andersen-ottaway lecture

1989 Andersen Lecture
Stefan Bratkowski
President, Polish Journalists Association

Poland, Solidarity, And The Press: The Difficulties Of Returning From The Moon

Ladies and Gentlemen, I feel highly honored by your invitation. Thank you for your kind attendance here.

I am supposed to talk about my country - not such an easy task after Lech Walesa spoke for Poland in Washington a few weeks ago. I hope, however, to give you some details of our return from the moon (or, if you want, from another planet 50 years away from the twentieth century). The spacecraft we are traveling in has been completely devastated and everybody fears now that it will burn when it enters the atmosphere. So to help you understand the problems we face now and our starting point, I will tell you of our obstacles, illusions, misinterpretations, chances, and hopes.

What do I mean when I talk about the moon we are coming from? Just before I left Warsaw, one of my younger friends from the new Ministry of Finance called me. After we talked for awhile, it became obvious that no one in the ministry specializes in cooperative banking for small businesses. They couldn’t find anyone in the entire country! No financier, no manager, no lawyer. Zero. And our interest in the topic was not theoretical. More than $1 billion was at stake.

This is not only a problem for economists, but also for journalists. It’s a question of new publishing companies, especially small local companies to publish the local newspapers we are so interested in now.

The party-owned press is in a state of self-dismantling. Under martial law the party purged their newspapers; they fired more than 1,200 journalists, all the best ones but three or four. They control 80 percent of our press market, but their newspapers are losing readers; the party-owned press is running in the red. They want to close different newspapers, at first those that were never necessary for power-making, only for controlling everything, such as the monthlies specializing in art, theatre, and the movies. The party doesn’t want to give up any part of controlled dailies, although some of the dailies are not any business at all. So now we form new publishing companies. Within the next year, we expect more than 500 new small local newspapers to be in print, also at least five new regional dailies. So we need the local banks that I mentioned because credits will be needed.

A few words on the economic background. Before World War II there was in Poland a vast network of local credit associations based on unlimited joint responsibility. That was the technical loyalists’ definition. (It was invented for poor small businesses in the nineteenth century by two old good Germans, Schulze of Delitsch and Raiffeisen, and then adapted by Poles.) The central bank of these associations was the most powerful Polish private bank just after World War I. After 100 years of partitions, there weren’t any big businesses. Both the systems of Schulze and Raiffeisen proved very successful, indeed; today in West Germany there are more than 3,700 banks of that kind, holding more than 20 percent of all West German capital.

But in Poland everything was destroyed over the last 42 years and all the traditions have been erased. The past has been lost. So the simplest way to rebuild local banking is actually blocked by lack of knowledge and lack of law. We do not even have legislators who know how to draft the law!

It’s a problem for journalists too. One year ago, we founded a weekly specializing in the field of banking, without any genuine bank in Poland at the moment, and without either bankers or banking legislation. After one year the editorial staff of the weekly has five new specialized journalists, but it is very difficult to find anybody else. It’s a question of the gap of 50 years, and also of the last eight years of the martial law regime. The new generation of journalists educated in our underground press - we published more than 700 titles totaling nearly 2,000 during these eight years - were not educated in scientific, technological, commercial, or agricultural questions. It was not necessary in the underground. This press required brave people. Indeed, 90 percent of all the people imprisoned under martial law were not trade union activists; they were printers, journalists, and distributors of the underground press.

It was amazing. The nationwide network of distribution - not just one underground railway - involved about 200,000 people. The most popular weekly of the underground press, Mazowsze, was printed in 12 to 20 underground printing offices in a run of from 40,000 to 80,000 copies a week. (I personally produced just such a one-hour, tape-recorded cassette newspaper. It was self-multiplying; that one copy was re-recorded sometimes to make more than 25,000 copies. We used to say that the cassette tape recorder was the most anti-government invention in history.)

To come back to the young journalists of the underground press: they now have to learn normal journalism. They have to be attracted by all of life’s normal problems. They learn quickly; after the Roundtable talks were finished, we - the old wolves of the profession - helped the young people of the Mazowsze create the first independent daily of Poland, Gazeta Wyborcza. We started after two weeks. The first issue was amateurish, with many mistakes. Number two was better but still below professional level. The third issue was just a normal newspaper, quite sufficient. And the fourth issue was the best daily in our country, and it has remained Number One even today. I hope, of course, it will remain there forever. We sell 550,000 copies a day, five days a week, and by October it was in the black even without advertisements. We do without ads because we had no newsprint for them. But it is not a philanthropy, it’s a business. We shall sell 1.5 million copies, I hope, within the next year.

I must come back to the problems of the younger generation that always lacks indispensable knowledge. Once more we should look at the example of the small local credit cooperatives.

I believe I am not exaggerating when I say that the only people in Poland who happened to learn about the past are my readers and the viewers of a TV serial for which I wrote scenarios. I have tried to publicize Poland’s efforts to defend herself, culturally and economically, in the nineteenth century against the Prussian regime - not Russian, but Prussian. The activities of the mutual credit cooperative banks were especially important. (I have tried to train my compatriots of the 1970s to fight the ruling system in just such a way.) But readers and viewers must take my word for it. The people who dealt with this business have died out. And we have no journalists (except these few mentioned by me) who are specialized in this field to publicize, to popularize, the ordinary knowledge of the civilized world.

I started in 1970 to publish a supplement to the most influential Polish daily, Zycie Warszawy (Life of Warsaw). The supplement specialized in management science, economic problems, and democracy-making. It may seem strange to join such fields today, but in Poland it was impossible to have shops and shopkeepers without democracy. The supplement was banned in 1973 and I was fired. I came back after seven years of unemployment, and the martial law regime fired me again after 15 months. One month ago I began the supplement once more in Gazeta Wyborcza. I have four pages a week, hundreds of collaborators, more than a million readers, and it is working. It counts. But we need more. Much more.

I feel obliged to explain my personal story as a journalist and writer. At the end of the 1940s, I was a teenager belonging to the generation that believed in socialism as a program of justice, equality, freedom, and peace against racism, Nazism, war, and killing. The old generations had lost the war, and we didn’t trust them. But we weren’t blind. Being confronted with everyday practices, we had discovered the Big Lie by ourselves. So we became rebels on our own behalf, on behalf of "honest socialism." That was before 1956, before Khrushchev’s famous speech revealing all of Stalin’s crimes. We wanted democracy, a free market, and national independence. We organized a powerful movement of young Poles against Stalinism. In 1956, Stalinism was, in fact, partially crushed. But that was only the first step. We did not realize how far away we were from the 20th century, and since 1956 the distance has grown.

I personally happened to meet some old engineers who told me about our lost past. So I became a gold digger searching through old books and, after many years, a promoter, reviving this lost past and knowledge. I have related to my readers surprising stories of old Polish managers, businessmen, engineers, of true economic institutions and skills. I seemed like a crazy hobbyist trying to find old specialists who had survived, trying to retrieve forgotten traces of modern civilization. Stalinism didn’t die in 1956. We lived under its invisible rule for many years after. And I don’t mean the secret police and the martial law of the 1980s. No, I mean economic and social life.

The elite of the Polish journalists never supported the regime again. One after another, the best weeklies were closed between 1956 and the time of Solidarity in the early 1980s. But all other mass media were controlled, even hand-controlled as we called it. These back-seat drivers - the political controllers - kept a firm hand on the wheel. As the people shouted in the streets of 1968, the media have been degraded: "The press lies, the press lies." So after the explosion of truth in 1980, our association of journalists - quiet, obedient, controlled, and loyal to the power up to the moment - changed its image entirely. One hundred of the best journalists of Poland became leaders of the association. Another 6,000 backed us. And the future of our profession was taken under our own care. Martial law simply could not be accepted by the Polish journalists. We had to preserve the image of our profession that we had rebuilt. And the minds of our readers, listeners, and viewers have always belonged to us. You must remember we have never been dissidents in Poland. The dissidents were within the ruling cabinet. We were a majority. And the feedback between journalism and the people has always worked in Poland since the early 1980s.

But we cannot fulfill the civilization gap only with courage. During the last 40 years, contacts with the normal world were limited: in physics and in medicine, a Polish scientist could be your contemporary, but not in social science, economics or politics. I know your universities have been inviting Polish economists for many, many years. These Polish guests are able to talk with you Americans about many very sophisticated problems of macro-economy, about different variants of the Cobb-Douglas function, about the most complicated models of economic growth. But not one of these brilliant whiz kids can analyze a simple balance sheet of a one-product manufacturer, because nobody taught them accounting. It seems strange, but it is true.

I have to repeat. It’s not a problem only for economists. Mostly it is for journalists. We are the ones who have to find some way to explain the real problems of Poland and other countries wanting to return from the moon. Maybe you, our professional colleagues, will help us in that work. The world media deliver descriptions of turmoil, demonstrations, and other political sensations of our bloc, but you can hardly find any of this activity in the decisive economic arena.

I read reports by experts of the World Bank. They criticized the Polish National Bank as a central bank. Nobody told them that it never was a central bank, not really even a bank at all. They were not told this because it never occurred to them that it might be necessary to ask such a question. The bank was an office with no assets; there are no real shareholders, no owner like the Treasury, for example, with assets or money to be responsible for. To this day, it is just an office that prints money if the government happens to need it. And the office, called a "bank," recently established so-called commercial banks emanating from the main branch. They have no real assets either. Their reserves were created by the pen and can be cancelled by the pen. None of the Western experts realize that so-called state-owned property is no man’s property. No person nor any institution is responsible for it. A Treasury does not exist. A class of bureaucrats runs the whole business under conditions of unlimited irresponsibility.

The so-called commercial banks aren’t banks in practice; they work like offices. And there is no clearinghouse in either Warsaw or other cities. And correspondence between two banks, from one street to another, lasts...can you guess how long? No...I suppose not. You would never guess properly. Up to five weeks! It seems impossible. It is a fact.

Accounting is not accounting. Our bookkeeper don’t know how to deal with capital accounts; any real cost analysis is impossible. And the tax system is a set of absurdities paralyzing any business initiative. Yes, paralyzing.

I could continue the list, but I don’t want to be a sensationalist. I wanted to show some of the difficulties of returning to civilization. Aren’t they the business of us journalists? I think that they have to be. We have won freedom of speech, but the freedom of speech also means our right to change our life, to rebuild our civilization.

I want to repeat my opinion, which is a bit different from the opinion of Walesa: Poland, initially, and the other countries of the Soviet bloc later, only needs an intellectual Marshall Plan as elaborate as was the plan for landing on the moon, because it concerns a return from the moon. I mean a Marshall Plan that is much cheaper and much more effective than any material help - lecturers, consultants, advisers, translated manuals and popular books, videotapes with lessons on banking or accountancy. One printing office with a Cameron printing machine that is able to produce 80 to 100 million paperbacks a year will push Poland ahead much more quickly than other machines. We also need, at first, normal contact with the press of the normal civilized world. Forty-nine reading rooms for each of the 49 regional capitals of Poland should each have a minimum of two copies of your most important newspapers (and some local Polish press too). There should be one duplicating machine in each reading room only for journalists, especially the young ones. It will connect us with your world. We also need your books and manuals referring to local newspapers and local broadcasting and TV stations. And we need your old, worn-out, but still usable small printing presses - ones scrapped in America but able to be repaired. We need contact with your various magazine publishers to get them to cooperate with Polish journalists, issue Polish editions, and also open up the Polish mass media market, because Poland has been a country of readers and it will be that again.

Such Marshall Plans will be not expensive. But without such a plan, Poland may not even be able to use the help she is being offered now. The journalists’ Marshall Plan could include basic help in drawing an accurate picture of our situation. It can be really critical. Not in the future, but right now, within the next six months.

One more example. We have many guests who offer us advice, concepts, and programs. But they don’t examine the patient beforehand. Experts from the International Monetary Fund do the same. They have recommended a cure that may kill the patient. Our country is neither Bolivia nor Soviet Kazakhstan. There is a two-currency money market and approximately 20 percent of the people have income in foreign currencies. Eight million people traveled abroad this year, and at least 6 million of those went to work abroad or to trade. They came back with an average minimum net profit of $150. More than half a million families receive continuing help of at least $50 a month from their foreign cousins. That may not sound like much, but the dollars add up. More than 50,000 people are employed abroad and paid in Western money. I estimate their earnings for this year alone will total from $1.5 billion to $3.0 billion. Only a small part of that money is put into an official state-owned, so-called bank.

All transactions related to cars, real estate, and apartments are paid with foreign currencies. Neither this trade nor the income earned from abroad mentioned before is controlled or controllable. To promote deflation and to stop inflation in the zloty by cutting demand, as the IMF requires, does not bring an equilibrium when there are shortages of everything, but rather encourages a faster escape from the zloty and an increase in the value of the foreign currency reserves kept in socks. The rich become richer without any effort, and the poor (paid in zlotys) become poorer, through no fault of their own. (At least 20 percent of Poles are underfed now and face hunger.) This is maybe very Friedmanesque, but in my humble opinion, it is not right. I would prefer to design a system that motivates people to invest and increase the supply, which is the reason small local banks are really crucial for financial amateurs.

Some of our university scholars do not believe in those sock reserves, but I understand the socks. The scholars study books, not life, but the consequences of this approach may be dangerous. I sometimes have to talk with thousands of people a week; a few days ago, I was told by 100 youngsters, "Mr. Bratkowski, you want us to learn how to work, but we know that working here isn’t any way to earn money. Taxes punish you for working. We know a more effective way - go abroad and either work there or trade. A few days of profitable trading sometimes brings the equivalent of half a year’s salary."

It’s true. These young people are not members of Solidarity. They support our new government, of course, and they never support any Communist power. They are not baby boomers, so their support may not be so important in the next elections. But these would-be money-makers are the people with drive, the go-getters we need so very much in Poland. So Solidarity with its smart leaders is not the group on the critical path. The youngsters are. Solidarity is a stable and strong factor in the game. It may not accept some of the proposals or ideas of the economists, but it is a partner. The youngsters are not. And they are not the clients of us journalists. They might read Gazeta Wyborcza because they lack any other credible daily, but they don’t trust anybody. They are frustrated and they dream of emigration. We need to form some newspapers capable of talking to them especially, maybe their own newspapers.

To repair this spacecraft coming back from the moon before its landing on earth is both complicated and optimistic.

There is, of course, much other news about Poland. There are future opportunities for big business, thanks to the Polish workers who think the way managers used to and not like today’s Western blue collar workers. There are the miracles of computerization like 1.5 million computers, 19-year-old authors of professional computer books, and 12- and 13-year-old stars of programming.

And there is the coming explosion of new weeklies and dailies. After the great adventure of the underground press, which was our strongest weapon against martial law, hundreds of new editorial staffs want to publish legal, local newspapers and use them as the most influential democracy-makers. So, if you have any old worn-out, small printing presses that you are scrapping, send them to Poland. They will work there for democracy. I can promise it.