In the years 2001-2007 Leszek Balcerowicz was the chief of the National Bank of Poland and because of that position he had to tone down his comments. Shortly afterwards he went back to political quarrels. Without any particular position in government Balcerowicz was still present and active in public debates. Even though he had a lot of experience in handling the economy Balcerowicz during this time as well presented himself as an economist who made one mistake after another in most of his diagnosis.
Hardly anyone remembers that just before the economic crisis in Ireland, he was praising the achievements of the Irish government; that the Baltic republics — just a few months before the gigantic collapse — were an example to follow. A number of times he prophesied the collapse of Scandinavian countries at a time when these countries were leading and still lead in the rankings of competitiveness, technology development and the standard of living. For a number of years Balcerowicz has been misleading the public, talking about the supposed high spending on social security in Poland, though the amounts of money put aside for such purposes are amongst the lowest in the European Union. He gives also false information on the huge fiscal loads, the GDP is 6% lower than the European Union average.
Balcerowicz has become to be known as a dogmatic ideologist who defends compromised ideas, not caring about the consequences of their implementation. The main objects of his attacks are those who are under social welfare, the jobless, pregnant women, mothers, workers in the public sector. In every quarrel he was on the side of the strong against the weak, he promoted unequal redistribution, his solutions were to reward those who are already successful and take welfare from those who did not make it.
In the last few years the popularity of Balcerowicz has been on the wane. Continuously repeating the same things, he is not attractive anymore even to the liberal media given the fact that the same ideas have been announced by government representatives. With the help of Balcerowicz there is a crisis. The private sector disappoints and without the intervention of the state it is difficult to work against negative trends. This is when the ministers in Donald Tusk’s government admitted that there was a need to undermine the neoliberal dogma and raise taxes as well as expanding the role of the public sector in the pensions system. In this situation Balcerowicz became one recognizable defender of neoliberal orthodoxy. A number of journalists speak about the big quarrel between “old liberals” and Balcerowicz. Everyone can see that Balcerowicz’s views are a sign of free market fundamentalism, which no one treats seriously in Western countries. How can you defend OFE in a situation when, in only a space of one year they have lost 20 billion PLN and their servicing is much more expensive than ZUS? How can you defend the lowering of taxes in a situation where the deficit in public finances is going up and the taxes in Poland are among the lowest in Europe? How can you demand cuts in social spending, when it is one of the lowest in Europe and the indicators of poverty among the highest? How can you demand that there has to be a reduction in aid and for the tightening of the criteria for giving aid when it is already the lowest and the most selective in the European Union? How can you demand for a reduction in the minimum wages despite the fact that they barely pass the social minimum? How can you dogmatically campaign for the privatization of public companies which bring in millions for the country every year?
More than twenty years have passed since Balcerowicz started his career in big politics. His present proposals are not in any way different from those that drove the country twice into economic and civilizational regression. Balcerowicz wants to limit the worker’s rights again taking help from the jobless, farmers, pensioners and the sick. At the same time he wants to support businesses, banks, pension funds. The rich are to get richer at the expense of the poor. Do we really need that model? Is it worth our time to treat Balcerowicz’s views as a sensible programme for reform? One of the advantages of a democratic system is the ability to learn from mistakes. Leszek Balcerowicz has already had two chances. He has not used even one of them and he has not learnt anything. He does not deserve another chance given the fact that he will not propose anything new.
Translation: Marlon Nziramasanga
Thursday, 30 June 2011
Saturday, 25 June 2011
It is never possible to convince everyone. Despite the consistency of climate change projections and the increasing regularity of unpredictable weather patterns, some will prefer to claim a form of conspiracy is at work. By whom and for what reason no one is clear.
One of the region's great climate change deniers is the Czech President Vaclav Klaus. Klaus is a conservative in the tradition of Hayek and Thatcher. He believes that ‘freedom’ is most threatened by the political ideologies that seek to control and regulate the market. He refers back to the experiences of communism and social welfare capitalism as examples of constructivist ideologies that promoted equality and non-discrimination but led instead towards totalitarianism. In the modern world Klaus identifies a number of new enemies: what he calls humanrightism and NGOs, political integration within Europe and also environmentalism. For Klaus the environmentalists are the new party commissioners - demanding controls, setting targets, interfering with people's individual freedom to consume and pollute as they wish.
Klaus has a friend in the European Commission: Janusz Lewandowski. Lewandowski is a strange breed. He emerged out of the Gdańsk Liberals along with Tusk during Communism. During the 1990s he was a leading advocate of extreme Thatcherite economics in Poland. An example of this was his claim that the Polish intelligentsia will be able to fulfil its historical mission only by supporting the “empire of capital” and that it would betray this task if it concentrated on caring for the needs of the losers of the transition and socially excluded.
So after spending two decades explaining why there should be no economic redistribution in Poland he became the EU budget commissioner in 2010. In this job he has been doing his best to convince the richer states to maintain their payments into the EU budget so that funds can be - yes you guessed it - transferred to the poorer states in the EU, not least Poland. A noble task indeed, but quite why economic redistribution works at a continental and not a national level is anyone's guess.
Perhaps Lewandowski's sense of economic fairness and redistribution extends yet further nowadays. EU environmental ministers met last week to discuss the European Commission's 2050 roadmap towards a greener economy. The roadmap had agreed to cut carbon emissions by 40% by 2030, 60% by 2040 and 80% by 2050, compared to 1990 levels. All were agreed except one country: Poland. Now there is a case that poorer countries such as Poland, which is heavily reliant upon coal, should be receiving help in meeting the targets set in this package. However, when expressing his support for the Polish government's decision Lewandowski remembered his Thatcherite roots and claimed:
We already have overambitious agreements on CO2 emission reduction. There is a notion that the thesis that coal energy is the main cause of global warming is highly questionable. Moreover, more and more often there is a question mark put over the whole [issue of] global warming as such.
As a spokesperson from Greenpeace stated: "It's terrifying that the man in charge of Europe's budget is someone you might expect to see in Sarah Palin's Republican party"
Friday, 24 June 2011
It was in this atmosphere that the two parties of the right that currently dominate Polish politics – PO and PiS – rose to prominence. Both claimed that they were opposed to corruption and that the problems in the country were primarily due to the corrupt elite that control public life. Prior to PiS forming a government in 2005, both parties supported the creation of a new Fourth Republic out of the ashes of the decaying Third Republic.
Just as hangers on and opportunists flocked to the ranks of the SLD ten years ago – so the same is happening to PO. It’s membership has increased to above 50,000 (from around 30,000 in 2008) – small in comparison to many parties in Europe but large in Polish terms. The leadership of PO has also engaged in a number of high profile political transfers in recent weeks. As reported previously, the former MP connected to the SLD – Bartosz Arłukowicz – has been given a symbolic post in government in order to provide PO with a left face at the forthcoming elections. During the recent PO convention Arłukowicz was sat – resplendent in his new blue tie – alongside two new recruits: Joanna Kluzik-Rostkowska and Dariusz Rosati.
The problem for PO is that their economic strategy is unviable. They are attempting to carry out one of the largest investment programmes in transport and sports facilities in the country’s history, whilst also endeavouring to bring down the budget deficit from nearly 8% this year to around 2% next year. Quite simply, these two simultaneous projects do not add up and is leading to less money being assigned to these investments (especially through making local governments reduce their spending) alongside more pressures to cut expenditures in other areas of economy and raising regressive taxes such as VAT. With inflation rising, unemployment remaining high (particularly for youth) and the government planning a new round of spending cuts, then PO’s attempt to be the ‘party for all’ will become increasingly difficult.
Tuesday, 21 June 2011
Monday, 13 June 2011
From the beginning of the transition in Poland (1989) Leszek Balcerowicz plays a very important role in Polish public life. It just so happens that the political career of the “father of Polish reform” above all has been characterized by failures and tragic mistakes with far reaching consequences.
The most spectacular act was the beginning of systemic transition. At that time Balcerowicz initiated and unfortunately was successful in putting into practice his plan free-market reforms. The effects of the Polish “economic miracle” were terrifying. In the years 1990-1991 the Gross Domestic Product fell by about 18%, the level of inflation was in triple figures, in the space of two years unemployment went up to above 2 million. Already in the first year of transition, the number of people living under the social minimum more than doubled — from 15% in 1989 to 31% in 1990. In the first two years of transition production, investment, production capacity as well as labour productivity went down radically. Production drastically fell in all sectors of the economy. In electromechanical industries it fell by 37,8% in light industries by 40,7% and maybe most importantly in the grocery industry by 25%. Wages for farmers were reduced by more than half in the space of two years.
The transition led to a number of other negative results of which a lot of people talk about even today. The reduction in the number of apartments built, mass liquidation of libraries and cultural facilities, closing down of a number of pre-schools, kinder gartens and nurseries. Huge number of suicides, alcoholism and explosion of prostitution followed. All of these events and phenomena are presented by Balcerowicz’s people as the necessary effects of change for which the state cannot be held accountable for. The pauperization of society, lack of jobs and life perspectives, segregation in education, lack of cultural finance… The guru of Polish liberalism was not interested those types of things.
Balcerowicz’s defenders like to repeat that there was no alternative for the neo-liberal reform. This time even the International Monetary Fund proposed three scenarios for reform in which Poland chose the one that had the most drastic effect on society. The strategy that Balcerowicz chose was no necessity at all. For example the government itself increased inflation by raising the price of energy six-fold. For unknown reasons customs control was removed and this caused a number of national companies to go bankrupt. Balcerowicz was stubborn in his quest to destroy the public sector, so taxes for state companies were two times higher than that of private firms. A significant part of the social infrastructure was liquidated, the money to fight poverty and tackle social exclusion was reduced and mass unemployment was seen as a necessary consequence for the transformation to a free-market.
In 1989 the Polish People’s Republic did not lose its potential to develop, nor was it on the edges of breaking up. In the mid 1980’s the economy started to expand relatively quickly. Production as well as consumption went up and the infrastructure was developing. The budget at this time was balanced and there was no threat of experiencing a deficit. In foreign trade exports were more than imports. A lot of other countries in the region had far much smoother transformation than Poland. In Czech, Slovenia, and in Hungary the level of unemployment was by far lower than in our country. Smaller also was the area where there was poverty, lesser also was the social stratification level.
Balcerowicz played an important part not only in the very begining, but also in the years 1997-2000 when he became the vice-premier and the minister of finance. Again the effects of his policies just like for the first time affected a large part of Polish society. The politics of ”cooling the economy” reduced the dynamics of development. In 1993-1997 the GDP rose by above 5% annually, however in 2001 only by 1%.The second edition of Balcerowicz’s government brought about a drastic rise in the level of unemployment. In 1998 1,83 million people were unemployed and four years later 1,3 million people more. In accordance to his declarations Balcerowicz did not do anything to fight against poverty. In effect the number of people living under the minimum existence level rose from 5,4% to 9,5%. The number of people living under the minimum social subsistence went up considerably from 50,4% to 57% of the population.
At this time the stratification of income went up, the social spending was limited and state property was intensly commercialized, at the same time taxes for firms were reduced although that did not have a positive effect on the macroeconomic indexes. It is also important to note that in between 1997-2001 the national debt went up considerably. From 22% of the Gross Domestic Product to 25,6% and the deficit of the public financial sector went up from 2,9% to 5,1%. The politics of “cutting” and “cooling” did not correct the state of national finances — very much on the contrary.
Jerzy Buzek’s government in which Balcerowicz steered the economy also made four unsuccessful reforms. They brought fatal effects, which up to today, successive governments have not been able to deal with.
Translation: Marlon Nziramasanga
Sunday, 12 June 2011
"5. Reiterates its call to the US authorities to review the military commissions system to ensure fair trials, to close Guantánamo, to prohibit in any circumstances the use of torture, ill-treatment, incommunicado detention, indefinite detention without trial and enforced disappearances, and reminds the EU institutions and Member States of their duty not to collaborate in, or cover up, such acts prohibited by international, European and national law;"
"7. Calls on the EU and Member States authorities, as well as the US authorities, to ensure that full, fair, effective, independent and impartial inquiries and investigations are carried out into human rights violations and crimes under international, European and national law, and to bring to justice those responsible, including in the framework of the CIA extraordinary renditions and secret prisons programme;"
In the meantime, former MEP Józef Pinior reiterated his allegations against former members of the Polish government, claiming that there was a document signed by the then prime minister Leszek Miller regulating the operations of a secret CIA detention facility in Stare Kiejkuty, also defining the status of corpses inside the facility.
Pinior admits that he never saw the document with his own eyes, but credits a very trustworthy source with this information who he refuses to name. Asked whether this was a source from within Polish intelligence services, he refused to comment. He added that with 30 years experience in politics, he was fully aware of the implications of such a statement.
He describes the document as brief, outlining logistics, and being addressed to the Polish Secret Service, who operates the base in Stare Kiejkuty.
Pinior also claims that Zbigniew Wassermann and Zbigniew Ziobro, who were part of the PiS government succeeding Miller, saw and discussed this document along with four other officials, and that there are minutes of this meeting.
During his work on a European Parliament investigation into CIA rendition, Pinior states to have spoken to members of the Polish Secret Service, who were uneasy about the fact that their facility was used for purposes which were not in their interest.
These revelations, and the new European Parliament resolution follows a turbulent month in which lawyers acting for Abd al-Nashiri filed a complaint against Poland with the European Court of Human Rights, Warsaw prosecutor Jerzy Mierzewski planned to file charges against former members of the Polish government and was subsequently removed from the case, documents were leaked to daily newspaper Gazeta Wyborcza, Gdansk prosecutors opened an investigation against the paper and President Obama visited the country and promised the deployment of F16 as a protection against Russia.
Monday, 6 June 2011
So with nothing to sign Barak again praised everyone around him, smiled, said everyone was great, smiled, reminded everyone that they were his best friend, smiled, and jumped back on his plane to head home. Despite the banality and consistency of form, this meeting did reveal some of the differences that exist between the Bush and Obama administrations. For sure, if a US President named Bush had arrived in Poland engaged in at least 2 wars (I’ve kind of lost count) in the Middle-East and proposing to station more troops and military equipment on its soil; then the protests may have been larger and louder than the hundred or so demonstrators that greeted Obama and were met with tear gas by an over-the top Police determined that no one would spoil the party atmosphere. However, two fundamental things have changed– that are more to do with pragmatism than anything else – in US-Polish relations.
One of the first decisions of the Obama administration was that it would seek to reduce tensions with Russia. The USA was already over-stretched both militarily and economically and only the most rabid Republican hawks could really conceive that it was in a position to take on its old Cold-War foe. The re-set button was pressed, the Star-Wars Two programme in Central-Eastern Europe scaled back and adjusted and Russia brought into a new strategic alliance with the USA against Iran. America’s leading ally in Central-Eastern Europe had to adjust itself accordingly. Fortunately, the more Russophobic government in Poland had already been replaced by 2007, with the new government better understanding changed Realpolitik. Although the Smolensk tragedy has opened up old wounds between Poland and Russia – the Tusk administration has done its best to soothe them and allow some ‘normalisation’ of relations.
It is worth reminding ourselves about what was happening in 2003. Poland was then governed by the Democratic Left Alliance (SLD) – the Polish representative of the Socialist International. While the majority of European social democracy turned away from supporting the US-led invasion of Iraq, the Polish social democratic Prime Minister (Leszek Miller) and President (Aleksander Kwaśniewski) followed Blair’s example by giving the USA their full support. It was in this context that Donald Rumsfield famously coined the phrase ‘New Europe’.
Beyond the recent platitudes exchanged between the leaders of the USA and Poland, lies the lingering controversy about whether Poland hosted CIA prisons on its territory in which torture was carried out. Despite denials by the Polish side, these allegations have been circulating since 2005. A European Parliamentary report in 2007 revealed that CIA prisons had existed in Poland between 2002 and 2005; and last September the Associated Press produced information that it claimed proved that torture had been carried out in these prisons.