Democracy and Privatization in Poland
Lucja Swiatkowski Cannon
The key issue of transition to democracy and a market economy in Eastern Europe, especially in Poland, has involved the interrelationship between political and economic democratization, which was intensely desired by the population, alienated by forty-five years of communist rule. This relationship is crucial because political and economic change always go together. It is impossible to have economic reforms without a political breakthrough. At the same time, the nature of the political breakthrough determines the level of democratization of the political system and the quality of economic reforms.
A subsequent issue concerns definitions of democracy and economic reform. Democratization of the political system does not always lead to democracy. A minimum requisite of democracy is free elections. A more expansive definition encompasses a constitutional government with genuine respect for human rights and/or the pursuit of policies reflecting a national consensus. In the case of Poland, the main criterion has been free elections, as other aspects of democracy still leave something to be desired. Market economy in this context means privatization of state-owned enterprises as the most significant, allencompassing structural reform of the previous communist system.
Reforms did not come in the aftermath of martial law, declared in December 1981. As a result, Poland was locked throughout the 1980s in an intense conflict between communist authorities and leaders of the Solidarity trade union in an environment of Western economic sanctions and increased dependence on the Council for Mutual Economic Assistance (Comecon) under conditions of deteriorating Soviet economic performance. The end result was a deepening economic crisis in Poland, default on international payments, and growing social unrest. Most importantly, no viable strategy emerged to overcome the crisis.
Until martial law, Solidarity sought to reform the communist system by gaining the legalization of independent trade unions and implementing industrial changes through successful legislation, such as the Act on State-Owned Enter-