economic history

-by Kyle Kattler

The economic policies of the Paris Commune were an experiment. Many of those experiments are reflected in our economic policies today. François Jourde, the Parisian accountant turned the Commune’s Economic Minister, set up a quasi-welfare system to boost economic development in the poorest sections of the city.¹ The creation of interest-free repayments of debts and rents shocked the world.² Jourde also created pensions for injured soldiers and their families, the first system which supported a soldier’s immediate family.³

The 1870-71 Siege of Paris not only brought the French government to its knees, it also brought the people of Paris to the brink of economic collapse. Pawnshops, landlords, and banks acted as borderline “loan sharks,” price gouging and profiteering during a time of severe stress. The economic leaders of the Commune suspended rent payments, provided housing for those who lost their homes, and gave money directly to the poorest people, which provided stability and support for the most at-risk people within the city.⁴

One of the early actions the Commune took was eliminating pawnshops, which has an interesting history. For those of us who have watched Pawn Stars on the History Channel, we often see people walk into the store with a valuable heirloom, then sell said valuable well below market value. Now, picture that, but more exploitative. Over a million objects were accumulated in Parisian pawnshops by April 1871, the majority of those being from the working class. Families would sell blankets, cutlery, and other furniture to buy food. Most of these loans were for 3 to 10 Francs, with an interest rate of 12 to 15%.⁵ The pawnshops made a profit of over 750,000 francs, equivalent to over $20 million today. The first step the Commune took to remedy this was to suspend sales of pawned goods. The Commune did not survive long enough for any further policies to be implemented, although a decree allowing items with a value of 50 francs or less to be withdrawn without payment was drafted and discussed.⁶

Today, during times of economic insecurity, governments institute rent freezes, a half-measure of cancelling rents. Support systems available to military veterans combined with legislation to promote their reintegration into society grew to new heights following the Commune. On March 29^th, 1871, the Central Committee of the Paris Commune declared “the general release of rents due between October 1870, and July, 1871.” The reasons given were “that property ought to bear its share of the general sacrifices.”¹¹

The policies implemented by Jourde and his team can be seen reflected in our society today. In 2009, Sweden and other European countries deployed negative interest rates, an even more radical policy than zero percent rates. The Paris Commune was able to deploy these progressive economic policies over a hundred years earlier, paving the way.

Jean-Baptiste Clement, a leader of the Paris Commune, felt that François Jourde and Charles Beslay should have acted sooner and done more regarding the pawn-shop situation.⁷ Beslay has received much criticism for his role in the management of the economy. As the delegate to the Bank of France, Beslay has been blamed for backing the bank and perpetuating the debt-ridden capitalist system. Karl Marx, Friedrich Engels, and Prosper-Olivier Lissagaray were his most vocal critics. They argued that seizing the wealth within the bank would have brought the Versailles leaders to the bargaining table.⁸

Why did the Commune not storm the bank? Beslay argued that the destruction of the bank would not have been productive and that rather, the transformation of the bank into an interest-free institution would have been a more sustainable solution.⁹ Jourde and Beslay both feared the reaction from Prussia and the international community if their payments were put in jeopardy.¹⁰

from the archive

Adolphe Braun. “Paris 1871- Ruines Du Chateau of St. Cloud”, 1871

The image featured above is a photograph of a destroyed building following an initial conflict during the creation of the Paris Commune. This photograph was taken by Adolphe Braun, a photographer who was famed for capturing the relationship between art and commerce.¹²

One policy implemented by leaders was making vacant apartments and houses free to those who lost homes during the fighting with the Versailles Army (the damage is seen above).¹³ Francois Jourde, the economic leader, and the Commune leaders strongly believed that housing was a basic social right.¹⁴ In a time of peace, this policy could have resulted in every Parisian having secure housing. The effects of a capital-profit driven housing market are prevalent in the world today, especially in Vancouver, and we can only dream what the world would look like with a secure housing supply for all.

The economy of the Commune was in dire financial straits, so Jorde and his organization secured payments from the Bank of France. The new money supply was distributed mainly to the military, yet also the poorest sections of the city, along with the various government agencies. This distribution gave financial security to those who suffered the most, and effectively increased the social safety net.

Too often when discussing historical events, major historical actors and events take the forefront of the conversation. Policies and ideology, beliefs and themes are the centre of the rhetoric, and the human condition is often discarded. The experiences of those who have little agency, those on the margins of society, historically have the smallest voice and experience the greatest hardships. This photo serves as a hallow reminder of innocents who suffered from the hands of war.

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1. Peter Lee Thompson Nickel, “The Socialist Minority and The Paris Commune Of 1871: A Unique Episode In The History Of Class Struggles,” BA Honours thesis, History, University of British Columbia, (2001): 22-23
2. Nickel, 23.
3. Nickel, 23.
4. Nickel, 23.
5. Jean-Baptiste Clement, La Revanche des Communeux, (Saint-Denis, Paris: Imprimerie Robert, 1886-1887): 112.
6. Clement, 121-134.
7. Clement, 120-129.
8. Karl Marx, Karl, and Fredrich Engels, “The Third Address, May 1871: The Pairs Commune,” in The Civil War in France, (English edition of 1871: Marxist Internet Archive, 2009), https://www.marxists.org/archive/marx/works/1871/civil-war-france/ch05.htm; Prosper-Olivier Lissagaray, Histoire de la Commune de 1871: 188-190.
9. Nickels, 26.
10. Lissagaray, 188-190.
11. Lissagaray, 159.
12. John Hannavy, Encyclopedia of Nineteenth-Century Photography, (New York: Taylor & Francis Group, 2008): 203-205.
13. Lissagaray, 159.
14. Lissagaray, 200.