France’s ability to build armies and fight wars depended on a strong economy. Fortunately for Louis, his controller general, Jean-Baptiste Colbert (1619–1683), proved to be a financial genius. Colbert’s central principle was that the wealth and the economy of France should serve the state. To this end, from 1665 to his death in 1683, Colbert rigorously applied mercantilist policies to France.

Mercantilism is a collection of governmental policies for the regulation of economic activities by and for the state. It derives from the idea that a nation’s international power is based on its wealth, specifically its supply of gold and silver. To accumulate wealth, a country always had to sell more goods abroad than it bought. To decrease the purchase of goods outside France, Colbert insisted that French industry should produce everything needed by the French people.

To increase exports, Colbert supported old industries and created new ones, focusing especially on textiles, which were the most important sector of the economy. Colbert enacted new production regulations, created guilds to boost quality standards, and encouraged foreign craftsmen to emigrate to France. To encourage the purchase of French goods, he abolished many domestic tariffs and raised tariffs on foreign products. In 1664, Colbert founded the Company of the East Indies with (unfulfilled) hopes of competing with the Dutch for Asian trade. He also hoped to make Canada — rich in untapped minerals and some of the best agricultural land in the world — part of a vast French empire. With this in mind, he sent four thousand colonists to Quebec.

During Colbert’s tenure as controller general, Louis was able to pursue his goals without massive tax increases and without creating a stream of new offices. The constant pressure of warfare after Colbert’s death, however, undid many of his economic achievements.