General Maximum

Competing theories exist as to the causes of the conditions the General Maximum was intended to ameliorate. In 1912, the historian Andrew Dickson White suggested that the ever-greater and ultimately uncontrolled issuance of paper money authorised by the National Assembly was at the root of France's economic failure and constituted the cause of its increasingly rampant inflation.White, A.D, "Fiat Money Inflation in France" 1912, The White Collection at the Cornell University, http://rmc.library.cornell.edu/collections/subjects/frrev.html Eugene White, in his 1995 publication "The French Revolution and the Politics of Government Finance, 1770–1815", argues that years of revolution, international conflicts, and poor climate conditions had led to an economic environment with massive inflation and food shortages throughout France.White, E. "The French Revolution and the Politics of Government Finance, 1770–1815." The Journal of Economic History 1995, pp. 236–238

Although it varied according to region, the maximum price for first necessity goods was about a third higher than the 1790 prices, and the legal maximum fixed to the wages was about half higher than the average level in 1790. Committee members feared new and more radical revolutionaries were being created by the crisis.{{Citation needed|date=December 2010}} Their concern intensified on 5 September 1793, when the sans-culottes invaded the National Convention demanding "food—and to have it, force for the law".Palmer, RR. Twelve Who Ruled. Princeton University Press, 1970, p. 47

On 29 September 1793, the Law of Suspects was extended to include the General Maximum. The Law of Suspects was initially created to deal with counter-revolutionaries, but hunger and poverty were seen by the Committee of Public Safety as dangerous to both the national interest and their positions within the government.Darrow, M. "Economic Terror in the City: The General Maximum in Montauban." French Historical Studies 1991, p 500 The law set forth uniform price ceilings on grain, flour, meat, oil, onions, soap, firewood, leather, and paper; their sale were regulated a third over the maximum price set in 1790.Darrow, M. "Economic Terror in the City: The General Maximum in Montauban." French Historical Studies 1991, p 498White, E. "The French Revolution and the Politics of Government Finance, 1770–1815." The Journal of Economic History 1995, p 244

Written into the text of the law were regulations and fines. Merchants had to post their maximum rates in a conspicuous location for all consumers to see and were subject to repeated inspections by police and local officials. Furthermore, the law gave legal protection to consumers who reported violations of the Maximum to local officials. If the consumer did not have a role in the infraction and gave report to the proper authorities denouncing the merchant, fines would be levied against only shop owners.{{citation needed|date=July 2019}}

The following table is an excerpt from the decree issued on 13 October 1792 by the administration for the district of Le Mans, department of Sarthe.

In 1793, the French Revolution caused wars with Austria, Prussia, Great Britain and Spain. The government continued to function during the economic and political crises by a series of loans, bonds and tax increases; an increasingly large amount of paper money issuance was a vain attempt to stimulate the economy.AD White "Fiat Money Inflation in France", 1912, The White Collection at the Cornell University library http://rmc.library.cornell.edu/collections/subjects/frrev.html

In many ways, the law actually exacerbated the problem, as the new price setting led to many food producers lowering their production or halting altogether, while many of those who continued to produce held onto their inventories, rather than sell at the legal price, which was often below the cost of production. This led to continued food shortages and recurring famines throughout the country. The Committee of Public Safety responded by sending soldiers into the countryside to arrest farmers and seize their crops. This temporarily alleviated the shortages in Paris, however it led to shortages becoming more intense in the rest of the country.{{Cite web|url=http://westerncivguides.umwblogs.org/2013/12/10/law-of-the-maximum-2/|title=Law of the Maximum : Western Civilization II Guides|access-date=2020-01-12}}

The law was written with an eye towards preventing business practices like price gouging and rent seeking, but in practice, the law targeted local shopkeepers, butchers, bakers and farmers, who were already feeling the effects of the economic downturn like other citizens.Darrow, M. "Economic Terror in the City: The General Maximum in Montauban." French Historical Studies 1991, pp. 503–505

The General Maximum's economic impact was largely negative, as its efforts at price control led to an overall decrease in food supply and prolonged famines in parts of the country. The law amplified parts of the problem it was trying to solve. The political and symbolic impact of the General Maximum were clear, as the harsh punishments enacted upon those who breached the Maximum became a symbol of the Reign of Terror.{{citation needed|date=July 2019}}

{{reflist|group=note}}

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• Darrow, Margaret H. . "Economic Terror in the City: The General Maximum in Montauban." French Historical Studies 17, No. 2 (1991): 498–525.
• Popkin, Jeremy. A History of Modern France, third edition (2006)
• White, Eugene N. . "The French Revolution and the Politics of Government Finance, 1770–1815." The Journal of Economic History 55, No. 2 (1995): 227–255.

Category:1793 events of the French Revolution

Category:1793 in law

Category:Economic policy in Europe

Category:French business law

Category:Inflation

Category:Law in French Revolution

Category:Macroeconomic policy

Category:Price controls

Category:Regulation in France