WORLD

CRISIS IN POLAND

THE REMOVAL OF PRICE CONTROLS ON FOOD ANGERS POLISH WORKERS AND RAISES THE THREAT OF STRIKES

MARY NEMETH August 14 1989
WORLD

CRISIS IN POLAND

THE REMOVAL OF PRICE CONTROLS ON FOOD ANGERS POLISH WORKERS AND RAISES THE THREAT OF STRIKES

MARY NEMETH August 14 1989

CRISIS IN POLAND

WORLD

It was a bitter pill to swallow. When Poles went shopping on Aug. 1, they found that food prices had soared by up to 1,000 per cent overnight, driving the price of a kilogram of beef to $8.40 from 85 cents in one store in the southern city of Krakow. In one bold stroke, the government had removed food price controls in hopes that free market forces would boost production and put produce on Poland’s chronically bare store shelves. But the brunt of that policy fell squarely on the shoulders of Polish workers last week, and they were clearly angry. Across Poland, people called strikes and strike alerts to demand higher wages. In the midst of the uproar, the Sejm, or lower house of Parliament, elected former interior minister Gen. Czeslaw Kiszczak as prime minister—but only after the Communist leadership managed to quell a revolt among its own ranks. Kiszczak, a 63year-old career army officer, conceded that not being an economist was a drawback at a time when Poland faces desperate economic problems. “The situation is worsening dramatically, the market has broken down, inflation is galloping, society is worried about future living

THE REMOVAL OF PRICE CONTROLS ON FOOD ANGERS POLISH WORKERS AND RAISES THE THREAT OF STRIKES

conditions,” Kiszczak said in a speech just before he was elected on Aug. 2. “In this situation, my candidacy as premier comes as a certain surprise.”

The opposition Solidarity movement, which humiliated the ruling Communists when it won 35 per cent of the 460 seats in the Sejm and 99 of the 100 seats in the Senate in May 7 elections, agreed. And Solidarity leaders urged deputies to reject Kiszczak, who, as interior minister, was responsible for implementing

martial law in the early 1980s. Although Kiszczak won the grudging respect of many Solidarity leaders over the past year for his role in negotiating democratic reforms, they did not want a member of the Communist party to serve as prime minister in the same administration as President Wojciech Jaruzelski. “No personnel reshuffles within the present political alliances, monopolized by one party, are capable of solving the country’s problems,” said Solidarity parliamentary leader Bronislaw Geremek. When the Sejm convened on July 31, it appeared that 13 Communist deputies and 60 deputies from the Peasant Party—traditional Communist allies—would also vote against Kiszczak. Indeed, Peasant Party deputies even proposed forming a coalition government with Solidarity. But Communist leaders held a crisis meeting late on July 31, where they threatened to dissolve parliament and to throw rebel deputies out of the party in the next election. They finally managed to rally enough support to elect Kiszczak by a vote of 273 to 173.

Although Solidarity lost that battle, it became clear last week that the union would wield considerable influence in the Sejm. Some

Peasant and Communist party deputies joined forces with Solidarity last week to pass two other resolutions that could deeply embarrass the government. On July 31, even before Kiszczak was elected, the Sejm voted 206 to 169 to establish an unprecedented Extraordinary Congress that will consider impeaching the outgoing government—led by former prime minister Mieczyslaw Rakowski—over its economic record. During Rakowski’s 10-month tenure, Poland’s industrial output fell and the country was forced to accept emergency food donations from the European Community. He is now Communist party leader. The inquiry could report to the state tribunal, a judicial body that can punish wrongful conduct by government officials, but has never been activated.

Then, on Aug. 2, the Sejm voted to set up a commission to examine charges that police committed political murders under martial law. Solidarity deputy Tadeusz Kowalczyk, who presented the motion, charged that since the introduction of martial law in December,

1981, “the interior ministry has been responsible for several dozen, almost 100, political murders.” He said that he came across many unpublicized killings involving the interior ministry that were covered up as apparent suicides during his work with Solidarity’s National Council of Farmers.

Since 1981, police have only been convicted in one political murder, the killing of popular pro-Solidarity Catholic priest Jerzy Popieluszko in 1984. Four security policemen were jailed for his murder.

Those resolutions—opposed by Communist party leaders—will not make life any easier for the new prime minister. But Kiszczak’s immediate concern will be the economy. “The most important task for now is the issue of feeding the nation,” Kiszczak told reporters. That will not be easy. His government faces a $45.6-billion foreign debt and an annual inflation rate of more than 100 per cent. Meanwhile, the value of the nation’s currency continued to plummet last week. On unofficial markets, the currency fell from 6,435 zlotys to the dollar on Aug. 1, to 8,073 zlotys to the dollar two days later.

All parties appear to agree that Poland must steer away from central planning and introduce some Western-style free-market mechanisms. But there is no consensus on how quickly those measures should be implemented. The unfreezing of prices last week was the first step in what the government calls its “marketization” plan. And it clearly hopes that private farmers—who have cut back production because they have not made money on meat and grain

sold to state agencies—will boost production. But Solidarity and the official Communist-led trade union movement have condemned the move, saying that it was ill-prepared and that a government compensation plan to pay 80 per cent of the cost of living increase was insufficient. Both unions supported strike actions at several industrial complexes last week. Even some Communist party officials opposed the plan, saying that it will plunge 60 per cent of Poland’s 38 million inhabitants below the poverty line.

The day before the price freeze was lifted, people pushed and argued as they tried to get into stores in a wave of last-minute panic buying. By Aug. 1, when the prices soared, there was little bread, salt, cheese, butter or sugar in Warsaw stores. And for the commodities that remained, prices varied widely. In one store in Warsaw, boneless beef that cost 85 cents a kilogram on July 30, was selling for $4.33 a kilogram the next day—while in Krakow, it cost $8.40. And 250 g of butter that could be found in one store in the northern city of Gdansk for 35 cents, cost 94 cents just a few blocks away. An average monthly wage is $150. “When I get a 32,000zloty [$46] pension, what can I afford—a sausage?” complained one elderly woman, queueing for eggs at a market in Warsaw. “I worked for 34 years. How am I to live now?” she said, before bursting into tears. Another woman said that the new government will not do any better. “Nothing will improve; there will only be more disorder,” she said. “I cannot even think what Kiszczak will do. He is not an economist. He will do nothing good.” Kiszczak’s first job will be to form a new government. And he told reporters immediately after his election that he would consult with Solidarity. “I will ardently talk to them about entering the government in a grand coalition,” he said. But Solidarity is unlikely to agree. In negotiations with President Jaruzelski over the past few weeks, Walesa had said that the union wanted to form a government on its own, or not at all. And joining a coalition at this time may not serve Solidarity’s political interests, since the union would certainly lose some public support over the short-term side effects of the government’s austerity plan. If the union remains outside government, however, it is certain to be a thorn in Kiszczak’s side. Whatever the final composition of his cabinet, it is clear that the prime minister will have to find a way to work with the opposition if he is going to impose painful economic measures without sparking a social explosion.

MARY NEMETH