President Carter is reported to have sent letters to Western European leaders, proposing economic help for Poland. At about the same time, the Polish ambassador in Washington was asking U.S. officials to provide Commodity Credit Corporation credits of $670 million in fiscal year 1981 for the purchase of American feed grains, tobacco and other agricultural products. (from 1971 through FY1980, the United States extended more than $1.5 billion in CCC credits to Poland.)
Poland is rich in natural resources. It is the second-largest exporter of coal in the world and has the fourth-largest reserves. Normally, Poland has exported significant quantities of beet sugar; pork and pork products, including the famous Poland Hams; poultry, and veal. Since 1945, the hard-working Poles have turned their country, once predominantly agricultural, into the 11th most productive industrial economy in the world.
Still, coal for heating Polish homes was rationed last winter, and not for the first time, either. Poland's thermal-power plants had to ration supplies of electricity. Meat -- even sausage -- is scarce and priced out of reach of the average family. Sugar is rationed. After 35 years of Soviet-style "socialism," housing is shoddy in quality and simply unavailable. Young couples planning to marry must wait from five to 10 years for their own tiny apartments.
In the aftermath of two months of strikes, culminating in the historic settlements in Gdansk, Szczezin and Silesia, the Communist leaders are admitting once again that mistakes were made. The usual post-crisis game of ministrial musical chairs has begun. The new leaders promise that the party will institute reforms and do better in the future.
Like the Polish workers, Western leaders and creditors would do well to take such promises with a great many grains of salt. The party made similar confessions and promises after the strikes of 1956, 1970 and 1976. It is 1980, however, and the party evidently did not do better. If it had, Poland would not have been crippled by the strikes of July and August.
Since 1971, Poland has been living largely on the more than $20 billion borrowed from the West and Japan and, so far as we know, the equivalent of at least $2 billion from the Soviet Union. The eminent economist Wlodzimierz Brus, who had to leave Poland because he criticized the party's dogged retention of a Soviet-style command economy, wrote in the July-August 1979 issue of the Paris Kultura:
"The post-December 1970 efforts to energize the economy through a powerful injection of resources from outside have proved to be economically bogus. The dynamism lasted as long as the influx of extra resources grew. Domestic economic driving forces were, however, not set in motion." In "East European Economies Post-Helsinki," acompendium of papers submitted to the Joint Economic Committee of the U.S. Congress in 1977, a second expert, Prof. Zbigniew Fallenbuchl, put it bluntly: ". . . [t]he borrowing of foreign capital and large doses of imported foreign technology" by the Polish Communist regime "were accepted as a substitute for reforms . . . ."
Now the president has announced approval of the new CCC credits, which the Polish regime has requested. The granting of these will be interpreted by the Warsaw government's agitprop apparatus as American support for this politically bankrupt group of leaders.
Unless a program of fundamental economic reform is put into operation in Poland, Western creditors who make additional loans will be throwing good money after bad. The next wave of workers' protests is not likely to be so peaceful as that of July-August 1980.
Before the U.S. government in fact extends new CCC credits to Poland, the Warsaw government should:
(1) Garantee a fair share of the feed grains bought with any future CCC credits to the private farmers who till 75 percent of Poland's arable land, instead of channeling, them to the inefficient state farms and collectives, as has been the case in the past.
(2) Decentralize industrial decision-making and introduce profitability as the principle upon which industry must operate. (Note to Jimmy Carter: the Poland leaders will not twit you about Chrysler. Their record in keeping failing enterprises afloat, no matter what the cost to society, is much worse than yours to date).
(3) Furnish a realistic schedule for reducing the current indebtedness to the West and Japan to manageable size. There is $7.4 billion in principal and interest that must be repaid this year and like amount in 1981. How will this be done? When will the snowballing, be unavowed, Polish roll-over end?
Unless the Polish leadership commits itself first to reform, further Western credits will only encourage it to resist the imperatives of commitment.
If, on the other hand, the Polish Communists are to be subsidized for political reasons, let the Soviets do it. At least they get a measure of subservience in return for their money.