No. 69.
Mr. Washburne to Mr. Fish.
Paris, May 31, 1876. (Received June 15.)
Sir: I have written you from time to time in regard to the financial and industrial condition of France. To persons who keep themselves an courant with the progress which this country has made within the last few years, it is something extraordinary. While the production of the country has been immense, I think its prosperity must be attributed in a certain degree to its political condition. Since the suppression of [Page 118] the commune in 1871 and the establishment of a republican government, France has enjoyed a repose such as was rarely seen before. It must be gratifying to persons in sympathy with the republic to reflect on the absolute tranquillity which has reigned since its inauguration. This quiet, scarcely disturbed for the last five years in any part of France by what would amount to an ordinary riot, has given the people a wonderful degree of confidence. With minds undistracted by political excitement and fear of internal commotion or foreign war, they have devoted themselves with unsurpassed activity to the further development of the great resources of the country. The recent statement of the condition of the Bank of France, showing in its vaults an amount of gold never before in the history of the world in the vaults of a similar institution, has led me to look a little into what the French people have accomplished since 1871.
After the commune, the Bank of France has a metallic stock of 557,000,000 francs, against a circulation in bank-notes of 2,242,000,000 francs. Since the termination of the war, France has paid to Germany the sum of 5,315,000,000 francs, of which sum 125,000,000 were paid in French bank-notes, 325,000,000 by the cession of the Eastern Railway, and the balance of nearly 4,900,000,000 was paid in gold and silver, or gold-drafts. To accomplish this purpose, France Emitted a 5 per cent. loan to the amount of 6,920,000,000, which was put on the market at an average rate of 80 per cent. To-day, instead of 557,000,000 francs in the vaults of the bank which France had five years ago this month, the bank has 2,000,000,000 of metallic stock against a circulation of nearly 2,420,000,000 of notes. The French government owed the Bank of France, after the commune, 1,400,000,000 francs; to-day that sum is reduced to 500,000,000, which sum, being already inscribed in the budget, with 150,000,000 re-imbursement per annum, will be finally wiped out in 1880.
The French loans of nearly 7,000,000,000 francs are nearly all held by the French people, and by the quotations at the Bourse to-day stand at 105; which shows that the French people have gained 1,700,000,000 francs by the premium. This statement proves a more rapid recuperation of financial strength within the last five years than the world has ever witnessed.
The country has not only gained the 5,000,000,000 paid to Germany, but has more gold and silver than ever before. It holds its entire indebtedness at a greatly advanced rate. The reduction of the debt amounts to 1,000,000,000 francs, and it may be safely asserted that the country, since the downfall of the commune in May, 1871, has gained the enormous amount of 10,000,000,000 francs.
Those who are interested may contrast this state of things with that which existed during the last years of the empire, when the debt was constantly increased in time of peace.
The facts herein stated must have a certain interest for our political economists. This government has held to the basis of hard money, and the watch-word of the people has been “Economy and Industry.”
I have, &c.,