“Making the Immobile Mobile: Land, Markets, and the Problem of Value
in Nineteenth-century France”
Alexia Yates
Center for History and Economics, Harvard University
Draft manuscript: Please do not circulate or cite without explicit permission of author
“Legal history teaches us that, in all times and in all places,
real and personal property have followed diametrically
opposed paths. […] More than anywhere else,
France demonstrates the spectacle of this grand rivalry
in its most dramatic form, in all its fascinating twists and turns.[1]
It is difficult to exaggerate the persistence and tenacity of the debate on mortgage reform, land registration, and the mobilization of property values in nineteenth-century France. A domain of specialist knowledge, arcane detail, and administrative convolution, these are on first glance unlikely candidates for vigourous, even impassioned, public discussion. Yet participants in debates on the mortgage question were convinced – particularly during moments of economic crisis – that overhauling the legal structures that shaped the relationship of land to the market was a “matter of life and death.”[2] The hopes lodged on the fruits of reform could not have been grander; witness the opening statement of one of the more substantial treatises penned on the subject:
A reformed mortgage code will consolidate property, promote its transfer, foil bad faith schemes, and generate confidence. It will attract capital needed for the improvement of soil to agriculture, multiplying the resources of property-owners and tenant farmers with abundant harvests, improving the condition of the working classes by supplying work and lowering prices, and finally, procuring goods that satisfy our needs and our pleasures by supplying materials to manufacturing at the best possible price. Thus the mortgage code grants each of us comfort and joy in life, even as it forms the foundation for the wealth and strength of the nation.[3]
The mortgage system is here fundamental to every facet of economic life. It is the scaffolding upon which individual happiness and national well-being is erected. But this is not the only reason that struggles over its mechanisms were often so fierce. As the century progressed, mortgage reform became implicated in the most tumultuous political events of the day, particularly the 1848 Revolution, one outgrowth of which was the establishment of the nation’s central mortgage bank, the Crédit Foncier. Moreover, the matters at the core of the debate – the relationship between the state and property, the legal and moral constraints on mobilizing land values – grew increasingly urgent as socialist doctrines, agricultural crises, and imperialist ventures proliferated.[4]
Indeed, nothing better reveals the contestation, ambiguity, and deep uncertainties that characterize the process of market-making than the long debate surrounding the commercial status of property and the economic role of property-holding. In a recent survey of the development of modern capitalism in France, Great Britain, and the United States, historian Alessandro Stanziani explicitly excludes the real property market from his analysis. While “it would seem necessary,” he writes, “to include the land market in any study of competition,” he concludes instead that the historically high degree of regulation of these markets makes their dynamics of less interest: “if we succeed in establishing that other markets were regulated everywhere by showing the control of commercial transactions in movable property, products and goods, the argument will hold all the more for the real estate market.”[5] Certainly, property markets were heavily regulated in most western countries in the nineteenth century. Yet Stanziani assumes and elides a great deal by focusing solely on the realm of commercial, movable assets. At the end of the nineteenth century – precisely the period that the author designates as marking a crucial shift in capitalist development – the problem of legally defining the modes by which land and built property (real estate) could circulate preoccupied businessmen, legal experts, farmers, rural reformers, politicians, and property-owner associations.
This paper follows the nineteenth-century debate on mortgage reform and agricultural credit with an eye to reconstructing the ways that legal frameworks, bureaucratic paper practices, and international political economy structured the conditions of marketability for real estate. The wide-ranging discussion on the forms and desirability of the mobilization of land not only helps illuminate the range of perspectives through which contemporaries understood the nature of production and value in an economy undergoing rapid industrial and commercial expansion. The registers, administrative reorganizations, money coupons, and property titles that were proposed and debated in the context of these discussions also point to the key role of material practices in constituting property as a particular kind of commodity. This approach builds on insights from economic sociology and anthropology, particularly recent work on “economization” and “marketization” by Michel Callon and Koray Çaliskan, and pursues the construction of markets by unearthing the specific actors at work in the invention of market models and market sites, giving attention to the various kinds of expert and lay knowledge mobilized for this task, as well as accounting for the materiality of both markets themselves and the goods with which they are concerned.[6] This dual emphasis on knowledge and materiality is particularly appropriate for the study of property markets. The nature of their commodities, notably the resistance of land and buildings to physical relocation, has a significant impact on the form of these markets, rendering their efficiency dependent on the centralization of information about and representations of the land and buildings available for sale or rental. By focusing attention on the contestation that surrounded the question of mobilizing land values in the long nineteenth century, this paper complicates our understanding of the place of real estate in our ecology of investment.
A Revolution in Mortgages
There are a number of reasons why France provides a particularly illuminating case study for better understanding this process of marketization. It was there that the eighteenth-century individuals first known as economists developed a philosophy of economic growth that placed primary importance on the wealth-generating capacity of land.[7] For the Physiocrats, value originated in the natural gifts of land; it was augmented by the labour of individuals, and circulated through the realms of industry and commerce, though these could not themselves generate or add to this original value. On this model, property ownership was a natural attribute of man as a productive entity, and landed proprietorship fulfilled a crucial moral and economic role in civil society, adjusting the social and natural order. Agreement on the social utility of private property was such that even those opposed to the large estate ideal of the Physiocrats, or more broadly critical of the rampant inequality that private property perpetuated, tended to elaborate models of limited ownership that supported a more egalitarian distribution of property rights rather than to reject private property outright.[8] These articulations took on a particular political importance during the Revolution, when both sans-culotte and republican ideology demanded the limitation of property ownership in the name, respectively, of the individual artisan and the virtuous yeoman farmer.[9]
While the Revolution radicalized reflections on the relationship between property regimes, civil society, and individual freedom, such concerns were certainly not absent in other polities. In France, however, the Revolution also transformed the country’s property rights regime, and undertook some momentous experiments with property commoditization. The multiple layers of privileges that constituted proprietorship in the ancien régime were leveled by the abolition of feudalism and the enshrinement of private property as an individual, natural right in the Declaration of the Rights of Man and Citizen in 1789. In point of fact, peasants had established de facto private ownership of their lands in many regions of the country before the Revolution, with use rights having come to predominate over eminent or seigneurial domain in eighteenth-century jurisprudence. Thus historian Gérard Béaur notes that,"the members of the Constituent Assembly simply put into law what had already been taken for granted by peasants for ages.”[10] Nevertheless, the import of the Revolution’s new legal framework for property relations cannot be underestimated; henceforth, property “became a private matter, free from feudal rights, free from the community’s intervention, and from collective use-rights.”[11] One of the most spectacular episodes of the Revolution, the appropriation and sale of ecclesiastical lands, typified the dissolution of collectively managed ‘national’ lands into real estate packages. As much as this affair affected the material distribution of land and the social makeup of the nation’s property-owning class, it was equally revolutionary in the manner it intervened in the financial life of land.[12] The assignat, one of the Revolution’s most infamous creations, was introduced as a government issued, interest-bearing note intended for the purchase of national lands. Subsequent issues of assignats abandoned provision of interest and became instead simple paper notes, but continued to take their underlying value from the total estimated worth of the national lands (an estimation that was becoming increasingly difficult given the monetary climate). Anchored by the material reality of national territory, these notes reconciled the mobility of currency with the immobility – and stability – of land, providing an antidote to fears of financial chaos inherent to a potentially unhinged and imaginary currency. As historian Rebecca Spang notes, recognizing the dual nature of the assignat is the only way to make sense of statements such as that of the former marquis de Montesquiou, who opined in 1790 that: “Yes, the money is made of paper, but it isn’t a paper money, and so none of the arguments against paper money are applicable in this case.”[13]
The revolutionary period was rife with schemes, projects, and fantasies of mobilizing land values in order to restore the country’s economic vitality. While the assignat provides the most well-known example, still more profound innovations were attempted in the seemingly mundane arena of mortgage and land tax reform. François Noël Babeuf, known as Gracchus Babeuf, prefaced his vision of an egalitarian, communist republic (a vision that would eventually lead to his execution) with a project for a reformed system of property taxes and land registration articulated in his 1789 publication, Cadastre perpétuel.[14] Babeuf’s proposal for remedying inequality called for radical transparency in the state of the nation’s land; a new mathematical system of surveying was elaborated that would lead to more accurate delineations of territory, and would allow for pictorial depictions of individual parcels to accompany textual records in a reformed land registry.[15] This transparency applied to ownership as well, and the proposed cadastre was to be ‘perpetual’ insofar as each property record would include space for updating, allowing the juridical life of the property in question to evolve on the page.[16] Babeuf’s was only the most radical of many such plans; the numerous proposals for mortgage reform presented to the National Assembly in the years following shared with his project an emphasis on the need to make fortunes transparent – both to the state and to fellow citizens – in order to ensure a just distribution of economic rights and responsibilities in the new regime, as well as to reinvigorate the country’s agriculture and commerce. More than simply attending to economic concerns, however, these plans were deeply linked to the revolutionary spirit of reform; they were an effort to undo the system of privileges that had previously encumbered land and its transfer, to replace the obscurity of the ancien régime with the clarity and equality of a republic, and to link individual self-interest with the public good of the nation.
Most noteworthy among revolutionary land reform works were those of Martin-Philippe Mengin, an official from the mortgage registry bureau whose proposals for monetizing land values became the basis for a new ‘Code hypothécaire’ or mortgage law instituted on 9 messidor Year III(27 June 1795). As was the case for many of his contemporary petitioners, Mengin saw improved facilities for credit for property-owners as a cure-all for the economic and political ills of the revolutionary period. He proposed a “Banque Immobilière,” or Real Estate Bank, as an antidote to the dependence of property owners on capitalists, restoring balance between the two great classes that comprised the whole of economic life.[17] Taking aim at bankers for their inept and expensive intermediation, Mengin’s plan hinged on new form of credit based on land and guaranteed by the state, which he projected would reduce the cost of money and draw foreign investment to the country. The cédule, a special mortgage debt instrument, would be available to property owners from departmental banks on the basis of official evaluations of property value, up to an amount not exceeding three quarters of this value. With access to reliable and affordable credit, owners would be free to direct their newly-liquid assets to agricultural improvements and investment in commerce. National territory, a security that “ne pourra jamais présenter de perte dans sa valeur” and that further required no intermediary to underwrite this value (precisely because it was immovable and material, benefiting from a “crédit réel” rather than a “crédit moral”), would prove uniquely capable of regulating international financial flows, rectifying France’s trade balances with foreign countries and placing the country once more at the head of European economic development.[18]
Mengin’s plans are rich in indications of the profound transformations in economic and political life occurring during their formulation. His proposal for a “mortgage on oneself” (hypothèque sur soi-même) was an innovation in financing methods that owed much to foreign, particularly German, examples; moreover, it was a practice that drew implicitly on the parallels between sovereigns, uniquely empowered to print or designate money within their realms, and the property owner, newly able to generate a paper money directly linked to his own domain. In a political climate permeated by the task of redefining the source and terms of sovereignty, Mengin suggested a means of endowing individual owners with some of the key trappings of political authority, albeit within limits that aligned individual with national interest. Yet some opponents were quick to point out that this new sovereign was a dangerously indebted individual, his properties not only fractioned into a series of liens, but those liens themselves mediated through state institutions that ultimately extended government authority over private property. Reflecting on the code of 9 messidor Year III, Deputy Jourdan (Bouches-du-Rhône) summarized the layering of debt and obligations on land as “a feudal regime” based on a “confusion of power and property, the inevitable outcome of which is already evident: an increase in wealth leading to the subjugation of people.”[19]