By Melchior Palyi
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Extra info for A Lesson In French Inflation (1959)
On January 1, 1959, the Common Market went into operation, reducing by 10 per cent the tariff against the other member countries and increasing quota-free imports from them at least to an amount equal to 3 per cent of each product's output in France. Lesser concessions have also been granted to nonmembers,. and French trade liberalization proceeds apace. ) Foreign exchange restrictions are being lifted at a fairly rapid rate. The economy is being progressively exposed to international competition, and thousands of parasitic organisms, are deprived of arti6cial nourishment.
But great damage had been done by the time their use was terminated - damage to the "morale" of the people who, relying on their respective escalators and subsidies, resented every attempt at stabilizing the purchaSing power of the currency. Redistribution and Retribution POLmCAL PULL became the Frenchman's instrument, used individually or via pressure groups, to obtain private monopoly positions; to take advantage of special loopholes in the snarled administrative framework of regulations, controls, and restrictions; to [32 ] obtain governmental siriecures and pensions, or partial or full tax exemptions, cheap credits, low rates for the products of nationalized industries, cheap medical treatment, nominal rents, and a multitude of other subsidies.
1 In the scramble for inflation hedges, tax havens, and governmental favors, a system of wealth redistribution evolved, a basic rule of which was retribution: punishing those who obeyed and trusted the laws, who did not or could not cheat on social security levies (the business corporations) or on taxes, or on foreign exchange restrictions, and the landlords who could not hide their properties. With its right hand, the Fourth Republic spent literally billions of dollars to foster the nation's industrial apparatus; with its left hand, it protected miniature business units by exempting them from income and production taxes and license fees - under the condition (until 1955) that they use no motorized equipment!
A Lesson In French Inflation (1959) by Melchior Palyi