Can Balcerowicz, government keep reform ball roll minefield?
And that's the same answer he gave last week to an overflow crowd of investors and reporters at an American Chamber of Commerce breakfast when asked about tax reform and the prospects for higher investment and growth for Poland.
"It's a political problem - to mobilize support for changes from the status quo," Balcerowicz said.
Politics is creating blockades to stepped up privatization in railroads, coal mines and the defense enterprises, he said. These are responsible for huge government losses "but these could be profitable under private ownership." Left as they are, they consume so much of the budget that the government can't address other major priorities in, say, education and health.
Lowering taxes is "nothing revolutionary, from an economic point of view. Taxes have to be simpler and broader," he said. But broadening the tax base means capping the tax breaks that have proliferated in the last four years.
Again, it is politics: "Those who defend tax privileges are defenders of the status quo," Balcerowicz said.
He agreed it would be useful to talk more in depth with foreign investors concerned about building and housing construction incentives, in answer to a query from Prime Property co-owner Janet Choynowski. That's progress from his back-of-the-hand rebuff last fall to a question from another mega-realtor, Agnieszka Couderq-Kubas.
And he told Krzysztof Błzdowski, Wood & Co. strategist, that within a month he would get the additional budget data - reflecting the vast off-budget spending, for the first time - so he could better assess Poland with Hungary and the Czech Republic. This would be new data compiled under last year's law on public finances.
Motorola exec Rick Lada urged Balcerowicz to stick to his guns on tax reform, saying this was "exactly what is needed to encourage further investment" especially in helping Poland nail down a "differential advantage" in the very competitive international market. But when he asked Balcerowicz to estimate his chances for success, the deputy prime minister said, "I'm not in the business of forecasting but of mobilizing."
Good thing, too, since the buzz in the ballroom was that the current Solidarity coalition government wasn't long for this world.
Energy investor Zack Allen wondered aloud if Balcerowicz had brought his resume with him. Błzdowski said he'd been predicting "higher risk" for Poland for nine months, and it looked as if the current government churning and political problems might prove him right.
More than 22,000 miners took the World Bank-financed bailouts, but others now are demanding that the government give their loss-making mines more time to phase out production. An Air Force general shocked his colleagues by resigning at a military conference in protest of low wages. ZUS chief Stanisław Alot revealed under duress that he'd only sent a fraction of retirement fund money to privately managed pension funds, compared to what the law requires. And on and on.
One former prime minister was reported to have talked to Solidarity Prime Minister Jerzy Buzek about toughening up his management style - and was appalled then to see Buzek not only not distancing himself from Alot but, in effect, giving him a public bear hug at a televised news conference about the delayed ZUS pension-fund transfers.
But ask ex-PM Hanna Suchocka about coalition governments. Hers was almost ungovernable early this decade, with seven warring partners including not just the Solidarity Union (which ultimately spawned the no-confidence motion that toppled the government) but the religious right which was never happy with capitalism, let alone the perks for the Catholic Church.
Despite Buzek's very low poll numbers and the expectation by nearly every Pole that the Solidarity coalition will be defeated a year from now by a resurgent ex-communist Democratic Left Alliance (SLD) coalition, Buzek and company could well reorganize and rebuild. And having the Solidarity union and Solidarity Election Action 'AWS' architect Marian Krzaklewski in the room when Buzek fired the shambling Interior Minister Janusz Tomaszewski last week ensured that this was an AWS-sanctioned ouster, not the PM alone, on the defensive after leaks from the "lustration" investigators.
"It's a political problem - to mobilize support for changes from the status quo," Balcerowicz said.
Politics is creating blockades to stepped up privatization in railroads, coal mines and the defense enterprises, he said. These are responsible for huge government losses "but these could be profitable under private ownership." Left as they are, they consume so much of the budget that the government can't address other major priorities in, say, education and health.
Lowering taxes is "nothing revolutionary, from an economic point of view. Taxes have to be simpler and broader," he said. But broadening the tax base means capping the tax breaks that have proliferated in the last four years.
Again, it is politics: "Those who defend tax privileges are defenders of the status quo," Balcerowicz said.
He agreed it would be useful to talk more in depth with foreign investors concerned about building and housing construction incentives, in answer to a query from Prime Property co-owner Janet Choynowski. That's progress from his back-of-the-hand rebuff last fall to a question from another mega-realtor, Agnieszka Couderq-Kubas.
And he told Krzysztof Błzdowski, Wood & Co. strategist, that within a month he would get the additional budget data - reflecting the vast off-budget spending, for the first time - so he could better assess Poland with Hungary and the Czech Republic. This would be new data compiled under last year's law on public finances.
Motorola exec Rick Lada urged Balcerowicz to stick to his guns on tax reform, saying this was "exactly what is needed to encourage further investment" especially in helping Poland nail down a "differential advantage" in the very competitive international market. But when he asked Balcerowicz to estimate his chances for success, the deputy prime minister said, "I'm not in the business of forecasting but of mobilizing."
Good thing, too, since the buzz in the ballroom was that the current Solidarity coalition government wasn't long for this world.
Energy investor Zack Allen wondered aloud if Balcerowicz had brought his resume with him. Błzdowski said he'd been predicting "higher risk" for Poland for nine months, and it looked as if the current government churning and political problems might prove him right.
More than 22,000 miners took the World Bank-financed bailouts, but others now are demanding that the government give their loss-making mines more time to phase out production. An Air Force general shocked his colleagues by resigning at a military conference in protest of low wages. ZUS chief Stanisław Alot revealed under duress that he'd only sent a fraction of retirement fund money to privately managed pension funds, compared to what the law requires. And on and on.
One former prime minister was reported to have talked to Solidarity Prime Minister Jerzy Buzek about toughening up his management style - and was appalled then to see Buzek not only not distancing himself from Alot but, in effect, giving him a public bear hug at a televised news conference about the delayed ZUS pension-fund transfers.
But ask ex-PM Hanna Suchocka about coalition governments. Hers was almost ungovernable early this decade, with seven warring partners including not just the Solidarity Union (which ultimately spawned the no-confidence motion that toppled the government) but the religious right which was never happy with capitalism, let alone the perks for the Catholic Church.
Despite Buzek's very low poll numbers and the expectation by nearly every Pole that the Solidarity coalition will be defeated a year from now by a resurgent ex-communist Democratic Left Alliance (SLD) coalition, Buzek and company could well reorganize and rebuild. And having the Solidarity union and Solidarity Election Action 'AWS' architect Marian Krzaklewski in the room when Buzek fired the shambling Interior Minister Janusz Tomaszewski last week ensured that this was an AWS-sanctioned ouster, not the PM alone, on the defensive after leaks from the "lustration" investigators.
