Friday, 30 January 2015

Barefaced populism exposed

The date of the next Polish presidential elections will be announced on Wednesday; most likely the first (and only?) round will take place in mid-May. The winner will be the incumbent, Bronisław Komorowski. The outcome is so utterly certain that the opposition parties are fielding totally unknown candidates so as to save their big guns from humiliation.

Stalin-Lenin-Dno (SLD), the successor to the Polish communist party, PZPR, will not be fielding its hated leader, Leszek Millllller, the Moscow-educated, former Secretary of the Central Committee of the PZPR. Instead, SLD presents a Ms Marionetka Cucumber, a total unknown, who at least has a pretty face.

Polish peasants' party PSL has yet to announce its candidate - it's unlikely to be deputy prime minister Janusz Piechociński. One rumour is that PSL won't even bother putting a contender into the race.

Law and Justice (PiS) leader Jarosław Kaczyński, having lost the 2010 presidential election to Mr Komorowski 54.4% to 46.4%, does not wish to become a two-time loser. So Law and Justice is fielding... Andrzej Duda. OK, I so never heard of him before either (he's not to be confused with rabble-rousing Solidarność leader Piotr Duda).

I recently started following Law and Justice on Twitter. Travelling home from work this evening, I was reading my Twitter feed, and chanced upon choice excerpts from Andrzej Duda's speech to voters in Grodzisk Mazowiecki. I was shocked by what I read.

"Niska płaca nie uzdrowi polskiej gospodarki,ozdrowi ją popyt. A ten będzie tylko przy większych zarobkach" [Low pay will not heal the Polish economy, it will be healed by demand. And that will only grow through high earnings.] All well and good - but who is to pay for the higher earnings? Maybe the entrepreneur? The small business owner?

"Polska jest nieopresyjna tylko dla wybranych. Zwykli, mali przedsiębiorcy najlepiej to rozumieją." [Poland is unoppressive only to the chosen. Ordinary, small entrepreneurs understand this best." So while they are currently being oppressed, under President Duda, they'll have to be oppressed even more to find the extra cash for higher earnings for their employees - and to pay the additional taxes to ensure the public sector also gets higher earnings. Given that 52% of the Polish workforce is directly employed by Polish small entrepreneurs, I feel that this particular group of voters will not be casting its vote for Mr Duda.

"Obrót polską ziemią będzie uwolniony w maju 2016 r. Jest jeszcze szansa zatrzymania tego procederu. Musimy zabiegać o ochronę polskiej ziemi, nie możemy jej oddać w obce ręce." ["Buying and selling of Polish soil shall be fully liberalised in May 2016. There is still a chance to stop this racket. We must strive to protect the Polish land, we cannot give it up to foreign hands."] Purest demagoguery. Barefaced populism of the most shameless kind.

Surely Mr Duda realises that Poland is a member of the EU? And that in the Accession Treaty, Poland signed up to the liberalisation of sale of agricultural land after a 12-year transition period? And in return, the countries letting Poland into the EU signed up to allowing Polish workers access to their labour markets - in the case of most countries, after a seven-year transition period. Over 77% of Poles voted in the 2003 referendum to join to the EU. So what is Mr Duda proposing? To tear up the Accession Treaty? Plain nuts.

"Skąd mają wziąć się miejsca pracy dla młodych ludzi, skoro zajmują je ich dziadkowie?" [Where will workplaces for young people come from, if they are being occupied by their grandfathers?] Do you know any octogenerians in the workplace, blocking the recruitment of graduates and school-leavers? This smacks of blatant ageism.

And this: "Jak można wprowadzać system przedłużający pracę ludzi, nie dając im nic w zamian? [How can you introduce a system extending people's work, not giving them anything in return?] Mr Duda's populist attack on pension reforms ignores that YES THEY HAVE BEEN GIVEN SOMETHING IN RETURN. It's called A LONGER LIFE. The average Pole lives three years longer today than in 2000, and six years longer than in 1990. Thanks to (yes) improvements in the state-funded healthcare system, as well as other benefits that free-market democracy bestows upon its citizens. As the lifespan of Poles increases, it is economically essential that they spend some of that extended life at work earning money rather than simply withdrawing pensions from an ever-shrinking pot.

Populist politicians trotting out such twaddle are either totally ignorant of the realities of the economy and the way the world functions - and should not hold public office on account of their outright ignorance - or they know damn well how it all works but are shamelessly lying into the electorate's face. It's binary - it's one or the other. Mr Duda is either ignorant or a liar.

I feel inclined to vote in the first round for the attractive Ms Cucumber, in order to totally humiliate Mr Duda and the PiS strategists who decided this lightweight populist should represent their party in a futile one-horse race against a dead-cert. Incidentally, 'Duda' can be translated into English as 'Bagpipe'. Very fitting.

Social inequality, over-regulation of small business, imperfections in the working of the single European market and pensions reform are all important issues that need to be resolved incrementally, by the application of human intelligence, demanding nuanced solutions that take the long term into consideration. Not by a meaningless, impotent litany of 'musts'  and 'shoulds'.

This time last year:
Straż Ochrony Kolei explained

This time two years ago:
The end of winter? So early?

This time three years ago:
How much education for the nation?

This time four years ago:
To the Catch - short story

This time five years ago:
Eternal Warsaw

This time seven years ago:
From the family archives


Neighbour said...


Akapit drugi i trzeci - poniżej Twojego poziomu. Nie głosuję na żadną z tych partii nie głosuję, ale naprawdę nie uchodzi... O reszcie Dudzie szkoda gadać.
Wolę jak chodzisz po polach wokół mojego osiedla i piszesz o tym, czego moje oczy nie są w stanie dostrzec.
W Lidlu jest bardzo zacny burgund Plan de Dieu, z szarą etykietą ia 20 złotych bez grosza, polecam, tylko lekkko go schłodź, znalazłem fajny gadżet do tego, takie ubranko na butelkę:

Neighbour said...

No i komentarz mi się rozleciał na iPodowej klawiaturze, wyedytować nie można.

Michael Dembinski said...

@ Neighbour:

The purpose of the second paragraph is to voice my visceral dislike of Milller - the personification of cynicism (floating off to Samoobrona, then calmly returning to SLD as though nothing had happened - and then to lead it to further electoral disaster).

The third paragraph is nothing but neutral reporting.

Thanks for the Lidl tip! 18 days to the beginning of Lent :-)

Neighbour said...

I remember Miller him from a meeting with students on strike at Politechnika back in 1988, his cynical approach was evident then and every single day afterwards.

student SGH said...

I see the Neighbour has been the first disgusted by your style in second paragraph. What's the point in stooping to styles which exudes so much hatred. In which biography of Mr Miller have you read he is a graduate of Moscow-based university? He graduated from a PZPR-affiliate university at the age of 39 and this might reflect on his level of education, but do not depart from facts! As it has been underlined, Leszek Miller has always been ultra-cynical, but his government will go down in history not only as the most corrupt and plunging into moral downfall, but also as the one which consistently pursued integration with the EU and which ran one of wiser and pragmatic (and in most aspects inconsistent with leftist agenda) economic policies. Given his recent track record of shooting himself and his party in their feet, it is high time Mr Miller pensions off...

Miss Ogurek has a pretty face, at least? Have you had the opportunity to see her face without make-up? True beauty doesn't need make-up!

Regarding the twits, as an economist, I cannot generally agree, but I have to warn of generalising... Indeed those who have the most money, i.e. public sector and huge corporations, pay their employees the best, but SME sector is not uniform. In my life I saw both those oppressed and striving to make ends meet, carrying the burden of bereaucracy, taxation, competition, etc., and those who extracted the most from their employees, paying them as little as possible. It is convenient to see the latter group as blood-sucking capitalists, exploiting the oppressed labour force...

When it comes to raising pension age, if we don't want this reform to fizzle out, we have to ensure the demand for labour will be big enough to absorb employees aged >60 and that the problem of structural mismatching between requirements of employers and competencies of employyes does not come up.

The two most recent big issues, the collapse of mining and Swiss Franc appreciation prove an average Pole's grasp of economics is still very poor and therefore voters are pliable and easily fall for populism...

Michael Dembinski said...

@ Neighbour -

I went to Lidl - sadly no Plan de Dieu - I did buy the last four packets of Roquefort though :-)

@ Student SGH -

Has Millller airbrushed his studies at the Moscow Institute of Marxism-Leninism out of the internet? Right to be forgotten? I cannot forget him pillorying premier Jerzy Buzek when the latter's popularity fell below 40%. "The nation is not behind you - you should go, and go now!" said Milller on Radiowa Jedynka. These words came back to haunt him, when his own popularity at the head of the most corrupt government of III RP fell to... 8%. You should have heard him blustering and spinning!

I entirely take your point about the variable quality of small entrepreneurs as employers - a point I made on TokFM a few years ago. Of course such nuance is lost on Mr Duda, who lumps them all together as long-suffering victims - while at the same time not making the connection that these are the paymasters of 52% of the working population.

Swiss Franc debacle will put a spanner in the spokes of any hope of a Polish real estate upturn - it will take years for confidence to come back to the market.

Finally, I put my money on Janusz Piechociński as prime minister by Christmas.

Neighbour said...

@student SGH - couldn't agree more, life's not black and white.

Michael - Plan de Dieu may come :-)
They restock the shops every few days. I'm sipping a glass from a bottle bought in Bielany, together with a thin slice of Kiełbasa Surowa Długodojrzewająca - thank you for a hint :-)

AndrzejK said...

Re your comment that the bagpipe man is either ignorant or a liar the whole point is that Przekręty i Samointeres politicians actually manage both i.e. they lie but cannot do so in a manner which is believable to other than the meanest intelligence. I think Keith Jospeh had some sound, albeit unacceptable in practise, ideas about who should be allowed to vote!

student SGH said...

Apparently he did leave no stone unturned to erase it and even changed the course of history, because Institute of Marxism-Leninism he indeed graduated from was based in Warsaw...

Yes, I remember that text, it made it big in the Internet in 2003 I guess, as I was about to finish middle school, that radio interview from June 2000 was sent via e-mails...

I'm curious to learn how you define "upturn" on property market? Could you elaborate on the thought?

The world has several shades of grey, hope the exact number is no fifty ;-)

Michael Dembinski said...

I've read it in a number of places, though from what I can see online, none are 100% credible sources.

One way or another, the course that Milller took was one that he was sent on by his political masters to learn a) a bunch of nonsense theory (he'd been as well served doing a course in Scientology or Mormonism) and b) how to lie to the public (sociotiechnika).

By 'upturn' I mean property as an investment class showing returns above those currently being offered by deposit accounts.

Those burnt by the Frank will not be trading up to new properties any time soon...

student SGH said...

It's so plain, he grauduated from the Instutute of Marxism-Leninism, which was based in Warsaw, not in Moscow.

Now a portion of nitpicking: 'property' is not a uniform investment class, but I guess you are referring to residential properties and get confused. Yields on property letting are higher (in Warsaw on average 4-5%) than risk-free rate (currently ca. 2%), so what's amiss? Had the rental yield equalled risk-free rate, the property would have most probably been in a bubble. Yes, the CHF has locked some folks up in their properties, but they generate neither demand nor supply, just the turnover is lower. Today CHF/PLN stood below 4.00, still more than 3.55 on 15 January early in the morning, but in late February I bet it will decline to 3.80 and in the long it will naturally decline. The Swiss economy will not manage to withstand too strong currency.

Dear politicians, what the hell was the point in bleating?

AndrzejK said...

When looking at property values and yields one needs to factor in the average period property is unlet in proportion to period it is let. Given large numbers of uninhabited flats available for rental I would imagine that the real yield rate is considerably less.

The other factor is that property investors look to rental income covering the cost of money and incidental expenses with the rue return being capital appreciation. Which with the almost total lack of planning controls is not going to happen anytime sson (land around and indeed in Warsaw is not a limiting factor)

student SGH said...

Needless to say letting a property is more risky than investing money in government bonds or placing into a bank deposit. Effective yields, i.e. those taking into account vacant periods and potential damages done by tenants should nevertheless be higher than risk-free rate. If both rates are roughly equal, the market is in imbalance. I will just quote myself: 2. Low income on bank deposits discourages wealthier depositors from keeping their savings in banks and makes some of them to invest in properties in pursuit of higher yields on rents. Beware though, this is a trap as well – if everyone buys flats with the intent to lease them – will the supply of new properties be matched by demand from lessees? Won’t this trend exert a downward pressure on yields to make them equal with bank deposits? And note flow of income from a relatively small group of well-off people is a rather one-off occurrence, therefore the price incline cannot rely solely on demand generated by wealthy buyers. In other words, if everyone bought a flat with the intent to let it to someone else's no one would be eager to rent them. Balance between supply and demand must be struck!