Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, May 27, 1990 TAG: 9005290197
SECTION: EDITORIAL PAGE: F-7 EDITION: METRO
SOURCE: CAL THOMAS
DATELINE: WARSAW LENGTH: Medium
The ever-present smog not only brings tears to the eyes and a tingle to the throat, it is thick enough, thanks to years of uncontrolled burning of brown coal, to make downtown Los Angeles look like an environmental paradise.
Add to this the recent high inflation, high taxes and a slow pace of privatization, and it's enough to discourage all but the most optimistic.
Ah, but many Poles are optimistic, beginning with my taxi driver, who, while acknowledging that times are tough, remembers the not-too-distant past and celebrates today: "It's better because the Reds are gone. I'd rather be hungry, but without them."
The first signs of an entrepreneurial spirit following four decades of wage and price controls are beginning to emerge. Grazyna and Jaroslaw Stanczykowie recently expanded their bakery into a modest full-service food store, thanks to a next-door "monopolist" who nearly went bankrupt and sold out for virtually nothing. They sell bread, milk, Swiss chocolate (a novelty), beef and pork on well-stocked shelves.
The Stanczykowies employ 16 people and say they have a profit margin of 20 percent. Is Jaroslaw optimistic about the future? "Of course I'm optimistic. I've been risking my whole life under communism."
Jaroslaw says if he could attract an investor, he could create a factory and produce enough croissants to pay off his loan in two years.
Other signs of a budding free-market economy can be observed at the Hola Mirowska, a large, two-story central market for the poor and low-paid workers. Inside the market are merchants who still operate under the old fixed-price system. They are losing business to farmers and other merchants who exercise the new economic freedom by selling their wares from trucks and cars outside, often at lower prices than can be found inside.
Cheese, coffee, soap powder, bacon and even toilet paper (once known as "strategic paper," not only because of its universal use but also because of the difficulty in procuring it) now are easier to obtain than under the old regime.
Such stirrings are not yet a trend, and much must be done before economic health comes to Poland. The government will have to reduce its high tax rate before there are widespread incentives to build. Higher taxes were imposed in order to bring down a soaring inflation rate. The strategy appears to be working. By December of last year, inflation was running at an annual rate of 900 percent for 1989, and threatening to emulate nations like Argentina by going into hyper space. But January's rate was 78 percent. In February, it was down to 25 percent. In March, it had dropped to 5 percent.
As The Economist magazine recently pointed out, "The first need of all the ex-Communist countries is to lay the groundwork for privatisation." Poland is no exception.
A commission appointed last month by Prime Minister Tadeusz Mazowiecki has begun assessing who owns what in Poland. Of the nearly 2,000 buildings used by the Communist Party, only 20 were owned by the party outright. Of the rest, 1,803 belonged to the State Treasury and 50 belong to private owners. A similar situation existed with the 620 buildings occupied by the Union of Polish Socialist Youth. Only 11 turned out to be legally owned by them. "They Had a Lot, But Own Little" says a headline in the English-language newspaper, The Warsaw Voice.
Though the task of resurrecting from the dead a new Poland is formidable, optimism continually emerges from behind any clouds of despair.
Even the biggest complainer I met, an architect named Czeslaw Bielecki, followed a steady stream of objections about taxes and other government policies with this: "Comparing the past to the present, I can be happy that I'm unhappy at this level."
Andrzej Stelmachowski, speaker of the newly created Polish Senate, which meets in a room off the Parliament Building's main hall, looked at me in his office through eyes that have seen much in about seven decades of living and said, "I was convinced, even two years ago, that I was working for a better future for my grandchildren, but now I'm involved in something leading to whole independence. It's fascinating."
No country that has been buried under communism for 40 years will rise from the economic and political grave overnight. But Poland's history and its strategic position between Germany and the Soviet Union will, indeed, make it fascinating to watch.
If the fascination turns to investment and encouragement from the West, people might stop telling Polish jokes and begin speaking of Polish miracles. Los Angeles Times Syndicate
by CNB