Les crises de la dette publique: XVIIIe-XXIe siècle

Published by EH.Net (December 2020)

Gérard Béaur and Laure Quennouëlle-Corre, editors, Les crises de la dette publique: XVIIIe-XXIe siècle. Paris: Institut de la gestion publique et du développement économique, 2019. 532 pp. €43 (paperback), ISBN: 978-2111294639.

Reviewed for EH.Net by Eric Monnet, EHESS and the Paris School of Economics.

The collective work Les crises de la dette publique, XVIII-XXIe siècle [Public debt crises], edited by Gérard Béaur and Laure Quennouëlle-Corre, follows on from a previous opus published in the same series in 2006 (Andreau, Béaur, and Grenier, 2006). It contains 21 chapters written by experts in the field. All are open access, freely readable online at https://books.openedition.org/igpde/6056?lang=fr.

The content is extremely varied in terms of scope and methodology. All the chapters are written (translated) in French, but most of the authors are international academics. The main virtue of the book is to provide superb material for teaching the history of public debt to French-speaking students. Several chapters of the book accomplish an important task by presenting an up-to-date overview of the international literature on key episodes in the history of public debt. These chapters often draw on material already published by their authors, but they are not devoid of new perspectives or analyses based on primary sources. Elena Maria Garcia Guerra presents the Spanish debt crises in the seventeenth and eighteenth centuries, highlighting how it cannot be understood without recognizing Spanish domestic politics (the balance of power between the local elites) between the king, parliament and the cities. Mark Spoerer explains everything there is to know about the German public debt, its complex financing and its destabilizing political consequences after the First World War. François Velde highlights the differences between the financing of French and English public debt at the beginning of the eighteenth century and — through this perspective — sheds light on the technicalities and the failure of the system of John Law (1716-20). Nicolas Barreyre takes us to the United States after the Civil War and shows how the financing of public debt during this period was essential for the political construction of the nation and for the development of the American administration. Anne Murphy presents a compelling analysis of England’s public debt after the Glorious Revolution. She debunks the myth of superior parliamentary control over the English public budget after 1688 and tells about the slow institutional evolution (learning from the frequent difficulties) of public finance techniques. This strongly echoes the account of Peter Ericsson and Patrik Winton in their chapter on Swedish public debt in the eighteenth century. Patrick Verley also discusses a key piece of standard public debt history: the Argentinean public debt crisis of 1890 and its international consequences through the Baring crisis. He interprets the Argentine debt cycle as being dictated by international creditors rather than internal factors.

Unsurprisingly, the volume also contains a number of chapters that focus specifically on France (a quarter of the total). Apart from a rather obscure but informative first-hand document by Didier Maître on the rise of primary dealers in the 1980s, the other five chapters deal with the eighteenth and early nineteenth centuries (respectively written by Arnaud Diemer, Joel Felix, Stéphane Guerre, Tim J.A. Le Goff, and François Velde). Relying heavily on primary sources, they offer a first-rate view of the troubled financing of the French government during this period. Thus, the book is also a good introduction in itself to the history of French public debt from Louis XIV to the July Revolution of 1830. Wars are inevitably omnipresent in this history. What these chapters also show is the importance of the memory of previous crises for the actors (financiers or ministers). The evolution of public finances is thus deeply shaped by the interpretation of past mistakes and defaults.

The other chapters belong to three different groups. Some give a long quantitative overview of the evolution of a country’s public debt over two centuries (Francisco Comin for Spain; Giuseppe Conti for Italy). Others focus on international negotiations between public creditors (Christophe Farquet on the League of Nations, Marc Raffinot and Vincent Duchaussoy on African debt crises, André Straus on Franco-Russian negotiations after the First World War). Finally, three articles tell the quiet story of sustainable public debt: Natalia Victorovna Platonova on Russian public debt in the nineteenth century, Jean Béranger on Austria in the nineteenth century and Mathieu Dubois on German debates on public debt in the 1970s.

Given the diversity of approaches and topics, it is very difficult to summarize a common conclusion of the volume in a few sentences. The editors themselves, in their introduction, acknowledge that the history of public debt is so diverse and heterogeneous that it should prevent researchers from drawing strong conclusions on the causes of the debt crisis or its sustainability. In fact, the heterogeneity of the volume even calls into question the need to treat public debt as a single entity in historical analysis. As François Velde reminds us at the beginning of his chapter, there is a conceptual unity that characterizes debt: debt serves to transfer resources from the future to the present (for borrowers) and from the present to the future (for lenders). But such a conceptual feature hardly exists for the “public” or the “State.” The debt of the kings of Spain in the eighteenth century does not seem so different from private debt contracted through personal networks. In contrast, the public debt of emerging markets such as Argentina in the nineteenth century or African countries today is as much an external debt of the whole country as it is a specific debt of the government. Identifying who is the “public” in public debt, as Nicolas Barreyre explicitly asks in his political history of the postbellum United States, and who are the creditors — as the editors point out in their introduction — remain key questions to go beyond the description of historical debt-to-GDP ratios.

Reference:

Andreau, Jean, Gérard Béaur, and Jean-Yves Grenier, eds. La dette publique dans l’histoire. Vol. 34. Comité pour l’Histoire économique et financière, 2006.

Eric Monnet is Directeur d’études at the EHESS (School for Advanced Studies in the Social Sciences, Paris) and Professor of economic history at the Paris School of Economics. He works on contemporary European financial and monetary history. He is the author of the book Controlling Credit (Cambridge University Press 2018) and has recently written the chapter “The History and Politics of Public Debt Accounting” (with B. Truong-Loi) in A World of Public Debts (edited by N. Barreyre and N. Delalande) Palgrave Macmillan, 2020.

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