ECONOMICS: Poland's New CapitalismBy Jane Hardy Pluto Press, hardback £60
THE STORY of Poland’s transformation from Soviet bloc country to one of the many success stories to emerge from behind the Iron Curtain since the collapse of communism in 1989 is a compelling testament to the robust nature of Polish nationalism and its capability to endure against manifold tyrannies.
Jane Hardy’s account of this transformation rightly gives credit to the series of worker-led revolts in 1956, 1970, 1976, and 1980. These were, as the author acknowledges, triggered by a rise in prices or, as the economist Jeffrey Sachs points out, the incapability of communist-era bureaucracy to cope with market failure.
At the heart of the journey that Poland has taken towards full immersion in the liberal free market has been the decision, taken very early on, that the transformation should be achieved by way of shock therapy, or in more prosaic terms by way of rapid transition to a market-based economy.
The key theme or spear point of Hardy’s critique is “neo-liberalism”, even though she reluctantly accepts that it remains a fuzzy term and something of a straw target for left-wing intellectuals who themselves have been displaced by the disappearance of the Berlin Wall.
The decision by the Polish authorities to go for the quick escape from the command economy came with a very high price tag in terms of unemployment, emigration, social dislocation and the all-too-familiar aggrandisement by former insiders, ranging from Solidarity activists to entrepreneurial ex-communist members of the nomenklatura.
In her treatise, Hardy deals with the importance of western consultants in facilitating their transformation of the Polish economy with a mixture of envy, anger and a modicum of respect. The author remains sceptical and quotes a Polish consultant on the influence exerted by the US agency US Aid: “Dozens of Americans arriving with their wives, dogs, cats and children, causing many more problems than they were able to solve.”
However, there is little by way of analysis of European assistance to the Poles and the extensive EU-sponsored programmes put in place in the wake of the Dublin summit which guided the response by the community to the unfolding events in central and eastern Europe.
Another weakness in the approach taken by Hardy is her somewhat cursory treatment of the European Union in the development of the Polish economy. Europe offered Poland and many of the countries of central and eastern Europe the talismanic opportunity of finally climbing out from under the scarring experience of Soviet communism with all its well-known economic and social oppressions.
The European single market, with its access to millions, and the discipline of meeting both the EU membership criteria and those for eventually joining the Euro currency zone are dismissed as yet another triumph of neo-liberal orthodoxy rather than substantive markers of progress in the transition of Poland.
Anti-poverty campaigners here and elsewhere, as well as NGOs interested in Third World issues, will be surprised by the barely concealed attacks on Jeffrey Sachs, who is a champion of the millennium development goals in relation to Africa.
“He was a prominent adviser and architect of shock therapy who jetted into Warsaw for a few days at a time, in between trips to Prague, Moscow and Sao Paolo, during the crucial period of its initial reforms in 1989-90,” writes Hardy. I know Jeffrey Sachs and he is very passionate in the way he frames his arguments, as I am sure Bono and others will testify, but on balance his advice is grounded on sound empirical evidence. In fairness to Sachs, he is also, like Hardy, a critic of IMF and World Bank prescriptions glibly dispensed at developing nations.
Hardy has done a reasonably good job in her description of the Polish transformation within the self-imposed straitjacket of using a conventional Marxist analysis. For those with a memory of the social sciences in the 1980s and its ritualised usage of Marxist jargon this book will bring a nostalgic smile. Jane Hardy is at her best when she describes both the successes and failures of the Polish trade union movement.
The author, in her conclusion, is right to point out that there was and remains an exceptional quality to the Polish experience. Hugely strategic issues were at stake in Poland. The former CIA director William Casey and Pope John Paul II were among the first to recognise the importance of the Solidarity movement and the rest, as one might say, is history.
Conor Lenihan is Minister of State for Science, Technology, Innovation and Natural Resources. He is a Dáil deputy for Dublin South West and in the early 1990s he lived and worked in Prague where he established a commercial radio station for Radio Bohemia