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I think that code was like some kind of regulatory guidelines that the entertainment industry in general had if I remember. I don't even think it was an official thing, more of a wink and a nod and lets all agree to this set of moral standards that won't offend the status quo. When it was dropped is when you see that sudden shift in movies where they became edgier, more violent, started using profanity openly and sex/nudity became commonplace. It's way more in depth than that but I'm just generalizing here. I'm pretty sure that was the Hayes code although maybe I'm confusing the name.
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