The meek and the outraged

Once upon a time there was a prosperity...

In one country in which several years ago one could rise from rags to riches, everyone, including drunkards having no jobs, no assets and no income, could get a mortgage without having to prove their creditworthiness. They could buy dreamt-up houses they had never afforded to buy and everyone was happy.

In another, once poor country, government, trade unions and employers entered into a social partnership, which gave rise to over a decade of fast, yet sustainable growth. When natural growth ran out of steam, economy was boosted by construction boom that did not last long, as everything what is credit-fuelled and based on low-efficiency sectors. They government would run budget surpluses thanks to rising property taxes and people could afford to buy houses despite prohobitive prices, thanks to easy credit conditions. Everyone was happy...

Once a country, which was facing bankruptcy in 1998, got up off its knees and rose to prosperity thanks to huge revenues from export of gas and oil... Only tycoon were happy... The rest were only proud of their new empire.

Another country, which joined the European Communities in 198,1 could rig statistics, wheedle out subsidies from the EU and live off the backs of German taxpayers. But actually eveyone was happy.

Once the biggest CEE economy was run by reckless politicians who at the same time cut taxes, raised government spending and despite this had a nearly balanced budget. But people weren't happy and in early election kicked out those magicians.

The times of living beyond one's means are gone. Good times will roll in sometime, but I suppose not before long. Come to terms with it, there's no such option as 'ship out' now.

Then the house of cards fell apart and Mr Crisis knocked on our doors. Believers of American Dream were evicted from their over-mortgaged houses and complex securities engineered by brainy quants from investment banks turned out to be a load of junk scattered all over the financial system. The government rushed to help out the troubled, but those bailed out were financial institutions. The case was that someone had been arranging the world in such way that banks had grown too big to fail and their collapse could trigger a knock-on effect, i.e. their bankruptcies would wipe out the 'real economy'. Thus the bankers were helped out and got away with the punishment and things went on.

At that time voices of people outraged at policies focused on big players, rather than ordinary people, were heard. But nothing, virtually nothing has changed.

As part of tacking the crisis, zillions of money wer pumped into financial system and some money was even injected into real economy. Economies somehow revived, but did not thrive as good as the financial system did. Drip of newly printed dollars flowed into banks' balance sheets and the banks did not, as the decision-makers had intended, turn them into loans for firms and individuals, but put them on financial markets. Between late winter of 2009 and mid-spring of 2011 stock prices doubled and commodity price tripled, not really reflecting economic recovery (often, like oil prices, threatening to hamper it).

In the meantime countries using fiscal stimuluses to prop up their economic, nations living beyond their means and those whose growth prior to the crisis had been totally unsustainable (these were the countries that had experienced property booms) fell into trouble. In 2011 banks are solvent (unless they have bought up too much "risk-free" Greek bonds), in 2011 the governments are about to go bust.

Poland got off the first wave of the crisis lightly. In early 2009 it was the only economy in Europe that did not contract. Neither the current (PO-led), nor previous (PiS-led) government could take credit for it. Accolades go to resilient Poles and their remarkable consumer confidence (in fact verging on profligacy), sound monetary policy pursued by the Polish central bank, wise financial supervision that curbed lending and resilience of Polish entrepreneurs. But lower budget proceeds and higher expenditures and inevitable in economic slowdown and so Poland as well has to tighten the belt...

But not only us. People feel it and someone roused up and discerned that ordinary people are paying for the crisis, while bankers, still untouched, are doing well. In 2008 Barack Obama won by promising the 'change'. The matter (or rather lobbyist) proved too resistant, and the change has not been brought about, leaving more and more people livid. They gathered in one New York district and dubbed themselves Wall Street Occupiers. The movement gained popularity in many countries, but I didn't think it would fell on a fertile fround in Poland. Yet for a moment it did. On 15 October hundreds of protesters marched through Warsaw's streets, but who were they? As right-wing journalists claimed, those were children of wealthy parents who thought it would be fun / trendy to protest again cruel capitalism and spent afternoon in such way. They even received support from a prominent leftist politician who came to the demonstration in his brand-new Jaguar...

In all countries they protested against the palpable distortions of capitalism, yet did not come up with any counter-ideas. Some of their postulates are even self-contradictory - how can you raise public spending and cut public debt at the same time? I don't feel affinity with those people. We are simply worlds apart, and not because we have different descents, but because our mindsets are worlds apart. I have a job that gives me a lot of satisfaction and offers me financial independence (limited, as without ruining my personal finances I cannot afford to move out from my parents' house) and... I'm afraid of losing the job, for reasons other than my performance. They are often jobless and with bleak future prospects. But where we are now is a result of how we got there and this in turn is a testimony of effort or lack of it over the past years.

And no, you are no longer entitled!

While others are outraged, I stay disturbingly meek. VAT increased by one percentrage point - other fulminate against the government, I say it is essential to bring extra revenues to the state budget. Raising the retirement age - my colleagues say they won't make it until they hit 67, I declare to toil away even longer without murmur to make budget'e ends meet. Scrapping tax deductible expenses - others are livid as they will not be allowed to claw back some money from the state, I happily commend the idea which simplifies tax system. I was even asked by my colleaugue, with a big tinge of malice, how I would be fixed for shortening paid holidays by some five days each year, cutting sick leave benefit, raising social sickness benefit contributions and restoring tax rates and brackets effective until 2008 (19% / 30% / 40%). Without much hesitation I said I would approve this, if only the money collected thus was spent wisely, i.e. on investments in infrastructure, education or, above all, contributed to reduction of public debt.

All in all, I have all makings of a ruthless technocrat who could turn an almost bankrupt country around and leave the office after four years, hated by 95% of the society. Or am I simply a naive sucker?


PS. This post written without effort. Was it read without pleasure?