Polish populism threatens democracy, says banker

POLAND: The president of Poland's national bank has said the country's democratic system is in danger because of the populist…

POLAND: The president of Poland's national bank has said the country's democratic system is in danger because of the populist politics of the ruling Kaczynski twins.

The remarks of Leszek Balcerowicz come as he faces charges of corruption by a parliamentary commission investigating the sell-off of Polish banks in the 1990s.

Mr Balcerowicz was finance minister of Poland's first Solidarity-led government at the time of some of the sales but says the corruption charges have been concocted by the ruling Law and Justice Party (PiS).

"There is a competition among the coalition partners who will be the bigger populist," said Mr Balcerowicz. "Democracy could degenerate and people will turn away from it . . . then we will have a democracy without voters."

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The commission is part of a government investigation into an alleged network of officials and businessmen it says unfairly benefited from crooked transactions during the wave of post-communist privatisations.

Mr Balcerowicz, seen as the personification of that process, is a love-hate figure in Poland. Many praise him for overseeing the economic shock treatment that rescued the Polish economy.

His enemies, including the three ruling parties, criticise him and others for the economic effects of his actions. Some go so far as to say that he sold off Poland on the cheap to international investors.

"Because he symbolises the transformation process, all attacks on him are attacks on that process," said Piotr Kaczynski of the Institute of Public Affairs in Warsaw. He says talk of threats to Polish democracy is exaggerated but that it is accurate to say that the government and its commission are appealing to certain populist trends.

"Balcerowicz is well known for his extremely high moral standards, therefore attacking him on a corruption front tells more about the attackers than the attacked."

Mr Balcerowicz has threatened to sue a PiS politician who chairs the commission for suggesting that international bidders for Polish banks ensured success by contributing to an economic research institute run by his wife.

"I am shocked by the scale of destruction of what has been achieved in Poland so far," he said of the PiS-led coalition with the populist parties Self Defence and League of Polish Families. "We are dealing with people who, without any scruples, make politics at Poland's cost."

Economist Krzystof Obloj says there is a danger that political rows and the "atmosphere of denunciation and interference" will harm Poland's attractiveness as a business location.

Critics say that while the government investigates alleged old boy networks in the 1990s, it is now creating one of its own.

More than half the heads of the 50 largest state-run businesses have been fired in the last year and replaced with PiS members, according to the Rzeczpospolita daily. The European Central Bank has expressed concern at plans to merge the three independent bodies supervising banks, insurance companies and the stock market. The new body would be governed by a seven-member board, mostly political appointees. The ECB said it was not clear whether the appointees would be neutral or even have any economic experience.