Tipping the Scales in Poland

...THE GIEREK FORMULA Tipping the Scales in Poland BY DONALD R. SHANOR Warsaw With the dismissal of Wladyslaw Gomulka as Communist party chief and the coming to power of Edward Gierek, Poland is on a course of reform and repair after the noting and strikes that tore apart its Baltic seaports and came very close to engulfing the entire nation Reform is necessary to prevent a recurrence of the wage-price crisis that caused the noting, repair is m order not only in the damaged cities of Gdansk, Szczecin, Gdynia, Sopot, Elblag, and Slupsk, but in the shattered ranks of the Communist leadership Thus the replacement, too, of lozef Cyranlae-wicz as Premier by trade expert Piotr Jaroszewicz The parallels between the Polish explosion and the uprising in Czechoslovakia three years ago, when the Central Committee was in the process of getting rid of Antonm Novotny, are striking But there are also important differences, and because of them no Prague Spring should be looked for in Warsaw this year Novotny, then 63, had displayed as much opposition as the 65-year-old Gomulka to much-needed economic reforms In both cases, the Party leaders reluctantly accepted the measures of their advisers, yet carried them out half-heartedly if they did not sabotage them deliberately The effect this was having m Poland was plain from conversations I had in Warsaw and Cracow the week before the noting broke out in the north Economists and Party officials alike were nervous about the signals they were getting, although no one, of course, was predicting the violence that followed The problems of the economy were manifold In industry, for example, it had been decided to close down the most flagrantly inefficient enterprises, or at least refuse them permission to take on more workers The idea was to concentrate investment in the growth industries petrochemicals, electronics, machinery The returns would be greater, and the products of these industries would feed the others in need of modernization Above all, agriculture would be helped by construction of chemical fertilizer plants But each time a plant was singled out as inefficient, its manager, or the local Party leader, would buy a $5 ticket on lot, the Polish airline, and fly to Warsaw to appeal If he had the right connections m the big square stone Central Committee building downtown, the efficiency order would be repealed Often the connections reached as high as Gomulka Agriculture as well as industry was hurt by this "reform, but" policy With farming still predominantly private, there was no incentive problem in Poland as there is m the collectivized countries The trouble here was simply that the government never seemed to know whether it considered the private holdings a temporary phenomenon --to be discriminated against as part of the technique to push the farmers into collectives--or a permanent feature-to be encouraged as a positive economic force Those in the Party advocating the former course were responsible for the shortage of mechanical equipment and fertilizers on private farms, and the resultant low productivity Those who took the latter view managed to set up agricultural circles, a system of loose and genuinely voluntary cooperatives where the private farmers could buy chemical fertilizers and use equipment Too few farmers were joining, though, in large part because they were suspicious about the Gomulka regime's real intentions If you add to this policy confusion two consecutive poor harvests and a chaotic distribution and sales system, it is no wonder that 1970's shortages were far worse than those of previous years Party officials were saying quite frankly m November and early December that since the supply could not be improved, the demand would have to be restricted Less than two weeks before Christmas, the Polish public found out what they meant Prices on basic food and coal were raised 10-30 per cent For the average Polish family, this was equivalent to being out of work without pay for a week and brought a sudden 2 per cent reduction m the standard of living In the Central Committee headquarters, the step seemed to make sense It would restore the balance between supply and demand in time for the next Five-Year Plan on January 1 It was unfortunate that it had to be carried out before Christmas, yet it was necessary for the sake of the plan The violent reaction in the shipyards and streets of Poland's Baltic ports does not have to be retold here By the end of a week of rioting, at least 20 persons were dead, 255 injured, and $2 million worth of property was destroyed in Gdansk alone Two days later, after hours of stormy Central Committee debates, Gomulka's resignation was announced and the 58-year-old former coalminer Gierek was placed in charge of the Party and nation It took violence to get rid of Gomulka where the Czechs and Slovaks pried Novotny from his Party sinecure with arguments alone But it is likely that subsequent events in Poland will have a much quieter course than those in Czechoslovakia m 1968 Gierek, who had been Party chief of the Katowice coal and mining area, ruling it with such independence from Warsaw that it came to be called Poland's Katanga, seems as good a candidate for the role of a potential Aleksandr Dubcek as any Poland, however, is not the place and 1971 is not the year to mix economic reforms with political freedoms as Dubcek did For one thing, Gierek has nothing like the clear mandate for change that the Czechoslovak Communists gave Dubcek He is considered a compromise successor to Gomulka, chosen because he is the man best able to mediate between the nationalists led by former Interior Minister and new Politburo member Mieczyslaw Moczar and the more moderate faction around Cyrankiewicz, now demoted to the ceremonial office of President For another, Gierek's own record shows that he favors orthodox cures for the economy rather than a thorough reorganization that might influence the nation's political life Gierek has been successful m his Silesian Katanga m combining relatively high pay for his coal and steel workers with a fairly steady supply of consumer goods But there is no hint of political relaxation in this formula, indeed, Gierek's district has long been the favorite example of political commentators in Poland who want to illustrate how to run a tight ship The new Party chief can be expected to try to extend his formula to the nation He will doubtless have the help of the Soviet Union in refilling the shelves of the stores The Soviets have a tradition of coming to the aid of their distressed allies m the wake of upheavals like those in East Berlin and Budapest Raising pay is no problem with Poland's rubber currency The exchange rate for the zloty slides from 25 to the dollar, the official rate to 40 for tourists, 65 for diplomats, 80 on the black market A little more inflation can't hurt the zloty Reform Gierek-style would give Poland a system like that of East Germany--efficiency oriented, with bonuses to spur on the workers and food and goods for them to buy Neither the East Germans nor the Poles feel safe enough to experiment with decentralization or a market economy, since that can spread to politics If Poland could achieve East Germany's standard of living by following its economic patterns, Gierek would be assured of a long tenure But there are at least two complicating factors One is that East Germany began its reforms after building its industry to a point of development far beyond Poland's No amount of bonuses can push productivity beyond a certain point in antiquated factories The second is that the local lobbyists will be as active as they were under Gomulka to keep their enterprises protected from efficiency measures If anything, the prospect of Politburo power struggles will make the regime even more hesitant to antagonize any economic group Donald R Shanor reports on East Europe for the Chicago Daily News...