Consul called forth the principal bankers of Paris, and there was composed an association for the incorporation of a bank, which was called

THE BANK OF FRANCE:

the same which exists to this day, and now occupies the foremost position among all the great Banks of the world.

Its original capital was thirty millions of francs. Its government was to be by twelve regents and a directing committee, of three, for which committee a governor was afterwards substituted. It was intended, according to its charter, to discount commercial bills representing real transactions, but not bills of accommodation; to circulate bank notes redeemable in cash, and to keep itself aloof from all speculations, other than those of discounts and exchange. And bank notes could be issued by no other institution in the country. The government paid the semi-annual interest on the public debt through the Bank, and before it had existed six months its notes were accepted by the public as readily as specie, all of which may now appear ordinary enough; but, at that time, after the aversion which the government assignats had caused for paper, and after innumerable bankruptcies, it was regarded as a sort of commercial prodigy. The government had not stopped there, but had deposited with the Bank in account current the surplus of the disposable funds. Having all at once such resources at its disposal, the Bank had lost no time in discounting, in issuing notes, which, always redeemed in specie, if the holders so desired, had soon acquired the value of such money. Thus, in a few months, by those able and judi

cious measures, the government had not only raised itself a powerful auxiliary, which, for the aid it had received at the outset, could then render it service to the amount of hundreds of millions of francs, but would, also, render inestimable services to the entire business and commercial interests of the country by providing a safe and convenient medium for their transaction.

The young general was no novice in the art of governing, for he had for five years carried on war, provided by his own measures for the maintenance of the armies he had commanded, administered and collected the revenues of the countries he had conquered, negotiated with Europe in the most brilliant manner; but finance, and a sound fiscal policy were subjects upon which technical knowledge was indispensable.

Having profound knowledge of men in general, gifted with rapid penetration and a prodigious memory, he called before him many special men in that line, the only men to whom he did listen, and then solely on the subject of their special pursuit. The First Consul possessed, in an almost unequalled degree, the ability of choosing the best qualified men for the work they were to perform. Among much more prominent and influential men who aspired to the administration of the finances, he chose one, M. Gaudin, who had formerly been a head clerk in the bureau of finance: a man of solid understanding and having great experience, who had rendered, both under the old system of the monarchy, and in the earlier years of the Revolution, those little known but invaluable administrative services with which governments cannot dispense. In this great office, which he held for fifteen. years, till the downfall of the Empire, during which the Emperor created him Duke of Gaeta, he never ceased

to render the most important and eminent services to the

state.

With the aid and advice of such men was the Bank of France established, upon principles of banking so sound and lasting, that, faithful to its statutes, it has never ceased to grow and prosper, and has become the greatest and strongest institution of its kind in the world.

And not less ably were the measures devised to place the national financial system upon a good and secure basis. The government first took advantage of the great revival of business and credit to substitute the plan of the creation of rentes to that of the sale of the national domains at low prices; in this manner it discharged by a small portion of these domains, and by the creation of rentes, the deficits left unpaid in the years V., VI., VII., and VIII.; it completed the liquidation of the floating public debt, and insured the payment of the interest in a certain and regular manner.

After having thus regulated or discharged old accounts, saved the remainder of the domains of the State, and fixed the amount of the debt, there would be an annual interest of 100,000,000 francs, an ample sinking fund, and finally a budget with an equal income and expenditure.

The news of the great victory of Marengo, and of the successes of the army of the Rhine under General Moreau in Bavaria, filled the country with joy and caused a universal feeling of the certainty of a speedy and glorious peace. At the same time a decree of the three Consuls announced to the holders of the public securities that the interest of the first six months, which would

end on the 22nd of September, 1800, would be paid to them entirely in silver. Doubly welcome news; such as had not been given for many a day, in fact, not since the commencement of the Revolution, to the unfortunate creditors of the State! The five per cent. funds, which had been sold, on the day of the Revolution of the 18th of Brumaire, for thirteen francs, had now risen to forty and promised to reach fifty francs. This financial phenomenon had produced a great effect, and it was regarded as not the least of the victories of the First Consul, who governed and made war in a manner equally superior and uncommon.

SYSTEM OF INDIRECT TAXATION

The territorial burdens of France during the progress of the Revolution had become enormous; the land tax amounting to a full fifth of the whole profit derived from cultivation by the nation, and the inequality in the distribution of this burden being so excessive, that in many places the land owners paid thirty, forty, fifty, and even eighty per cent. on their incomes. (Duc de Gaeta. 1, p. 196.) The enormity of this evil attracted the attention of Napoleon, and his sagacious mind at once perceived the superiority of taxes on consumption, which, confounded with the price of the articles on which they were laid, were hardly felt as a grievance, over an enormous direct payment from the proprietors to the government, which fell with excessive and intolerable severity upon a particular class of tax-payers. This able measure of indirect taxation, under the name of Droits Reunis, was organized under his direct auspices, and soon formed an important part of the revenue, thus enabling

the government to diminish the land-taxes by an equal amount so easily raised from all consumers.

VIEWS ON THE GOVERNMENT OF THE COLONIES, AND THE RACE ISSUE

About this time, a project to establish chambers of agriculture in the colonies was considered in the Council of State, and they were decreed, but the war which soon broke out with England, and the frightful disorders in Hayti, Martinique and the other colonies in the West Indies, prevented the plan being carried into execution. The principles advanced by Napoleon upon this subject, however, are admirable for their wisdom and justice.

"Doubtless," said he, "you must govern the colonies by force; but there can be no force without justice. Government must be informed as to the real situation of the colonies, and for this purpose must patiently hear the parties interested; for it is not sufficient to acquire the character of justice that the ruling power does what is right. It is also necessary that the most distant subjects of the Empire should be convinced that this is the case, and this they will never be unless they are sensible that they have been fully heard. Were the Council of State composed of angels or gods, who could perceive at a glance everything that should be done, it would not be sufficient, unless the colonists had the conviction that they had been fully and impartially heard. All power must be founded on opinion; it is in order to form it that an institution similar to that proposed is indispensable.

"At present there is no constitutional channel of communication between France and the colonies; the most