By Dr. Federico Bordonaro
http://www.pinr.com

On October 31, 2005, talks between the Polish Law and Justice Party (PiS) and its designated liberal allies of the Civic Platform (P.O.) failed to produce a center-right government. As a result, a minority government, led by PiS, is now in place and will have to be backed by the right-wing populists of the Self Defense Party (Samoobrona) and by at least one party among the far-right League of Polish Families and the protectionist Peasant Party.

Such news may sound surprising: on September 25, in fact, the right-wing Law and Justice Party won the Polish general elections with a slight advantage (26-28 percent) over the liberal-conservative P.O. Many foreign observers then thought the two parties would form a solid center-right coalition set to expand liberal reforms in Poland.

However, Poland's recent political history suggested a much more cautious forecast regarding the two winners' ability to shape a common, coherent policy. Since the first negotiations, it appeared that a PiS-P.O. coalition would be filled with disagreement because of their conflict over economic liberalization and cuts to the welfare state.

Moreover, it was predictable that a failure by the two leading political forces to set a coherent policy would pave the way to a further rise of radical outsiders such as the nationalistic and populist Self Defense Party, thus changing the nature of Warsaw's rightward turn. [See: "Poland's Rightward Turn and the Significance for Europe"]

What is surprising, however, is that such a forecast has become a reality much sooner than expected. In the coming years, Poland will not be governed by a liberal-conservative, pro-market right-wing, but, instead, by a Catholic-conservative-populist combine.

The PiS Needs Support
According to Polish constitutional rules, the leading party, PiS, will try to form a majority coalition within two weeks after the swearing in date (which was October 31, right after the P.O.'s denial of support). Therefore, on November 10, a crucial vote will be held. Confronted with the P.O. refusal to back the PiS-led government, Jaroslaw Kaczynski (twin brother of the newly elected President Lech Kaczynski) and other PiS leaders said they are confident that they will get the support of Andrzej Lepper's Self Defense Party (S.O.). The PiS leaders see the Self Defense Party's political program being similar to their own.

A PiS-S.O. combine, however, would mean a deep change in the coalition's character since Lepper's party claims it will ask the new cabinet to boost social spending, to renegotiate the terms of farm subsidies agreed with the European Union and to make the central bank responsible for economic growth. If Lepper and his decision makers gain influence in the coalition -- which will be hard to avoid -- and such proposals are inserted in the government's program, the prefigured liberal turn proposed by the P.O. will be replaced by a rather different policy.

Warsaw and the "New Europe" After the Vote
Europe and the world are now trying to understand which direction the new Polish government's economic and foreign policies are headed. Because it was projected that the P.O. would enter into the new government, analysts and decision makers in the West thought that liberal economic reforms would be rapidly introduced in Poland, thus making Warsaw a sort of bastion of the reform-oriented Europe advocated by Tony Blair -- often in public opposition to the so-called "European social model" proposed by many French and German policymakers.

Furthermore, Poland was expected to be the leader of a "neo-liberal axis" in Eastern Europe, fostering economic reforms in the Baltic-to-the-Black Sea area and working together with Ukraine and Lithuania to facilitate the opening of markets in the region.

Also, the pro-U.S. stance in Warsaw's foreign policy was expected to consolidate to such an extent that Poland would be the leader of a "New Europe" -- a formerly communist Eastern Europe -- reorientated along the lines of neo-liberal reforms and a pro-U.S., pro-N.A.T.O. security policy.

Now, the fundamental question is whether the failure of the liberal-conservative coalition and the rise of right-wing populists will have decisive consequences on these political trends. In fact, not only the Self-Defense populist party will enter the government, but the new president of the country -- Lech Kaczynski -- is known for supporting the Catholic social doctrine instead of the more classical liberalism advocated by the P.O.'s leader Donald Tusk, who lost the presidential election in October.

In order to answer the economic question, the social structure of Poland must be considered. The country's economy is still centered on agriculture. Like many other historical cases, the transition from a strongly rural economy to a more "modern" one is full of social tensions. Policies that try to mitigate the potentially disruptive effects of economic reforms via a "social market" model are likely to be privileged by the middle and lower classes. That is exactly what the PiS program is set to do, whereas the populist right-wingers are more aggressive in their rhetoric and much less enthusiastic with giving more control of the national economy to the E.U.

In fact, the Social Democrats' loss in the recent election is basically due to the persisting high unemployment (around 18 percent), and the farmers' and lower classes' disappointment with the former government's economic policies.

However, the country also appears conscious of its new European identity, and -- what is more important -- knows well that its recent good economic record would not have been possible without the reforms and the subsequent investment boom.

As a consequence, it is to be expected that a slowdown in liberal economic reforms will not transform into a reversal of this policy; reforms already introduced will very likely remain in place. In addition, Polish elites are determined to gain full integration into the E.U.'s economic structures, and, in order obtain that goal, they must favor Brussels-inspired financial and economic changes. Some new fiscal cuts are highly likely even under the rule of a more statist right-wing coalition; on the other hand, Warsaw's negotiations over E.U. farm subsidies could be significantly tougher.

In regards to its foreign policy, Polish long-term interests won't be decisively affected. Warsaw has nothing to gain from rapidly realigning with the Franco-German combine on security policy (which is the only alternative to its present pro-U.S. and pro-U.K. stance). Poland's ambition is to lead the E.U. Eastern "newcomers" and its fundamental security concerns are to counter-balance possible German or Russian hegemony in Central and Eastern Europe.

Additionally, Warsaw will probably try again to put pressure on Belarus -- the last Russian "rampart" in Eastern Europe -- to cause the weakening of Belarus President Alexander Lukashenko's pro-Russian rule, and to facilitate Moldova's integration into the E.U. Washington and London also share these goals in the region. Also, Poland's strong pro-Atlantic orientation is in no way an obstacle to its determination to be fully integrated into the E.U.

Conclusion
The PiS-P.O. combine has failed because of the inescapable differences over the extent of liberal economic reforms between the two parties. As predicted, the populist right-wingers have rapidly profited from the failure of the two main parties to give birth to a viable government.

The new Poland will be an interesting combination of different right-wing orientations. The geopolitical leader of the "New Europe," Poland will maintain its pro-U.S. and anti-Russian foreign policy, but it will not choose the British social model as its socio-economic way. Economic liberalism will probably be mixed with statist policies, because of both cultural and structural reasons. Once again, the weight of history and geopolitics has influenced economics and social models.
_________________________

The Power and Interest News Report (PINR) is an independent organization that utilizes open source intelligence to provide conflict analysis services in the context of international relations. PINR approaches a subject based upon the powers and interests involved, leaving the moral judgments to the reader.