Friday, 21 August 2009

Beneficiaries and losers of Polish transition of 1989

Every revolution eats its children – the adage proved true by the fate Vladimir Ilyich Lenin met in the early twenties could also be substantiated by the calamity of Law and Justice party in the elections of 2007. The Polish transition of 1989 in its economic respect was also a revolution, but this one took place as an evolution, tough, full of sacrifices, turning many spheres of the social life, reducing some of the Poles to the beggars, meanwhile letting the others grow from rags to riches. The changeover, known as Plan Balcerowicza, was the unprecedented attempt to bring the central planned economy onto the market economy, what meant the presumptive results and spin-offs were almost unpredictable. I have to pay homage to the architect of the operation, he showed a utmost bravery by taking up the drafting and execution of the plan, still bearing in mind how difficult it would and how many grudges would some Poles hold against him. The latter statement is of note if we recall catchwords like “Balcerowicz musi odejść” (EN: Balcerowicz has to leave) and the likes (here Balcerowicz can be seen as a victim of his reforms as he took the fall for their ramifications). I can speak highly of him as of the governor of the central bank, but on the flip side I cannot forget about his dogmatism and oversimplified prescriptions for economic problems. Free market is like democracy – nothing better has been figured out and it’s not downside-free. Self-regulating mechanism do not have to reach the equilibrium every time they are facing shocks, so I am calling for more pragmatism.

The person of Balcerowicz is not the core of my today’s reflections. Following the previous post I take the liberty to outline the mark left by the implementation of market economy.


1) Small entrepreneurs – to quote Balcerowicz it was the biggest success – over a million of self-proprietors, small entrepreneurs, pioneers of fledging capitalism. Many of those businesses went bust, but many turned profitable and their founders are millionaires today. And the stalls put up on fairs, pavements, roadsides are probably etched in our memories as a landmark of the early nineties…

2) All the group which were granted several privileges during the martial law, in the eighties or during the transformation – uniform services’ employees, miners, customs officers, trade unionists, former members of PZPR – they all enjoy not only living in a free and democratic country but also excessive privileges of early retirement, high benefits, job security and so they retain the pick of the previous system.

3) Young, ambitious, go-ahead, clever, determined, add a few more adjectives to this list and you will get the portrait of Poles born in the late sixties who entered their adulthood twenty years ago – they got the unrepeatable chance and many of them knew how to not to waste it. Today they are at the top, they do not have to worry about financial security, their children lead the problem-free life. Many of instead of politics focused on “grilling” and enjoy the time of their lives.

4) International corporations which entered unsaturated market of Poland and built their structures here. Their advance to Poland was a race against time – the ones that found a gainful market niche hit the ten, for many of them Poland, country on the make is a dreamt-up cash cow.

5) The… Should I call it “układ”? There is a grain of truth in it – the last group consisted of the ones who set themselves up where the politics and business met. That was where the great deals could be made. Prosecutors carry out the investigations on some of the privatisation transactions, in some cases the truth will never come to the light – but hundreds of folks benefited from it without remorse, although in fact they had been stealing away the national property. What belonged to the state was built with the hands of its citizens – so factories, plants, etc. were not no-man’s property.


1) Ordinary people who went through an ordeal of inflationary spiral, job insecurity, worsening living standard – that was tough but necessary.

2) Employees of PGRs – collective farms. Under the Plan Balcerowicza all farms were liquidated within a few months. The vast majority of farms were unprofitable and were the great example of “moon economy”. Inefficient, obsolete are now considered the relic of those times. The people once fired in the 1990 or 1991 descended into durable joblessness, many of them got addicted to alcohol. Those losers are irrevocably in the point of no return, however, their habits and attitude will be inherited by their children and the chances to cure the disease are diminutive…

3) The long-term structural unemployed, in simple words the ones, whose qualifications do not fit the employers’ requirements. Usually laid off from wound down factories, unskilled, or semi-skilled, maladjusted to the economy partly ruled by the law of jungle, with computer illiteracy, who do not speak foreign languages, unable to adapt to challenging work environment. Quite often immobile, the stay where they had been born and where they had lived for all their lives. This often means that demand on workforce in Warsaw does not meet the disproportionate supply on province…

4) All the ones who profited from the absurdities of the previous system. The ladies selling meat under the counter, clerks corrupted for making favourable decisions, the ones who had a cushy “czy się stoi, czy się leży, dwa tysiące się należy” (EN: no matter if you stand or lie, you deserve to be paid two thousand) job of putting the papers from one pile to another.

5) For Moherowe berety see he post below…

1 comment:

Michael Dembinski said...

Lovely article. First time in 12 years in Poland I've seen a list of winners and losers.

I'd add to the winners:

Poles born in the West (or who spent a substantial part of their lives studying/working there) who came to Poland once the dust had cleared. They sold their know-how and experience to the international corporations for a good price; their social standing in the New Poland being far higher than it would have been had they remained in the West.