Anne-Robert Turgot served as Louis XVI’s first Comptroller-General of Finances. In 1774 he provided the king with a summary of measures to address the national debt:
I wished to have detailed the reflections suggested to me by the present posture of the finances, but time will not allow this. I shall reserve myself for a more detailed explanation when I have obtained more accurate information. At the present moment I confine myself, Sire, to call to your recollection these ideas:
No national bankruptcy.
No increase of taxes.
No new loans.
No increase of taxes. The reasons for this measure, Your Majesty, you will find in the situation of your people – and still more in your own heart.
No new loans. For every loan, by diminishing the amount of the free revenue, necessarily produces either a bankruptcy or an increase of taxes. In a period of peace, money should not be borrowed, unless to liquidate old debts or to discharge others bearing a higher interest.
To obtain these points there is but one method: that of reducing the expenditure below the receipt, and so much below it as to leave 20 million [livres] every year for the redemption of former debts. Without this precaution, the first cannonball that is fired will force the state to a public bankruptcy.
Where to retrench this expenditure? Every department will maintain that there is scarcely a single expenditure that is not indispensable. The reasons alleged may be very good but… must give way to the irresistible necessity of economy.
It is this necessity then that calls upon Your Majesty to oblige each department to consult the Minister of Finances. It is indispensable that he should be allowed to discuss with each, in Your Majesty’s presence, the degree of necessity of proposed expenses…
A hope may be indulged that by the improvement of agriculture, by the suppression of inefficiencies in collection of revenue, and by a more equal distribution of the taxes, the people may be sensibly relieved, without greatly diminishing the public income… but unless economy is adopted first, no reform will be possible…
August 24th 1774.”