SPECIAL ANALYSIS
POLAND) Jaruzelsxi's Economic Measures
Premier Jaruatlakt is turning his attention to rebuilding the economy, now that overt resistance to martial law has been at least tseporarily suppressed. Despite the negative impact of martial law on ths attitudes of the workers, his program may lead to somein the retail market and to increased production in some sectors in the short run. Prospects for implementing effective eoo-nomio reforms and policies are poor, however, and Poland's basic economic problems are likely to continue. This, coupled withwill leave the people with the soar: economic grievances thai contributed to ths events of
Financial problems willerious obstacle to economic rocovery. Western creditors are not likely to restore Poland's credit until its debt payments are rescheduled. Warsaw needs to demonstrate that it can pay at least tho Interest on past credits and to show some progressustained economic revival and toward political
The regime has taken advantage of the martial law period to-erccnt Increases in retail priceside range of food items and for domestic utilities. These increases ere to be offset by wage ad-juatmente only for low income earners. They are needed to absorb the excess purchasing power in the hands of the population end therebv reduce shortages by discouraging boarding and speculation. bjj
If shortages arefarmers might then bo more willing to sell their production to the state because there would be more goods for them to buy. The price incrvasea, however, will leadrastic decline in the purchasing power of the population and, if savingsare not adjusted for inflation,harp decline in the reel value of personal savings, fl
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The martial law regime so far has not won theof the farmers, which will be necessary if food supplies are to be increased. Although the regime has not vetoed any pending liberalization changes inpolicy, it has threatened to force deliveries of food. This would increase food supplies toimited extent because some private fanners are likelytheir livestock and destroying their
The recent resumptionix-day workweek in the mines and other key industries probably will lead to some Increases in production, although the lack of Western rood, raw materials, spare parts, and equipment will be important constraints. Even though the regime hasthat working hours may be reduced to previous standards once martial law is lifted, it probably will be unwilling to risk losing the added production. fj
Coal output has already jumped substantially,to offioial data. If this trend is real, and if it continues, coal production this year mayillion tone, compared with the targetillion tons prior to the imiasition of martial law.%
Popular Resentment
The austerity measures are extremely unpopular and are virtually eliminating any government hopes of winning worker support and of discred*Solidarity. Workers will remember that Solidarity attached stringent conditionseneral retail price hike and refused repeated gov-ernracjnt attempts to restore the nix-day workweek. K
The government can hope chat initial rooontment may bo reduced If its policies make goods more available and shopping more convenient. Authorities recognize that the price issue is an explosive one, however, and martial low controls are likely to be extended beyond the date of the price increases.
Reforms of the Econoinic_SyBtom
Martial law has greatly reduced the prospects for basic economic reform. The government had alreadythe effective date of many reforms even before martial law. Far-reaching worker self-managementead issue and other measures are likely to be scaled down, mammal
Council of Ministers docree onecember further impaired planned reforms by giving branchole again in imposing "production tasks" on enterprises and by increasing the number of industrial sectors where central control will be maintained. The government is following through on the plans for wholesale priceand for devaluation of the zloty, but thosewill be largely ineffective unless the economy is decentralized, eessem
Familiar Responses
ln^Bresi
Jaruzelski Is likely in the short run to steer the oconomy rather than rely on unfamiliar economicand foroes. His government will find it difficult to accept decentralisation of decisionmaking, reduced central planning, and use of such market mechanisms as prices, interest rates, taxes, and profits to guide the economy.
the longer run, despite the apparently strong desire of the leadership to avoid the fallings of the old economic eye tern, the regime is likely to repeat tht experiments of, when bureaucratic and party elements first limited the extent of theof those years end eventually regained nearly total control of the economy. M
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Original document.
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