Question

Upon his accession in 1774, Louis XVI found an empty treasure. What were the reasons behind the financial crisis in France?

Answer 1

In 1774, Louis XVI of the Bourbon family of kings ascended the throne of France. He found an empty treasure. The reasons behind the financial crisis in France were-

(i) Long years of wars had drained the financial resources of France. The condition became severe when under Louis XVI, France helped the thirteen American colonies to gain their independence from Britain.

(ii) The king's court at the immense palace of Versailles was extravagant. A huge amount of money was required for its maintenance.

(iii) France had borrowed money from money lenders who were now charging 10% more interest. So, a large share of the French Government's budget is now spent on interest payments.