It is now some seven years since the anti-communist revolution in Central and East Europe (hereafter CEE) began. Perhaps enough time has now passed for us to move from analyses of the potential of transition policies to some tentative assessments of the success of different approaches.
Poland and Hungary are generally accepted to have been the trailblazers into post-communism. Along with Lithuania, they were also the first CEE countries to have been seen by many analysts to have 'brought back' former communists in free and proper parliamentary elections (in September 1993 and May 1994 respectively) - as distinct from never having properly disposed of them in the first place, as in Ukraine or Romania. Polish voters subsequently (in November-December 1995) went on to remove the erstwhile leader of Solidarity, Lech Walesa, from the presidency and to replace him with 'former communist' Aleksander Kwasniewski. This alleged 'return to communism' is reason enough to analyse these two states.
But another reason why Poland and Hungary constitute one of the most interesting pairs of comparisons among the post-communist countries is that they are said to represent two radically different approaches to economic transformation. Thus Poland is usually taken as the prime example of experimentation with the Sachsian 'shock therapy' (or 'big bang') approach, while Hungary is often seen as the quintessential gradualist. In the first part of this article, the meaning of these terms in the Polish and Hungarian contexts is examined. It is argued that although the terms are useful as short-hand overviews, they also obfuscate some important special features about both economies. This first section also provides some basic evaluation of the two approaches. In the following section, economic policies are related to the political changes in the two countries. One point to be considered is the extent to which there appears to be any major shifts of direction when so-called 'former communists' come to power. The third section focuses on a problem common to all post-communist states, corruption. Some of the material used in that section draws on the author's four visits to Poland and two to Hungary since mid-1995. Is corruption hindering or helping the transformation of the two countries? If it is a problem, what measures are being adopted to deal with it? The third section is followed by some concluding observations.
1. The Economies
Although both Poland and Hungary had essentially CPEs (Centrally Planned Economies) until the collapse of communism, neither economy was as rigidly under central control as those in some of their neighbours, such as Czechoslovakia, the GDR or Romania. Following the 1956 troubles in Poland, the Polish communist leaders reluctantly permitted widespread decollectivisation of agriculture, for instance. While the new leader following the Hungarian uprising of 1956, Janos Kadar, was initially more cautious than his Polish counterparts, he overtook them in the 1960s. The clearest sign of this was the introduction of the New Economic Mechanism in 1968; although other East European states - starting with the GDR in January 1963 - and the USSR had already introduced what were hailed by the communist leaderships at the time as significant economic reforms, none was nearly as radical as the Hungarian scheme.
If official statistics are to be believed - and we shall never know for certain how reliable they were - economic growth in both countries was comparatively impressive until the mid-1970s. Using figures produced by the Secretariat of the Economic Commission for Europe, but which themselves were largely dependent on data provided by the communist statistical offices, the annual average growth rate of net material product produced in the 1966-70 and 1971-5 quinquennia respectively amounted to 6.8% and 6.2% in Hungary, and 6.0% and 9.7% in Poland. But this annual average dropped substantially in 1976-80, to 2.8% in Hungary and a mere 1.2% in Poland. The average annual growth rates continued to decline in Hungary during the 1980s - at 1.4% in 1981-5 and 0.8% in the period 1986-9. This pattern was reversed in Poland, in that the annual average growth in the period 1986-9, at 2.9%, was higher than in the first half of the decade, when it fell to -0.8%; although much of this very poor average can be attributed to the seriously detrimental effects on the economy of the Solidarity period and its aftermath, the fact is that Poland was the only country in Eastern Europe to record negative growth in the first quinquennium of the 1980s.
Following the comparatively protracted removal of the communists in Poland, the first new governments were very influenced by Harvard economist Jeffrey Sachs, who encouraged finance ministers and prime ministers to adopt a rapid and radical marketisation and privatisation policy. The theory was that the more short-term pain could be endured, the sooner the country would turn the corner economically. But such an approach was also argued to have potential political legitimation benefits for the successors to the communists. It was maintained that there would be only a small window of opportunity to make radical change, during the so-called honeymoon phase of the new government. Polish policy-makers such as Leszek Balcerowicz and Hanna Suchocka were basically in agreement with this approach, and adopted what many have seen as the most radical set of economic transformation policies in CEE. Closer inspection, however, reveals that this image can be somewhat misleading. While the first post-communist Polish governments did indeed adopt radical policies in areas such as pricing and convertibility, they were initially more hesitant in the fields of mass privatisation (for medium- and large-scale projects) and foreign investment.
While the above figures on Hungarian growth rates might suggest that the successors to the Hungarian communists would have been attracted to the approach adopted in Warsaw, apparently they were not. In many areas, reform was less radical and more slowly introduced than in Poland. Once again, however, this aggregate picture can be misleading. In the areas of large-scale privatisation and foreign investment, the Hungarians initially went further and faster than the Poles. The new Hungarian leaders were much less concerned than were their Polish counterparts that too much of the economy would fall into foreign hands, for instance.
Despite these correctives to the popular image, and while it is important to have a more refined image of Polish 'shock therapy' and Hungarian 'gradualism', it is accepted here that on balance these two terms are as appropriate as any. What have been the results?
There is no doubt that the Polish economy has performed much better than the Hungarian in the 1990s. Following two years of negative growth (at -11.6% and -7.0% decline in GDP) in 1990 and 1991, the Polish economy had already turned the corner by 1992, when GDP growth reached 2.6%. The figures since then have been relatively impressive, at 3.8% in 1993, 5.1% in 1994, 5.9% in 1995 and an estimated 7.3% in 1996.(1) As of 1996, Poland was the only post-communist country whose economy was actually bigger than at any time under the communists. All this compares with Hungary's GDP growth rates of -3.5% in 1990, -11.9% in 1991, -3.0% in 1992, -0.8% in 1993, 2.9% in 1994, 1.5% in 1995, and an estimated zero growth in 1996.(2) It will be some time yet before the Hungarian economy is bigger than at any time under communist rule.
In terms of large-scale privatisation, Poland's slower start did not apparently put it behind other countries overall by the mid-1990s. Already by mid-1994, according to the EBRD, the percentage share of GDP produced in the private sector amounted to some 55% in both Hungary and Poland, placing them in joint equal second place in CEE (together with Estonia, Latvia and Slovakia) behind the Czech Republic at some 65%.(3)
One area in which the differences between the more moderate and the more radical approaches are most visible is inflation. Hungary's rates, while rather high by international standards - at 28.9% in 1990, 34.8% in 1991, 23.0% in 1992, 22.5% in 1993, 18.8% in 1994, 27.0% in 1995 and 24.4% annual average in the first ten months of 1996 - have been towards the lower end among CEE countries during the 1990s.(4) In contrast, the radical price reforms in Poland in the early post-communist period were accompanied by a very high inflation rate in 1990, at 585.8%. It then slowed down dramatically, however - to 70.3% in 1991, 45.3% in 1992, 36.9% in 1993, 33.3% in 1994 and 27.8% in 1995.(5)
It might be assumed that a more moderate or gentle approach results in less social pain. But this is not necessarily the case. If unemployment rates are taken as one of the leading indicators of such pain, then it soon becomes clear that both Poland and Hungary have suffered considerably - especially given their negligible rates under the communists - in the 1990s. Thus Poland's rates have been in the mid-teens throughout the 1990s - standing at 16.5% in 1994 and at a four-year low of 13.5% in September 1996 - while Hungary's are a little lower at 11.3% average in 1994 and 10.8% in August 1996.(6) Moreover, while Poland's rates have been coming down in 1996, Hungary's have been slowly rising.
Partly in order to reduce the impact of this social pain, both Poland and Hungary have been introducing a proper welfare state in recent years. Poland and Hungary were, once again, the trailblazers in terms of establishing unemployment benefits schemes in CEE. In both countries, there is a sliding scale of benefits, with rates declining the longer one is unemployed. The early Polish arrangements were criticised by some, who preferred the cosy 'cradle to grave' security of the communist era, for being too draconian. In particular, some Poles disliked the fact that citizens who refused either two jobs offered by a job centre or a retraining or public works program forfeited their right to unemployment benefits. Against this, it must be noted that Poland also soon introduced one of the CEE's most sophisticated compensation schemes for citizens particularly hard hit by price rises.(7)
Unfortunately, the cost of the various schemes has been exorbitant, for both the state and employers. Total on-costs (for social security, health care and unemployment schemes) for employers amounted to 48% in Poland and 51% in Hungary by 1993.(8) This burden on employers is seen by many as a major factor hindering the more rapid growth of the CEE economies. But the burden on the state is also heavy; more than 20% of Polish GDP has been expended on social security of various kinds in the mid-1990s. In Hungary, there has been a huge blow-out in social security spending by the state this year, which has been accompanied by proposals for major cutbacks in recent months. Such proposals, if fully implemented, will please the IMF, which has recently been arguing that Hungary, Poland, and other CEE countries need radically to reform their social security schemes.(9)
One way in which both Poland and Hungary have sought to develop and reorient their economies following the collapse of the CMEA in 1991 has been to turn towards the West, particularly Western Europe. Both countries were admitted to the OECD in 1996. More significantly, both states signed Association (or Europe) Agreements with the EC in December 1991, and were the first CEE countries to apply for full membership of the EU (April 1994). But the EU has been less welcoming than it implied it would be in the heady days immediately following the collapse of the communist systems in CEE. Thus the Association Agreements did not actually become effective until February 1994. Moreover, it is largely because of pressure from Poland and Hungary, rather than internal motivation, that the EU finally produced a list of criteria for EU membership in May 1995. But the adoption of a 300-page White Paper at that time still did not provide any deadlines for admission. In December 1995, the EU indicated that negotiations would probably commence in the second half of 1997; more recently, in October 1996, British prime minister John Major informed the Polish president that negotiations would commence in January 1998. In April 1996, EU Commission President Jacques Santer announced that negotiations for Czech and Hungarian membership might (my emphasis - LTH) be completed by 2000, while those for other countries would take longer.(10) Even this deadline, to the extent that it was one, was only for the completion of negotiations, not admission - so that even the front-runners among the CEE states look set to take much longer to gain admission to the EU from the time they overthrew their authoritarian regimes than did Greece (c. seven years), Spain (c. eleven years) or Portugal (c. twelve years).(11)
Not only do Poles and Hungarians feel they are being excluded from formal membership of Western 'clubs', but some also become annoyed at what they - with some justification - see as the hypocrisy of the EU. The latter claims to support market economics; but when Poles, in particular, have sought to sell agricultural produce in Western Europe at prices below those of even the cheapest EU-produced fruit and vegetables, they have sometimes found the EU intervening and insisting that prices must be at least as high as the EU produce. This has happened with Polish cherries, for example.
2. Political Aspects
As mentioned earlier, many observers were shocked when so-called 'former communists' were elected to power in Poland in 1993. After all, the Poles had publicly protested against their communist rule more than any other CEE nation in the period 1945-1989; they were held to be deeply Catholic, which was at fundamental odds with communism; of all the Western Slavic groups, the Poles were the most anti-Russian, and associated communism with Russia; and the most powerful anti-communist workers' organisation to have been established in Eastern Europe during the communist era was Poland's Solidarity.
The success of the 'former communists' in Hungary in 1994 was not quite as surprising as that of the Poles, partly because the Hungarian communists had been more popular in the 1970s and 1980s than had their Polish counterparts. Moreover, the Hungarian transition to post-communism had been largely engineered by the communists; what is sometimes rather unfortunately called the 'melancholic' revolution(12) was in many ways a revolution from above. Yet many observers were still taken aback; surely the Hungarians were even more like Westerners than were their Slavic neighbours?
In analysing the success of the 'former communists', several important points must be borne in mind. First, so many citizens were hurting in the putatively short-term pain of transformation that it is hardly surprising that many voters thought back fondly to the days of full employment, low inflation, and subsidised prices on basics such as housing, transport and food. Second, and leading on from the first point, many of those who voted for the 'former communists' were registering a protest vote against the incumbent government as much as a strongly supportive vote for the 'communists'. Third, the 'former communists' genuinely seemed to be reformed. There was no suggestion of a return to Marxism-Leninism, democratic centralism, or the nomenklatura system. This is why the term 'former communists' is invariably placed in inverted commas here. Fourth, the Democratic Left Alliance in Poland and the Hungarian Socialist Party (i.e. the 'former communists') appeared to have more people experienced in actually administering a state than did the other parties. Closely connected to the last point was the fact that many of the parties other than the 'former communists' were in a state of disarray by the time of the elections, and proved incapable of forming workable coalitions to defeat the left. Sixth, many Poles and Hungarians were by now becoming cynical about the West, which had in their view been less supportive than many of them had expected, and hence about Western institutions; comparisons can be made with the attitudes in some parts of CEE (most notably Czechoslovakia) from the late-1930s to the late-1940s. Finally, it should be borne in mind that turnouts for the elections were not particularly high - at 52.1% in Poland and 55.1% in the Hungarian second round - so that many voters appeared simply not to support anyone. Although the Hungarian Socialist Party did secure over 54% of the vote, this represented only a little over a quarter of the total electorate; the Democratic Left Alliance did far less well, attracting just over 10% of the total Polish electorate. The success of the 'former communists' can thus all too easily be exaggerated.(13)
Of course, it is from some perspectives only after they have been in power for some time that the real significance of the 'return of the former communists' can be evaluated. Have they proven to be (red) wolves in (democratic) sheep's clothing?
In fact, both the Polish and the Hungarian governments have proven to be far less 'socialist' than many of the erstwhile supporters had almost certainly hoped for. In the case of Poland, for example, the mass privatisation program adopted by parliament in April 1993 (i.e. before the 'former communists' took office) essentially went on hold in the early days of the new government, but was finally implemented from November 1995, when shares in fifteen national investment funds went on sale to the public; by the time the scheme was completed, in November 1996, some 95% of Polish citizens had purchased participation certificates.(14) Another significant indication that the so-called 'former communists' in Poland were almost as hard-nosed economic rationalists as those they had replaced was the government's attitude towards the Gdansk shipyard during 1996. In March, the government proposed selling off its 60% stake in this home of Solidarity. Then in June, the government opted not to save the shipyard from bankruptcy - which led former president and Gdansk shipyard worker Lech Walesa to claim that it was selling out the workers it claimed to represent. There followed a sit-in by the workers in Gdansk. At the same time, the junior partners in the governing coalition, the Polish Peasants' Party, tabled a vote of no confidence in privatisation minister Wieslaw Kaczmarek, which led to tensions between it and the Democratic Left Alliance. Although the Gdansk shipyard was apparently given a temporary 'stay of execution' in August, the government had demonstrated that it was prepared to adopt tough measures to ensure that the economy kept on modernising and growing - as became very clear by the renewed protests of shipyard workers towards the end of 1996.(15)
The Hungarian Socialist party has also demonstrated its ability to adopt tough policies despite its awareness of the unpopularity of these. In March 1995, the government (which had been in power only since July 1994) adopted an austerity package that included a nine per cent devaluation in the exchange rate value of the forint, a crawling exchange rate peg, and a tougher approach to wages in the public sector. There were a number of protests against these measures during 1995, and several ministers resigned because they believed the package was too draconian. It is true that the finance minister primarily responsible for the measures, Lajos Bokros, resigned in February 1996 after he failed to get the support of the rest of the government for a further tightening of Hungary's belt (mainly in terms of dramatically reducing the social security deficit caused by the huge expenditure in this area mentioned above). But following Bokros's resignation, prime minister Gyula Horn announced that the government would in general be continuing with the implementation of the 1995 austerity package. By the (Northern) spring of 1996, the proportion of GDP going to public expenditure had declined, and the IMF had given its seal of approval to the reforms.(16)
It could be argued that the distinctly unsocialist nature of the policies adopted by the 'former communists' in both Poland and Hungary has been essentially forced on them by their junior coalition partners. In the case of Poland, such an argument is invalid in the sense that the junior partners are themselves also seen as remnants of the communist era. While this is not true of Hungary, the fact is that the 'former communists' have now shown themselves to be in essence just as tough-minded and capitalist as their predecessors, and ordinary voters will see them as such. While I have not discovered survey data to this effect for Poland, recent Hungarian attitude and opinion polls suggest that voters there are moving away from the 'former communists', leading one pair of analysts to conclude that, '. . . the upward swing in support for ex-communist parties two to three years ago was indeed an aberration'.(17) It would not be surprising - barring some major new development between now and then - to see the 'former communists' removed at the next parliamentary election in Hungary, and perhaps also in Poland; were this to occur, these two countries would again be emulating the trend set by Lithuania, which, following elections in October and early November, replaced its 'former communist' government with a more conservative one in late November 1996.
Before concluding this section on political developments in the two countries, and the issue of democracy, one somewhat disturbing common feature should be noted. For rather different reasons, developments in the media in recent times are cause for some concern. In the case of Hungary, a five-year struggle over the media resulted in what initially appeared to be a pleasing outcome, with the adoption in December 1995 of a law on the media that appeared set to remove most of the government's influence. Unfortunately, there have this year been signs that many of the 'independent' newspapers, etc. are being sycophantic towards the government, and that corruption is rife in the media industry.(18) In Poland, the problem is more one of increasing state intervention, notably in the form of censorship. While this is nowhere near as serious a problem in Poland as it is in countries such as Belarus and Slovakia, it is disturbing that a country that in so many ways appears to be making significant strides towards a truly democratic culture (as distinct from merely creating the basic institutional structures of democracy) should be taking these retrograde steps.(19)
3. Corruption
Earlier, reference was made to corruption in the media. While it is arguable whether or not much of this actually is corruption, which usually implies private abuse of public office, there is no question that actual corruption and political scandals are very much part of contemporary Polish and Hungarian life, and are perceived as an increasingly serious problem.
One of the best-known examples of corruption in Poland relates to police officers in Poznan. In March 1994, the interior ministry confirmed that investigations had revealed widespread corruption among police officers, who were collaborating with organised crime groups involved in the smuggling of motor vehicles and the illicit production of alcohol.(20)
One of the potentially most damaging examples of corruption and political scandal in Hungary in recent times was the series of allegations raised against the Hungarian privatisation board earlier this year that resulted in the sacking of all eleven members of the board in October.(21) This was not the first time there had been a scandal relating to the privatisation process. Two years earlier, in September 1994, the interior ministry announced an investigation into allegations relating to the corrupt sale of formerly state-owned enterprises; this led to the forced resignation in October 1994 of no less than eight of the ten members of the board.
A potentially serious drawback with public perception of widespread corruption in the state, especially in those parts of the state that are directly involved with the structural transformation of a country, is that ordinary citizens can begin to associate market economics and 'democracy' with a deterioration of public ethics. If there is also perceived to be widespread corruption in those agencies which citizens believe should collectively constitute the one honest and trustworthy part of the state in the confusion of transition, namely the law enforcement agencies, then corruption can exert a seriously delegitimising influence.(22)
Official statistics suggest that the problem of corruption may in fact be a relatively minor one.(23) However, the very nature of the crime - where there is often no obvious victim to report malfeasance, for example - means that gathering reliable data on corruption is not possible in any country.(24) Moreover, it is public perception rather than actual numbers and scale of crimes that really matters. Survey data reveal that many Hungarians and Poles are indeed very concerned about corruption, and that this problem is making the transitions in these two CEE states even more difficult than they already would be. For instance, a 1995 survey revealed that no less than 93.4% of Poles surveyed considered corruption to be a significant or very significant problem in their country.(25)
Fortunately, many officials in both Poland and Hungary have recognised the potentially destabilising effects of corruption, and have begun taking measures to tackle it. Not only are such officials aware of the potential delegitimising effects of corruption within their countries, but they also appreciate that too much of a reputation for corruption can render a given country less attractive to potential foreign investors; this can add to the economic problems of a country, and hence add to the spiral of delegitimation. By way of example, interviews conducted by this author in Hungary during 1996 suggested that many Western businesspeople believe that a major reason for low-level corruption, including official complicity in tax evasion, relates to the fact that employer on-costs are so high; thus the state can miss out both on on-cost revenue and in terms of the country's image, as a direct result of its absurdly expensive social security arrangements.
In addition to the more obvious ways of tackling corruption - such as passing stiff sentences on those convicted of it and mounting public campaigns against it - both the Polish and Hungarian authorities have been adopting innovative measures to deal with it. For instance, the Hungarian authorities established a task force early in 1996, that is attached to the prime minister's office and currently headed by Dr. Jozsef Beneze, that has the particular brief of addressing corruption. Hungary has also this year joined the Berlin-based Transparency International; this was established in 1993 with the particular objective of advising governments that sought its advice on ways to reduce structural incentives for corruption.(26) Both Polish and Hungarian authorities have also been collaborating more closely with foreign counterparts lately in their fight against organised crime (which often involves corruption).
One of the numerous reasons for corruption is that many officials are unclear as to what does and does not constitute 'conflict of interest'. Inasmuch as politicians, as legislators, should be setting an example in this area, it is interesting to note that neither Poland nor Hungary yet has a satisfactory conflict of interest law for politicians and senior public servants. Poland passed one in 1992; but this has been criticised as grossly inadequate by former justice minister Jerzy Jaskiernia.(27) Similarly, Hungary has this year witnessed heated debates on a proposed new law, but no final agreement.(28) Both countries need to resolve this issue if they are to make headway in their fight against corruption.
So far in this analysis of the fight against corruption, the emphasis has been on measures taken by the state. But in the relatively much freer atmosphere of post-communism, 'civil society' agents can also play a role. One of the most obvious is independent mass media. Thus the Polish periodical Nie has built up a reputation for exposing the more questionable activities of leading figures in Poland, which has sometimes resulted in investigation and the laying of charges. The above-mentioned moves to control the press could prove counter-productive.
Although it would seem that, on balance, corruption is seen to be harmful to society, it should be noted that it can also play a beneficial role sometimes, especially during a difficult transition period. A proper analysis of this is way beyond the scope of this article; suffice it to say that it is not possible to understand how some of the post-communist societies and economies have survived unless the cushioning effects of some forms of corruption are factored in.
4. Conclusions
By many criteria, Poland has performed better than Hungary in the 1990s. Does this mean that the oft-criticised 'shock therapy' approach has been vindicated, or, expressing it differently, that gradualism has been shown not to work? Unfortunately, it is much easier to ask this question than to answer it, at least with any certainty. Many factors need to be considered. Are Polish attitudes towards work and risk-taking different from Hungarian, and, if so, does this matter? How much significance should be attached to the fact that the Poles were able to negotiate a write-off of much of their foreign debt in the early-1990s? Given the points made earlier about the relatively late emergence of a large-scale privatisation program in Poland, is it appropriate to maintain that Poland and Hungary adopted two radically different approaches to transition anyway? It could be argued that their sequencing was different, but that, as in any real economy, models and objectives were in both countries often knocked off course by the effects of political conflicts. The differences in performance might be much smaller anyway by the end of the decade, in which case it might be argued that both 'models', to the extent that these really are distinct, brought similar results.
Hence, while analysts such as Harvard University's Joel Hellman are currently producing very impressive and persuasive data-based arguments to suggest that we already have the proof that more radical approaches to transition are in the medium- and long-term more economically effective and less socially costly than incremental approaches(29), an honest jury might decide it has to remain out for some time to come.
Leslie Holmes is Professor of Political Science at the University of Melbourne. He is currently on study-leave at St. Antony's College, Oxford, where this article was written.
His most recent book, Post-Communism, has just been published by Polity Press.
Endnotes:
1 All growth statistics are from EIU Country Reports, Business Central Europe and The Economist.
2 Ibid., plus BBC Summary of World Broadcasts - Weekly Economic Report (hereafter SWB-WER), Pt.2, 31 October 1996, p.EEW/0459 WC/3.
3 The European, 21-7 October 1994, p.18.
4 Source as for fn.1, plus SWB-WER, Pt.2, 28 November 1996, p.EEW/0463 WC/4.
5 As for fn.1 and 'Moving from Moderate to Low Inflation in Poland', IMF Survey, Vol.25, No.3 (February 1996), pp.46-8.
6 The Economist; SWB-WER, Pt.2, 24 October 1996, p.EEW/0458 WC/6; and SWB-WER, Pt.2, 12 September 1996, p.EEW/0452 WC/5.
7 On welfare and unemployment policies in CEE see B. Deacon et al., The New Eastern Europe (London: Sage, 1992) and T. Boeri (ed.), Unemployment in Transition Countries (Paris: OECD, 1994).
8 L. Vinton, 'Poland's Social Safety Net: An Overview', RFE/RL Research Report, Vol.2, No.17, pp.3-11; K. Okolicsanyi, 'Hungary's Misused and Costly Social Security System', RFE/RL Research Report, Vol.2, No.17, pp.12-16.
9 'Transition Economies Need to Reform Social Safety Nets', IMF Survey, Vol.25, No.16 (August 1996), pp.261 and 269-70.
10 Santer's comments were made during official visits to both the Czech Republic and Hungary, which probably explains why he did not mention Poland. However, Poland came in for some criticism from the EU in late 1996 for liberalising visa requirements with Russia, and was informed that such a policy could hinder its chances of early admission to the EU.
11 In his meeting with President Kwasniewski mentioned above, John Major is reported to have suggested that Poland might be admitted to the EU in 2000; even if he did, it presently appears unlikely that the EU authorities themselves would permit such an early entry.
12 J. Simon, 'Post-paternalist Political Culture in Hungary: The Relationship between Citizens and Politics during and after the "Melancholic Revolution" (1989-1991)', Communist and Post-Communist Studies, Vol.26, No.2 (1993), pp.226-38.
13 The list of factors just provided is a comparative one, applying to both countries. There were also, of course, a number of reasons relating exclusively to either Hungary or Poland. In the latter case, for example, the former government's very strict anti-abortion policy was unpopular with many Poles; the present Parliament approved a government bill substantially liberalising the abortion law in August 1996. The new policy was strongly condemned by the Pope in September.
14 SWB-WER, Pt.2, 28 November 1996, p.EEW/0463 WC/5.
15 For an interview with Polish Deputy Prime Minister Grzegorz Kolodko, endorsing the notion that his government is more committed to economic growth and stability than to conceding to social pressures, see Transition Brief (OECD publication), No.4, Summer 1996, pp.4-5.
16 'From the Executive Board', IMF Survey, Vol.25, No.8, p.134. Some have argued that the government has subsequently slowed down the pace of reform - see Z. Szilagyi, 'Slowing the Pace of Economic Reform', Transition, Vol.2, No.20 (October 1996), pp.40-3. Even though there is some truth in this, the slowdown is of a modest nature, and does not alter the basic thrust of policy since 1995.
17 A. Szakolczai and L. Fustos, 'Changing Values Leave Ex-Communists Behind', Transition, Vol.2, No.22 (November 1996), pp.46-8, here at p.46.
18 See Z. Szilagyi, 'Shady Dealings and Slow Privatization Plague Hungarian Media', Transition, Vol.2, No.21 (October 1996), pp.44-5.
19 On all this see J. Karpinski, 'Polish Ruling Parties Assert Control Over Television', Transition, Vol.2, No.21 (October 1996), pp.51-3.
20 Surveys conducted at about the time of this scandal revealed how dishonest many Poles believed their police force to be - see Sponsorowanie Instytucji Panstwowych a Korupcja i Lapownictwo (Warsaw: Centrum Badania Opinii Spolecznej, 1994); I am indebted to Oliver Freeman of St Antony's College, Oxford for assistance in translating this document.
21 For details see SWB, Pt.2, 7 October 1996, p.EE/2736 C/3-5.
22 It should be noted that, according to official statistics, corruption among police officers is declining in Hungary. Whereas 36 officers were charged in 1991, this figure has fallen each year, and stood at only 9 in 1994. This said, personal interviews conducted by the author suggest that many Hungarian citizens and officials believe that these figures are but the very tip of the iceberg, and that there is a considerable amount of (often rather low level) corruption in the police force.
23 On Hungary see M. Kranitz, 'Corruption in Hungary' in D. Trang (ed.), Corruption and Democracy (Budapest: Institute for Constitutional and Legislative Policy, 1994), pp.105-9, here at pp.107-8.
24 Although data on both corruption and the much broader concept of the 'black economy' are invariably rubbery, it is interesting to note that Hungarian prime minister Gyula Horn recently announced that, 'according to economists' estimates', the value of the black economy currently amounts to some 28% of GDP and has been holding steady since 1994 - having risen to this level from some 22% in 1990 (SWB-WER, Pt.2, 28 November 1996, p.EEW/0463 WC/4).
25 Survey data kindly provided to the author by Prof. Andras Sajo during an interview in Budapest, 24 September 1996; unfortunately, the comparable Hungarian data had not yet been processed at the time of writing.
26 For details on the work of Transparency International by its Director see P. Eigen, 'Combatting Corruption Around the World', Journal of Democracy, Vol.7, No.1 (1996), pp.158-68.
27 Author's interview with Jaskiernia in Warsaw, 27 March 1996; see too J. Jaskiernia, Wizja parlamentu w nowej konstytucji Rzeczpospolitej Polskiej (Warsaw: Wydawnictwo Sejmowe, 1995), pp.33-5.
28 Z. Szilagyi, 'Slowing the Pace . . . ', pp.41-2.
29 Prof. Hellman presented a report on his as yet unpublished findings and arguments at St. Antony's College Oxford, 2 December 1996.
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