I am reading a book about The Thirty Years War at the moment. In the light of the current situation in Europe, you may well imagine how startled I was to read the following in that book (the subject is the finances of the French Government in the early 17th century):
"The war strained a system that worked only imperfectly even in peacetime. The monarchy always overspent, forcing it to borrow heavily. As in Spain, specific sources of revenue were mortgaged to financiers in return for loans. Revenue was not only spent before it had been collected, but large parts of the fiscal system were transferred into private hands, largely beyond government control. Only 49 per cent of expenditure under Richelieu was submitted to the royal audit office, with the remainder only presented in total. The government claimed exemption on grounds of national security, but the real reason was to hide the exorbitant rates of interest paid to financiers. A total of 700 million livres of loans (affaires extraordinaires) was raised between 1620 and 1644 at the cost of 172 million. The formal structure of ordinary taxation 'became little more than a front behind which the financiers carried on their affairs with studied indifference towards the damage that they did to the government and contempt for the suffering of the tax-paying element of the population'"
- Peter H. Wilson, Europe's Tragedy: A New History of The Thirty Years War, Penguin, 2009, p.558
The quote in the last sentence is from J. Dent, Crisis in Finance. Crown, financiers & society in 17th century France, Newton Abbot, 1973, p.32
It may be remembered that the immediate trigger of the French Revolution was an unsolvable debt crisis in the government of Louis XVI.
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