In 1789 France was greatest country in Europe. Wealthy, sophisticated, in the forefront of art, intellect and fashion, it was the paragon of western civilization. And all these achievements were despite a government of remarkable incompetence.
The French monarchy was an anachronism. It had modern pomp but medieval circumstances. The government had 18th century expenses and a 14th century income. A king, on the whims of his mistress, could plunge France into a calamitous war, but he could not raise the taxes to pay for it. The king did not have to answer for his vanity, lust, bigotry or mistakes; but he had to borrow the money for them.
The Crown had been bankrupt throughout most of the 18th century. Much of the treasury actually had been lost in a stock market crash of 1720. The monarchy simply borrowed money to meet its expenses and then borrowed more money to pay off its debts. The deficits grew but the monarchy continued its profligate ways.
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