A provocative Parisian pamphlet

(Author’s note: below is Part 3 of 3 of my series of blog posts on Adam Smith’s first visit to Paris.)

The pamphlet, Richesses de l’etat, took Paris by storm and stirred up an enormous debate about royal finances. (Darnton 2024, p. 72)

When Adam Smith arrived in Paris in February 1764, an enormous public controversy was swirling around the French capital. By all accounts, the ostensible culprit was a recently published pamphlet titled Richesses de l’etat, ou Lettre écrite à l’auteur de ce systeme, par un de ses confrères. (See Anon. [Roussel de la Tour] 1763. For reference, a 1764 reprint of this pamphlet is available here.) Although this pamphlet was published anonymously, it was subsequently attributed to Roussel de la Tour (see Darnton, 2024, p. 75; Higgs 1897, p. 61.) Within two years of its original publication in May 1763, more than 40 pamphlets were circulated in response to Roussel’s proposal (Shovlin 2006, p. 96).

Roussel’s pamphlet had kindled the embers of public debate in Paris for several reasons. First and foremost, it was provocative. Roussel proposed nothing less than an end to France’s “unjust system of taxation” (Darnton 2010, p. 72). At the time, commoners contributed a disproportionate share of the kingdom’s taxes, while nobles and clergy were excluded from most taxes (see, e.g., Hauser, 1933). Under Roussel’s proposed tax system, by contrast, most peasants would be exempt from paying taxes. Moreover, France’s tax system was not only unfair; it was also notoriously suboptimal and inefficient (see, e.g., Chanel 2015; White 2004).

Under Roussel’s proposed scheme, France’s complicated plethora of direct and indirect taxes (see pie chart below), including the taille (a land tax) and the vingtième (a 5% property tax), would be scrapped and replaced by a single graduated tax on the incomes of the wealthiest two million families of the kingdom. For Roussel, France’s complicated tax system not only had to be simplified; nothing less than a “radical reorganization” of the tax system would be required (Shovlin 2006, p. 95).

Another reason why Roussel’s work received so much attention was the kingdom’s dire financial straits: France was bankrupt. (See, e.g., Riley 1986). Roussel, however, had projected that his proposed “single tax” reform would generate 700 million livres per annum, more than double France’s tax revenues (Darnton 2024, pp. 72-73; Shovlin, 2006, p. 96). Moreover, Roussel’s provocative proposal not only purported to replenish the royal coffers; it also took direct aim at the inequity of the France’s complex tax system in which the poorest people generally paid the most in taxes, while the wealthiest paid little or no tax, a mind-boggling lack of proportionality that may have informed Smith’s four maxims of taxation in Book V of The Wealth of Nations (Kim, 2023).

Was Smith aware of Richesses de l’Etat or of the intense public debate it had provoked, and if so, was he thinking of Roussel’s proposal when he (Smith) formulated his maxims of taxation in The Wealth of Nations? Although Smith does not refer to Roussel or to Richesses de l’etat by name in any edition of his Wealth of Nations, the title of his second magnum opus most certainly does, since a literal translation of the words “richesses de l’etat” means “wealth of the state.” In addition, Smith was in Paris at the height of the controversy generated by this pamphlet, and as it happens, a copy of Roussel’s work made its way into Smith’s library (see Bonar 1932, p. 157; see also Klein & Humphries 2016, p. 455), so perhaps the question we should be asking instead is, How could Smith have not been aware of the controversy surrounding Roussel’s pamphlet?

In any case, even if Smith had not read Roussel’s work himself or debated its merits with the économistes and philosophes of pre-revolutionary France, it is also possible that Smith learned about the kingdom’s archaic system of taxation during his subsequent travels in the south of France. (See Alcouffe & Massot-Bordenave 2020, pp. 198-207.) Some 10 or 12 days after their arrival in Paris in mid-February 1764 (Ross 2010, p. 210), Adam Smith and his pupil Duke Henry travelled south and took up residence in the tranquil town of Toulouse. They would not return to Paris until two years later.

To be continued …