A few short years after the proclamation of liberalization, the government found itself faced with a burgeoning subsistence crisis and embroiled in a growing debate on the judiciousness of the reform. The reforms were meant to change the way in which the grain trade was conducted. The May Declaration radically altered the conditions of internal commerce and the July Edict opened the frontiers to exports. Taken together, these measures were supposed to build a stronger, more resilient, and more dependable commercial structure at the same time that they generated powerful incentives for agricultural expansion. In this chapter we shall consider the impact of the reforms on domestic and foreign trade and especially on the customary patterns of provisioning. In addition, we shall examine the way in which partisans and adversaries of the May and July laws explained the relationship between liberalization and dearth.

I

Contemporaries were never able to assess dispassionately the impact of liberalization upon the grain trade and the patterns of provisioning. The proliferation of scarcity, spiraling prices, and disorder polarized feelings toward the reform legislation. The parties to the debate were more interested in ascribing and denying political and moral responsibility for the crisis than in studying the processes of cause and effect. Resentful of the dearth that jarred their serenity, the liberals viewed it as an accident, ill-timed but banal, which bore no intrinsic relation to the implementation of liberalization. On the contrary, they claimed that it was a vindictive legacy of the old police system, for were the liberty perfect in its application, dearth by definition would be impossible. If prices were occasionally excessive, it was due to the persistence of the old prohibitions, to the inclemency of the weather, or to other traditional sources of fluctuation. The opponents of liberalization ridiculed the idea that the reforms and the scarcity were merely coincidental occurrences. After all, the avowed purpose of the laws was to open new markets for the grain trade and to raise prices. The dismantling of controls led directly to the flight of grain and the vertiginous increase in prices to which, in the eyes of the police party, the popular disturbances furnished eloquent testimony.

[1] The Holy Gospel, since it has come to light, rebukes and reveals all ‘the works of darkness,’ as St. Paul calls them, in Romans 13:13. For it is a brilliant light, which lightens all the world and teaches how evil are the world's works and shows the true works we ought to do for God and our neighbour. Therefore some of the merchants, too, have been awakened, and have become aware that in their business and commercial dealings many a wicked trick and hurtful financial practice is in use, and it must be feared that the word of Ecclesiasticus applies here, and that ‘merchants can hardly be without sin.’ Nay, I think St Paul's saying in the last chapter of 1 Timothy 6:10, fits the case, ‘Avarice is a root of all evil,’ and ‘Those that are minded to get rich fall into the devil's snare and into many profitless and hurtful lusts, which sink men in destruction and perdition.’

[2] I think, to be sure, that this book of mine will be quite in vain, because the mischief has gone so far and has completely got the upper hand in all lands; and because those who understand the Gospel ought to be able in such easy, external things to let their own conscience be judge of what is proper and what is not. Nevertheless I have been urged and begged to touch upon these doubtful financial manipulations of late and to expose some of them, so that even though the majority may not want to do right, some, if only a few, may yet be delivered from the gaping jaws of avarice. For it must be that among the merchants, as among other people, there are some who belong to Christ and would rather be poor with God than rich with The Devil, as says Psalm 37:16, ‘Better is the little that the righteous hath than the great possessions of the godless.’ For their sake, then, we must speak out.

A Declaration of War

After invoking the gospel as a guideline to good deeds [1], Luther comes straight to the point by identifying the evils of his time. These may be captured under the catchall term avarice [1, 2 and passim]. As avarice (or greed, Latin avaritia) is one of the capital vices or cardinal sins, it is – in Luther's view – the main danger posed to contemporary society [1, 2]. Avarice can be generally defined as the desire to have more, but after that the story becomes tricky. What does more mean? It could mean, for instance ‘more than due’, as justified in terms of the just profit or reward to one's labour and effort spent on procuring a specific bundle of goods or making a just and honest living. Even though Luther disliked the medieval scholastic theologians, he is, at least implicitly, using the schoolmen's distributional concept of justice here; figuratively speaking the geometrical (as opposed to an arithmetical) mean as a benchmark for distributing capabilities, rewards and resources. Everyone should be rewarded a fair wage, profit and income, commensurate with one's occupation and status within society. Fair in this model does not mean equal as in the later communitarian and proto-communist utopias of the age, for instance, Thomas Muntzer's movement in Muhlhausen or the Anabaptists’ design of egalitarian communities in some other regions of contemporary Germany in the wake of the Reformation. It means, rather, ‘according to one's contribution and rank within society’. But more, in the theological notion of avaritia entertained by Luther, could also mean ‘more and more’, that is transforming the desire for a just reward or profit, which even honest Christian merchants were entitled to, into the desire for ‘profit for profit's sake’.

I

Modern times has invented its own brand of apocalypse. Famine is no longer one of the familiar outriders. The problems of material life, and their political and psychological implications, have changed drastically in the course of the past two hundred years. Perhaps nothing has more profoundly affected our institutions and our attitudes than the creation of a technology of abundance. Even the old tropes have given way: neither dollars nor calories can measure the distance which separates gagne-pain from gagne-bifteck.

Yet the concerns of this book seem much less remote today than they did when it was conceived in the late sixties. In the past few years we have begun to worry, with a sort of expiatory zeal, about the state of our environment, the size of our population, the political economy and the morality of the allocation of goods and jobs, and the future of our resources. While computer projections cast a Malthusian pall over our world, we have had a bitter, first-hand taste of shortages of all kinds. The sempiternal battle between producers and consumers rages with a new ferocity, as high prices provoke anger on the one side and celebration on the other. Even as famines continue to strike the Third World in the thermidor of the green revolution, so we have discovered hunger in our own midst. The historian of pre-industrial Europe has always been able to find analogies and metaphors in press reports from Asia and Africa about “famine plots,” crowds pillaging storehouses, governments promulgating draconian measures against food hoarders and speculators, and famished consumers obdurately rejecting unfamiliar staple substitutes. Now the historian experiences the same eerie feeling of déjà-vu when he reads front-page articles in the New York Times about monstrous international wheat deals. Now that scarcity looms as part of our future, it is easier to make the case that it is also a heritage of our past—a heritage worth knowing, if not commemorating. Though we are not terrified by the same fears that obsessed our ancestors, we now have a keener sense of the burdens of subsistence and survival.

The subsistence problem dominated life in old-regime Europe in a merciless and unremitting way. No issue was more urgent, more pervasively felt, and more difficult to resolve than the matter of grain provisioning.

The explosion of joy and gratitude that followed the promulgation of the liberal measures seemed to confirm the royal claims. The May Declaration elated the Journal économique. In it the editors rediscovered the prince whose proud sobriquet had once been “the well-beloved”: they hailed “the august monarch that heaven gave for master to this great kingdom” and characterized him as “so justly cherished by all his people.” They regarded the declaration as a genuine triumph but they esteemed it more for what it portended than for what it actually was likely to achieve. It was “a first step,” the “forerunner” of an “unlimited” freedom which the king would not deny the nation. La Chalotais, the Procurator General of the Rennes Parlement, asked the councillors to view the Declaration not “as a simple law of interior police but as a Blessing of the Monarch,” as one of those momentous acts which provide for “the happiness of peoples.” More than the measure itself, it was the certainty that it “will undoubtedly be followed by a complete and general liberty to export” that enraptured the Breton magistrate.

The eagerly awaited July Edict, despite its limitations, generated a wave of exultation. While the laboureurs shed happy “tears” in the fields, the effusions of the journalists were no less lachrymose: “At last we see the dawn of the beautiful day for agriculture for which we have sighed for so long.” In the Toulouse area, proprietors, parlementaires and local administrators celebrated the victory. “The liberty to export our grain … has become an immutable law which will render dear the memory of the prince who issued it and the citizen-minister who inspired it,” declared a representative of the Toulouse Chamber of Commerce. La Chalotais, whom the Correspondance Littéraire considered to be the only magistrate in the kingdom with “the ideas and the tone of a statesman,” judged the edict to be “in conformity with the wish of the Nation which provoked it, with that of the Estates of the provinces, with experience which is the mistress of man, with the sentiment of Henry the Great and the illustrious Sully, with the opinion of all those who examined this question in an unprejudiced and disinterested manner.” Henceforth there would be no reason to fear either dearths, or “what was almost as terrifying,” the superabundance of harvests.

A dramatic innovation, liberalization, I shall argue, took shape directly from the needs and circumstances of the early 1760's. Yet insofar as it embodied a certain vision of public administration and economic life—a theory of political economy—it had an ample critical tradition upon which to draw. It is beyond the scope of this chapter to sketch a history of the development of political arithmetic or political economy in the Old Regime, though such a study, fully integrated into the context of political, economic, and social change, is sorely needed. Nor can it attempt to do for the idea of liberty what Mauzi did for “happiness” and Ehrard for “nature,” though such an undertaking, too, would be of great value. I wish only to suggest that liberalization had an important intellectual as well as political and economic preparation, leaving it to others to pursue these connections in detail. I have already discussed on several occasions the critics of the police. Most of them were part of what became the movement for liberalization. I refer to all persons who favored a fundamental reform of the police in the direction of greater liberty as liberals. By liberalism I mean to indicate nothing more than those political, economic, and social ideas that informed the attitude of the grain trade reformers and their allies. To others, too, I leave the task of charting out the links between this grain-centered liberalism of the Old Regime and the Liberalism which triumphed in the nineteenth century.

I

Like many of the notions that became preoccupations of the Enlightenment, the liberal idea crystallized during the reign of Louis XIV. It appeared in several versions in the anti-mercantilist, Christian-agrarian, and utilitarian currents which traversed the kingdom in the second half of the seventeenth century. Already the landowners were plotting the political resurgence and the revenge taken in prices and profits which the eighteenth century would allow them. A large part of the merchant community rejected Colbertism on grounds that would become familiar to eighteenth century reformers. Political dissenters criticized the methods of government for their arbitrariness and their oppressiveness—that is, for their excessive police in all domains of life: administration, religion, and foreign policy as well as the economy.

The government felt that it could surmount the crisis provided, above all, that the situation in Paris remained under control. As long as it did not have to face massive disaffection and disorder in the capital, the ministry felt it could win the day in the rest of France, where the mutinies were relatively small and widely scattered and where there was still to be found considerable sentiment in favor of the new regime. In this chapter we shall examine the impact of the crisis upon the capital and the way in which the Paris police tried to deal with it. In the following chapter, we shall consider the extraordinary efforts which the central government made, not without serious reservations and contretemps, to spare the capital the most terrible costs of dearth.

I

The quarantine of Paris proclaimed by the clauses of exception in the liberal laws proved singularly unsuccessful in preserving the capital from fear, dearth, and the disruption of its provisioning trade. Once the rest of France was liberated, the special guarantees regarding Paris provisioning became largely illusory. At the confluence of her great rivers, in the very center of the realm, the capital simply could not be isolated from the rest of France by fiat. Provisioning was a twoway affair. It made little sense to stand on the Port of the Grève or the carreau of the Halles and declare that nothing had changed while at the same time telling the rest of the nation that things would never be the same again. The exemption provision created a bizarre disjuncture between the capital and the hinterland, enjoining the police of the latter to conform to the very liberal code which it empowered the police of the former to ignore.

According to the May and July laws Paris was to continue to provision itself as it always had done in the past. The survival of the old way, however, depended upon the preservation of both the traditional regulatory apparatus and the familiar trading patterns. Liberalization, as we have seen, jarred them both mightily, and the disarray of each encouraged the further breakdown of the other. The maintenance of the old Paris police system depended primarily upon the vigorous support of the Controller-General, the freedom of action of the Lieutenant General, and the cooperation, or subjugation, of the officials in the provisioning zones.

This chapter may be kept brief; it is only intended as a general survey of Luther's economic thought. Its main aim is to correct an earlier notion that Luther was either ignorant or disinterested in economic questions or that accordingly his economics was rather primitive. Neither of these charges is accurate. The key points of Luther's economics and business ethics can be grasped from the monographs and articles by Roscher, Schmoller, Barge, Fabiunke, Strohm, Scott, Pawlas and more recently the present author; as well as the monographs focused on particular aspects of Luther's economics, such as Prien's volume on business ethics, Rieth's volume on the concept of avarice in Luther's theology or Koch's more recent dissertation on business ethics from the Middle Ages to the modern period. They all have some minor as well as (in some cases) major weaknesses, and not always have they advanced the field considerably or significantly. The interpretation to be found in the following lines will, accordingly, differ in places. By sketching out the cornerstones of Luther's economic ideas, this will provide us with the context for the analytical summary of his Von Kauffshandlung und Wucher in (chapter 5).

Myths

As suggested in the introduction (chapter 1), there are many myths – let us call them oversimplified meta-narratives – about Luther and his times. Let us here consider only those relevant for the present purpose. An older tradition, based not only on Schmoller and Roscher but also on some twentieth-century Marxist historians and their concept of an Early Bourgeois Revolution, had it that at Luther's time early modern capitalism came to the fore and that Luther's economics, as well as the early mercantilist authors, with whom he shared some convictions (see chapter 5), would classify as the ‘first economic doctrine of the Bourgeoisie’. This is, of course, wrong. Capitalist practices, such as profit-making for profit's sake, had existed for ages. The thirteenth-century Italian giant family firms and ‘medieval super-companies’ of the Medici, Bardi and Perruzzi and thirteenth-century financial institutions in Siena and Genoa had provided the blueprint and algorithms for modern banking; setting the scene for the sixteenth-century Augsburg Fugger, Welser, Höchstetter and many others of the ‘last medieval super-companies’.

The Powers of Space

Two things must be noted when locating Luther in the idiosyncratic coordinates of his times and space. First, he was an agrarian man. He spent the majority of his career as a reformer in Wittenberg. Wittenberg was located in the north-west of Saxony, in the Kurkreis or electoral Saxony – there were two Saxon territories, one ruled by the duke and the other by the elector – that is the part of the Saxon lands which had by far the largest share of grain sales in total Saxon government revenue at the time (if we may interpret revenue accounts as reflective of this area's stage of development and structure of economic activity). The area produced regular grain supplies that were used in provisioning those parts of Saxony further to the south-west, in the Erzgebirge Mountains, where employment and production were geared towards non-agrarian activities, mainly mining. Here, in the Erzgebirge Mountains and its offshoots, native grain production had for a long term proved unable to keep up with the surging demand for foodstuffs. This was due to the structural changes in this area which saw increasing numbers of people emerge outside the agrarian sector. At Luther's times day after day whole caravans of carts loaded with grain would ply Saxon roads southward from the northern areas, passing through Grimma near Leipzig and other staging posts where the Saxon rulers levied the Geleit payment, a convoy duty, leaving us with an ample record of quantitative sources documenting the frequency and intensity of domestic transport patterns. Thus, the areas in need were relieved from those areas with a grain surplus. In 1525 circa 3,500 carts with teams of up to 14,000 horses and oxen carrying a total of perhaps 8,000 tons of grain passed through the Saxon Geleit or toll of Borna to the south of Leipzig, bound for the Erzgebirge Mountains.

I

Many monographs will have to be written before one can properly assess the impact of Terray's policy. De-liberalization wrought no miracles. It did not herald the general return of abundance and it did not restore universal social tranquility. Even in those places which enjoyed a marked change of fortune after the end of 1770, it would be difficult to show that the improvement in conditions was due to the reinstitution of controls. Yet there is no question that Terray's law buoyed the morale of the police, infusing them with a sense of confidence that they had not felt for years. There were still frequent denunciations of “disorders” and “monopolies” in the trade, but the police no longer complained that they were impotent to act; they once again located the source of the vice in the malice and greed of the dealers rather than in the laws, and they resorted to “the usages of authority” when necessary to furnish their markets. There is some evidence that consumers in parts of the Hainaut and the Paris region received the news of the government's regulatory law with enthusiasm. An observer in Champagne reported that the break with liberalization helped to “revive” the “courage” of the people. Large numbers of merchants began to register with the police in order to secure permission to traffic in grain.

As always, execution of the law depended heavily upon the parlements; in this regard the Maupeou purge changed very little. It was precisely in order to assure the widest possible diffusion and enforcement that Terray had the December law enveloped in letters patent requiring registration. Though a number of courts, such as the Parlements of Paris and Metz, gave their approbation without difficulty, it should not be imagined that registration was either universal or uncontested. None of the liberal parlements endorsed the letters patent. By not insisting on registration at the beginning of 1771, the government, after a fashion, discharged its debts to these courts for having supported the king's position on the grain question so fervently in the sixties. Aware that it would take a “combat of authority” to secure registration and convinced that a forced registration would serve no purpose, Terray decided to wait for the evolution of events and opinion to cause the liberal courts to gravitate toward the police system on their own.