Poland's New Men of Property
On Sunday, October 27--the future as I write this--the Poles will elect their two houses of Parliament, for the first time in an entirely free vote. For the 460 seats in the Sejm they will choose from among 7,021 candidates on twenty-seven national party lists and a number of regional ones in a complicated system of proportional representation. For the 100 senators they will pick among 613 contenders. Is it not a triumph of democracy? Nobody in Warsaw seems to think so. Poland is catching up with America in this unwelcome respect: Half the electorate is expected not to go to the polls. The vote may be so dispersed that it will be difficult to muster a majority even for a coalition, and that should strengthen the hand of President Lech Walesa. With Solidarity's capital of good will exhausted and discontent rising--as unemployment exceeds 10 percent and will top 15 percent next year if the trend is not reversed, as real wages decline and the depression deepens--the market euphoria 1s over. The days when Leszek Balcerowicz, the Finance Minister and darling of the International Monetary Fund, was the Eastern miracle maker and Professor Jeffrey Sachs his successful Western salesman-those days are gone.
I went to Poland, the pacesetter in the Eastern European race toward capitalism, to see how within a few years a country is supposed to crystallize a class, the bourgeoisie, that in the West took centuries to emerge from the feudal womb. Or, to put Galsworthy into plural, I went to look at the new men of property. In the process I saw the gap between the new political parties and the 2 social groups they are supposed to represent; the extent to which some parties are artificial voices from the past, echoing a nationalism that, though reactionary, made some sense when ethnic minorities accounted for one-third of the population but now is simply absurd; the political paradoxes and economic contradictions that suggest the menace of authoritarian rule.
For Those Who Have
Superficially, it is still possible to describe the Polish miracle that wasn't. Warsaw has altered radically, and I sensed it already at the airport, where a taxi driver grabbed me and, as I was to learn, cheated me by doubling the fare while explaining in friendly conversation that the Communists had deprived Poles of the spirit of initiative. The square where my hotel sits, on the border of the former Jewish district, once bore the name of Feliks Dzlerzynski, the Polish founding head of the Cheka, the ancestor of the K.G.B.; now it has recovered its prewar name of Banking Square. Next door, the House of Soviet Literature has been replaced by the Ameryka Bank.
Yet the starkest change in terms of symbolism was not apparent until I went to the big building at the corner of New World Street and Jerusalem Avenue. It was there, at the Communist headquarters less than three years ago, that a party spokesman insisted to me that never would a Kuron or a Michnik sit around the negotiating table. Today a flag flies from the building with the initials CBF, standing for Banking and Financial Center. Indeed, all five floors are filled with various firms, including, at the top, a Stock Exchange (or rather the embryo of one, since it quotes only ten stocks). On the ground floor a sculpture of three miners is an odd remnant of the past. The change is symbolic in another sense. Originally, the party building was to be handed to the university for its library; the government opted for the banks. Here is the sign of the new hero: no longer the Man of Iron, the proletarian, nor even the intellectual rebel; instead, the manager with red suspenders and a combination-lock attaché case.
For such people there is plenty to buy. The shopping area, around the smart New World and Krakow Suburb streets has changed beyond recognition. It is not quite Bond Street or the Faubourg St.-Honoré more at the level of Bloomingdale's, with high-class ready-made goods by Pierre Cardin, Yves St. Laurent or Dior, and more to come. Here are foreign products at foreign prices, much more costly for the local population. A person has to wait six months for a Mercedes SEL, which costs 1.4 billion zlotys (roughly $125,000, at about 11,000 zlotys to the dollar), but that's sixty-five years of earnings for a Pole with the average monthly wage of 1.8 million zlotys. Some Poles have reached the stage of conspicuous consumption.
Cosmopolitan Flea Market
The snapshot above is a bit misleading. Shopping, for those who can afford it, has altered throughout the country, also in the suburbs and provincial towns. The lines have vanished, and Poles are glad that they can buy toilet paper and toothpaste when they choose. The shopping revolution, with its invasion of foreign goods, has also taken place at a much poorer level. Until quite recently the best indication of this was to be found around the Palace of Culture, a skyscraper in Stalinist neo-Gothic. It was like the fair around the cathedral in the Middle Ages, with people flocking from various parts of Eastern Europe and selling from bags or suitcases. Now the poorest vendors and the foreigners have been eliminated. Trade is conducted from stalls ranging from metal booths to more elaborate wooden huts, but the imported goods, listed here at random, still read like a Surrealist poem: Brazilian shoes, Italian raincoats, embroidered blouses from Thailand, Turkish knittings and Pakistani jewels, a Korean down jacket, Adidas sports shoes, soap from Germany and detergent from Britain.
But to see the real international flea market you now have to cross the Vistula and go to the main sports stadium. The inner seats are for soccer fans, but the outer tiers are reserved for trading. You pay a thousand zlotys to enter and 20,000 to sell. The Romanians, selling colored pencils or begging, are the poorest. The Poles have stalls and the best spots. The top of the stadium, which I inspected, was dominated by the Soviet contingent. They sold straight from the suitcase--scarves, dolls, boxes, surgical equipment and army uniforms. They came from the Ukraine, from Nizhni Novgorod, from Uzbekistan and distant Mongolia. This Soviet commercial incursion, with a week's wait at the Polish frontier, has prompted all sorts of stories about the Ukrainian or Russian mafia defeating its Polish counterpart, about the transit of cars from Germany or even the Moscow-Medellín connection.
Such rumors I can only echo. On the other hand, I have it from the horse's mouth that the Polish government purposely encouraged consumer imports. It did this by keeping tariffs low (until a rise in September, Polish duties, averaging 3.6 percent, were among the lowest in the world) or by turning a blind eye to smuggled goods or uninspected foodstuffs. The goal was to break the public trade sector, and it was reached: More than three-quarters of Poland's retail trade is now in private hands. But that was achieved at a price. The loss of taxes aggravated the budgetary deficit; imports of consumer goods further depressed domestic production; and to this must be added the cost of moral corruption. As an editor put it to me, a clever student importing bananas could earn in a good day I .5 million zlotys at a time when a minister was earning 4 million a month and the head of a bank 20 million; so why should he keep studying?
The government's idea was also that some of the vendors would move from the suitcase to the van, to the stall and then to the shop, restaurant or whatever, and to some extent this has happened. For the genuine capitalists, however, I had to look among the really rich. old or new.
The Men of Property
The old ones first. President Walesa has his own parallel government. In it the "minister" in charge of giving property back to its former owners is Jerzy Grohman, the right man for the job. He is the heir of Grohman and Scheibler, who had the biggest textile mills in Lodz. He corrects me politely: "biggest in Europe." In his late 60s, the man would fit nicely in a Swiss hotel or an English club. He mentions that among big firms the number of claimants is small because 70 percent of big business belonged to foreign capital before the war, a useful reminder for those who idealize the past. For the time being, rather than introduce his own bill, he is trying to prevent the passage of one concocted by the real Minister of Privatization, and that will not be easy. Walesa the workman may be flattered to have a former big boss on his staff, as he is flattered by the presence of aristocratic ladies to whom he promises the return of their land. Yet he handed over the government to Jan Kryzysztof Bielecki and his fellows from the Liberal-Democratic Congress, and these panegyrists of capitalism want to pass on the factories to their friends, if they can, and to get some money from foreign investors. They are likely to carry the day.
For rich men of more recent vintage I turn to Mieczyslaw Wilczek, the "red millionaire," who had his moment of glory when he was appointed Minister of Industry in the last Communist government. We met in the green bar of Victoria, one of Warsaw's two poshest hotels. He is small, quick-witted and wears gold cuff links. Coming from a modest background, he took degrees in chemistry, law and economics. He registered a number of patents while working for a state detergents firm. Twenty years ago he set up on his own as an "artisan," employing first five, then ten people. By the time he joined the government he was very wealthy. Did Mieczyslaw Rakowski, his Prime Minister, believe that the C.P. could preserve its hold on power during a transition to capitalism, and did he encourage privatization with that in mind?
Wilczek has a curiously split mind. On the one hand, he is grateful to a regime that gave him the possibility to climb, and he argues that Polish development should be compared, not unfavorably, with that of Turkey, Greece or Portugal. On the other, he talks like a boss bashing unions and detesting workers' councils. He sounds quite comical referring to Ryszard Bugaj, leader of Labor Solidarity and the nearest thing to a socialist economist in Poland, as "much worse than the Communists." Yet as a businessman he appears shrewd, putting his money into meat and animal feed and arguing that Poland should look to the hungry Eastern market because for some fifteen years it will not be able to compete in the West.
For a spokesman of the most recent contingent of dollar millionaires I look to the Senator Andrzej Machalski. A philosopher by training, kicked out of his job as a Solidarity activist, he went into business during military rule and then formed his employers' confederation (there are two of these in Poland now, as well as a club of millionaires). Linked with Liberal Democrats, he puts property at the heart of the matter and claims that the state must give it to specific groups "with an active attitude toward capital." Otherwise, his views do not differ from those of Wilczek, whom he would welcome in his confederation.
I mention his attitude concerning the likes of Wilczek be- cause the problem of what to do with the old nomenklatura is controversial. The Liberal Democrats but also the Democratic Union, the party of former Prime Minister Tadeusz Mazowiecki and Jacek Kuron, which is tipped to get the highest vote, see no difficulty: The law must be the same for all and, if you want capitalism, you must build it with whom you can--the nomenklatura, currency speculators or foreigners. On the other hand, the Center, the party headed by the Kaczynski twins, which helped Walesa to become President but which no longer has his backing, maintains that the country cannot accept men building their fortunes on the position they reached under the previous regime. This position not only has legal inconveniences; it has no moral leg to stand on now that Solidarity can no longer pretend to represent principle and purity. In a transitional system, with legal loopholes and tremendous opportunities, the new regime seems to be staggering from scandal to scandal. To cite the most recent incidents, millions of dollars were made exploiting the slow accounting and poor control of capital movements--in one case, by individuals quickly shifting deposits between banks and getting interest several times on the same amount; in another, by high-level officials of the Fund for the Servicing of the Foreign Debt, who took advantage of the transactions to put money into their own pocket or that of their partners. It was not astonishing, then, that when the head of the Highest Chamber of Control, a watchdog agency dealing with the property of public institutions, died the other day in a car crash, everybody concluded at once that it was a case of murder.
Anyone who has read Marx knows that the builders of capitalism were not angels. But the problem is not the character of Poland's new capitalists. From conversations with practitioners and analysts I draw the conclusion that while pots of money are being made in Poland and some entrepreneurs are traveling in their own helicopters, the development of capitalism on the whole has reached the level of trade and speculation, but not yet that of productive accumulation. And this has something to do with the general climate.
I saw Maggie Thatcher applauded in Poland, but native Thatcherism has lost its former self-confidence. Ryszard BugaJ is no longer alone In pointing out that to forecast an increase in the private sector's share In industry beyond 30 percent over the next few years is doctrinaire presumption; and in stressing that since the crucial task is to relaunch production, this must be done in the state sector. Others are equally aware that if credit were really tightened the economy would go bust. Speculation about Balcerowicz's fate is not surprising. While the economic figures can be argued, the overall trend cannot, and the budgetary deficit now threatens public pensions. No doubt some of the unemployed are working on the side, notably in private trade, but then restructuring has barely begun. The insufficient accounting of the private sector may partly explain the 40 percent drop in two years of both industrial production and real wages. Such qualifications, however, are marginal. Nobody denies that some three-quarters of the population are substantially worse off and angry. A minister facing a crowd at an electoral meeting in an area full of the unemployed tried to pacify the women: "You ladles at least appreciate the absence of lines and the presence of goods in the shops." One woman snapped back, "Thank you, we can now look at the goodies shown in the window."
I came to see a capitalist class In the making and discovered a series of paradoxes, which must be summed up in shorthand to grasp the situation. The f m t is the relationship between Solidarity and the working class. Solidarity was originally bulk by the labor movement in the big plants, in the shipyards and In the mines-the very sectors that are threatened by the sudden acceptance of the international division of labor. Its declining support among workers will be evident in election results now that the union itself has put up candidates under its own banner of Solidarity (not to be confused with the more leftist Labor Solidarity, which is a political party).
The second paradox is linked with farming. The hated Communist regime protected the smallholder; the capitalist market will not. Forty percent of Poland's population live in the countryside and less than 30 percent still work on the land. This was the proportion in France just after the war; there it has now dropped to 6 percent. Nobody likes to be eliminated in the name of economic progress, and the rural vote is one of the unknowns of this poll.
The Catholic Church would require an article on its own. It clearly overplayed its hand, and there is a reaction. A prominent Catholic writer explained to me that the Pope's last journey through Poland was a flop compared with its antecedents. Others reported that the clergy's luxurious parish houses and conspicuous cars antagonize many people. Against this is the fact that the church remains the only truly organized force. Anka Wolicka, a Labor Solidarity candidate In Lodz, showed me documents indicating that Catholic ideologists here have Ireland, not Italy, as their model. Visiting a church, I rediscovered the sickening nastiness of the hierarchy's antiabortion propaganda. Will the church, at the last moment, put its full weight behind the most reactionary parties?
Finally, there is a complicated contradiction. Looking through my notes I perceive that almost everybody--the head of a new political institute, the boss of the employers' confederation, Mazowiecki or Wilczek--complained about workers' councils, self-management and the egalitarian feeling of the population. Indeed, the economic spokesman of the ex-Communist Party told me, with tongue only half in cheek, that "Solidarity should have acted as a 'vanguard' and brought to the working class the ideology of conversion to a capitalist market." All this suggested hopefully that the ideals once inspiring Solidarity are still alive and haunting. Against this, here as everywhere in Eastern Europe, there is the repetitive refrain about the absence of an alternative, the uselessness of rebellion, leading to a feeling of explosive impotence.
The cabman bringing me to Warsaw was a preacher of private initiative and an admirer of the new regime. The driver taking me back to the airport, at half the price, was less enthusiastic. Asked why so many taxis stood in line, he explained that "there are now 60,000--more than in New York--because the authorities are accepting anybody. A cabbie, to prove the point, got a permit for his 3-year-old son." The driver is now worse off. Under the previous regime he had the money to buy a new chassis, though delivery was delayed; now he can get one quickly but can't afford it.
"And we're not the worst off," he told me. "My mother- in-law, a pensioner on half the average wage, can't make ends meet; we invite her from time to time for a square meal. Before, it was the nomenklatura; now it's the new rich. We ordinary people never get anything." His words reflect the mood better than the slogan scribbled here and there and best translated as "Commies, come back!" The Alliance of the Democratic Left, which includes the former Communists, is not expected to get more than 10 percent of the vote. On the other hand, there are masses of people who curse both the reds and their successors. Without a progressive political outlet, this mood may lead to dangerous outbursts.
Eight days of Indian summer and yet it was a sad occasion. Sad because my formerly leftist friends, now converted to capitalism and trying to compensate by taking a decent stand on national issues, painted an apocalyptic vision of Eastern Europe's future. With Yugoslavia burning, who could deny their gloomy forecast with certitude? The few who remained true to themselves were no more optimistic. When I asked Karol Modzelewski, another leader of Labor Solidarity, if his improvised movement could benefit from popular discontent, he replied skeptically, "We're social democrats now, but has reformism much of a future if Poland goes the way of Latin America?" At the end of my journey it was obvious that the road to capitalism will not be as swift or smooth as many assumed. Paraphrasing Radek on "socialism in a single country," yes, you can build capitalism in Eastern Europe, but heaven or hell have pity on the people, who have not lost altogether their capacity for rebellion.