Rueff’s book reverses the premise of the 1965 monetary debate: the United States deficit is not a problem to be solved before reforming the international monetary system, but a symptom of a system that prevents normal correction. The issue is causal, and Rueff gives it the form of a recurring puzzle:
C'est là que gît le problème de l'œuf et de la poule.
English translation: Therein lies the problem of the chicken and the egg.
If external balances are discretionary aggregates or fixed by trade structure, then controls, quotas, and exchange rationing seem necessary. Rueff’s thesis is the opposite: balances of payments are governed by monetary mechanisms, and disequilibrium persists when institutions neutralize those mechanisms.
The book’s structure serves this argument. Rueff first assembles historical episodes—the 1960s American deficit, the postwar dollar shortage, exchange control, reparations, and the trade-balance fallacy—then reconstructs the theory able to explain them.
La première partie présente surtout des faits.
English translation: The first part presents above all facts.
Balanced payments, he insists, are too unlikely to be accidental; their recurrence points to regulation.
Le principal caractère d'une balance des paiements équilibrée, c'est son extrême improbabilité.
English translation: The principal characteristic of a balanced balance of payments is its extreme improbability.
Rueff’s mechanism is double. A deficit creates an income effect, since purchasing power has been spent abroad rather than at home, and a money effect, since cash balances fall and money-market pressure rises. Under convertibility and sound discount policy, residents must sell more, buy less, attract funds, or lose reserves; trade and capital flows adjust. But postwar arrangements block the process. The dollar shortage was not natural scarcity but inflation plus institutions that prevented deficits from contracting demand. The gold-exchange standard then let foreign central banks hold dollars and reinvest them in New York, returning to the debtor country the purchasing power it should have lost.
Dans l'état actuel des relations monétaires internationales, il n'existe aucune raison d'ordre financier pour que les balances des paiements soient équilibrées.
English translation: In the present state of international monetary relations, there exists no financial reason whatsoever for balances of payments to be in equilibrium.
The reparations chapters give the argument its classical test. Against Keynes’s claim that exports have a difficult-to-alter natural level, Rueff argues that transfer itself changes demand, prices, imports, and exports. Germany’s real limit was not an external “transfer capacity” but the internal fiscal ability to raise resources without disorder.
Le problème n'est donc pas un problème de transfert, mais un problème budgétaire
English translation: The problem is therefore not a problem of transfer, but a budgetary problem.
The same move grounds his attack on the trade-balance fallacy: a merchandise surplus is not inherently favorable, nor a deficit unfavorable. Creditors may import more because invisible receipts finance them; debtors may export more because they must service obligations.
In the theoretical part, Rueff modifies Say’s law by locating disequilibrium in the gap between effective and desired cash balances. Credit is noninflationary when it monetizes real, self-liquidating claims desired by money-users; inflation comes from false claims, especially Treasury paper that cannot truly be repaid. Money is therefore not a passive stock commanded by authorities:
La monnaie, dans nos sociétés complexes, n'est jamais la masse inerte qu'envisagent les théories mécanistes des phénomènes monétaires.
English translation: Money, in our complex societies, is never the inert mass envisaged by mechanistic theories of monetary phenomena.
Users of money determine desired balances by buying less and selling more, or the reverse. The discount rate is the key threshold: if properly set, deficits are corrected through trade and income adjustment; if too low or subordinated to fiscal deficits, reserves drain and regulation fails.
Rueff’s liberalism is thus institutional, not laissez-faire indifference. Freedom depends on monetary arrangements that make responsibility, convertibility, and price signals effective.
La liberté n'est pas un don gratuit. Elle exige des systèmes monétaires efficaces.
English translation: Liberty is not a free gift. It requires efficient monetary systems.
The book remains relevant because it treats balance-of-payments disorder as a constitutional defect of international money, not as a collection of trade complaints.
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