-Essay-

WARSAW -Poland has always lacked capital for important investments. The roads have always been bad, muddy, full of ruts and potholes. We have great universities, but they are woefully underfunded.

In Poland there have always been “islands of modernity in a sea of backwardness,” according to economic historian Witold Kula. In this sense, Poland’s standing in the Western world has always been precarious. But now, there is a chance to change that, though the potential potholes and pitfalls remain.

Our new highways are a sign that we are catching up to the West, but they also show that Poland is taking the wrong approach to modernization. Germany and France, for instance, built new highways because their countries are actually modern – whereas Poles think that they will become modern by building new highways with EU money. As long as it keeps doing that, Poland will always be a second-rate country – only with better infrastructure that has been paid for by their richer neighbors.

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Poland's first highway in Upper Silesia - Photo: Krzysztof Duda

According to international statistics, Poland is a rich and developed country – but always in last place on the list. In the European Union, only Romania and Bulgaria usually fare worse than Poland. The Czech Republic, Hungary and other Baltic countries, on the other hand are doing better than us. It is worth noting however that in regard to GDP per capita, Poland is doing as well as Hungary. This is a huge accomplishment considering the huge gap in prosperity between Hungary and Poland in the 1980s. But this is only half of the battle.

The civilizational difference between Poland and the West is still deep, much deeper than can be revealed by GDP statistics, which don’t paint the full picture in regard to economical or social issues.

Case in point: Polish food exports are breaking records. Moreover, Poland ranked fourth in the world for furniture exports. Apple stores, which pride themselves for their design and quality, use Polish shelves to display their products.

However, Poland is not an innovative country – only Bulgaria does worse than us in this regard. According to Eurostat, Germany had a 79.3% rate of innovative companies, while Poland only had a 28.1% rate. According to the World Intellectual Property Organization, only 0,12% of world’s patents and inventions come from Poland – nine times less than Spain. High-tech products represent only a tiny fraction of Polish exports.

The Polish answer to this problem is to spend more money on education – but simply doling out money is not a solution.

Poland has a really long and rich history of intellectual life and an impressive gallery of writers and poets. However, the Polish nation also ranks last in Europe for reading books and newspapers. This is not a question of money, because poorer countries do not have this problem. Money – whether it comes from the EU or from oil riches – is not always an indicator of the level and quality of life.

Revamping our public institutions

The late eminent British historian Eric Hobsbawm summed it up in one question: “Why is Switzerland richer than Albania?” This question might seem odd, but in fact both countries are very similar – they are small, mountainous and deprived of natural resources or good soil. Both of them were poor for centuries, and both fought fiercely for their independence and made it by sending young people to serve in mercenary armies. Switzerland doesn’t even have access to the sea.

The answer to Hobsbawm’s question requires looking at historical, religious and economic reasons, as well as the long and complicated story of both countries’ evolution, which is impossible to summarize in one sentence.

So economists and economy historians prefer to compare what they call “institutions:” the level of corruption, the competence of civil servants, the efficiency of public services (schools and hospitals), the quality of the education and banking systems, the judicial system and social norms. For instance, Danish people do not take bribes, but the Russians do. This has to do with tradition but also with the judicial system, the police and the courts. Its institutions have made Denmark one of the richest countries in the world even though it is small country without natural resources. Russia, meanwhile, despite its huge resources and large-scale industry, remains far behind Denmark.

So how should Poland spend the EU money? The answer to that question is quite simple. It should be spent on public institutions, so that they can work more efficiently. Not only is the state conducive to economical growth, but it is also responsible for making its citizens feel safe and comfortable. Residents of rich countries trust the state, including its courts and police, unlike residents of poor countries, who are often afraid of the state.

In this area, there are so many dysfunctions in Poland that it would be impossible to list them all in this newspaper. A perfect example is the dysfunctional welfare system, where a large proportion of resources are wasted and not given to those who need it most. This system does not work, and it undermines public confidence.

Of course, all the money from the EU is not for us – just 3% of the Polish GDP. Institutions are harder to change than it is to build a road or a highway, but it is a more profitable investment. My colleague Witold Gadomski once wrote about “strategies” and long-term plans developed by various government agencies. There were dozens of them, he said, stuffed in drawers.

The Polish state is not good with long-term planning, or projects that require consistency and that take years to be carried out. We cannot decide whether we want nuclear plants or high-speed trains. Each project is a gigantic investment, and because of this they rarely leave the planning phase.