In his opinion piece “The Polish case for less economic liberalism” (October 21), Deputy Prime Minister Mateusz Morawiecki attempts to put forth some ideological justification for the Law and Justice (PiS) party’s mishmash of populist economics and conservative social policies. Echoing Viktor Orbán, Morawiecki argues that Poland’s liberalism has gone too far. His argument is intellectually incoherent, and a terrible misreading of Polish history.
Poles do not save enough and that investment ratios are far below where they need to be, Morawiecki says. This may be a correct assessment, but PiS itself has penalized savers: bank taxes have decreased capital available for investors, while economic uncertainty has increased Poland’s risk premium. Expanded government spending has crowded out private investment.
Morawiecki’s proposed plan is not new or innovative. It is similar to communist plans from the 1970s and 1980s, predicated on government intervention and heavy borrowing to fill fiscal gaps. This spending led to a painful fiscal adjustment in the early 1990s, when forgiveness from international creditors narrowly avoided catastrophe. A return to these profligate ways will do nothing to encourage investment. Instead, it will stretch an already over-extended Polish government.
Morawiecki also neglects Poland’s long experience of an interventionist state. Contrary to the minister’s assertions, Polish illiberalism historically has been the best path to stagnation.
Moreover, Morawiecki’s claim that PiS’s plans mirror Reagan’s deregulation push is historically inaccurate. PiS involves government in all aspects of its citizen’s lives, from investment choices to contraception to which supermarket they should shop at and when. PiS’ policies have more in common with Reagan’s nemesis, Democratic Speaker of the House Tip O’Neill.
In short, Morawiecki’s approach is entirely backwards. While Poland needs a comprehensive plan of deregulation, the country needs the government to get further out of the way, and leave national planning in the 1980s where it belongs.
Christopher A. Hartwell
President, Center for Social and Economic Research
Warsaw, Poland