The Black Market in Poland 1944–1989
This book analyzes the history of the black market in Poland before the 1940s and the development of black-market phenomena in post-war Poland. The author evaluates the interrelation between black-market phenomena and historical and geographical conditions. At first, the black market stabilized the system by making it more flexible and creating a margin of freedom, albeit in the short term. In the long run, the informal economic activities of the people ran counter to and undermined the official ideology of the state. The author concludes that in post-war Poland, owing to a singular coincidence of historical, political, economic and social factors, the second economy had its own unique character and an endemic presence that loomed large in the Soviet Bloc.
3. The Polish (anti) Speculation Curve: 1944–1989
Even though the shortages in post‑war Poland were not always acute, there never existed a balanced market, crucial for the elimination of the black market. These shortages were curve‑shaped – rising briefly in times of prosperity, then quickly falling again, when store shelves emptied and the lines got longer. The Polish authorities and the Polish people faced the necessity of having to invent increasingly sophisticated strategies. The critical turning point came when the authorities decided it was time for an unorthodox approach, reaching new highs in repression. In post-war Poland there had always existed professional, both uniformed and civilian, institutions for dealing with economic crime. They could be effective but at the same time even under an authoritarian regime they had limitations imposed by rules. The status attached to an institution of the state was a stigma and they could not count on social acceptance. Additional institutions were therefore set up, neutrally called “commissions” or “teams” in order to create the illusion that the state was loosening its grip. These commissions combined the structures of the state, labor unions, and social organizations and gave an impression of mass social participation or popular support for their activities. Until 1980, the authorities had a monopoly on information and propaganda, so they found it easy to manipulate public opinion, characterizing certain groups as a threat and enemy of the state and fanning citizens’ wrath against them. This was not hard – since the more difficult everyday living conditions, the easier it was to drum up support, especially from low income citizens, to attack scapegoats.
There were three occasions in post‑war Poland on which special institutions in charge of “extraordinary measures” for controlling and regulating the market were appointed: in 1945, 1957, and 1981. On each occasion they had different names and the political, social, and economic context was different. What they had in common was their target: “speculation” – this referred to any sector of the black market – and a shared ideological foundation. With their fighting slogans lifted as if straight from wartime reports, and an almost fanatical conviction of their own efficacy and righteousness, they were populist and egalitarian. At the same time, the commissions were helpless in the face of a reality that they could not fully control and to which they could only react. As a result, the commissions became an arena for a game of two players – the state and the people. The former had more pawns and set the rules, which they changed at will as they went along. ←57 | 58→But the latter were quicker, more creative and quick to adjust. In the game of The State versus The People, it was The People that ultimately won.
The Special Commission for Combating Fraud and Economic Corruption, which was active between 1945 and 1954, did not progress in a linear manner. The first year and a half could be called a trial period and it involved looking for a formula, researching the possibilities, and acting on intuition. The unleashing in 1947 of the “battle for trade” marked the beginning of the Commission’s golden era. It lasted until 1950, when the Commission was deprived of most of its powers and left only with decision‑making functions. We will focus therefore mainly on the first five years of its operations.
Once the euphoria of liberation had passed, Poles found themselves once again obliged to try and answer the ubiquitous question: “How can one make a living?” Trading offered the simplest solution, so it is not surprising that the occupation‑era black market instantly adjusted to the new, post-war circumstances. The pauperized intelligentsia and famished workers were pushed into the black market by post‑war circumstances. Stanisław M. Korowicz wrote, “Even the sporadic black‑market trading proved much more advantageous financially than the wages of either blue, or white-collar workers.”114
The very same situation could be observed in all the war‑scarred European countries. And everywhere, Poland included, in the muddy post‑war waters there swam not just minnows but also sharks. The period of chaos, political destabilization, and mass internal and external migrations created opportunities for big‑time, profitable business operations. The Second World War shattered many social, moral, and ethical barriers. New ways of behaving, unacceptable and ←58 | 59→indeed unimaginable before 1939, became commonplace. “Everywhere”, an inspector wrote in 1945, “in trade, industry and state or local government offices, fraud goes on, for the sake of making a personal profit.”115
The legal aspect of the economy also posed problems. Small-scale manufacturing and commerce were rapidly coming back to life and geared up for maximum profit in the shortest possible time. In a country destroyed by the war and suffering from acute shortages, where those who had jobs earned hunger wages and many others such as orphans, widows, the elderly and the disabled required aid from the state, this caused conflicts and tension. Introducing full rationing was logistically impossible – it would have required the involvement of a huge apparatus, expropriating all production surpluses from the peasants, which would have resulted only in expanding the black market. In the end, a half‑way system was introduced, with the assumption that food rationing would do no more than complement the free market. This partial rationing was expected to protect the weakest and also the “most important” citizens from the state’s point of view – big‑city inhabitants, miners, and railroad workers.116 The latter two groups received allocations of basic food articles, enabling bare survival at low, fixed prices, which were expected to keep in check the number of those using the black market.117
The reality, as always, departed from the theory. Merchants looking for profit tried to avoid the regulated prices by selling (legally or not) most of their wares at commercial prices. They were not controlled; this led to absurd situations where food prices in agricultural areas (in which inspections were infrequent) were 50–100% higher than in big cities.118 In large agglomerations such as Łódź, the price differential between different districts reached 100%. In the first half of 1945, rationed bread cost 0.75–1.50 zl, whereas commercial (free-market) bread between 45 and 50 zl; similarly, pork fat respectively 2.75 – 10 zl compared to 350 – 500 zl, meat 2.25 – 4.50 zl against 70–180 zl, and wheat flour 1.10 – 1.15 zl in shops and between 57.50 zl and 95.60 zl on the black market.119 As a result, there was not much to be bought in shops, due to the fact that the official, low prices were hardly an incentive to suppliers. Just as it had under the German occupation, this ←59 | 60→encouraged black market strategies and unsurprisingly, enhanced the yearning for “order”120 – since in the summer of 1945, the average wage covered no more than 38% of the cost of living. Against the backdrop of starving workers and intelligentsia, those who enjoyed conspicuous consumption – thanks to hard currency and goods brokerage (maklerstwo towarowe i dewizowe) or wholesale looting (szaber hurtowy) – stuck out like a sore thumb121 and attracted public wrath.
An unbalanced market at all times encourages an egalitarian mood. This was especially the case in post‑war Poland, where social equality was the chief premise of the socialist system, with official propaganda based on the slogan that the socialist state would provide for “each according to his need”, and emphasis on the equality of all citizens in terms of their biological, material, and cultural needs.122 Beside loudly expressed discontent, there were frequent grass‑roots demands for the implementation of “the appropriate provision of necessary articles for all working people in the spirit of democratic equality, or [for] raising wages to the minimum subsistence level.”123 Citizens expected the state to act decisively and use whatever methods were necessary.124 The authorities were themselves well aware that half‑measures would no longer suffice, particularly as they had already proved ineffective.←60 | 61→
The period directly after the war was a golden age not only for the small fry but also for black market sharks: So, the Director has lost 60 bales of cotton, the President has lost 15 wagons of coal, I have only lost two cars and Dr Szaberski won them all… [a pun based on ‘Szaber’ – in Polish, looting]. Karol Baraniecki, Clients of the Special Commission, “Szpilki”, no. 9, 26 February 1946.
The first decree on combating wartime usury and speculation was issued on October 25, 1944. In early 1945, the Central Office for Combating Wartime Usury and Speculation (Główny Urząd do Walki z Lichwą i Spekulacją Wojenną, GUWLS or GU) was established in the Office of the Council of Ministers. It dealt mostly with illegal trade, speculation, and the illicit production of alcohol.125 The institution had only a few dozen employees – not many, considering its wide-ranging objectives. By August 1, 1945 it had been possible to establish regional departments solely in the “old Poland”, that is within its pre-1939 borders – in the Warsaw, Lublin, Łódź, Krakow, and Katowice voivodships; the “recovered”, ←61 | 62→post-German territories were still terra incognita. There were problems with the city of Białystok where it proved impossible to recruit locally, which prompted the idea of sending in sporadic inspection brigades a month at a time.126 Nor was it smooth sailing in other cities. The setting up of an anti-usury and speculation department in Łódź, in June 1945 caused such a stir amongst local merchants and black marketeers that they threatened to create a separate Department for the city of Łódź, staffed by their own “ol’ boy networks”.127 The results of the GUWLS’s activities were modest. In July 1945, in Warsaw the Office confiscated a mere 20 kg of tobacco, 1330 headache medications, 3.25 kg saccharine, 20 liters of moonshine, and in Lublin 17.5 liters of moonshine, 3.7 kg counterfeit yeast and 3.6 kg of tobacco.128
The first institutions set up to fight speculation functioned like those depicted in Jerzy Zaruba’s cartoon The Office for Fighting Speculation, “Szpilki”, no. 9, 1 May 1945.
←62 | 63→
Prime Minister Edward Osóbka‑Morawski’s hopes that the GUWLS would replicate the Soviet cherezvychaika office, which controlled all walks of life where official routes were being by-passed, no matter what position the fraudsters held, did not materialize.129 The GU was a weak and bureaucratized structure dependent on the coalition government (from the end of June 1945), not revolutionary enough and much too politicized. For conservative bureaucrats, the GU became a fifth wheel and on August 18, 1945 the decision was reached to incorporate the GU in the Ministry of Treasury. However, neither the conservatives nor the supporters of the GU’s independence applauded that decision.130 The latter worried that the GU would now be censored and supervised by the Central Inspectorate of Treasury Protection (Główny Inspektorat Ochrony Skarbowej, GIOS). They postulated the “establishment of an Office or Inspectorate for Combating Wartime Usury and Speculation, parallel to the Central Inspectorate of Treasury Protection (at the Treasury), which would be able to introduce initiatives, and with the existing duplication with other Offices, would bring about reciprocal control, desirable in our opinion.”131 Ultimately, the Office would be included in the GIOS as a subordinate unit, but “with the existing powers”.132 This did not end the problems and it turned out that the Treasury Protection team would not be able to tackle usury and speculation, since it lacked the necessary legal authority. According to the Finance Minister, there were plans to amend the decree from August 25, 1944.133 There was no need to do this. The Politburo of the Central Committee of the Polish Workers’ Party (KC PPR), the real center of decision‑making, was not interested in bringing to life another bureaucratic institution, which was difficult to control, to boot. So the Politburo took the initiative, while trying to keep up appearances. It is hard to believe that the appeal directed to the government by the Central Commission of the Labor Unions (Komisja Centralna Związków Zawodowych) on August 31, 1945 urging it to create a “special commission to fight corruption, bribery, speculation, and banditry” had not been inspired by the Party. Especially since ideology began clearly to dominate the economy: “through their propaganda and support for thievery, bribery and speculation as well as acts of industrial sabotage and disorganization of the state apparatus, reactionary groups in Poland […] want to exacerbate our difficulties and keep our cities starving in order to spread discontent amongst the working masses so that on the wave of that discontent they, the ←63 | 64→reactionaries, may again reach out for power and drive the working masses into enslavement by the capitalist and the landowner.”134 It did not take long for the Party authorities to react. By September 2, 1945, the Politburo of the Central Committee of the Communist Party established a Special Commission for Combating Fraud (Specjalna Komisja do Walki z Nadużyciami). Administered personally by Władysław Gomułka, the Commission was set up at the State National Council, (Krajowa Rada Narodowa, KRN), headed by Bolesław Bierut, which served at that time as a kind of super‑government.135 The Commission faced an enormous task and was also granted enormous powers. It was expected to combat the theft of state property, corruption and fraud in the “state, local government, and economic apparatus”, and it could avail itself of all other state structures.136 Unlike the professional institutions, the Special Commission was to rely on the “participation of the social entities, and especially on supervision by municipal councils, on social invigilation by the labor unions, and on the activities of complaints offices established for the purpose.”137
Bolesław Bierut and Jakub Berman were in charge of developing the appropriate decrees. After more than two months of deliberations, on November 16, 1945 the package of decrees was accepted together with the establishment of the Special Commission for Combating Fraud and Corruption. Published side by side (sections 300–302) in the Journal of Laws, Issue 53, they were an important step on the path to stabilizing not so much the economy but rather the power of the new regime.
Since there is an ample body of literature138 on the historic and legal aspects of the Special Commission (even though there is less coverage of its sociological ←64 | 65→or cultural contexts), we need only focus here on the most important issues. During the nine years of existence of the Commission, its chairman was Roman Zambrowski. It seems, however, that Bolesław Bierut and members of the Special Commission Bureau had more sway (among others Kazimierz Jasiński – the director of the Executive Office, Jan Grubecki, Leon Chajn, Eugeniusz Gajewski, Mieczysław Mietkowski, Marek Porowski and Konrad Świetlicki). The institution that they were put in charge of had been equipped with executive means that were at odds with the rule of law. It had the powers to charge, prosecute, and pass and carry out sentences, sending convicts to labor camps that were also run by the same authority. The Commission’s officials – paid better than in other state agencies and allowed to carry weapons – were meant to be the new and trusted personnel of the justice system.139
The Commission’s executive authority and simultaneously its core – the Warsaw‑based Executive Office – took care of the more serious cases. In 1945/46, there were many multi‑million zloty cases, in which the perpetrators were high‑ranking state officials.140 The Commission was also involved with prominent cases such as the illegal trade in pharmaceuticals or thefts of UNRRA gifts, however small‑scale. These mattered all the more in view of the fact that the Commission’s success rate in the provinces had not been that impressive.141 One does have to acknowledge, however, that those in power were realists, fully aware that on the one ←65 | 66→hand the illegal market posed a threat but on the other did rescue people in need. Alceo Valcini, an Italian diplomat who arrived in Warsaw in late 1945 and stayed for a year, was astounded to find how well supplied Warsaw was in comparison with starving Rome. “This abundance,” he recalled, “was eloquent testimony to the reign of chaos and lack of discipline that prevailed in Poland, and especially in Warsaw, immediately after the war. It tempted the authorities to implement drastic solutions, a temptation to which they did not succumb because these would have been resented by a part of the population, and would have had undesirable political effects in view of the unstable political situation.”142
The Commission’s first year and a half of activity was based more on pragmatism than ideology, all the more so as the cases brought before the Commission covered thirty different kinds of crimes – from hard currency and gold trading, speculation, and smuggling to sabotage, corruption and fraud – which turned out to be too much even for such a specialized and well‑trained and equipped institution. The Commission’s focus turned then to easier cases such as illegal alcohol production, slaughter and tanning, and hard currency trading, which were more burdensome for both the state treasury and the average citizen. The particular characteristics of the periphery where the boundaries between the authorities and the society are always less clear (see chapter 4) and difficulties in assembling appropriate personnel made any more sophisticated activity difficult. Six months after the Commission had been established, reports from Poznań stated, “practically no member of the delegation has at their disposal even the most rudimentary information necessary to maintain adequately such an important institution as the Special Commission. They are individuals with no conception of law and order.”143 As a consequence, instead of combating fraud, the Commission often preserved the existing “ol’ boy networks”, thus guaranteeing their stability.
At the same time, it was not unusual for the Commission to engage in excessive repression or for its employees to settle private scores. Walenty Preiss, the chairman of the Szczecin delegation, who had earlier worked in the prison system, treated the Commission like a form of the Bolshevik cherezvychaika: “During an interrogation he makes the accused stand at attention a few meters away, does not allow the smallest movement; there is a handgun on his desk with the safety catch off. The interrogation usually lasts several hours (up to five) and the alternating interrogators ask the accused the very same question a hundred times even when the accused has pleaded guilty […]. At a particular ←66 | 67→moment, Preiss approaches the accused from behind and acts as if he is about to shoot him. Preiss uses the same methods even when dealing with witnesses and outsiders […]. Preiss’s excessive temperament has found its release in fighting smugglers. He has been in charge of field operations, often risking his own life. Blowing‑off steam at the railroad station where the chairman of the delegation was personally catching women with small‑time loot did nothing to lend dignity to the Commission’s image.”144
In the Łódź voivodship there was a shortage of employees authorised to conduct investigations and independently prepare the minutes.145 The Voivodship Office of Public Security (Wojewódzki Urząd Bezpieczeństwa Publicznego, WUBP) in Olsztyn tried to use the local Special Commission’s delegation for its own political ends.146 The delegation in Rzeszów was unable to cope with the smugglers.147 In the Warsaw voivodship, no-one took seriously the meat‑free and cake‑free (sic) days introduced by the authorities (and theoretically supervised by the Special Commission).148 In mid-May 1946, Wilhelm Garncarczyk the voivod of Warsaw complained that the war on illicit alcohol production had “so far really been a fiction. The bylaws are strict and they should be observed. The Special Commissions must join the war against moonshine and keep track of the police (Milicja Obywatelska, MO) to ensure that they do not take bribes.”149 Such actions were doomed to failure, due as much to the low level of ethics as to the low wages of the officials. For example in May 1946, a policeman from Warsaw could not present himself for duty because he had no shoes.150 Functionaries were therefore more likely to take bribes and engage in their own dealings than prosecute the black marketeers. In June 1947, the civil authorities of the Polish capital urged policemen who owned vending kiosks to “stop selling vodka and abide by the law because they are demoralizing the neighboring kiosk owners.”151 Soon enough there was no one left to be demoralized.←67 | 68→
On July 1, 1946 the peasants were released from the compulsory submission of food provisions (świadczenia rzeczowe). It was a canny move from the propaganda point of view, but less so as far as food supplies were concerned. Now it became more difficult to induce peasants to deliver food to collection stations, especially since the cities had nothing attractive to offer – except for a modest and not very appealing choice of industrial articles; former German supplies were exhausted and UNRRA rations limited.152 To make things worse, extreme weather hit most of Europe hard in 1946 and 1947 – first came a severe winter, followed by spring flooding and summer drought. This had serious long-term consequences and led to increased tension in international relations.153 But even before nature struck, the food supply in Poland had worsened. Peasants were now consuming more, thus selling less; especially since their profit margins were improving. Free market prices, and inflation, began to grow while purchasing power was sliding; all this made the already long‑suffering wage earners even worse off. The state‑imposed prices ceased to have any foundation in reality, since they were set much below the cost of production, and merchants tried all they could to avoid accepting them on a scale not seen before.154 The official market was in disarray, due to profiteering that fed on ever more acute shortages, and periodical panics brought on by rumors about price hikes, a looming currency replacement, or the possibility of a new war.
These circumstances allowed the authorities, which had just “won” the parliamentary election and eliminated the legal opposition, to start dealing with the small private sector, as a pretext evoking the “righteous wrath of society”. In April 1947, during a session of the Polish Workers’ Party Central Committee (KC PPR), the blame for the market situation was put down to the excessive purchasing power of the cities, unwarranted enrichment of the peasants but mostly the “mess, disorganization, anarchy, barbarity and demoralization” of commerce.155 ←68 | 69→Unsurprisingly, it was traders who were first in the line of fire; they were often meted out the highest penalty available in the Special Commission’s repertoire – two years labor camp. At its session on May 6, 1947 the Commission announced that it would embark on a “path of strict coercion in order to deter speculators”. The Special Commission sought permission to impose huge fines (up to five million zloty) and to close down the black marketeers’ stores.156 The Special Commission received all those powers (and more157), based on the Act of June 2, 1947 on Combating High Prices and Excessive Profits in Trade. Together with other Acts passed on that day,158 it became a foundation of the “battle for trade”.
Warsaw, 1 May 1947, propaganda banner of the Special Commission for Combating Economic Fraud and Corruption on the route of the parade; photo from the archives of the Polish Press Agency (PAP).
The Special Commission played a major role in this battle. The administrative authorities, which until then had been able to mete out legal penalties, were now expected to do no more than “cooperate in unveiling crimes liable to prosecution ←69 | 70→by the special commissions.”159 During the Fourth Convention of the Special Commission that took place on June 16, 1947 it became clear that “combating speculation is now the most important economic issue in the country. Following the war, speculation has become a mass phenomenon in Poland and it threatens the economic balance of the State”.160 All the members of the Commission (925 in 1947 and 1 300 by 1949) were suddenly removed from their on-going tasks and without any special preparation sent out to inspect the mostly private stores, which at that time constituted 90% of all stores.161 By the end of the year, more than 70 thousand public controllers162 had inspected 213 353 retail sales premises and prepared 45 thousand penalty reports. The outcome was that almost 22 thousand people received fines totaling more than 531 million zloty. 1 850 people were sent to labor camps (where the conditions were made drastically harsher).163 The fast pace continued in the following year when 153 thousand people participated in more than 23 700 control actions. They inspected 455 400 stores (some repeatedly) and wrote 77 744 criminal reports.164
The Commission was becoming an increasingly convenient and specialized tool, used to suit the government’s immediate needs. It was involved in all new areas of the battle – against wholesale and retail trade, against the agricultural products (mostly meat) trade, against the skilled trades, against private commerce (or what was left of it) and artisans, who at this point operated illegally. The sheer numbers of those sent to labor camps clearly showed the trend. When the Commission’s focus shifted to small trade, the number of people sent to the camps for black marketing rose from 518 in 1947 to 1 072 in 1949. First in the line of fire was the illegal trade in industrial articles. By the end of 1948, in a propaganda effort intended to demonstrate a semblance of normalization, the Commission proudly announced that “only a very limited range” of industrial articles was now subject to speculation.”165 It was also for this reason that rationing was abolished with effect from January 1, 1949, as was the circular of December ←70 | 71→29, 1948, which recommended the use of fines and advised mass arrests only in the “most glaring cases”.166
At the turn of 1948 and 1949, this provision applied mainly to meat supply. When the worst meat crisis since the war came in September 1948, the authorities began to tackle the meat trade, which remained mostly in private hands. In the fall, they unleashed a press campaign, accompanied by stringent control of butcher stores. The government had been clandestinely working on its “H” (husbandry) legislation, which it launched on January 28, 1949. Again, the Commission rose to the challenge: whilst in 1947 no-one was sent to the camp for illegal slaughter, in 1948 there were already 314 arrests and in 1949 – the number soared to 2 119.167
As long as the targets of the Commission were the black market tycoons, it had reasonable support from the public. As soon, however, as it started to poke around in the pots and pockets (and lives) of ordinary people, who were simply trying to survive, it came to be seen as a typical state institution, an object of hate. The labor camps, supposedly intended to put away and re‑educate the “enemies of the people” – black marketeers, now started to fill with ordinary folk. “In the camp [Mielęcin],” stated an anonymous letter sent to the Ministry of Justice in December 1947, “80 to 90% [of the prisoners] belong to the proletariat and land up in the camp because of the difficult economic situation.”168 If the number of anonymous letters is a measure of social trust and faith in the effectiveness of the state, the flurry of denunciations diminished in step with the change of operational mode implemented by the Special Commission: in 1946 – private letters constituted 28.3% of all reports, in 1947 – 8.8%, in 1948 – 6.5%, and in 1949 – only 2.3%.169
The revolution devours its own children. Nor was the Special Commission spared. It had been effective at the time that the communists seizing power but, once the state’s structures had become entrenched, it began to interfere more than help. A state, and especially a totalitarian state, cannot have two prosecuting institutions simultaneously (in this case, the Special Commission and the State Prosecutor’s Office). These two Polish institutions in were in direct competition with each other. This led to the paradoxical situation that other organizations were free to pick which of the two institutions it wanted to deal with crimes committed within their own structures. The Commission was generally the preferred ←71 | 72→option for a good reason: the sentences that it passed were lighter than those that would be delivered by the courts.170 The Act of July 20, 1950 redefined the powers of the Polish Republic’s Prosecutor’s Office, stripping the Special Commission of its investigative and prosecution functions as well as of the right to accept reports of crimes directly from citizens. The Commission was left with dealing with cases that had already gone through the prosecutor’s office and with meting out the sentences, be they a fine, confiscation of assets, or a labor camp sentence. All these options were made use of, especially since – beside sentences for dealing on the black market, illegal slaughter and tanning, taking benefits in kind or clandestine distilling – the Commission also passed judgment in political cases. Whereas between 1945 and 1950, the Commission sent to the camps some 25 thousand people, between 1951 and 1954, the number more than doubled to 59.5 thousand.171
`As late as June 1954, the General Prosecutor approvingly described the Commission as a “sharp instrument of the class struggle created to implement harsh and quick penal repression”;172 as such, it had made a lasting impact in the delivery of the coercive state. Once the state became less repressive, however, the Commission had to go. The decree disbanding the Special Commission was issued on December 23, 1954. What was left was the personnel (indeed, many Special Commission functionaries embarked on successful careers also after 1956), the memory (both collective and institutional) and a lesson to learn that an institution like that is useful as long as it does not go “over the top”: it is fine to combine invigilation and prosecution in one body but sentencing should be left to others.173
Both the curtailing of the Commission’s powers in 1950 and the disbanding of it in 1954 were explained on the grounds of the supposedly stabilizing economic situation and diminishing number of prosecutions. This was no more than wishful thinking. The black market is like a flu virus: under favorable conditions, it rapidly develops new mutations, resistant to the most sophisticated vaccines. Even the hard currency and gold trade, heavily persecuted and drastically ←72 | 73→penalized, did not disappear but rather went deeper underground, giving rise to new, fancier, and authority‑resistant strategies. Smuggling, illegal slaughter and alcohol production followed suit.174
Just as had happened under the German occupation, the oppressiveness of the state and systemic shortages precipitated the emergence of a black market‑based society, in which the creation of social capital and multi‑branched networks of dependency were geared mostly towards the acquisition of goods unavailable on the market. Again, the market supply worsened to the point that in the middle of 1951, food stamps for basic articles were re‑introduced (and remained until the beginning of 1953).175 Industrial goods, coal, and construction materials were unofficially rationed during that time, using special coupons and allocations. The rapacious redenomination of the currency in October 1950, which in one fell swoop wiped out two thirds of Poles’ savings, completely destroyed their trust in the national currency and inspired spending rather than saving.176 And the constant fear of a new war, prevalent in the early 1950s, coupled with periodic runs on shops, encouraged stockpiling.
On the one hand, all these goings‑on intensified the war on profiteering, on the other – they fostered the development of illegal commerce. At the same time, the Polish black market diversified. On the one side there were the experienced and highly specialized, wily operators, who had often undergone their baptism of fire during wartime; they kept a low profile and were cautiously adjusting themselves to the new circumstances, with networks of intermediaries at their disposal often outside of Poland, for example in Berlin or in port cities such as Szczecin or Gdynia. On the other side were the non‑professionals; they only made occasional sallies into the black market and treated illicit trade as an additional source of income to eke out the hunger-level state wages.177 The nationalized industries created a new re‑distribution channel, readily available to a multitude of participants – from those employed in wholesale to transport and retail store workers. As a result, everyone who got a chance to do so was dealing on the black market, regardless of their position or income. At the beginning of 1950, there were three phenomena involved in the “chain trade”: buying goods at state‑owned stores, then re‑selling them on the free market or to the private ←73 | 74→retail stores, and re-customizing or repackaging goods for retail trade.178 The risk taken was cost-effective, considering that at the beginning of the 1950s there was a fourfold differential in price between retail stores and local marketplaces. Exchanging goods for food products in rural areas and distributing them in the cities was also highly advantageous.179
Taking the wind out of the black marketeers’ sails was one of the pretexts for the drastic price hike implemented on January 3, 1953, which almost equalized the retail and black market prices. The price increase, aimed at emptying citizens’ pockets instead of reforming the market, changed little. A mere two months later, the decree on the protection of the interests of buyers enhanced the impact of the resolutions of the Act of June 2, 1947 that had combated high prices by introducing more severe sanctions with obligatory prison sentences, which could not be substituted by a fine. “All acts that interfere with the trade in goods with the motive of profiteering” were subject to prosecution and punishment.180
The decree was tailored to purge small-time retailers. Meanwhile, talented entrepreneurs soon realized that the centralized and nationalized economy was a true Eldorado and a potential source of enormous profits. If one knew where to invest and was also familiar with the law and skilled in filling the pockets of corrupt functionaries, one could operate successfully and safely for a long time. Between 1954 and 1957, a Warsaw resident, one Stefania Husiatyńska, together with eleven partners in crime, successfully managed to run a foreign trade enterprise in Warsaw. They “received nylons from the USA and England, which they exchanged for cash and then gave the money to families in Poland indicated by their bosses in the USA”.181 The group’s turnover was estimated at 36.5 million zloty, the profit – at 14 million zloty.182 This story was not an exception.
Husiatyńska (and those who ran similar operations) avoided as a rule any contacts with official structures, with the exception of the postal and custom services. The Stalinist state allowed its citizens quite a large margin of (economic) ←74 | 75→latitude, whether due to omission, neglect, corruption and inability to control everything or deliberately as a result of its dependency on the economic activity of the public players. A case of a certain Mr. Kowarski is a good example here. Mr. Kowarski, who had acquired some capital by trading hard currency in 1953, “organized near Warsaw an illegal production of fruit juices necessary to manufacture wine. The business was set up as a regular enterprise. Kowarski kept accounts and paid his workers and clerks modest wages. However, the business was not registered and did not pay tax.183 Kowarski’s business thrived to such an extent that he was soon able to buy a farm, then add or rent orchards, developing his own production, which practically monopolized the supply. By 1956 he had sold to the state products worth approximately 50 million zloty.184
Often, this “inter-sector cooperation”, which was allowed by the law, would turn into more or less hidden privatization of the state. Managers soon noticed that by using the existing legislation, which afforded considerable flexibility to all kinds of cooperatives (permitting for example purchases outside of the state channels), one could scoop up nice profits as a middleman. It is hardly surprising that such cooperatives “became hotbeds of a variety of private profiteers, in the process losing the character of nationalized enterprises.”185 This was skillful brokerage, and effectively drained the state’s less‑than‑bottomless coffers. It is worth providing a detailed illustration of how the mechanism of a typical, large‑scale speculation from the first half of the 1950s functioned, even if this necessitates quoting at length:
The profiteers, (from all over Poland, and especially from Łódź, the northern region of Kurpie, the mountainous southern region of Podhale, and the southern counties of the Lublin district) bought, on a mass scale, cottage industry products such as homespun cloth, wadding, and others. The basic material for the production of homespun cloth was wool that came from the farms of individual peasants or else had been stolen from state textile plants. The profiteers delivered the textiles, wadding and other materials to tailors working from home who made coats and other ready‑to‑wear clothing. The profiteers also bought from the state‑owned retail stores haberdashery and various household items, to which they “added value” with the help of their cottage industry workers and then (often without bothering to “add” any value at all) sold for wholesale prices to the state-owned stores or coop stores at a huge profit.←75 | 76→
A certain hierarchy was born within this procedure – from small, local black marketeers who hoarded or purchased supply straight from the cottagers to the profiteers acquiring large amount of goods […]. The latter put them on the market and were paid in cash.
Disregarding the bans and limitations, the profiteers usually disposed of the goods through the stores of the Consumers’ Cooperative (Powszechna Spółdzielnia Spożywców, PSS), and other multi‑branch coops, and also to a smaller degree in the Community Cooperative (GS) stores. They could take advantage of the regulations, which between 1953 and 1955 allowed PSS outlets to buy goods from private individuals in certain circumstances (such as shortages in the state-owned wholesalers or in coops). The rules of the workers’ cooperatives (auxiliary, handicapped and others) permitted the buying of resources and “other products” necessary for their own production from decentralized sources.
Since the cooperatives had limited opportunities for using the purchased products or resources in production, and had difficulties disposing of them in their retail stores (in the case of the GS and the PSS), they embarked on re‑selling them to other trade enterprises. The profiteers delivered the goods – and paid the bribes – directly to these enterprises (usually the MHD, the CPLiA, the Centrogal, and similar chains), received the receipts and accepted new orders for the board of the cooperative designated by the profiteer. After recording in the books the fictitious purchase and re‑sale transaction, the management of the coop made payments to the profiteer in cash either via their own cashier or via the National Bank of Poland (NBP). Subsequently, the payment due was levied from the state trade enterprise by a bank transfer. Beside the state trade enterprises, the Polish State Railroad (PKP), coal mines, construction material suppliers, mills and meat processing plants were among the recipients of goods sold via the profiteers’ re‑invoicing.”186
In a similar way, hundreds of tons of cement, steel products, and means of transportation were turned over. The profits from such operations, after deducting the costs (which included huge bribes), were estimated at millions of zlotys.
As ever, the only cases that we are aware of are those exposed by prosecutions. Between the second half of 1954 and February 1956, six hundred people were under investigation (no doubt, the tip of the iceberg – it is quite impossible to assess the size of the entire iceberg); half of them were arrested – and 40% were members of the Communist Party. At the beginning of 1956, Polish trade was corrupted to such a degree that “one could only buy the more attractive products from black marketeers or acquaintances that worked in state trade or by paying a ←76 | 77→bribe, typically 10% of the price of the product.”187 No exception was Toruń, where in 1956 there was allegedly “not a single trade or service enterprise, where the management had not been arrested or prosecuted for profiteering.”188 According to cautious estimates (excluding smuggling, illegal tanning, slaughter, distilling etc.), in 1956, the illegal income of Poles constituted more than 8% of the national income (21.4 billion out of 256.7 billion zloty).189 This was only a prelude to the next year’s events.
The political, economic and social problems, which crawled out of the Polish Pandora’s box in 1956, gave sleepless nights to those in power, especially in the first months of 1957. The brutally suppressed Poznań riots of June 1956 were what prised open this particular Pandora’s box. The weakened authorities tried to stifle the subsequent conflagration. They did it against the urgent pressure of unfolding events; their method of choice was to throw money at the emerging problems, which was disastrous for the unstable economy and the leaky market. In 1956, the purchasing power of wages began to climb (for the next such boom, Poles would have to wait until 1971, when it went on until 1975). In 1956 alone, the payroll budget rose by as much as 17.7% and peasants’ income by 20.4%.190 And that without including illicit earnings!
Increased cash flow stimulated market demand but despite the government flooding the official market with goods before they were informally rationed, such as radio sets, motorcycles and citrus fruit, Polish wallets continued to bulge with an excess of “hot” money.191 The reason was that consumers had become choosier; they were unwilling to buy the usual shoddy goods that had littered the stores for weeks. By 1956, it had been noted that the needs of the Polish customer had gotten more sophisticated, both in respect of food products and material goods. In mid‑1956 it was noted that the “consumer now demands prettier, more aesthetically appealing products of higher quality, as well as modern and fashionable, which industry does not deliver in satisfying quantities either because of technical difficulties or due ←77 | 78→to its total disregard of customer demand.”192 Not much changed in 1957; consumers continued to buy some products only “out of necessity or because they could not afford anything better.”193 Not only were the goods available in nationalized stores usually shoddily made but they were also very expensive. Anyone fashion‑conscious and anyone who gave a fig about quality and design went shopping in the incredibly popular “ciuchy” flea-market, or visited the network of “komis” sale‑or‑return stores (which were rapidly expanding, especially since March 1957 when the anonymous purchasing of supplies was introduced), turning to the state distributors only as a last resort.194
The unfulfilled demand was only one of the factors that drove the rapid growth of the black market in 1956 and 1957. The decriminalization of the operations of private craftsmen and private trade had many different consequences. Private entrepreneurs needed resources, goods, semi‑finished products, machinery, and tools. They found it difficult to acquire them legally so would turn to a gamut of illicit solutions.195 Sometimes the method of choice was simply theft from the state sector. At other times entrepreneurs had to run complex trade operations requiring much capital, including hard currency, and excellent knowledge of the market, including the non‑Polish market. For foreign products they paid with foreign currency, most often acquired on the black market. Selling the manufactured product was not much easier. Usually the best solution was to find a state or coop trading partner. It often required corrupting a state official or store manager.
Those on both sides of the transaction rarely showed any moral qualms. No reader can doubt that by now that the authorities had no such considerations; as for the entrepreneurs, who could now operate legally, they had not rid themselves of the underhand ways and clandestine habits practiced in the recent past. In mid-1957, even the conservative Krakovians bemoaned the absence in the reviving private sector of honest businesses based on pre‑war tradition and complained about the “post-war, newcomer speculators, determined to siphon off a significant part of the national income.”196 The press wrote: “many people ←78 | 79→without any serious capital, experience, or qualifications have rushed into commerce. They evaluated the economic situation as uncertain, new economic policy as short-term and counted on quick profits, not planning any long‑term operations. In their favor was legislation passed by the Ministry of Interior Trade on the re‑instatement of travelling salesmen. Such are the people who constitute the core of the profiteers: discharged administration personnel and former door‑to‑door salesmen. They deal in goods purchased from nationalized stores or in foreign goods, the easiest to come by.”197
The private, mostly illegal, foreign trade erupted and spread like wildfire. Whereas previously it had been next to impossible to travel beyond the borders of Poland, now the gates to freedom opened a little wider and relaxed passport regulations encouraged Poles to travel in their masses. Emigration, mostly of Jews and Germans, increased as did the repatriation of Poles from the countries to the east of Poland; contacts with the Polish diaspora abroad (the “Polonia”) intensified – this all added to the cross‑border traffic. In 1957, as many as 59 thousand people travelled to the West as tourists, compared with only 14 thousand a year earlier! Trips to the capitalist and Soviet Bloc countries were “tourist” only in name – usually they were connected with trade activities (see chapter 9).198 Professional smugglers now also had better “work opportunities” and could operate on a truly large scale. Hard currency, Polish currency, silver and objects of art were leaving Poland; the imports were gold coins, watches, nylons, and clothing. Just a single speculator, one Mieczysław Dudek, between October 1956 and March 1957 sent to Vienna 40 thousand dollars, 400 kg of silver, and 2 400 000 zloty, receiving in return 11 thousand Swiss watches.199
It was not difficult to sell even luxury goods smuggled into Poland. The demand was enormous. The small but fast growing fortunes of the black marketeers had to be invested quickly – the memory of the savage currency redenomination ←79 | 80→in 1950 was still fresh. There was high demand for objects that were stores of value, such as jewelry, watches, and gold coins (which from 1956 could once again be owned legally). Construction of single-family homes was on the rise, fueling demand for construction materials. The sales of automobiles increased and were quickly followed by the illegal sale of gas (the appearance of speculation in cars was noted in 1957).
At first, the black market operations were relatively safe and, to a large extent, helped by society’s open-minded attitude. “People are used to the black market and it doesn’t bother them in everyday life, even if some complain,” a diarist noted in 1957. “We are used to backstreet shopping. People have also got used to the fact that those with modest earnings lead luxurious life styles, buy cars or even build villas. The atmosphere of tolerance is accompanied by a sense of impunity. The profiteers […] feel quite safe among us. Snitching happens rarely”.200 Even when it did, especially after October 1956, there was a good chance that the authorities would ignore incriminating information. The police, earlier accused of brutality or lawlessness, played it safe by restraining their more radical actions, often to the point of idleness. “The incorrect approach to tackling [the abuses of] the previous period,” the Warsaw District Committee of the Polish United Workers’ Party complained in 1957, “and the relatively great influx of cases in relation to the number of employees […] further formalized the prosecution proceedings.”201 The police were accused of trying not to “harm” the suspect, of being skeptical about the evidence and often uncritical towards the suspect and their defense.202 Ultimately, the “condemnation of severe sentences issued in the past had led in some cases to much too lenient punishments”203 and until the second half of 1957 “many actions considered criminal before were no longer prosecuted, such as […] obligatory deliveries, general profiteering, etc.”204 The courts and the prosecutor’s office trod lightly. Reality made it clear that the existing legislation was unable to categorize some of the black market activities as criminal; as a result, prosecutions were often dropped.205
Neither did the regulatory institutions have much sway. The National Trade Inspectorate (Państwowa Inspekcja Handlowa PIH) had no powers to inspect ←80 | 81→production, especially that of the cooperatives and crafts. Often, it was the hostility of people openly siding with the profiteers that was more of a problem for the Inspectorate’s employees than the actual fraud. The Commissions for Combating Corruption and Fraud in Trade (Komisje do Walki ze Spekulacją i Nadużyciami w Handlu KWS) operating at the National Councils based their operations on the activists and, in the revolutionized atmosphere of late 1956 and early 1957 stood practically no chance of functioning effectively. Paradoxical as it may seem, the National Trade Inspectorate (PIH) itself contributed to the demise of the said Commissions, even though it was its official brief to direct them. The professional inspectors would no longer hide their negative attitude toward their “amateur” colleagues whom they considered a hindrance rather than a help.206
It is not surprising that the black market, built up for many years, now rapidly provided a foundation for a solid structure. In 1957, the number of economic crimes detected in Warsaw rose by 26% in comparison with the previous year. There were numerous cases involving large amounts of capital and profit. For the authorities, the black market operations had both economic, especially with regard to the “distribution of the national product”,207 and political repercussions. They shook the foundations of the system and brought about an economic diversification of society. Krzysztof Madej noted that, in its own way, the Gomułka government had tried to acknowledge the rule of law.208
By early 1957, the new administration had entrenched itself sufficiently to begin to quench the hopes awakened during the thaw and trim the existing margins of freedom. What it needed, however, was a proxy enemy that could distract society. The “kulaks and reactionaries” were now bogeymen of the past but the profiteers fit perfectly the role of Public Enemy No. 1, particularly since cases of conspicuous wealth stuck out like a sore thumb against the widespread poverty and grayness. In the spring of 1957, the anti‑black market rhetoric in the press and elsewhere began to resemble the “battle for trade” campaign of the past. JacekWołowski wrote in Nowe Drogi: “The battle against fraud, bribery and profiteering is the battle that the government and society need to fight. Appropriate decrees are necessary. Public opinion demands fair sentences but we also need a wide and active social inspection (national councils, workers councils, and the unions).”209 Debates on the topic swamped the media. Some called for restraint ←81 | 82→and argued that, with the improving economy and supply, the black market would disappear – but they were outnumbered by those who were in favor of the traditional approaches such as control, prosecution and severe punishment. More importantly, the authorities themselves also had faith in the saving grace of institutionalized repression.
In mid‑March 1957, the press reported that the government was working on establishing a team at the Prime Minister’s office to co‑ordinate a wide front (of professional and social institutions) for the war on the black market.210 One can assume that the debate conducted on May 3, 1957 by Warsaw economic activists was representative of the whole country. The consensus of the meeting was to maintain private trade (although not necessarily in city centers) but was adamantly against “all attempts by speculators to conduct black market operations under the label of crafts (rzemiosło), and against the diversion of goods produced in state or coop factories in order to line the profiteers’ pockets, thereby depriving the state of part of the national income.”211 Some speakers opted for bringing back the public “commissions for combating corruption and fraud in trade”, which were still active in some areas, albeit on their last legs, and spoke in favor of energizing the labor unions but most of all for obligatory participation in the battle by Party members, for whom fighting the profiteers should be an “important part of the class struggle on the economic front”.212 The pragmatists were less than impressed; they reckoned that the public activists might be able to encourage housewives to get involved in inspecting markets and stores, but would be helpless when faced with seasoned profiteers. “Comrade Directors,” they argued, “keep sending out as inspectors not the best but the worst employees. Often, instead of carrying out the inspection, they go somewhere else. They quickly jot down some negative conclusions, take a stroll around the city, then come back, and return their report convinced that they have fulfilled their party duty.”213 The participants agreed that the most important issue was not ineffective inspection but the lack of updated legislation, which would serve both as a deterrent and a tool facilitating the punishment of “economic criminals”.214
This two‑pronged approach was indeed implemented. In May 1957, the Politburo established regional commissions to combat profiteering. On May 23, 1957, the Council of Ministers issued a decree to set them up in a traditional manner, ←82 | 83→attached to the county, municipal, and city district presidiums.215 Simultaneously, the Polish parliament (Sejm) was working on an anti‑profiteering decree and passed it on July 13.216 Taking advantage of the relative freedom of speech still existed, the debate on the decree spread outside the corridors of parliament, government and Party offices. Not all newspapers were prepared to echo the positive tone of the Party newspapers Trybuna Ludu and Nowe Drogi. Some did not hide their skepticism. They criticized the decree for its lack of consistency,217 and pointed out the senselessness of fighting the black market with punishments and court sentences rather than aiming for economic normality.218 The journalist Józef Kuśmierek went even farther by pointing out the absurdity of the “battle with the black market”, which “slowly saturates our whole political life and which has already become a new political theory, an almost conservative dogma.”219
There was no unanimity on whose job it should be to combat economic crime. Some, analyzing the events of the previous year, doubted if the police and the Prosecutor’s Office would be able to rise to the challenges of “organized crime”, against which, wrote Władysław Kopaliński, “one should act in an organized way. There should be an institution, which would systematically combine experience and facts […]. I don’t have in mind, however, those extraordinary or special commissions but a permanent institution, whose job it would be to supply the investigative authorities with indispensable information about the object of the crime.”220 There were others who were, though, of the opinion that the state already had at its disposal sufficient apparatus to deal with the profiteers. “I would like to point out quietly,” wrote Jerzy Milewski in Kierunki, “that there already exists in Poland an institution with a Latin‑sounding name, charged with ←83 | 84→prosecuting crime. It is the Prosecutor’s Office of the Polish People’s Republic. Auxiliary organs such as the National Trade Inspectorate and […] the Citizens’ Police [the state police] cooperate with the Prosecutor’s Office.”221
A large section of society took with a large pinch of salt yet another ‘anti-fraud commission’ set up in 1957. In the cartoon by Zbigniew Ziomecki, The Economic Underground, an apparatchik from such a commission asks the workers, “If you happen upon any trace of the economic underground, do please let us know.” “Szpilki”, nos. 51–52 of 22–29 December 1957 (courtesy of the author)
←84 | 85→
The pragmatic approach and common sense pointed to the latter solution. This required time, however, and the authorities were after a quick and spectacular success. On August 39, 1957, by an edict of Prime Minister Józef Cyrankiewicz, the Teams for Combating Corruption and Economic Fraud (Zespoły do Spraw Zwalczania Spekulacji i Nadużyć Gospodarczych) were created. The Central Team was at the Prime Minister office; the chairmen of the Voivodship National Councils (WRN) nominally governed the regional sections. The main goal of the headquarters was to co‑ordinate the methods and direction of the ministries and institutions “established to prosecute profiteering and fraud” (since October 3, 1957, this had included all economic crimes). The headquarters mapped out the projects and drafted the motions requiring government decisions, and supervised the regional teams. Konstanty Dąbrowski, the Minister of State Inspection (Ministerstwo Kontroli Państwowej) and, following its dismantling, the president of the Supreme Audit Office NIK, became the chairman of the Prime Minister’s team. Its members were the deputy minister of interior trade, the Chief of the Police (Komendant Główny MO), representatives of the Ministry of Justice and Finance, the Supreme Court, the Prosecutor General, the Central Committee of the PUWP/PZRP, the Main Council of the Trade Unions (CRZZ), Społem, Farmers Self-Help, Samopomoc Chłopska, the youth organizations, and the Women’s League.222 The structure of the regional teams reflected that of the Central Team: it was headed by the WRN chairman, with the president of the District Court, the prosecutor, the chairman of the NIK delegation and the Voivodship Chief of Police as team members.
The structure of the teams was expected to facilitate the execution of the basic tasks of the teams: the intensification of legal penalties, the strengthening of the enforcement apparatus (including the re‑animated Commissions for Combating Corruption), and in the most newsworthy cases the expediting of court decisions. The teams focused on the most visible and easiest to prove crimes – “goods profiteering”. Naturally, this focus resulted in increased scrutiny of private enterprise. However, the teams needed “big operations”, which would demonstrate the effectiveness both of the new decree and the newly established teams. On September 26, 1957, some 700 policemen and employees of the regulation enforcement bodies participated in the roundup at the Bazar Różyckiego marketplace in Warsaw. On September 29 and 30, the “largest-scale enforcement operation since its inception” was conducted in the CDT Main Department Store in Warsaw. The sting revealed major “speculation leaks”, especially in the high‑end fur ←85 | 86→department, whose target clientele were certainly not ordinary people. Despite press articles hailing the confiscation of hundreds of sacks of illegal goods at marketplaces, actual results on the ground were much more modest. And no amount of obfuscation could hide the fact that the first anniversary of October 56 followed a year that had been less than successful both economically and politically (bearing in mind the riots that had followed the shutting‑down of Po Prostu magazine).223
In second-hand goods street markets, people tussled excitedly over coveted Western fashion items and any clothes that looked markedly “foreign” – which was the highest accolade for a piece of clothing, and was in fact a euphemism for “Western”. The inspectors’ own “clothes battles” usually ended in Pyrrhic victories, the illegal trade resuming the moment the inspectors left. Moreover, the dealers could easily reach a mutually beneficial consensus with the inspectors. “The war on profiteering and the profiteering live side happily by side”, wrote Józef Kuśmierek. “One can buy anything and everything on the black market, for almost none of the attractive goods is available legally. As for the profiteering‑enforcement squads, they will buy lemons for their rickety children in plain sight and legally on the illegal market as soon as they have finished their public inspection round.”224 Whilst voivodship‑level achievements were easier to demonstrate – for instance, the questioning of light sentences passed by the county courts, checking the licenses of private stores and restaurants and imposing on them the appropriate taxes (in Warszawa, Szczecin, Wrocław, Kielce), or combating the “marketplace black market”,225 attempts to activate the teams at county level were not successful. County teams were usually left to their own devices; not only were their employees poorly paid but at all times subject to local scrutiny, which at times resulted in physical assaults on the inspectors. And without any means of transport at their disposal, unsurprisingly, they “did not develop effective methods”.226
More and more frequently it had to be admitted that the battles coordinated by the teams were a fiction. Only small fry were arrested, whereas “most of the black marketeers keep selling meat on the side, deal in goods purchased at nationalized stores, and sell clothes door‑to‑door”.227 The workplaces – under a formal obligation to delegate public inspectors – as a rule sent out their ←86 | 87→“unsophisticated, lowest-qualified employees, just so that the onerous formalities and ‘feudal’ duties were fulfilled.”228 People were reluctant to join the commission, since it required time‑consuming post‑enforcement procedures involving the prosecution, court, testimonies, etc. – all the more so if the case was found to have merit. And, after all, refusal to participate did not entail any serious consequences.229 In 1959 in Praga Północ, a large, and not very safe, district of Warsaw, from 31 plants only 148 public inspectors volunteered, despite interventions by Party organizations.230 Unsurprisingly, many of the cases uncovered and documented by the inspectors were not followed up “due to irregularities in the filing of charges, securing of evidence and other infringements”.231 When the head of the team took his tasks seriously (as was the case in Wrocław), those interested in maintaining the status quo tried to get rid of him by accusing him of corruption.232 Even after his acquittal, an air of ambiguity remained, effectively pre‑empting any future anti‑black market initiatives on his part.
In mid-1959, exactly two years after the start of the anti‑black market offensive, it became clear that economic crime activities were not showing any downward trend. Crimes were being committed “within groups with a mutual understanding involving people who should have been keeping an eye on each other.”233 Faced with robust local social networks, both the anti‑profiteering Act of July 1957 and the actions of various commissions and teams proved ineffectual; in fact, it was the police (MO) and the apparatus of state control that detected the majority of offences.234 The era of professionalism had arrived. The police and the Trade Inspectorate (the latter often rejected any attempts to be part of the public control teams) as well as the highest offices of the government understood this very well. The resolution of the Third Congress of the Polish United Workers’ Party in March 1959 declared that the “protection of public property requires the implementation of harsher measures” and that, for the Party, a “constant battle ←87 | 88→against the plague of fraud is of utmost importance as is instilling in the public a sense of the indefatigable hammering of corruption and thievery.”235 What the resolution did not mention, however, was that this goal should be achieved by using “social” tools, that is – community input. Even the former apologists of the anti‑black market legislation from 1957, two years later were much more restrained in their pronouncements and pointed to legal infringements, incompatibilities with the criminal code, ambiguities and doubts.236 They stressed that the cutting edge of a decree forged in haste “is quickly blunted”.237 Nevertheless, the legislation remained in use until a new criminal code was introduced in 1969 (the decree was repealed in 1972).238 The teams and commissions were finally disbanded by the end of the 1950s.
As pointed out earlier, in the investigations of economic crime conducted from mid‑1954 until February 1956, members of the PUWP made up some 40% of all those arrested. These were not some rank‑and‑file activists from the local, regional committees but usually leading Party apparatchiks, who held “positions of power”239 – managers, directors, and chairmen. Whether in the metropolises or small, provincial towns, a Party membership card was a ticket to a higher position and provided a greater scope of action for the holder, while also providing him with a protective umbrella. While an average black marketeer was a small‑time trader, party members were typically involved in large‑scale theft, corruption, and embezzlement,240 activities that fall outside of the proposed field of research of the present work. Nevertheless, we ought to refer briefly to the discrete team set up between 1957 and 1958 to combat crime among Party members. It is difficult to make a firm distinction between the different types of profiteering, especially since it often involved both the public and the private sector. It was, however, unique in the history of communist Poland that a formal body was set up to deal exclusively with the wrong-doings of Party members.←88 | 89→
Until at least the 1960s, black-marketeers were depicted as a cross between hoodlum and petit-bourgeois, with workers shown fighting them. Jan Sochacki, Speculator, 1959. Photo: Warsaw Museum of Caricature, sign. 4302.
On October 31, 1957 the Central Committee of the PUWP appointed the Team for Combating Fraud and Corruption, (Zespół do Walki z Nadużyciami i Korupcją), with Jerzy Albrecht at the helm; the team had voivodship, municipal, county, and city district branches. Its goal was to “cleanse sections of state and economy administration of corrupted and criminal elements.”241 With no sources available on the actual process, we can only speculate about how the teams were set up. The economic context was bound to have played a part, since we know how much the ←89 | 90→economy and what he considered its pathologies mattered to Gomułka. All the more so, since the numbers of corruption cases, inflicting tangible, and increasing, losses on the state sector systematically increased. Only radical action could put an end to the growing anarchy in the ranks of the PUWP, tighten discipline and abate the mood of “liberalism and helplessness in the executive bodies set up to prosecute economic crimes.”242 Their aim was two‑pronged: to calm the mood of the lower echelons of the Party – which, emboldened by the events of October 56 – had ever since, more and more openly, criticized the abuses and irregularities. But it was also important to prove, especially now that the end of the “thaw” was in sight, how uncompromising the leading ideology of the state was capable of being, also towards its own members. Far be it from me to indulge in a conspiracy version of history but one cannot exclude the possibility that the spur to action came from the Party’s desire to get rid of its negative image by washing its own dirty linen, or at least selecting the items for the laundry, away from public scrutiny.
The teams consisted of members of various rungs of the Party administration, in particular, those employed in the Prosecutor’s Office, the judiciary system, state security services, the Police, the Trade Inspectorate and Treasury security as well as Party activists from major factories, Party members within the Union of Socialist Youth (ZMS), the Union of Rural Youth (ZMW), and the trade unions. The teams were to focus on “Party organizations active in trade, restaurants and catering establishments, in construction, on State Agricultural Farms (PGR), and in institutions and enterprises in close contact with ‘private initiative’”243 – as all private enterprise was referred to. It was not an easy task. Even when the Party auditors tried to carry out their duties thoroughly, they usually hit a brick wall built by the local cliques. Insiders were fully aware that only through solidarity would they be able to wait out the actions of the Party’s cherezvychaika. For example, members of the “economic activist group” in City Meat Trade (Miejski Handel Mięsem) in Chorzów “organized a clandestine meeting […] and swore an oath that in case of an investigation, [they would] not wreck the situation […] and all put up their hands to swear they would not snitch on one another.”244 The teams at the regional committees were so passive that by mid‑1958, the Secretariat of the Central Committee remarked on it in a special circular.245 This is not to ←90 | 91→say that there was no resistance in the big cities. For example in Warsaw, where “absolutely no one is in charge of the fraud-fighting team”, by the end of 1957 only eight cases out of a hundred had been investigated. In the Old Town district of Warsaw and in the city center not a single case had been pursued; the situation was similar in Łódź.246