REVIEW #11: It’s Not Only the Economy, Stupid: Progress in Poland after Socialism

Many people are familiar with President Bill Clinton’s “It’s the economy, stupid” campaign slogan. The economic success of Poland since 1989 is indisputable. Nevertheless, defenders of Poland’s success story may sometimes hear that they focus too much on economic advances, prosperity, and GPD growth instead of thinking about the actual lives of “average people” and the “social costs” of Poland’s transformation.

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There are many myths connected with the concept of “social costs” and its understanding by the opponents of Poland’s path towards a free-market economy. Critics of the transformation usually ignore “social costs” of no reforms and root causes of many negative developments that can be linked to over 40 years of socialism.

The transformation is closely linked to the idea of progress and its impact on human beings – not only elites but also “ordinary people”. Various external and internal forces made it difficult for Poles to reap the full benefits of the intellectual revolution of the Enlightenment, industrialization and globalization.

One of the key barriers to prosperity was the lack of individual freedom. Only in 1989 did Poland become a full member of the club of progress, which gave the country an opportunity to catch up with the more prosperous West. Various measures – from life expectancy to some environmental and political indicators – show how life has been improving since 1989. Special attention is devoted to the topic of nature because the disastrous environmental impact of socialism is often forgotten.

In the end of the article the nostalgia towards socialism is discussed and how, in a free market economy, even this type of nostalgia can be…profitable. Furthermore, Civil Development Forum (FOR) is active in educating young people about Poland’s transformation, including a virtual “Museum 1989”.

It is also important to emphasize that distinguishing between economic and non-economic changes is often futile. Economics is not only a study of consumption, production, or money – although it is often associated only with these measures, – but mostly of human choices and behavior in the world of incentives and constraints.

From this perspective, it does not really matter if we say that “It’s the economy, stupid” or “It’s not only the economy, stupid”, as many areas can be associated with the economy and prosperity anyway. While GDP is not a perfect indicator (such a perfect measure has not yet been identified), it is a good proxy of standard of living and essential (but not the only) condition for human progress.

Moreover, many other qualitative aspects of human lives are correlated with GDP and income.

The celebrations of the 30th anniversary of the transformation in Poland and elsewhere should be forward-looking. Remembrance about failures and the costs of socialism is needed so people do not repeat mistakes from the past.

Post-transformation achievements are also an important lesson and inspiration for another wave of necessary reforms in the future. And awareness of progress in Poland after socialism matters as excessive pessimism is a fertile ground for various radical demagogues in politics – people who are willing to sacrifice catching up with the Western standard of living in Poland for their short-term political gains.

The Myth of “Social Costs” of Transformation

Debates about transformation in Poland usually fall into a rather familiar pattern: One side is rightly showing enormous economic success of Poland, visible in comparative analyses of GDP per capita since 1989 in Central and Eastern Europe (CEE).

The other side usually responds with “social costs” of transformation, a vague term meaning usually everything people dislike – unemployment, poverty, insecurity, and even stress. “It was very safe in our police state. We didn’t have competition, or the accompanying stress. There was no rat race” – wrote Slawomir Sierakowski1, a founder of one of the leading left-wing NGOs that frequently publishes articles in which the transformation is blamed for its “social costs”.

Marek Tatala