7 ms·

It still doesn't work as all those social programs are unsustainable from fiscal viewpoint. It's all financed by debt and inflation.

trasz 5y ago
Not true. In fact, those programs are only barely more expensive than "podatek liniowy", which got introduced decades ago and which is essentially a subsidy for the wealthy for being wealthy.
- bitcharmer 5y ago
  Care to explain the reason behind currently skyrocketing inflation and PLN devaluation then?
  - trasz 5y ago
    https://tradingeconomics.com/european-union/inflation-rate https://tradingeconomics.com/european-union/inflation-rate. Also, while it's kind of hard to say for sure how Poland is doing, and while there definitely are some things that the current government is horrible at, it would be quite a stretch to say it's the "500+" program's fault. Especially given that "podatek liniowy" still exists.
  - lkrubner 5y ago
    Poland is able to keep its unemployment somewhat down, by keeping the zloty weak relative to the euro, and therefore helping Polish exports. And before anyone says "Poland has a lot of unemployment" compare it to other weak Eastern European countries on the euro. Poland could end inflation if it wanted higher unemployment, but for now it accepts the higher inflation and weaker zloty so as to help exports and so limit how bad unemployment might get.
    - lkrubner 5y ago
      I'm not sure why this is getting downvoted. If you believe there is no link between the currency, inflation and employment then you're engaging in a well known economic fallacy. See "The Doctrine of Immaculate Transfer": https://krugman.blogs.nytimes.com/2011/01/12/the-doctrine-of-immaculate-transfer/ https://krugman.blogs.nytimes.com/2011/01/12/the-doctrine-of... "The fallacy comes in when you say, “Well, given that it’s all about spending imbalances, exchange rate policy has nothing to do with it.” This is what John Williamson of the Institute for International Economics once dubbed the Doctrine of Immaculate Transfer. (Uh-oh, Erick Erickson’s gonna come after me …) It’s a popular fallacy, especially at the WSJ, although I’m not sure if it rises to zombie status."
      - mmarq 5y ago
        I can’t downvote yet, but you can indeed lower unemployment without rampant inflation or devaluations.
        lkrubner 5y ago
        That's true, there are 2 main approaches, but they both have real costs, and neither is obviously better than the other. In the face of a severe economic shock, such as the global financial crisis of 2008 or the pandemic of 2020, you would expect to see unemployment increase. The two approaches to reduce that unemployment are: 1. Keynesian stimulus. The government could stimulate demand, either by increasing the purchases where it is the final consumer (military, education spending) or it could give money to citizens so they can spend more. It's important that the increase in spending is not initially offset by tax increases, so this means the government has to take on debt. 2. Devalue the currency so as to help exports. This way you avoid taking on debt, instead you rely on increased money from exports to stimulate the economy. But here, instead of debt, you pay for the stimulus via inflation, as imported goods are now more expensive. Keep in mind "increase exports" is relative to what your main trading partners are able to consume. The EU is the main trading partner for Poland. When the EU is in a deep recession, Poland's exports can be expected to fall, so "increasing exports" might only keep them at their previous rate (the rate that existed before the crisis). Whatever you do, there is some cost. Either you take on debt or you take on inflation. There is no way out of the crisis that is completely free.
  - p_l 5y ago
    The 500 PLN extra for kids by itself was not necessarily going to cause skyrocketing inflation. I don't necessarily agree with how it was implemented, but it's true that we had a huge lack of important support for less wealthy. However, on top of that, you have a lot of simply bad management, and also ridiculous amounts of fraud by ruling party politicians. This means that a lot of money is leaking from the budget in various ways into pockets of people associated with current government, and another (possibly bigger) chunk of money is lost by mismanagement - including things as simple as replacing experienced people with nepotism-pushed ones who then fail to process documents for EU funds. This year we ended up with huge fines (increasing daily), with direct cause being continued operation of Turów surface mine. What is often missed in discussion is that Czech Republic didn't want it closed or fined - they requested that in exchange for continued operation, Poland funds waterworks necessary to ensure nearby villages & towns on Czech side of border have access to potable water, as the mine caused considerable lowering of water table. So rampant spending on often idiotic things, which also heavily goes into pockets of party nomenclature (so it doesn't even have the benefit of being "make work") results in considerable lack of funds in the budget...
p_l 5y ago
The social programs could be made to work. They don't because all other areas of government are broken, but they make for good lightning rod for attention, both negative and positive. There are some social programs that make no sense, like coal mining ones (we're at the point where I'd vote to have current coal miner wages frozen in exchange for closing the mines - i.e. everyone currently working underground would continue to get their last yearly wages till pension for not working at all) And the budget is crushed by all sorts fraud and mismanagement, with vanity projects funneling money to people connected to Law&Justice party (examples: creating new passage between Vitula Lagoon and Baltic sea; new power generation block in Ostrołęka - currently demolished before it ever got finished; Centralny Port Komunikacyjny - a giant useless airport without reason to exist, and yet nearly no work is being done other than funnelling more and more money to friends; etc. etc.)
- ed_balls 5y ago
  The Central Airport makes sense. There are 0 big airports in this part of Europe. It could be used by 60mln people (Slovakia, Belarus, Ukraine etc..). It even makes sense for people in Berlin to use it. (Frankfurt - Moscow. 2000km without a big airport) Besides, you can close down WAW and use the land to expand the city. You also don't have to expand other airports, which are close to cities and cause massive noise pollutions.
  - bitcharmer 5y ago
    It makes absolutely zero sense as it is just too far away from business and tourist spots. I reckon you're an avid supporter of PiS?
    - ed_balls 5y ago
      What does it mean "just too far away". It's gonna be much closer than a lot of airports e.g. London Stansted I do not support any party
      - p_l 5y ago

trasz 5y ago

Not true. In fact, those programs are only barely more expensive than "podatek liniowy", which got introduced decades ago and which is essentially a subsidy for the wealthy for being wealthy.

bitcharmer 5y ago
Care to explain the reason behind currently skyrocketing inflation and PLN devaluation then?
- trasz 5y ago
  https://tradingeconomics.com/european-union/inflation-rate https://tradingeconomics.com/european-union/inflation-rate. Also, while it's kind of hard to say for sure how Poland is doing, and while there definitely are some things that the current government is horrible at, it would be quite a stretch to say it's the "500+" program's fault. Especially given that "podatek liniowy" still exists.
- lkrubner 5y ago
  Poland is able to keep its unemployment somewhat down, by keeping the zloty weak relative to the euro, and therefore helping Polish exports. And before anyone says "Poland has a lot of unemployment" compare it to other weak Eastern European countries on the euro. Poland could end inflation if it wanted higher unemployment, but for now it accepts the higher inflation and weaker zloty so as to help exports and so limit how bad unemployment might get.
  - lkrubner 5y ago
    I'm not sure why this is getting downvoted. If you believe there is no link between the currency, inflation and employment then you're engaging in a well known economic fallacy. See "The Doctrine of Immaculate Transfer": https://krugman.blogs.nytimes.com/2011/01/12/the-doctrine-of-immaculate-transfer/ https://krugman.blogs.nytimes.com/2011/01/12/the-doctrine-of... "The fallacy comes in when you say, “Well, given that it’s all about spending imbalances, exchange rate policy has nothing to do with it.” This is what John Williamson of the Institute for International Economics once dubbed the Doctrine of Immaculate Transfer. (Uh-oh, Erick Erickson’s gonna come after me …) It’s a popular fallacy, especially at the WSJ, although I’m not sure if it rises to zombie status."
    - mmarq 5y ago
      I can’t downvote yet, but you can indeed lower unemployment without rampant inflation or devaluations.
      - lkrubner 5y ago
        That's true, there are 2 main approaches, but they both have real costs, and neither is obviously better than the other. In the face of a severe economic shock, such as the global financial crisis of 2008 or the pandemic of 2020, you would expect to see unemployment increase. The two approaches to reduce that unemployment are: 1. Keynesian stimulus. The government could stimulate demand, either by increasing the purchases where it is the final consumer (military, education spending) or it could give money to citizens so they can spend more. It's important that the increase in spending is not initially offset by tax increases, so this means the government has to take on debt. 2. Devalue the currency so as to help exports. This way you avoid taking on debt, instead you rely on increased money from exports to stimulate the economy. But here, instead of debt, you pay for the stimulus via inflation, as imported goods are now more expensive. Keep in mind "increase exports" is relative to what your main trading partners are able to consume. The EU is the main trading partner for Poland. When the EU is in a deep recession, Poland's exports can be expected to fall, so "increasing exports" might only keep them at their previous rate (the rate that existed before the crisis). Whatever you do, there is some cost. Either you take on debt or you take on inflation. There is no way out of the crisis that is completely free.
- p_l 5y ago
  The 500 PLN extra for kids by itself was not necessarily going to cause skyrocketing inflation. I don't necessarily agree with how it was implemented, but it's true that we had a huge lack of important support for less wealthy. However, on top of that, you have a lot of simply bad management, and also ridiculous amounts of fraud by ruling party politicians. This means that a lot of money is leaking from the budget in various ways into pockets of people associated with current government, and another (possibly bigger) chunk of money is lost by mismanagement - including things as simple as replacing experienced people with nepotism-pushed ones who then fail to process documents for EU funds. This year we ended up with huge fines (increasing daily), with direct cause being continued operation of Turów surface mine. What is often missed in discussion is that Czech Republic didn't want it closed or fined - they requested that in exchange for continued operation, Poland funds waterworks necessary to ensure nearby villages & towns on Czech side of border have access to potable water, as the mine caused considerable lowering of water table. So rampant spending on often idiotic things, which also heavily goes into pockets of party nomenclature (so it doesn't even have the benefit of being "make work") results in considerable lack of funds in the budget...

p_l 5y ago

The social programs could be made to work. They don't because all other areas of government are broken, but they make for good lightning rod for attention, both negative and positive. There are some social programs that make no sense, like coal mining ones (we're at the point where I'd vote to have current coal miner wages frozen in exchange for closing the mines - i.e. everyone currently working underground would continue to get their last yearly wages till pension for not working at all) And the budget is crushed by all sorts fraud and mismanagement, with vanity projects funneling money to people connected to Law&Justice party (examples: creating new passage between Vitula Lagoon and Baltic sea; new power generation block in Ostrołęka - currently demolished before it ever got finished; Centralny Port Komunikacyjny - a giant useless airport without reason to exist, and yet nearly no work is being done other than funnelling more and more money to friends; etc. etc.)

ed_balls 5y ago
The Central Airport makes sense. There are 0 big airports in this part of Europe. It could be used by 60mln people (Slovakia, Belarus, Ukraine etc..). It even makes sense for people in Berlin to use it. (Frankfurt - Moscow. 2000km without a big airport) Besides, you can close down WAW and use the land to expand the city. You also don't have to expand other airports, which are close to cities and cause massive noise pollutions.
- bitcharmer 5y ago
  It makes absolutely zero sense as it is just too far away from business and tourist spots. I reckon you're an avid supporter of PiS?
  - ed_balls 5y ago
    What does it mean "just too far away". It's gonna be much closer than a lot of airports e.g. London Stansted I do not support any party
    - p_l 5y ago