We use cookies to distinguish you from other users and to provide you with a better experience on our websites. Close this message to accept cookies or find out how to manage your cookie settings.
We use cookies to distinguish you from other users and to provide you with a better experience on our websites. Close this message to accept cookies or find out how to manage your cookie settings.
Managing the Franc Poincaré Published online by Cambridge University Press: 23 November 2009
The end of deflation
The Popular Front's election victory on 3 May precluded the possibility of any further deflation; its platform had promised an end to the injustices of the decree laws, greater support for agriculture, a large public works program, and increased social welfare spending, including a national unemployment insurance system. The Socialists hoped to generate recovery by augmenting purchasing power, believing that prices would then fall because of higher production and tax revenue would rise to finance the growth in government spending. Such a program would take time to accomplish: To avoid capital flight and gold losses, the Popular Front program called for exchange control.
The Bank of France lost gold steadily in the election period and the weeks before the Popular Front took power: 1.7 billion francs in the last week of March, 3 billion francs in April, and 2.7 billion francs in the first week of May. Prime Minister Sarraut threatened to resign immediately if Blum did not declare Popular Front policy on defense of the franc: On 10 May Blum announced that the Popular Front remained opposed to devaluation. Exchange controls made political sense to prevent the economic sabotage of the Popular Front program by the holders of capital. Either devaluation or exchange controls would soon be essential; choosing between them was one of Blum's most urgent tasks as he prepared to take office.
This chapter follows the course of influential opinion and the actions of the Blum government from the election victory to the devaluation of the franc.
To save this book to your Kindle, first ensure [email protected] is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.
Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.
Find out more about the Kindle Personal Document Service.
To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.
To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.
