We are without passion, we are rich, we are powerful; such is credit.
Napoleon Bonaparte, 5 March 1808Footnote 1
The day had not started auspiciously for the stockbrokers of Paris. As part of a deputation summoned before the Council of State, the duty had fallen to Jean-Baptiste Joseph Boscary de Villeplaine, former head of the brokers’ professional association and scion of a powerful family of financiers,Footnote 2 to defend the marché à terme, or futures contract in public debt on the Paris Stock Exchange. As Napoleon's dismissive response indicated, Boscary and the stockbrokers did not face an easy task. With Napoleon's claimed dominion over credit, the need for such forms of finance would seem to have been obviated. As a means of speculation frequently under suspicion both moral and legal since at least 1724,Footnote 3 the marché à terme risked proscription in favor of a more tightly regulated financial market.
A type of futures contract, the marché à terme permitted investors to speculate on price fluctuations in the public debt, then the dominant security on the Paris Stock Exchange.Footnote 4 Through the intermediation of the Paris brokers, the contracting parties agreed to buy or sell debt in the future, with the price and quantity locked in beforehand. This expanse of time between the initial drawing up of the contract and the final settling up of accounts allowed prices to move in the interim, creating two kinds of speculator. Haussiers, or bull speculators, bet that prices would rise; since the marché à terme contract here stipulated a below-market price for the debt, haussiers could therefore acquire underpriced debt, allowing them to resell it for a tidy profit at the going market rate. Baissiers, or bear speculators, on the other hand, bet on a price decline; in this scenario, since the contract stipulated an inflated price for the debt, baissiers could buy cheap debt on the market, then sell it at the contractually obligated higher price. Both kinds of speculator appeared to jeopardize the stability of the concept of property. At the time of the initial contract, the baissier might not in fact possess the appropriate quantity of public debt intended for sale, while the haussier might not possess the requisite wealth intended for purchase.
Ambiguities in the definition of property were hardly unprecedented. A 1769 legal dictionary stated the case forthrightly: “Property and possession differ, in that one may be the possessor of a thing, while not being its property-owner; and, on the contrary, often the property-owner does not possess the thing that belongs to him.”Footnote 5 Property and possession could be split apart in numerous ways; usufructuary rights, for instance, could be peeled off from full property ownership, permitting one party to benefit from property belonging to another.Footnote 6 Property could be held in intangible objects, such as in debt–credit relations. Indeed, the form of the public debt, the rente, was quite old, with origins stretching back into the Middle Ages.Footnote 7 But the question concerning the marché à terme in the Napoleonic context signified a different moment in the concept of property. As a future bet on future credit, it was an abstraction of an abstraction, or, in modern terms, a financial derivative. Such judgments were particularly controversial given the role that public debts had played in precipitating the crisis that touched off the French Revolution in the 1780s,Footnote 8 as well as the then-recent state debt repudiation of 1797, still a stinging reminder to creditors and state officials alike of the dangers of debts. The evaluation of the marché à terme in Napoleonic France thus took place in a discursive context in which such futures contracts in public debt had become economically marginalized and socially stigmatized. At the same time, the concept of property was to be central to the institutional and intellectual stabilization of the Napoleonic regime. Showing how this conceptually “marked” speculative form was in fact reconciled with the concept of property will help illuminate the political theory of the postrevolutionary state. An exploration of the Napoleonic rehabilitation of the marché à terme in public debt, in other words, will highlight how financial capitalism implanted itself, after it had been nearly extinguished, in a conceptual landscape quite hostile to it.
DISCOURSES ON THE DEBT BEFORE NAPOLEON
Property, public debts, and the marché à terme had been much debated during the eighteenth century. In the wake of the collapse of the “System of Law” in 1720,Footnote 9 the Paris Stock Exchange was created in 1724, as a centralized place where financial speculation could be observed and regulated.Footnote 10 As George V. Taylor notes, until near the end of the eighteenth century, this exchange was relatively quiescent.Footnote 11 However, with public debts spiking dramatically during the Seven Years War,Footnote 12 and further stimulated by innovations such as the proliferation of lifetime annuities after 1770,Footnote 13 and the establishment of the Discount Bank in 1776,Footnote 14 the exchange witnessed a speculative boom that would last until the onset of the Revolution in 1789.Footnote 15
Facing speculative frenzy and recurrent scandal, the Old Regime state attempted to regulate the marché à terme. Its approach, however, was ambivalent. In a regulation of 7 August 1785, the Council of State nullified futures contracts in government securities. But not two months later, in a regulation issued 2 October 1785, the state stepped away from this hard-line position, and in another regulation dating to 22 September 1786 it would recognize as legitimate the marché à terme in public debt, as long as the settlement date of the contract did not exceed two months.Footnote 16
Though acting with a heavier hand, the Revolutionary state also displayed similar ambivalence. Open in the early days of the Revolution, the exchange was shuttered, in an attempt to extirpate financial speculation, on 27 June 1793,Footnote 17 reopening on 14 December 1794, only to be closed again on 9 September 1795, before throwing open its doors once more on 20 October 1795.Footnote 18 Not until the definitive refounding of the institutions of public finance in 1801 and 1802, during the Napoleonic period, would the exchange and the Paris stockbrokers find a durable institutional home.Footnote 19
Michael Sonenscher has particularly probed the intellectual and institutional implications of public debts for states. Sonenscher has shown how the “Janus-faced”Footnote 20 nature of public debts generated an enduring—and, in the end, revolutionary—discourse on the nature of geopolitical competition, mounting inequality, and representative government. This Janus face related, broadly, to public debt's ability to bolster state power, especially through debt-financed war,Footnote 21 as well as to produce the conditions for political catastrophe, whether through endless warfare or the sowing of intractable dissension through wealth transfers that deepened social inequality, most particularly through taxation dedicated to debt-servicing costs.Footnote 22 Sonenscher argues that there was a paradox at the heart of theories of public debts: rational political institutions of the very kind that made public debts stable also threatened to push states into despotism, as, in a world of ceaseless, debt-financed international competition, states would eventually be forced to default, to confiscate property, to abandon liberty in the name of survival.Footnote 23 Grappling with the persistent dilemma of public debts, he observes, spurred intense speculation on the ways in which representative government might be made systematic and lasting, which ultimately involved envisioning a society quite different from that of the Old Regime.Footnote 24
The debates over public debt and the marché à terme in the Napoleonic period marked an important evolution within this discourse. Previous debates were largely articulated in the context of what John Brewer has termed the “fiscal–military state,”Footnote 25 in which expanding, systematized public debts were an essential cog in the political–institutional machinery enabling the state to wage wars of ever-greater intensity—precisely the problematic that Sonenscher has incisively analyzed at the discursive level. The scope of the Napoleonic wars was indeed immense, requiring sophisticated coordination among the military, political, and financial arms of the state. However, despite presenting just such a moment in which public debts might aid the war effort, the Napoleonic regime almost entirely eschewed state borrowing to fund its campaigns.Footnote 26 Napoleon showed a marked aversion to public debt, as it yoked imperial power to outside creditors. Though the Napoleonic episode did witness thematic resonances with prior debates over public debt—particularly in debt's capacity to undermine states, as well as speculation's questionable moral validity—the continued existence of public debts and financial speculation was not justified through the exigencies of war and state formation.
What the Napoleonic discourse over debts and futures contracts illuminates, rather, is the intellectual constraints that property—including property in financialized form—placed upon theories of sovereign authority. Emerging out of eighteenth-century discourses, the Napoleonic encounter with public debts and the marché à terme marked a further step in the intellectual connections between public debts, theories of property, and conceptions of political authority, with debts and speculation justified less with a view to military necessity than with a concern over the state role in facilitating smoothly functioning financial markets, in which property could circulate without the threat of arbitrary legal sanction. If, as Sonenscher has argued, “future-oriented speculation about public debt”Footnote 27 prompted prolonged intellectual engagement in the eighteenth century over the life, death, and possible institutional renovation of states, then the Napoleonic episode shows how speculation on public debt futures set off a debate over the meaning of property, of rational law, and of political authority in a specifically postrevolutionary state. Under Napoleonic rule, legal and financial institutions really were redesigned. Yet, despite imperial disregard and under few compelling fiscal exigencies, the marché à terme survived. How it did so attests to the ways in which locating public debt futures under the legal and intellectual authority of the concept of property could furnish a justification for financial capitalism absent its more habitual foundations in the fiscal–military state.
REDEEMING THE PUBLIC DEBT
“By the beginning of the nineteenth century,” John Shovlin writes, “economic discourse had become an everyday and indispensable part of the language of public life.”Footnote 28 This discourse, he argues, tended to favor land, agriculture, and manufactures, which were seen as contributing to the patriotic spirit. By contrast, more private economic activity was seen as potentially dangerous to the nation, as it did not emerge from a sense of patriotism.Footnote 29 For Shovlin, the creation of a new Napoleonic social elite, the “notables,” correlated to this “patriotic political economy.”Footnote 30 As Robert Forster claims, “For most aspiring provincial families, this was an improvement over the Court favoritism of the Old Regime, a clear recognition that land and local name would carry more weight than liquid wealth and intrigue at Paris.”Footnote 31
Such an atmosphere, at first blush, appears hostile to arguments in favor of the public debt, recently associated with default and scandal.Footnote 32 But advocates for the debt carved out a space within this patriotic economic discourse. Michel Bruguière has described a “polemic” regarding the legitimacy of the public debt during this period, a polemic that reached the highest levels of the state.Footnote 33 This polemic helped shape the conceptual grounds on which the later dispute over the marché à terme would be fought.
Emblematic of the advocates of the public debt was the 1800 pamphlet Considérations sur les avantages de l'existence d'une dette publique, et sur la nécessité d'un plan général et complet de bonne conduite en finance. Nominally without attribution, the pamphlet has been consistently attributed to Claude-Odile-Joseph Baroud.Footnote 34 A prominent financier in the Old Regime, Baroud had long been a familiar figure on the exchange, acting through his primary broker, Boscary—the same who would later defend the marché à terme before Napoleon.Footnote 35 Making (and occasionally losing) much of his fortune in speculative ventures, Baroud was a financier of impressive magnitude;Footnote 36 he was a major adversary of financier Etienne Clavière in the pre-Revolutionary scandal surrounding the Nouvelle compagnie des Indes.Footnote 37 Baroud transformed a critique of the pre-Revolutionary state into a kind of post-Revolutionary discourse in which the proper administration of public debts, the autonomy of the economic sphere, and the rationality of law expunged of arbitrary privilege were all intrinsically connected.
Baroud's past financial sins had not yet been forgiven—as a handwritten note on Considérations acidly remarked, Baroud had not comported himself with the same probity that he counseled governments to practiceFootnote 38 —but few could question his financial expertise. Personal financial adventurism notwithstanding, Baroud appeared to have written Considérations in good faith. Coming soon after the Bankruptcy of the Two-Thirds, the administration of the debt had fallen into grave disfavor.Footnote 39 In writing down two-thirds of the extant public debt, this 1797 bankruptcy had established the primary vehicle for government securities, a perpetual annuity entitled the tiers consolidé.Footnote 40 But this form of rente had almost immediately collapsed in value, falling to as low as six francs 95 on 8 January 1798; when Considérations appeared in print, it was fluctuating between approximately nineteen and twenty-one francs, signifying serious concern that the public debt was not a sound investment.Footnote 41
With the price of the debt thus concretely encapsulating the worry that the state might not be able to meet its obligations, Baroud argued instead for the fundamental validity of the public debt, seeking to influence the coming Napoleonic reorganization of state finances.Footnote 42 For him, the public debt's virtues were legion:
A means of circulation and reproduction, a principle of movement and activity for capital of all kinds, and even a supplement to capital and value;
You will see a strong and powerful link of attachment and trust between the government and the subjects of the state;
You will find, in the price of the public debt:
A regulator of the general opinion on the accounts of government and, for that very reason, a guarantee of good administration;
A constant measure of the value of all other kinds of property;
An infallible guarantee of the success of all large enterprises, of the economy of means, and of the rapidity of execution;
An irrecusable moderator of the respective pretensions of government and of its contractors, in every treaty and market concerning the service of the state;
You will see, above all, in the public debt and in the exactitude of its servicing, a means of easing the burden on taxpayers, of increase in the product and the celerity in the collection of taxes;
Finally, it will not escape your attention that the value of public funds in a state is a dazzling and perpetual index of the degree of force and power with which it may confront its enemies, or which it may assert in all its external, commercial, and political relations.Footnote 43
The debt encouraged the circulation of capital, while also serving as a standard of value for other kinds of property; it moderated the respective claims of the state and its creditors, since both had vested interests in the robustness of credit; it established enduring links between state and citizen, as it served to aggregate public opinion, providing a (purportedly) objective standard of good government.
All this could only be true if the state faithfully carried out its financial promises. This “exactitude” in debt servicing provided the solution to a troubling paradox. Public debt is a kind of obligation owed by the state to its creditors, with creditors loaning capital to the state in return for a regular stream of interest payments; given a long enough time horizon, these interest payments could easily outstrip the initial capital outlay. Moreover, as a perpetual annuity, which technically never terminated or came to maturity, the tiers consolidé presented the troubling image of a future in which the state was continually paying interest sums far in excess of the amount of the initial loan.Footnote 44 The paradox thus centered on the apparent contradiction that “a state is richer for all the more that it owes.”Footnote 45 To resolve this conundrum, Baroud asked the reader to picture two countries, each possessing the same population, the same territory, the same public debt, the same institutions, the same money supply. The sole difference is that one country honors its debt, while the other seeks to suppress it.Footnote 46 And that, for Baroud, has made all the difference. For when a state repudiates its debt, it cannot truly decrease the tax burden, as the need for revenue persists, despite momentary capital seizure; moreover, available capital will evaporate, due to the state's demonstrated inability to keep its word.Footnote 47 All the previously enumerated advantages of the public debt would vanish, if the government did not service its debt honestly.Footnote 48 Baroud's encomium to the virtues of public debt did call upon an older tradition that sought to balance state vitality with growing public debts.Footnote 49 But, diverging from this tradition, his overriding concern was not with the systemic effects of inequality, nor with the martial implications of debts; public debts could act as an “index” of force, but they were not a funding stream for that force. Rather, for Baroud the true benefit of public debt rested with its economic powers and its ability to knit together state and citizen in the interests of mutual prosperity.
Public debt, properly serviced, was thus a legitimate tool of modern states, insofar as public debts spurred economic development. But the validity of the debt ran deeper. For Baroud, the public debt was valid because it was property.Footnote 50 However, this status was not always plainly evident. The rente, after all, was not a stretch of land one might occupy: “We are too easily accustomed to thinking that the acts and contracts of the public debt, due to their intangible and hardly visible nature, should not participate in the inviolability that the social compact assures to land, buildings, and other real heritages.”Footnote 51 One may be accustomed to thinking of property in terms of physical objects, but custom, in this case, was deceptive. Despite the public debt's “immaterial nature,” Baroud argued, it too counted as property.
The long-running discourse on public debts had recently been shaken by revolutions, regime changes, and sovereign defaults, unraveling the justificatory framework supporting state borrowing; how could public debts play a legitimate part in the political theory of the modern state, in light of the French state's repeated lapses into default?Footnote 52 Indeed, as the low prices of the rente indicated, this concern over the viability of the public debt persisted into the beginning of the nineteenth century.
Nonetheless, public debt, according to Baroud, merited the same degree of protection afforded other classes of property.Footnote 53 The debt was, moreover, a particularly expansive kind of property. Baroud claimed that
however we try to isolate ourselves, it is impossible . . . to avoid all contact with public affairs, to not be exposed, in the course of management of a business or any kind of property, to the shock of this great handling that, starting from the center of the state, extends to all points on the circumference, embraces all kinds of works, and penetrates anywhere there is fortune or industry.Footnote 54
Activity at the exchange concentrated capital in one place, allowing it to be distributed to appropriate ends efficiently; the density of capital there acted as a signal to industry, reducing the expense involved in searching elsewhere.Footnote 55 The public debt also acted as a standard for the values of other kinds of property. Price fluctuations in the rente, Baroud maintained, would affect the value of landed property, with the potential returns on investment in the public debt acting as a moderating influence on estate prices.Footnote 56
Private citizens may largely have been seeking to increase their wealth in the exchange of rentes, but these transactions also entailed wider effects. Baroud observed, “Such is presented to the eyes of the man of state this striking observation, that the true elements of the public fortune are nothing other than private fortunes.”Footnote 57 Far from subverting the public good, the circulation of rentes, with all attendant speculation, in fact formed a crucial element of the nation's health—private vices had become public virtue. Baroud continued, “consequently, the state itself suffers, for its own accounts, all the losses that seem to strike only individuals.”Footnote 58 Financial loss on the exchange did not stay confined to the exchange; a collapse in prices there would both ruin the individual investor and signal the weakness of the state.
Yoking together private and public goods was one of the primary effects of the public debt for Baroud, placing state and citizen in a relationship of mutual dependency. He wrote, “When, in a rich and powerful nation, a considerable public debt is formed . . . the government becomes thenceforward the true guardian of state creditors, the special conservator of the means of existence of this multitude of families successively inscribed on the registers of its debt.”Footnote 59 Citizens initially loaned capital to the state. But once the public debt grew large enough to support a secondary market, then the state became the “guardian” of private interests. As opposed to primary markets, in which the state directly contracted new loans with creditors, in the secondary market these pre-existing debt contracts circulated from hand to hand, with one party transferring to another the rights to the original contract's interest payments. The secondary market was therefore a way for existing bondholders to recoup at least some portion of their investment immediately, as well as for others to buy into what was hopefully a secure revenue stream.
But beyond financial well-being, for Baroud the public debt also forged affective links between state and citizen: “Thus is established, between those who govern the state and those who are its creditors, the same relations of attachment or hate, contempt or trust, gratitude or indignation, that, in the common order, neglect or exactitude, imperiousness or sagacity, fidelity or fraud will form between the administered and the guardians of their fortune.”Footnote 60 State creditors would not just bloodlessly desire a good return on investment. Sound management of the debt would inspire loyalty or “confidence” regarding the state. Conversely, mismanagement, late payments, or defaults would inspire feelings of hate or “contempt.” The choice between “fidelity or fraud” that Baroud outlined referred not—or not only—to purely financial decisions. Rather, he argued, a well-managed debt helped establish political legitimacy in a postrevolutionary milieu. Public debt was thus a conceptual tool to establish political consensus.
Indeed, for Baroud, the public debt revealed a new kind of authority, one that placed people and things on the same plane. He argued,
Everything is connected in this great ensemble; and it is due to this union, this reciprocal dependence, that the rest suffer when the public debt suffers. In vain do properties differ by their nature, like persons by their condition: despite these differences, things, like people, cannot exist under the same domination, without everything indiscriminately suffering, more or less, from the forgetting of healthy maxims that seem to strike only a few.Footnote 61
Baroud confronted what appeared to be a logical contradiction. He first proclaimed the interlinked nature of property. There existed a relation of “reciprocal dependence,” in which the treatment of the public debt carried over to other forms of property. Baroud then analogized property to persons, with surface variations masking deeper uniformity. The nature of property and the condition of persons really did differ, but such differences would ultimately be brought under uniform rules of administration. But, in an apparent rhetorical volte-face, Baroud then seemed to suggest that these differences do interfere with the establishment of those uniform rules. Treating property and persons as though they adhered to the “same domination” would appear to result in confusion, in which the “healthy maxims” that seem to apply only in individual cases were neglected, to the detriment of the whole. Uniformity and difference, “the same domination” and “the forgetting of healthy maxims”: Baroud's argument appeared to be mired in intractable contradiction.
The resolution came through an appeal to the rationality of law. The problem lay not in establishing the “same domination,” but in assuming that “healthy maxims” were actually restricted to those individual cases. For support, Baroud looked to apparent differences in two kinds of property. It would be easier, he noted, to expropriate rentes rather than real estate. The latter had a “material consistency,” which permitted a greater degree of resistance to authority.Footnote 62 If one were creating legal rules according to the varying natures of different kinds of property, rentes and real estate would therefore belong to different legal regimes, with correspondingly different levels of protection. But Baroud's point was that such a conclusion would ultimately be a mistake. The state had a duty to protect property in all its forms, and expropriation would be no more moral, even given the rente’s incorporeal nature.Footnote 63 Ruling according to differences in form or condition would damage the rationality of the law itself; just as personal status should no longer be factored into the administration of the law in a postrevolutionary society that had established formal legal equality—the aristocracy could no longer claim privilege to differential legal treatment—so too should property not be adjudicated differentially. The “healthy maxims” only appeared to apply to a select subset of things; in fact, these maxims should apply to the entirety of property's domain. It was the individuality of the “healthy maxims,” not the uniformity of authority, that was illusory. For Baroud, people and things really did adhere to the same and single authority.
Debt, private individuals, public interest: all were fused together according to the rule of property. Baroud closed by emphasizing that “the interest of the state is always inseparable from the interest of the individuals subject to its laws; public fortune cannot grow where private fortunes are destroyed.”Footnote 64 The individual may have been subject to law and compelled to submit to the state's authority. But that did not mean that the state could act arbitrarily regarding individual economic decisions. The state—or rationally administered states—had to follow another kind of authority, which restricted the ability to intervene in the economy. Private and public interests were unified in postrevolutionary society. And property was the authority that commanded state and individual:
“We have not made any acception of persons;
We have not harmed the rights of property;
We have not been mistaken about the engagements undertaken in the name of the state.”
This single thought would finally protect them [the heads of state] against the least lapses in authority; and they would never forget that arbitrariness, once admitted in the transactions to which they are party, is then introduced, thanks to their example, their protection, or their tolerance, in all private conventions, circulating anxiety and fear in all the veins of the social body, and attacking successively all property and all fortunes, eventually withering, until the very roots, the tree of public prosperity.Footnote 65
Formal legal equality and the rights of property were placed on a continuum. To adjudicate differentially with respect to personal status—to make legal “acception of persons”—would be equivalent to violating property. The essence of a postrevolutionary legal regime, of a state that ruled rationally and not arbitrarily, was coterminous with respect for the concept of property. And state debt obligations entered as the final term. The public debt, fully recognized as property, would be regulated according to the same authority that commanded other forms. A good state would be compelled to do so, since the concept of property demanded rational treatment. Private and public interests could therefore converge in mutually beneficial fashion. The single authority that subsumed people and things, property, ensured the continued vitality of the public good. And in so doing, it provided a theoretical anchor for a political regime exiting more than a decade of revolutionary turbulence. With sovereign respect for property established as a central principle, citizens could enjoy all the previously enumerated advantages of the public debt, while the state would benefit both from the economic advantages that the debt provided, and from the concretized display of political consensus signaled by the rising price of the rente.
Baroud's pamphlet reached the hands of state administrators, while also catching the attention of the public. The response was not undividedly positive. Paired with Considérations in the archival holdings of the Napoleonic bureaucracy is an anonymous missive addressed directly to Baroud. While commending the “energy, the justness, and the precision of style,” the author argued that it ultimately masked the deeply corrupted nature of Baroud's arguments about the public debt.Footnote 66
Baroud was not judged wrong in every particular. Splitting Baroud's pamphlet into the “moral part” and the “systematic part,” the author wrote, “I thus recognize the moral part, which consists in proving by irresistible arguments that the debt existing today must be paid, and the systematic part, in which you want to establish that it is advantageous for a Nation to have a debt.”Footnote 67 There was no quarrel whether extant debts should be respected. But, the author acerbically noted, Baroud “thought it necessary to employ so much reasoning and eloquence to recall such a simple principle: you will pay, because you owe.”Footnote 68
Rhetorical barbs aside, the true target was the “systematic part,” in which Baroud had essayed an affirmative defense of the public debt. The author claimed that Baroud, having fallen too much under the sway of misapprehended theories of political economy, had diverged from economic reality.Footnote 69 The advantages of the public debt that Baroud had heralded were, in this view, false, nothing other than a mere “abstraction,” with the Panglossian theories of political economy standing in for verifiable empirical data.Footnote 70
Taking aiming at Baroud's claim that given a well-managed debt, modern states were richer for having owed, the author argued,
If it were true that the State was richer from what it owed, in paying precisely; it should, in order to at once double its wealth, borrow up to the capital value of all its landed property. Following you, it would thus have doubled its capital and its revenue; and if all landed property rose to thirty billion, and their revenue to one and a half billion, in borrowing a sum of thirty billion, in the form of the five percent rente, the State would be enriched by a capital of sixty billion, with a revenue of three billion? The falsity of the proposition is evident. For how will the State pay the interest on its debt, if this is not through the revenue of landed property? And as their amount is equal, who will not see that the State is, on the contrary, reduced to poverty, since it owes all it possesses! . . . Finally, to whatever sum you would reduce the debt, the rentiers are only enriched from that which the State takes from property owners, or from commerce; and in lieu of being enriched from all it owes, the State really is immiserated, in desiccating the sources of industry.Footnote 71
Could a state double its wealth simply by doubling its debt load? No, the author suggests, as debts must be paid back; any potential gains from the debt would be lost to ruinous servicing costs. Worse, he maintained, these interest payments would be paid out of revenues collected from “property-owners, or from commerce.” The author figured public debts in zero-sum fashion: there could be no convergence between public and private interests, as one's gain would entail the other's loss.
Public debt could never truly be productive for the author, as the value that circulated at the exchange was illusory, a much-degraded facsimile of other kinds of property. “It would be,” he wrote,
a very great misfortune, if indeed the public debt fixed the price of other properties. This would prove that, without any discernment, one would search it out further, and thenceforward, independently of the harm that loans produce, either at the moment of their creation, or in the future, they would have this fatal drawback of blinding us to the point of taking shadow for body, fictive for real, and surfaces for solids. An industrious people would be replaced by a cowardly and lazy people; the land, in want of property owners, would remain uncultivated, and famine would be the lesser evil that this reversal of ideas, this blindness, would produce.Footnote 72
Public debt was a mere “shadow” or “surface” to other, more solid phenomena. To believe otherwise would suggest a kind of willful blindness, entailing a “reversal of ideas” of the putatively natural economic order. With capital diverted to public debt, the people would turn away from truly productive pursuits, the land remaining disastrously uncultivated, promising ruin for the economy in general.
The invocation of shadows and bodies, surfaces and solids, was no accident, as the relation of public debt to property in general constituted the focal point of the author's argument. The author maintained that a growing public debt destabilized property relations in the broader economy.Footnote 73 He wrote, “Real and landed property existed before the fictive property of the public debt, since the latter are based on the former; the variation of the value of the public debt must therefore depend on that of landed values.”Footnote 74 Value at the Exchange was thus dependent on the primary value of the land. A rising public debt, the author argued, tended to reverse this relationship. With shadows being taken for real, capital would flow away from the physical form towards its abstraction, confounding property's ability to order the economy smoothly. Inverting the true basis of wealth, the public debt endangered well-being both public and private. Abstraction, shadow, fiction: public debts were, for the author, not to be tolerated in a rational state.
In the early stages of the Napoleonic regime, at a period of fundamental institutional and legal renovation, these two authors sketched out the major positions regarding the validity of the public debt. These dueling interventions on public debts were also ways of articulating differing visions of the relations between law, property, and the postrevolutionary state. For the author of this Lettre, the public debt could only be an ill-formed version of property, a shadow of the real thing. Rational states, he maintained, should not abide installing illusory, deceptive abstractions in the core legal concept of property. For Baroud, by contrast, public debts were legitimate because they were fully property, meriting all relevant legal protections—a controversial proposition, given that the very vehicle of the debt, the rente, had been born out of the 1797 bankruptcy, in which the state had failed to maintain its financial promises to its creditors. But one of the signature elements of post-Revolutionary society was, for him, that people and things now existed under the same “domination.” The dawning legal regime must therefore adjudicate them similarly, with public debts and all their economic ramifications falling under the normative authority of the concept of property. The post-Revolutionary state would transgress its obligation to administer law rationally and equally if it did otherwise.
THE MARCHÉ À TERME AND THE ORDER OF THE ECONOMY
The controversy over the marché à terme began from the conceptual template articulated by Baroud and his anonymous interlocutor. But the questionable legality of futures contracts complicated matters. While the moral justification for issuing new debt may have been up for grabs, few disputed the right of states to employ credit in the first place.Footnote 75 The marché à terme enjoyed no such consensus, as it remained an open question whether such speculative vehicles truly were protected under property law; moreover, it was precisely during this period of formative legal codification that prohibitive sanctions could be drafted. In expanding the defense of public debt in general to cover the marché à terme in particular, advocates had to make the case that it was not only morally justifiable, but legally valid as well.
This conceptual rehabilitation of the marché à terme emerged, haltingly at first, from the upper echelons of the Napoleonic state, from trusted advisers and framers of legal codes. Such tentative acceptance of futures contracts would later be further developed by the Paris stockbrokers, who deployed the conceptual vocabulary expounded by their frequent client Baroud, articulating an affirmative defense of financial speculation as a wholly valid part of the post-Revolutionary legal, economic, and moral order. And in such an order, the free circulation of property could trump sovereign imperial authority.
The participation of the Napoleonic administration in building this conceptual apparatus may strike a rather paradoxical note. Napoleon is sometimes described as regarding finance with a fundamental suspicion. Wary of the dangers that a collapse in the rente’s price might bring, he seemed to consider the Exchange a threat to his authority. Maurice Gontard writes, “Bonaparte had the greatest distrust regarding financiers and men of the Exchange . . . He did not want to resort to credit and loans, which are the functions of prices at the Exchange, and which place the debtor at the mercy of the creditor.”Footnote 76 Napoleon saw little utility in the debt, as it might weigh the state down; as Gontard notes, the financial misadventures of past regimes—kings crippled by debt, Revolutionary bodies forced into odious bankruptcy—had served to darken the star of the Exchange.Footnote 77
Gontard's claims are, to some degree, corroborated by Napoleonic monetary policy. While Britain financed expenditures through a combination of increased public debts and monetary expansion, France hewed to a much more hard-currency line; whereas Britain, for a time, took the pound off the gold standard, France maintained strict convertibility for the franc.Footnote 78 France's imperial regime was to be paid for through taxation and conquest, rather than through credit. Michael Bordo and Eugene White observe that some of this policy rigidity was due to the legacy of past financial traumas. With the hyperinflation of the assignat and the Bankruptcy of the Two-Thirds in living memory, France's ability to borrow had been severely curtailed, rendering credit scarce.Footnote 79
Yet the attitude of the Napoleonic state towards the marché à terme was not one of intractable rigidity. Nicolas François Mollien was particularly salient in this respect. Director of the French Sinking Fund from 1800 to 1806, then minister of the treasury from 1806 to1815,Footnote 80 Mollien had a major influence on the shape of France's financial institutions. Born a merchant's son in Rouen in 1758 and long steeped in the political economy of Adam Smith, Mollien had been involved in tax farming under the Old Regime.Footnote 81 Arrested during the Revolution, but, by his account, barely escaping the scaffold, Mollien was eventually pulled into the financial administration of the Napoleonic state.Footnote 82 A frequent interlocutor of Napoleon, he was also tasked with overseeing price fluctuations in the public debt at the Paris Stock Exchange, sending near-daily reports while the French leader was out on campaign.Footnote 83
Mollien was instrumental in developing the discourse on public debt, moving from Baroud's defense of the very concept of the debt to a theorization of how speculative practices such as the marché à terme might be legitimated. This theorization was most evident in a letter to Napoleon, which directly addressed the thorny topic of public debt futures. He began by casting the varieties of the marché à terme in a familiarly pejorative light: “what one calls marché à prime or marché ferme is nothing other than a gamble. Such a speculator gambles, for instance, that the rente priced at fifty-three on 30 brumaire will be at fifty-seven on 30 frimaire, and he is compelled to pay this price for it on 30 frimaire.”Footnote 84 The marché à prime resembled a modern call option, in which the purchaser, in paying a premium (prime), obtained the right, but not the obligation, to buy debt, meaning that the transaction could be canceled before the sale closed;Footnote 85 the marché ferme was synonymous with the marché à terme.Footnote 86 In all cases, futures contracts were likened to morally suspect gambling. Rather than wagering on the outcomes of innocuous events—few, presumably, are physically harmed by the turn of a cardFootnote 87 —the speculator in public debt gambled on the health of the nation. But instead of citing such moral ill-repute as the reason to prohibit these transactions, Mollien defended the legitimacy of futures contracts, however sparingly: “Both do nothing other than exploit the illimitable right of property, which can only be defined thusly: jus uti et abuti [the right to use and abuse]; the law cannot intervene to prevent this transaction; for the will of the contractors would be even stronger than the law.”Footnote 88 The state could not forbid the marché à terme, because the “will” of the contracting parties would be strong enough to overcome any potential legal sanction, a tacit admission of the centrality of the marché à terme to public finance. Even for the Napoleonic state, it was impossible to do away with speculation through futures contracts as a whole by legal command.
In addition to this practical impossibility, the law of property also provided affirmative protections for the marché à terme. Though the hypothetical contracting parties wickedly “exploited” this right, property really was thought to be “illimitable.”Footnote 89 The state could not intervene to constrain such transactions, since this intervention would constitute an arbitrary—and thus unjustified, illegitimate—restriction on the concept of property. As Mollien had claimed, the right of property essentially reduced to “jus uti et abuti .” This apparent reference to earlier legal traditions marks the letter as likely pre-dating the adoption of the Civil Code, as Article 544 of the code was meant to establish the core definition of property going forward.Footnote 90 Abuti here connoted the right of the property-owner to make final and irrevocable use of property, even if it this use were frivolous, wasteful, or distasteful. Such a legal norm, which Mollien claimed lay at the core of the concept of property, generally directed the state not to intervene in private economic interactions too heavily, so that citizens could freely circulate property according to clear and stable legal rules, without fear of arbitrary political action from on high. The marché à terme would have to stand, despite official disregard. The right of property vaulted above state authority.
As long as this right was taken to be illimitable, at least. But the advent of the Civil Code in 1804 changed the legal environment. Property was still seen as foundational to the social order. As Jean-Etienne-Marie Portalis, the central figure in the code's composition, proclaimed, “it is property that has founded human societies. It has vivified, extended, enlarged our own existence.”Footnote 91 Property was seen as coextensive with ordered society; the division of property provided the impetus for human endeavors, insofar as property accumulation allowed humanity to escape the blinding constraints of physical necessity. However, Portalis noted that property itself was not free of all legal constraints: “It belongs to a well-ordered legislation to regulate the exercise of the right of property, just as one regulates the exercise of all other rights . . . True liberty is only gained through the sacrifice of independence.”Footnote 92 A rational legal system would have to establish boundaries to the manipulation of property, just as it regulated other rights. To think otherwise would be to mistake liberty for independence, or reliably enforceable security for an arbitrary and unstable state of noninterference.
Continuing in a Rousseauian vein, Portalis observed, “The people who live together in the state of nature are independent without being free. They are always forcing or forced. Citizens are free without being independent, as they are submitted to laws that protect them from others and from themselves.”Footnote 93 Entering society required that one exchange indiscriminate force for law-governed order. “We must be free with the laws,” Portalis forcefully maintained, “and never against them. Hence, in recognizing in the property-owner the right to enjoy and dispose of his property in the most absolute manner, we have added: so long as he does not make usage prohibited by laws or regulations.”Footnote 94 Delineating the philosophical heritage of Article 544 of the code, Portalis circumscribed property's prior illimitability. Property would constitute the foundation of post-Revolutionary society, while also being brought in line with the exchange of absolute independence for secure freedom that a law-governed society demanded.
The marché à terme could no longer unrestrictedly be defended through appeals to the jus uti et abuti. But if the state now could constrain the marché à terme, any prohibitions would still have to be legitimated, to avoid the stain of arbitrariness.
Building upon the discourse on property, public debts, and the meaning of rational, nonarbitrary law that had been developing since Baroud's intervention, the Paris stockbrokers tried to mold this legal ambiguity in favor of the marché à terme. An 1807 letter addressed to the minister of the interior, authored by Houard (later to defend public debt futures before the Council of State), argued against further legal restrictions. The pressing concern was Article 90 of the recently adopted Commercial Code, which explicitly addressed government securities.Footnote 95 The article acknowledged financial transactions on the Exchange as protected under the rule of property, while also reserving the right to issue regulation. Given the suspicion consistently troubling the marché à terme, possible serious legal sanctions loomed.
Houard's response was to argue that the marché à terme was necessary, valid, and moral. Its necessity derived from economic utility, with prices signaling the robustness of imperial credit: the rente’s “greater price is assuredly due to the confidence that has inspired the genius of the Emperor from the start; but this confidence needed to be aided.”Footnote 96 The personal qualities of the emperor might buoy the judgments of public credit. But they could not do it alone; the “confidence” that the emperor radiated would have to be further transmitted by the marché à terme. Houard continued, “Those who did not have money and who wanted to obtain government securities obtained delays in payment. In augmenting the number of purchasers, this faculty stimulated the rise in prices for securities.”Footnote 97 The marché à terme opened the public economy to those who desired to display affirmative judgments of the regime, but lacked the requisite liquid funds to do so. This, in turn, ratcheted up demand for the rente, since purchasers would no longer be shackled by present financial constraints.
Houard further defended the marché à terme as a normal part of the economy. “One can say,” he noted, “that just as storekeepers are necessary to provision manufactories in advance of consumption, speculators are necessary to support the mass of government securities when it is considerable.”Footnote 98 While the marché à terme typically called down obloquy, Houard observed that such transactions were economically necessary. Manufactories require intermediaries to supply the appropriate resources, without which the chain of production and consumption would be disrupted. To restrict the marché à terme would therefore introduce a negative shock to public finances, radically unbalancing demand and supply of the rente. As he noted, “the government itself would undermine its credit in disrupting speculation on government securities.”Footnote 99
The marché à terme’s economic necessity, in this view, was clear. And according to Houard, it was not some transgression benignly tolerated for its utility, but rather a valid part of France's legal architecture. Foremost in this respect was locating the marché à terme under the general rubric of property, hardly an unprecedented move. But Houard's tactic was less to defend the marché à terme from high theoretical grounds, than to point out that à terme transactions were quite common:
The marchés à terme in government securities are no more condemnable than marchés à terme in all other objects of circulation; the existence of government securities necessitates the commerce in them; government securities can no more go without commerce than commodities themselves; consequently, the commerce in these securities should also be under the safeguard of laws that protect the safety of transactions of whatever nature they may be.Footnote 100
The ubiquity of the marché à terme suggested that purchasing public debt futures would be no different to purchasing other products, such as wine futures. Ruling the marché à terme illegal would strike out a crucial support from the wider economy, an action beyond the legitimate authority of modern states. In a conceptual resonance with Article 544 of the Civil Code, the marché à terme in the financial realm was protected by the expansive rights of property-owners to transact essentially as they saw fit.
That the marché à terme appeared to be under no prior restrictions did not preclude future law from stamping it out. The final part of Houard's apologia thus consisted of a moral defense of the marché à terme. He argued, “It is an incontestable principle in commerce that the marchés à terme or with delay in payment, far from being contrary to good morals [moeurs], are of the essence of commerce.”Footnote 101 Houard acknowledged the suspicion under which the marché à terme had so consistently fallen. But he did not counter this suspicion on commensurately moral grounds. Rather than mounting an aretaic defense of the marché à terme, in which the financial transaction would be shown to be in accordance with a pre-existing standard of virtue, Houard instead justified it from the standpoint of economic utility; “good morals” and “the essence of commerce” were fundamentally coterminous. To act morally was to benefit economically. Houard continued, “discredit cannot arise from the sale à terme of government securities: every operation necesssitates another that balances it; for benefit can only come about as a result of both parties. The seller being obligated to deliver, the greater value of securities is the consequence of this transaction.”Footnote 102 The word “discredit” here bore a double meaning, signifying both a kind of moral failing and disfavorable economic downturn. But, according to Houard, the marché à terme would avoid such dual discredit, since the transaction required both parties acting in concert, smoothing out unexpected price fluctuations. The marché à terme was moral because it leashed together buyer and seller in a mutually beneficial relationship, in turn bolstering the health of public credit. And just as it would constitute ill conduct for a state to jeopardize its own stability, so too would it be immoral for a state to outlaw the marché à terme.
In defending the legitimacy of the marché à terme, Houard testified to a convergence between the moral and the economic dimensions of property. The way property was to normatively regulate social interactions would be according to economic utility, rather than other kinds of first principle. And consequently, Houard maintained, a just state must renounce its claims to moral stewardship over the exchange, since the sphere of the economy would provide for the necessary order.
Houard's defense, however, hinged on the location of the marché à terme under the concept of property, still a contentious issue. Less than a year later, in a memo of 5 March 1808, written by Houard in preparation for the impending meeting with Napoleon and the Council of State that same day, the Paris stockbrokers expanded their theoretical defense of financial speculation in public debt. The memo mainly sought to displace critical disfavor from the marché à terme towards more manageable offenses, such as unlicensed trading and nonpayment of contracts.Footnote 103 But such arguments themselves depended upon the prior legitimacy of the marché à terme. For critics, Houard noted, it was through the marché à terme that “often is sold what one does not possess. One even purchases what one cannot pay for, and, in order to prevent such abuse, the marchés à terme in government securities would seem to need to be prohibited.”Footnote 104 If the public debt could circulate with no true possessor in à terme transactions, then, the argument went, it did not truly merit legal protection.
In response, Houard looked to the legally codified freedom of property. Property may commonly be experienced as concrete things, but this experience was not the normative legal view. Houard observed,
If we wanted to fix for a moment on the principles of property, we could not contest that, everyone being master of disposing of his own, it would be unjust if one who possessed a security could not sell it like any other property à terme or with delay in payment, if they so please. We could not contest that it would be unjust if one who, in possession of capital, could only obtain reimbursement for it later, did not have the liberty of being assured in advance, at a price agreeable to him, of the property in government securities.Footnote 105
As with the 1807 letter, “justice” derived from economic utility, from the capacity of goods and capital to circulate freely. The legal safeguard for this circulation was property's ability to be exchanged without undue restrictions. The essence of property was its abstraction, written into the Civil Code, as a vehicle for circulation, to be disposed of in maximally absolute manner. Prohibitions based in real possession were not, for Houard, truly justified, because property outstripped containment in things.
Houard's claims did require the selling party to possess the underlying securities. And, in a savvy move, he agreed that the law should punish those who try to sell à terme without first possessing the appropriate quantity of rentes, just as it punished other kinds of fraud.Footnote 106 This view appeared to close the gap between the abstract essence of property and the concrete nature of possession. It might also threaten to interfere with the circulation of public debt, since such a requirement would obstruct speculators betting on a decline in prices, consequently throwing the flow of debt out of order. But Houard quickly qualified his stance. He argued that though property and possession should in principle be unified, finance at the exchange divided the facts of possession:
he who possesses the certificate of registration of a rente on the Grand-Livre is often not the owner of the rente that he appears, and must not dispose of it.
Another does not possess the title to a rente that belongs to him. This is the case, for instance, in which the property-owner of a rente on which he has borrowed finds himself, since he has transferred to title to the name of the lender.Footnote 107
One could own a rente without possessing title; one could possess title without truly owning a rente. Bringing law's repressive powers down upon the selling parties in the marché à terme would therefore not be legitimate, because this repression could only be based in an incomplete conception of property. The desire to ground arguments against the marché à terme in possession was based in the view of property as something immediate and graspable. But the core legal definition of property was substantively abstract, permitting property relations to ramify beyond the possession of things.
Even if possession and property were presumed inseparable, such a provision would still be nearly unenforceable in practice. Contracting parties at the exchange were confidential, known only to the relevant brokers. Since there was no prohibition on dealing with multiple brokers, there would be no effective way to check accounts without violating this confidentiality. The mandate to possess, therefore, would be unlikely to restrain speculation, at least not without substantial disruption of public credit. And since the principles of legal justice and economic utility, Houard argued, had converged, the state should not constrain the marché à terme:
it is repugnant to every idea of justice, because it is not possible for the property-owner to produce, at the moment of negotiation, the security that he wants to sell, nor for the purchaser to furnish a genuine proof that he will be able to pay, to deprive those who possess securities, or those who should receive capital, of purchasing or selling at their will.Footnote 108
The selling party might own a rente, but not be able to demonstrate so; the purchasing party might have sufficient funds, but could not prove it. But rather than providing the legal justification to restrict the marché à terme, this situation was, on the contrary, of a piece with the meaning of property. “Property-owner” did not match up directly with either “those who possess securities” or “those who should receive capital.” The marché à terme, far from constituting a form that was, at best, grudgingly tolerated, was rather emblematic of the legal expansiveness recently codified in the definition of property, and deserving of all appropriate legal protections.
DEFENDING THE MARCHÉ À TERME IN THE NAPOLEONIC COUNCIL OF STATE
With Houard's careful theorization of public debt futures in place, the stockbrokers were prepared to defend the legal validity, moral rightness, and economic necessity of the marché à terme at the 1808 meeting of the Council of State. During the debate between the council and the stockbrokers, Napoleon took little care to hide his disdain of matters financial. After proclaiming his personal dominion over public credit, he loftily observed, “It hardly matters for credit if public funds rise or fall.”Footnote 109 Rhetorically separating the concept of credit from the more sublunary day-to-day fluctuations of price, Napoleon cast doubt over the necessity of public debt futures. With a farseeing sovereign on the imperial throne acting as guarantor for the stability of credit, the marché à terme would not seem to usefully smooth out the volatility of the nation's credit. It could consequently be legally prohibited without endangering the nation's economic stability.
Houard had followed essentially the same conceptual strategy before emperor and council as he had laid out in his writings.Footnote 110 But the effort had left him drained. His voice grown hoarse with emotion and faint from exhaustion, he stepped down to let Boscary, Baroud's former agent, take the word. Boscary tackled Napoleon's challenge to the marché à terme head-on. In line with the post-Revolutionary rehabilitation of public debts and financial speculation that had been developing since Baroud, he argued in favor of the marché à terme as a bulwark against systemic financial chaos and as fundamentally a kind of property.Footnote 111 And in the new regime, property was to be free.
Napoleon still had barbs in reserve to launch at the stockbrokers. After hearing Boscary's plea, Napoleon tersely stated that “according to the Civil Code, Article 2059, it was forbidden to sell that which one did not possess.”Footnote 112 Mirroring the argument set out by Houard, Boscary responded that anyone who sold public debt was “supposed” to possess it, cannily avoiding specifying just when such possession was to be established. He then swiftly moved on to darkly describing the chaos that would result from prohibiting the marché à terme: by removing one of the key means by which French citizens could make concrete judgments about the state's future creditworthiness, crippling financial disorder would result, precipitating a collapse in the price of the public debt, which had only slowly ticked upwards after years of instability during the Revolution.Footnote 113 The conceptual legitimation of the post-Revolutionary state was therefore tied to the validity of the marché à terme, insofar as the marché à terme gave citizens a means by which to financialize their participation in the new regime—to turn property into political consensus, by actively investing in public debt futures. This validity, moreover, was guaranteed according to existing law, specifically the council's previous decisions rendered prior to the Revolution's outbreak, which, Boscary asserted, “had not yet been nor should not be considered as suspended judgments.”Footnote 114
Boscary's emphasis on the nature of the marché à terme as property was carefully chosen. Baroud and Mollien had both conceived of public debt futures as a valid form of property; Portalis had conceptualized property as central to a rationalized system of law, in which arbitrary privilege had been banished. And as Suzanne Desan has shown, stabilizing property was a matter of first importance for the new regime. The 1804 Civil Code, she argues, was intended to rebuild post-Revolutionary society on the twin pillars of patriarchal power and private property. The promulgation of the code was carried out through a characteristically Napoleonic evacuation of the political, with dissenting voices shut down and power consolidated at the highest levels of the state.Footnote 115 The enduring legal architecture of post-Revolutionary France was thus adopted in authoritarian context. Yet, in a regime in which the sovereign had explicitly articulated his personal control over credit, the stockbrokers argued instead that the concept of property ensured the marché à terme’s moral rightness and legal validity, consequently reining in the acceptable range of imperial action. The stockbrokers’ defense of public debt futures ultimately served to mark out the boundaries of state power, yoking the political theory of a postrevolutionary state to the autonomy of the concept of property, even in financialized form.
And Napoleon, despite his antipathy to finance and public debts, was convinced by this defense.Footnote 116 No statutory law or administrative regulation was issued eliminating the marché à terme from the Paris financial markets. Futures contracts were not, to be sure, immediately unshackled from all legal sanction: Articles 421 and 422 of the 1810 Penal Code would later prohibit any sort of contract that swerved too close to games of chance.Footnote 117 But not mentioning the marché à terme by name—the articles spoke only of a speculative “gamble” (pari) on rises or declines in the prices of government securities—this sanction in fact only applied to contracts in which prices were simply netted, with no property ever actually being exchanged.Footnote 118 French bondholders were therefore left free to speculate in the public debt—to express their political faith in the future of the nation in economic terms—through the marché à terme, so long as that economic transaction was, theoretically, concretized into property at some determinate point. But even such attempts to freeze the progressive abstraction of property through the marché à terme would ultimately prove futile. Indeed, as stockbroker Houard's arguments made clear, the futures contract would always escape any reliably durable concretization, since the practicalities of public debt markets ceaselessly drove property to abstraction. The stockbrokers’ defense of speculation thus suggested that insofar as good states were duty-bound to promote smoothly functioning financial markets, as part of their broader obligations to ensure economic vitality, the marché à terme must survive. Financial speculation in the public debt would remain a part of France's legal constellation going forward.
CONCLUSION
At the 1808 Council of State meeting, the marché à terme risked repression; it was not repressed. Not as a whole. Prior regimes had witnessed elements of financial capitalism embedded in the wider architecture of the fiscal–military state. And given the continental—indeed, global—scale of Napoleonic warfare, it may seem that such a martial justification would have provided the intellectual basis for the grudging acceptance of public debts and financial speculation. But it did not.
Disembedded from their previous justificatory grounds in the fiscal–military state, public debts and public debt futures were intellectually rehabilitated by being allied with the concept of property. This illimitable right, even when limited, was deeply connected to the political theory of the post-Revolutionary state. To defend property was to stabilize society and to uphold rational law, in which arbitrary privilege had been expelled and citizens, nominally at least, could confront each other as equals. By locating public debt futures under the normative authority of the concept of property, the Paris stockbrokers and their fellow travelers were able to carve out a legitimate space for financial capitalism within an otherwise inhospitable discursive terrain.
The episode of the marché à terme thus marks an important moment in the intellectual history of financial capitalism. As revealed through the case of public debt futures, the re-emergence of financial capitalism in Napoleonic France had become tied up with what it meant to be free in a postrevolutionary society. The disputed legality of the marché à terme served to delineate what kinds of behavior, undertaken by private citizens, rational law could or could not repress, what kinds of action the sovereign could or could not take in the economic sphere. In the face of withering imperial disdain, unmoored from its prior grounds in the fiscal–military state, and without the comforting support of wartime contribution, the marché à terme in public debt nonetheless survived, as property. Such was credit.
