Wednesday, July 18, 2012

PSL. Lol.

Not so lucky right now
Who here was surprised by the so-called "PSL tapes" showing the former head of a farm agency run by the Agriculture Ministry allege that Polish Peasants' Party (PSL) members were fleecing the public purse?...Bueller?

The PSL's entire ideology, nay, its raison d'etre, seems founded on sticking its people in public ministries, agencies and institutions -- usually farm-related -- where they can most benefit. And how they do benefit sometime.

Case in point is one Andrzej Smietanko, the ex-president and current director of Elewarr, a state company that controls the biggest grain elevators in Poland and run by the Agricultural Market Agency (ARR). Smietanko makes PLN 29,000 a month in a country where the average salary is about PLN 3,700. This is padded by a bonus of 3% of the agency's profit and he gets PLN 7,000 for sitting on the board of a company Elewarr owes. Trouble is, the government watchdog NIK found that he was hired without proper qualifications (I suppose other than being a PSL man).

Elewarr has in fact been hounded by NIK for some time. The watchdog even demanded Elewarr directors return PLN 1.4mn in bonuses paid out that were illegal. The money was ordered returned…though so far none of it has, surprise, surprise.

Agriculture Minister Marek Sawicki fell on his sword today as part of the effort to protect the PSL from negative fallout to the scandal. Prime Minister Donald Tusk, who is savvy enough to have demanded a fast response, might even take over the ministry temporarily.

Before the scandal goes, though, the European Commission's interest has been piqued. It demanded on Wednesday that the Polish government explain what was going on with the ARR. If reports that money was wasted are proven, it will call on the government to return funds.

The PSL has always been the weak link of the coalition. A scandal such as this was just a matter of time. For now, Tusk says the coalition has provided "more good" and so should continue, though he called on the PSL to purge itself of impropriety.

This reminds me of the fable about the scorpion and the frog, which can be altered to fit the recent events. The PO (frog) agrees to carry the PSL (scorpion) across the Vistula after extracting a coalition agreement the PSL won't sting the PSL. When half-way across the river, the PSL stings. When Tusk asks PSL leader Waldemar Pawlak why he stung the PO to kill off the coalition, Pawlak answers, "it's in our nature."

We'll see if the PSL can prove this wrong.

Thursday, July 12, 2012

We don't need no education

At the cost Polish teachers want to charge for their services we don't need any no education. Teachers in Poland spend the least time actually teaching in Europe. For the 2010-2011 school year, the average Polish teacher spent 14 hours a week in front the chalkboard. Ouch.

A German teacher spent nearly double that, teaching for 26 hours. But it's hardly surprising that a German would work longer than a Pole. Yet, a Spanish teacher spent 25 hours in front of the class, French and Finnish ones some 24 hours, and a Greek teacher taught for 21 hours. My god, Greek teachers worked harder than Polish ones. That's got to be a new low.

The Polish daily Rzeczpospolita notes that before 1982 teachers taught class for a more respectable 26 hours a week. In 1982, General Wojciech Jaruzelski, the then ruler of a Communist-controlled Poland still caught in the grip of Martial Law, bought off teachers that had been threatening to strike by agreeing to much shorter working hours and guaranteeing privileges.

The rules still in place don't require Polish teachers to be in school beyond actual lecture hours. Teachers counter probably (and somewhat justifiably) that they don't get paid a lot to sit around at school.

But teachers do get paid to go on holiday. Jaruzelski's largesse and the lack of reform since means Polish teachers get some 80 days of holidays a year. That is nearly three full calendar months of holidays.

Local governments attest that the high cost of teachers combined with low productivity is helping ruin their budgets, according to Rzeczpospolita. Local government reps say that as long as the central government doesn't want to splash out for teacher privileges, it should limit them. Their main demands are to increase working hours, lengthen promotion thresholds and cut holidays.

Teachers, unsurprisingly, are having none of this. Some 96% of them vowed to protest against any limitation of their current rights. A full 30% said they were willing to go on permanent strike.

The Education Ministry, for now, is ready to back down in the face of always unpopular protests with parents. It says no changes will be made to working conditions without teacher approval. We know exactly what that means: there will be no changes.

Change, however, never stops. With Poles ageing fast, there simply won't be enough kids to go around, even if teacher working hours are kept ridiculously short. In this context, it seems the quicker the system can move to paying fewer good teachers well the better. Otherwise, the question really be 'is our children learning?'

Wednesday, July 11, 2012

Market diseconomy

The ever creative Waldemar Pawlak has been the goat of this blog before. Now he's back. His latest idea is so infuriating I've even been riled from my non-blogging slumber. Deputy Prime Minister and Economy Minister Pawlak wants to mess with the market, but not in a good banks-are-back-stabbing-bastards kind of way but rather of the could-ruin-the-game-forever sort.

Poland's construction companies were once the envy of the lot when everyone pondered the likely impact of billions of euros of EU funds and billions of zloty of public money combined with the utter lack of road infrastructure. Surely the money would start rolling in.

But a combination of self-defeating public procurement laws that encourage companies to bid too low and likely a large dollop of hubris has led some of the biggest to the brink of doom.

Enter Pawlak. The good sir Pawlak says the companies should be saved from their own mistakes. At first, he suggested the troubled ones should be nationalised a la General Motors in the US. It's not their fault after all, he says. After realising the troubling implications of a state buying up private companies, he has changed tack.

Now Pawlak says that one beleaguered builder needs 'only' PLN 500bn and that the state can buy bonds issued by that company. The ever generous Pawlak even says the state could pay above-market prices. How nice.

To the rescue comes…Jacek Rostowski, finance minister. When asked whether the construction companies should be saved, the usually garrulous Rostowski says "no." When asked whether builders' bonds should be bought, the answer is "no."

It's troubling that Pawlak can't see that if Poland were to bail out every private company that got into trouble, it would eventually be back in the not-too-ancient past when the state did indeed call all the shots, to everyone's ill fortune.

I'm not a market purist, but it seems to me a little deterrent might go a long way, not just for Poland's builders but perhaps for the world's banks as well.

Tuesday, April 10, 2012

The real victims...

The second anniversary of the Smolensk crash that killed President Lech Kaczynski and 95 others in Smolensk, Russia provides a fitting opportunity to shine a light on the continued political idiocy of Lech's surviving twin brother, Jaroslaw Kaczynski, and the opposition Law and Justice (PiS) party he leads.

In case you missed it, Jaroslaw and his PiS minions now openly say Lech was murdered by the Russians.

"Lech Kaczynski exposed himself to those who do not want Poland to be effective," Jaroslaw said on Monday. "All indications are that this ended in an attack. I have the feeling that President Lech Kaczynski was murdered. In Poland and abroad were people who could benefit from the death of Lech Kaczynski. And did."

Hmmmm. People who could benefit and did? Well, they can only be thinking of Civic Platform (PO) leader and PM Donald Tusk, or maybe the PO in general and in particular in the 2010 presidential election.

The only trouble is that Lech Kaczynski was extremely unpopular that year and, though you can never rule out a comeback, it is likely Popeye could have won if the PO presented him and he ran against Lech.

Did Russia benefit from Lech Kaczynski's death? Unlikely since there has not been any real change. In fact, Russian President Vladimir Putin would have to be the dumbest politician of all time to have ordered the killing of Lech Kaczynski since the latter was about to lose an election and his death did nothing other than increase the already antagonistic attitude toward Russia held by a certain part of the Polish population.

As for the allegations of an attack, all signs continue to point to a series of events all occurring until it ended in a crash in the fog. Tragedy does not imply guilt.

Two things still infuriate me about the Smolensk catastrophe. The first is that the head of the main opposition party can make outlandish allegations with impunity. In some countries, proof is needed or the politician making the accusations has to resign. We can only hope this day comes.

The second thing is far worse. For anyone in Poland that foggy cold Saturday morning two years ago was an unbelievable moment that touched all of Poland. I remember it like I remember 9/11. I still get those goose bumps. That one political option is trying to co-opt the memory does a disservice to the real victims.

No, Jaroslaw and PiS members, the real victims are not you. They are those whose lives were cut short that tragic morning. RIP.

Tuesday, April 03, 2012

Public enemy number one: Lektor

The tension nears the unbearable, muscles clench, the hero is about to save the....some arsehole five rows down starts to fricking chat away and ruins the entire effect. That same sin is committed by the Polish lektor but committed each and every day. I call on all expats based in Poland: Let us track down the nefarious Polish lektor and put an end to his misery-making power.

For the confused, Polish TV and cinema mostly eschews dubbing or sub-titling foreign films or TV shows in favour of having some guy (very rarely some gal) read dialogue just after it is spoken. The original dialogue is audible but quietened. To be clear, one person reads the text for all parts of the film or show. All. Whether of the opposite sex or not.

Poles tend to love the lektor. A poll I found on the internet showed that only 19% of Poles would prefer subtitles to the lektor. One Polish forum I found saw broad support for the lektor over subtitles or dubbing since no one wants to "read a show" and dubbing was deemed poorly done.

Fair enough. But what about the disruption?

When I ask my Polish friends how in the hell they can even follow the plot, most say the lektor becomes invisible. He sort of installs himself in the brain and the text is read out and understand almost sub-consciously.

Sounds easy enough. But I have tried this trick. I just can't stop listening to the original person speak English. Usually, I'll start following the lektor, but then naturally start trying to listen to the actual speech, I'll not hear something, I'll try to figure out where the lektor is, get lost, the scene changes, I've missed something, then I turn the channel.

The lektor is not as much of a problem these days as he was. The interwebs and digital TV mean you can pretty much watch a show in any language you want any time you want.

But this does not account for the educational damage done by the lektor. Sure, it's easier to listen than read subtitles. But Poland's two education ministers in 2008 said they wanted to encourage TV to add subtitles in order to help Poles learn foreign languages. The lektor thus stops learning.

I say this motion should be re-heated -- nooo, this is not selfish -- and all TV should be subtitled.

Friday, March 30, 2012

Highways in hell

Expats in Poland agree on one thing usually: Polish roads are hellish and Polish drivers are insane. Most prefer rail, which seems safe though isn't always. A few opt for air, which is cheaper and cheaper. But almost no one drives unless they have to.

I am the exception. When I first came to Poland in the mid-1990s, Polish roads were indeed scary but they were also extremely exciting. It was like driving in the early video game Outrun (pictured).

Coming from Western Canada, where falling asleep at the wheel is a big danger, I could appreciate the fact I was never sleepy driving in Poland. On the contrary, I was riddled with adrenalin.

I thus learned to drive like a true Pole: fast, hard, aggressive. You are not driving if you aren't internally timing yourself.

Over the years, I've been party to many a fight on whether driving was so dangerous in Poland because of the roads or drivers. I have usually said the roads: the poor quality of them forces one to take risks in order to salvage a half-decent time.

Most say the drivers: you have to adjust driving to the roads. I usually view the latter like I view rational economic theory -- fine in practice but woefully inadequate when confronted by the messy irrational actors we all are.

I have also believed things aren't that dangerous. New data suggests I'm wrong.

Poland had the most deadly roads in the EU in 2011. A full 109 people died in road accidents for every 1mn people, according to just released European Commission data. The EU average was 61. Greece was second with 97. The UK was the safest at just 32.

Methinks the roads and drivers need to improve massively, though not of course, ahem, me, who naturally is the perfect driver….

A modest proposal

Frenzy grips Poland as the senior ruling Civic Platform wants to hike the retirement age to 67 and everyone and their dog (except mine) is in mad-dog mode crying foul. As I write, the Solidarity trade union is burning things in front of the Polish parliament, where a debate on the issue is being held.

How dare they take away our right to go on a really crappy retirement pension at 60 (women) or 65 (men)? How dare they take away the golden years of our lives when we will sit around and watch You Can Dance 2035? How dare they take away our right to enjoy oatmeal and enemas?

Well, I have a modest proposal. Being a child of 1973, I put forward a reduction of the retirement age to 39. Yes, 39. Imagine. No longer are you old and grey with one foot in a pine-box when you retire. Rather, you are young (ish) and free and ready to parrrrrtay After all, aren't the late 30s the new late 20s?

In economic terms, just think of the massive increase in positive consumer sentiment when the retirement age is lowered. If everyone gets really upset when it is increased to 67, the opposite can only mean a surge of optimism. Everyone will go out and spend to the tee, buying holidays and six packs, and tennis rackets and ice boxes, and party hats and cigar holders….

…what's that? How are we going to pay for this? Ummm, exactly.

Wednesday, February 01, 2012

That sinking feeling

Political capital, any politician will tell you, is a precious commodity. Squander it at your peril. But Prime Minister Donald Tusk seems to be doing just that, and this could have a big impact on coming reform.

Tusk and the "new old" Civic Platform (PO)-Polish Peasants' Party (PSL) government sailed into the October elections and prevailed. This was a historic achievement. The pair became the first government to be re-elected since political and economic transformation in 1989.

But that's when a lot of the good news stopped.First, there was the prescription drug refund disaster. Anyone needing to fill prescriptions saw doctor protests followed up by pharmacy protests. Information chaos prevailed throughout. The elderly tend to be most affected by such things, and the new government cannot have won many friends there.

If that was the hammer, the anvil was the mess over ACTA, the rearguard movement by governments and the entertainment business to try to control the internet. Protests gathered thousands of young voters. Schools were even known to have let some students skip class to protest. Who do young people vote for? Till now, the PO.

The new government has thus managed to alienate the old and the young. This might not be a problem since the next elections are long off. But the big issue is that squandering political capital on what are basically side issues is a huge mistake.

This government has pledged ambitious reforms that deservedly have won praise from those calling for reform, including markets and credit rating agencies. Equally deservedly everyone is worried about 'execution risk,' a fancy way of saying 'we'll believe it when we see it.'

To do any of the big reforms, the government will need political capital. One example is the pledge to increase the retirement age to 67, something the vast majority of Poles oppose. Yet, this is one of the most important pieces of legislation in recent Polish history, particularly because Poland's will be one of the oldest populations in Europe in 20 years.

Irking the old, angering the young, pissing off everyone. That is not the recipe for reform or re-election. The gauntlet has been thrown. Now it is up to the government to stop wasting political capital and get to work on what really matters.

Tuesday, January 17, 2012

Wolves in white coats

Polish pharmacists have now joined doctors in protesting against the new prescription drug refund law. For the good of the patient, naturally.

Pharmacists are closing their doors for an hour a day. Some are refusing to fill any prescriptions unless life threatening.

Doctors' refusal to decide the level of refund in line with the new law means pharmacists are afraid they will be left to pay if a drug is refunded for the uninsured.

The new law was to make doctors accountable for deciding how much the state will refund prescription drugs and make them pay if a patient was refunded but was uninsured. The government has already bowed down to doctor pressure, though they continue to protest. For the good of the patient, naturally.

The thing that irks me is that pharmacies in Poland are little more than purveyors of aspirin, cold medicine, vitamins and French cosmetics. They have gone through a dramatic transformation in recent years in terms of renovation and presentation.

Unfortunately, the focus is profit, not patients. In the search for medicine that is not super common but not uncommon either, I have personally gone from pharmacy to pharmacy only to find none of them sell it. Today, I went to one pharmacy that said on the door it refused to fill prescriptions and then naturally didn't have what I needed. They did have a lot of vitamin c, however.

I think Polish pharmaceutical market needs to be radically opened up. Supermarkets have to be let into the vitamin, OTC and related markets. Pharmacists can work at pharmacies specialising in prescription drugs. The rest we can buy where we like or where is cheapest.

Pharmacies like to pretend they have some sort of special relationship with the patient. That's why they wear the white coats, I guess. But next time check out the stationary they are using. It'll invariably be from one drug company or another. Profit is the motive.

I have no problem with this. But if profit is your overlying motive, as is obviously the worry in regards to the drug refund protest, let's make it a real business, open it up to supermarket competition, drive down prices, shift lineups for stuff that does need a specialist to prescribe, and shorten lineups for those that really do need prescription drugs and a little better care.

Friday, January 13, 2012

Tit for tat

Poland's ruling coalitions fight and stab and bicker and cat-fight and tussle and pull hair and kick at each other. The lack of this truculence made the Civic Platform (PO)-Polish Peasants' Party (PSL) ruling coalition in 2007-2011 so strange. But let bygones be. The fights are back.

The PSL was the first to take off the gloves. Prime Minister Donald Tusk presented the new PO-PSL government's often prickly fiscal and economic reform plan in mid-November. Problem is, the prime minister doesn't seem to have consulted the PSL.

The PSL has since the speech opposed seemingly all of it. The PO wants to raise the retirement age to 67 for men from 65 and for women from 60. The PSL calls this barbaric. It instead wants women to be able to subtract three years for each child birthed from the statutory retirement age. If you have 10 kids, technically you could retire at 37…just to be clear, the PSL is mum on the level of retirement benefit.

The PSL doesn't want soldiers, police officers and the like to lose the ability to retire after 15 years of service (I once met a 40-year-old pensioner, though he was working). The PO wants a minimum of 25 years and a minimum age of 55.

The PSL doesn't want farmers to pay much in health-care contribution. The PSL didn't want the amount employers pay for a workers' contribution for disability payments to be raised. It is skeptical of capping local government deficits, tighter EU integration and Poland lending 6 billion euros to the IMF.

PM Tusk has found the PSL's conduct infuriating. In late December, he even said that if the PSL didn't back the reform plan, it was hard to talk about a future for the coalition.

But Tusk might have the last laugh. The PSL violated the electoral code for an infraction in the 2001 elections. It was ordered to pay 20 million zloty, including 9 million for the actual violation and 11 million in interest. Finance Minister Jacek Rostowski was able to forgive the repayment of the interest. Surprise, surprise, he ordered earlier this week the full amount to be repaid.

Your move PSL.

Monday, January 09, 2012

Speed traps to help out budget?

Finance Minister Jacek Rostowski wrote a recent "love" letter to European Monetary and Economic Affairs Commissioner Olli Rehn in which he outlined how Poland would reduce its budget deficit as fast as demanded by the European Commission. Rostowski did chastise the EC for a lack of "transparency" -- the Finance Ministry is clearly so transparent -- but for the most part it was boring public finance stuff…until the statement "a newly introduced road speed enforcement system should yield further revenues, estimated at 1.2bn PLN in 2012."

Ahem, excuse me, but the police are going to raise 1.2 billion zloty from speeding tickets? Jesus H Murphy.

Recent data said there were 18 million cars. Though this doesn't include trucks and buses, it would mean some 67 zloty per car in speeding tickets just in 2012. Let's say with trucks and buses some 50 zloty a head.

But babcias tend not to drive overly fast. There are also more and more less experienced drivers who follow the "drive defensively" rule. I thus have the feeling speeders -- little old me, perhaps -- will be stumping up a little more than others for this one.

Boy oh boy am I happy to be ready to help Poland meets its budget deficit goals when a secretary at a mining company can retire at 35, farmers don't pay health-care, social security or taxes, and the government drives the latest BMWs.

Wednesday, January 04, 2012

Prescription for change

Be careful of what you wish for. I urged the government to bust a gut and get cracking. The good news is they did. The bad news is that it has been a disaster.

The new year brought with it joy for all (I'm sure) but also far-reaching changes to the way the government refunds prescription drugs. Doctors are now obliged to say which drugs are refunded and by how much. If a patient turns out not to have public health coverage, then the doctors are liable.

Doctors are not happy about bearing responsibility for what appears to be a bureaucratic decision. Instead of saying how much a prescription should be refunded, they are stamping them with a statement that the decision is up to the National Health Fund (NFZ).

So, a poor patient gets the prescription for some life-saving drug, gets the NFZ stamped version and goes to the pharmacy. The pharmacist doesn't know whether any refund will be honoured with such a stamp since it technically violates the law. Some pharmacists are thus refusing to give any refund in case they are liable one day.

Leaving aside controversial changes to the prescription drug refund list, the above basically sums up the problem. As always, who gets screwed in the end? We patients.

How do you know something in Poland is important? Prime Minister Donald Tusk holds a press conference.

Tusk met doctors on Wednesday and later announced that room for a compromise existed. Though he was sure to blame the whole mess on doctors, noting there would be no problemo if doctors had followed the law, he said he would work toward suspending any potential fines for drug refunds until a national insurance system was up and running. . .

. . . Erm, wait. There's no such system already? You wanted doctors to vouch for a patients' insurance coverage even though there's no national registry or easily searchable database. Hmmm. Maybe this could have been done first.

Monday, January 02, 2012

Get to work!

No more lollygagging. No more dragging your heels. No more saying you can't do anything because the president is bad or the opposition is bleh or there's a crisis. No more excuses. The moment of truth is at hand.

For the senior ruling Civic Platform (PO) it is crunch time. Prime Minister Donald Tusk appears to understand this. His plan for the next four years laid out in mid-November comprises an ambitious agenda that would address a lot of economic and fiscal problems, both short- and long-dated ones. It deserves praise and indeed got it.

But how can one not raise the question of execution risk. Or, how can one believe a government that found a lot of reasons to not do anything in the preceding four years and precious few arguments for doing something.
The next three months will in fact already provide a good measure of whether Tusk's promises will be more than paper tigers and will help Poland become a Central European eagle.

In a just approved government plan, January is to start a busy first three months. The government will kick off with taxing copper and silver mining and then change the way the 9mn or so pensions are indexed. For February and March, the government wants to change tax breaks to effectively increase the tax burden, limit the free-spending ways of local governments, limit baby payment eligibility, limit early retirement eligibility for soldiers and police, and raise the retirement age to 67 from 65 for men and to 67 from 60 for women.

Some progress has already been made. Already in December the government increased the amount employers must pay for their employees' disability contribution by 2 percentage points in a bid to raise some 6-7 billion zlotys.

The European Union economy remains on the precipice regardless of the fact we have all enjoyed a couple week break. The global economy's prospects are tough. Consumer and broad sentiment is grim. In such bleak times, reform strength and stamina could be the difference between buying in and selling off. So, I say to the government, get to work.

...After a famine of Poland X posts in December, I pledge to also, er, get to work ...Happy New Year all.