The Double Budget System
By the Treaty of Versailles, Germany agreed to pay for the reconstruction of the devastated regions in France. On this basis, the French Government in 1919 adopted the system of a double budget-one for ordinary expenditures offset by ordinary revenues and a second for extraordinary expenditures., the so-called “Budget of Recoverable Expenses”, offset by eventual payments from Germany on account of reparations. Between 1919 and 1924, France raised by internal loans more than 118,000,000,000 francs for reconstruction and indemnification. During this period the ordinary Budget balanced but this result was only achieved by piling up this debit balance on the special Budget. As all sums hitherto paid by Germany to France have been applied to the maintenance of the Army of ...