5io WOLNOSCComecon organization. It was referred to as TRWPG Bis; and it showed that
nearly 18 months after the Fall of the Berlin Wall Moscow still harboured hopes
of salvaging its East European empire. The moment, from Poland's point of
view, was extremely unfavourable. In the early stages of the economic shock
therapy introduced under the Balcerowicz Plan, calm and stability were
required above all else. A confrontation with Moscow could have dire conse-
quences. So the Soviets blustered and threatened. Fearful for his plan,
Balcerowicz advised compliance. But the young Polish premier, Jan Krzysztof
Bielecki, Walesa's colleague from Gdansk, held his nerve, risked Moscow's
wrath and refused. The danger did not pass until August of that year when the
August Coup in Moscow put an end to Soviet power for good.
In the event, the transition proceeded with far less pain than might have been
predicted. In the early years, 1991-2., when Poland was most vulnerable, the
USSR was breaking up and, despite the continuing presence of a huge Soviet gar-
rison, was incapable of interference. Economic shock therapy proved a great
blessing. Hyperinflation was brought under control almost immediately.
Productivity began to pick up in the second half of 1991, and was soon enjoying
record rates of 4, 5, and eventually 6 per cent pa. The country's huge foreign
debt, a milestone since the 1970s, was paid off by 1995. Thereafter, the new zloty
held steady, and the privatized banking and financial sector met its challenge.
The IMF was impressed and eager to assist. Foreign investment grew steadily,
and was well distributed among a number of participating countries. The fear
of immediate German domination proved unfounded. Of course, there were
many failures. Peasant-based agriculture did not revive quickly; and cheap
imported food replaced home production. Dismantling the redundant giants of
heavy industry was not achieved, as hoped for. The Lenin Shipyards at Gdansk,
for example, symbol of the SOLIDARITY Revolution, failed to adapt to the
new circumstances and fell into bankruptcy. Yet the shipyards at Szczecin flour-
ished. For every failure, there were two or three successes. Despite patches of
continuing pessimism, the depression of decades lifted. In terms of economic
recovery measured as GDP per capita, Poland by 1996 clearly led the field of all
ex-Communist states; and in terms of stability measured in price inflation, it
was one of the best performers.
Political reorganization took rather longer. Both the SOLIDARITY camp
and the old Communist coalition fragmented into rival groups. The former was
permanently split by the bitter contest in 1990 between the more nationalist
Walesa and the more liberal Mazowiecki, whose supporters founded the
influential Unia (Freedom Union, initially Democratic Union). The latter was
atomized beyond recognition. Both the SD and the Peasant Party; relishing their
liberty, broke their Communist links for good, and split into further factions.
Many of the former members of the nomenklatura were converted to capitalism
overnight. As people with ready access to funds and to the opportunities for net-
working, they took up the leading positions in banking and in privatized indus-
try, thereby becoming an instant conservative element in the new order. The