What are the guilty?

   Prime Minister Jerzy Buzek, many now realize, is not a man of many talents. But last week he demonstrated a surprising ability that not even his ever-shrinking band of supporters had suspected him of: namely, his unerring ability to wreak yet further destruction on his government and his personal reputation with only three weeks remaining before national parliamentary elections. The dismissal of Finance Minister Jarosław Bauc in the extraordinary events of last week must surely rank as one of the most bizarre events in recent Polish political history.

   Recall that Bauc had a few weeks ago presented his analysis of the state of the country’s national finances, and concluded that unless radical reforms were undertaken in the sphere of social spending, the 2002 budget would balloon to a deficit of about zl. 90 billion ($21.4 billion) and effectively spark a financial crisis. Bauc himself presented to the government a preliminary budgetary plan that suggested ways of limiting the deficit to zl. 35 billion ($8.3 billion), through a series of spending cuts and institutional reforms that would at least keep the deficit to fundable proportions.

   The reaction of the government – including the prime minister and Economy Minister Janusz Steinhoff – was to distance themselves from Bauc’s proposals, and indeed question the basis of his calculations. Steinhoff established his own independent group of economists to go through Bauc’s calculation, hoping to show them to be exaggerated. Much to Steinhoff’s embarrassment, the team concluded last week that, indeed, Bauc was correct. The result? Instant dismissal of Bauc, on the grounds that he had been “too late” in informing Buzek of the impending crisis. This feeble reasoning for the dismissal begs the question as to who is to blame for the situation, which now extends much further than the fate of the finance minister and now revolves around the future of the economy.

   It is true to say that Bauc was perhaps not acting in the cleverest fashion by springing his analysis on the government via the media, and six weeks before the submission of the budget to Parliament. Indeed he can be accused of naivete in expecting Buzek to support a budget that would have been the longest suicide note in Polish political history. Yet for all that, the behavior of Buzek speaks volumes about the nature of the prime minister and of the entire political class.

   Firstly, the event underlines once more the relative weakness of the Finance Ministry both institutionally and personally within the current government. The fact that Bauc was forced to use the media to get his message across is proof that he had given up on trying to persuade his cabinet colleagues privately, while the attempted public humiliation of him by the “Steinhoff experts” shows the depth and closeness of the relationship between the prime minister and Steinhoff to the exclusion of other ministries. It remains to be seen how in an Democratic Left Alliance (SLD) government the Finance Ministry will fare, but last week’s hint by Marek Belka, currently President Aleksander Kwaœniewski’s chief economic adviser, that he may well refuse the job is an indication of how Belka views his abilities to get things done when Leszek Miller becomes prime minister.

   Secondly, the background of the crisis shows that the past four years of government were center-right in name only, at least as far as economic policy was concerned. Solidarity Election Action (AWS) had come to power with a broad agenda of social engineering, through legislation that essentially set up a whole legal structure of welfarism that will now take a heroic effort by whatever government to dismantle. The range of social privileges handed out during the past four years seem entrenched and their attempted removal will provoke massive union unrest – something Marian Krzaklewski, leader of the Solidarity trade union, will be only too happy to unleash under an SLD government to rebuild his faded political position on the right.

   Ultimately, the guilty men are the entire Polish political class, with one or two noteworthy exceptions. It is ironic to see the SLD reaping increased political capital from the crisis, when a close look at their voting in the Parliament reveals that they were as responsible as AWS for pushing through the social legislation that has so burdened the economy. The last four years have been spent by the SLD criticizing Leszek Balcerowicz, the former finance minister, and Bauc for being too “monetarist” and hard-line in their budgetary policies, yet had their proposals been implemented the crisis would be worse yet. However, in their defense, the view of the SLD that it is possible to have one’s economic cake and eat it, too, is a view that has been dominant throughout Polish politics in the past 12 years. Few politicians have had the guts to stand up before the electorate and tell them that their ambition to live at West European standards of living with an economy generating one of the lowest GDP per head levels in Europe was a fantasy that could only end in financial disaster. Those that tried, such as Balcerowicz, were mercilessly hounded out of politics, sometimes by their own parties.

   Now comes the delicious spectacle of seeing those same politicians seeking election or re-election claiming that they have the solution for the problems that they themselves have created. Miller must surely be increasingly dreading taking on what is now the poisoned chalice of heading up the government. The reality of the economy will be merciless, and will force Miller to finally show his hand on economic policy. He has two clear options: to go down in history as the man who finally got to grips with the nation’s finances, or to be remembered as merely another of the guilty men who through their incompetence and political cowardice brought the economy to its knees.