revolution through the proceeds of a debt conversion. However, his idea proved highly controversial – though less because it would compensate formerly exiled aristocrats than because it would reduce the income of small rentiers and civic institutions with endowments invested in rentes.

The limits of the Bourbons’ attempt to assert their legitimacy became apparent in the late 1820s, particularly as the economy slumped after 1825. The downturn fuelled the rise of economic liberalism, invoked by a vocal group of the government’s opponents in their quest for a smaller state and cheaper government – ‘un gouvernement à bon marché’. Though many of these people found themselves in power after the overthrow of the Bourbons in 1830, the new July Monarchy did little to reduce the size of the state. Rather, it largely upheld the existing fiscal system, doing little to reduce taxes and resorting to public credit to cover shortfalls in public finance that arose in the immediate aftermath of the Revolution of 1830. Borrowing therefore facilitated the survival of the fiscal system, which only incurred minor changes to direct taxes, alcohol duties and customs. While the Revolution changed little and thus demonstrated the continuities that affected French politics and economics during the ‘Age of Revolution’, it produced new pressures to reform the fiscal system, many of which encouraged the development of the French state’s economic interventionism from the late 1830s onwards.

The growth of the state during the 1840s provoked fierce criticism of fiscal irresponsibility from the government’s opponents. Consequently, a series of spending cuts followed the overthrow of the July Monarchy in 1848, focusing most heavily on public works, which were to be delegated to the private sector to a greater degree than under the Orleanists. The expansion of public works continued apace in the 1850s, but with less government investment than in the 1840s. Indeed, the pressure for public amenities was made all the more intense by the advent of universal suffrage in 1848, which increased the need for the government to promote widespread prosperity. At the same time, the government continued to pursue the enhancement of French prestige abroad, participating in the Crimean War in 1854–6. Financing the war relied heavily on credit, prompting an overhaul of government borrowing as the state issued loans by public subscription, realising on a large scale what previous regimes had only envisioned and reshaping the way that the government contracted loans in subsequent years.

Napoleon took power in 1799, promising to end the instabilities of the previous decade. To some degree, he succeeded. The ancien régime indirect tax of l’octroi, abolished in 1790 and then reintroduced in 1798, was rapidly extended after 1799 and smoothed the introduction of new, national indirect taxes from 1804 onwards. To compensate for the limitations of public credit, which only recovered slowly from the collapse of the 1790s, the Napoleonic regime heavily plundered occupied territories. This, though, revealed the limitations of Napoleon’s renovation of the fiscal-military state. As David Bell has argued, the period 1792–1815 was characterised by ‘total war’; the escalating costs of men and material eventually overstretched the Napoleonic state, destroying its legitimacy and precipitating its collapse in 1813–14. Nevertheless, despite their failure to produce a sustainable fiscal-military state, the Revolutionary and Napoleonic regimes established the taxes that formed the basis for the post-revolutionary fiscal system.