“World trade, underground capital mobility and social stratification:Why has Solidarność been created on the Baltic Coast?”

 Tomasz Blusiewicz, Harvard University

blusiewicz@fas.harvard.edu

 Paper presented at the ASN World Convention

Columbia University, 23-25 April 2015

 Please do not cite without the author’s permission

Tomasz Blusiewicz

Dear colleagues,

My original submission title promised more than I am able to deliver at this moment. This paper focuses mostly on Poland – my research on the Kaliningrad and Rostock ports is still preliminary and will be treated summarily in the conclusion. My apologies, the proposal has been submitted months ago and my research has been progressing slower than expected. This paper is a rough draft, please excuse its editorial sloppiness or the typos I have missed.

1. Introduction

On December 14, 1970, thousands of workers from all Polish Baltic Coast cities - Gdańsk, Gdynia, Szczecin, Elbląg, Słupsk and others - went on strike. After several days of regular street battles with armored military units - dozens perished, hundreds were wounded and thousands imprisoned. Several days later the fourteen-year-long tenure of Władysław Gomułka as the First Secretary of the Polish United Workers’ Party (PUWP) was over. He was replaced by Edward Gierek. Ten years later, in August 1980, Edward Gierek was forced to resign after Solidarność was born in the Lenin shipyard in Gdańsk, strongly supported by the Paris Commune shipyard in Gdynia and the Warski of Szczecin. The act of signing the August Agreements by Lech Wałęsa has become a symbol of the beginning of the end of Soviet dominance in Eastern Europe. However, the very specific spatial location of those momentous events “has received some comment, but almost no sustained [scholarly] study.”1 This aspect is worth studying for many reasons, also because it helps to counter a popular notion that Solidarność quickly united Poland’s entire opposition under one umbrella movement. A careful analysis shows both the Baltic coast cities had retained unique local specificity and that the region had remained quite isolated, in fact completely isolated in December 1970. It was only in 1981 that Solidarność emerged as a truly nationwide movement.

My study of hitherto unstudied and largely secret documents produced by various institutions, from the PUWP and the secret police to local customs bureaus as well as a sociological investigation into the sources of workers’ discontent reveals the existence of an extensive underground economy in the Baltic port cities. This economy emerges as a powerful (and little acknowledged)2 factor contributing to understanding the strength and perseverance of the workers’ protests. The hard currency-supplied second economy flourished thanks to large-scale profiteering generated by all kinds of embezzlements of the foreign trade flows passing through the Baltic ports.3 Medium-run income disparities generated between, for instance, a person regularly employed in the region’s shipyards and a sailor routinely manipulating the foreign trade system were enormous. They had led to a local concentration of blatantly visible social stratification that surpassed any other area in Poland and perhaps a vast majority of urban areas in the entire communist world.

1 Roman Laba, The Roots of Solidarity: A Political Sociology of Poland's Working-Class Democratization (Princeton, N.J.: Princeton University Press, 1991), 115.2 To my knowledge – this issue has received only passing comments in Western literature on the genesis of Solidarność.3 In the late 1970s, virtually all West-directed exports passed through the country’s two main sea port complexes: the Szczecin-Świnoujście channel and Gdańsk-Gdynia; it is worth noting that Szczecin and Świnoujście formed one integral port system, while Gdańsk and Gdynia operated separately. Between 10-50% percent of Czechoslovak (in particular) and Hungarian exports travelled through Szczecin, often shipped down the navigable Oder River. Szczecin was an important port for East Germany until the development of a large port in Rostock in the 1960s. For more information on the role of the Baltic Sea ports in the COMECON trade system, see: AAN, TRZZ 571, Sygn. 6, Materiał do deklaracji ideowej TRZZ, 1959 przygotowany przez Prezydium Rady Naczelnej TRZZ, k. 113-116; Sygn. 1312, TRZZ, Polskie porty morskie. Referat Czesława Wojewódki.

In this paper, I focus primarily on sketching the various ways in which the underground economy of the Gdańsk area operated. This economy has perhaps been in operation in various form ever since the port’s establishment in the medieval period, but it was only in the late 1960s that it began to assume remarkable dimensions. I also discuss the scale of social stratification generated by its growth, how it was perceived by the workers and why it led to the outburst of their discontent both in 1970 and a decade later. In conclusion, I offer a brief comparative overview and discuss the historiographical significance of my findings.

2. The Second Economy

After Stalin decided to move Poland west in 1945, the country has been granted over three hundred miles of the Baltic Coast line – the longest stretch it has ever held in history. In the interwar period, Gdańsk had been declared a ‘free city’ in 1921 and effectively controlled by Germany afterwards. The newly reestablished Poland had no ports to speak of apart from several fishing villages. In the 1920s, the government decided to construct a large, modern port in Gdynia just 10 miles north of Gdańsk. In 1945, port infrastructure and shipbuilding industries of Danzig, Elbing, Stettin and other ports have been taken over by Poland. Two large neighboring ports – Gdańsk and Gdynia – formed the Tricity urban system with the resort town of Sopot squeezed between them. After several years of chaotic postwar reconstruction, the decision has been made that Gdańsk would retain its former role – the shipyard has been rebuilt while the port remained an outlet chiefly for timber and bulk foodstuffs. Szczecin turned into the Baltic’s major industrial port through which Polish coal, raw materials and steel entered the world market alongside exports from Czechoslovakia, Hungary and the GDR. Gdynia, on the other hand, has become Poland’s main passenger port and serviced mostly advanced industrial and consumer goods.

Map 1. Major Polish Baltic Sea Ports.

The different functions performed by the shipyards and ports of Gdańsk, Gdynia and Szczecin are key to understanding the functioning of the black market in all of them. Physical work performed in shipyards or docks offered little opportunity for plugging into the second economy. Its functioning has been dependent chiefly on various ways of siphoning from the long-haul foreign trade in consumer goods, preferably with the capitalist world. Reloading coal, copper or timber or shipping second-rate goods to the socialist world was not a particularly lucrative occupation. In 1968, it was estimated that up to 160.000 people in Poland were employed in sectors directly connected to maritime occupations. But only about 9 percent of them – 13.100 – were employed in sectors connected with long-haul shipping and only about 2.000 in the most rewarding sector: foreign trade administration. The shipbuilding and fishing industries employed nearly 100.000 and these sectors were only tangentially connected to the mainstream of black-market profiteering.4 The very nature of working as a shipbuilder and as a sailor differed fundamentally. Regular shipyard workers toiled long and hard and had little time or energy left to seek income elsewhere. Sailors, on the other hand, could normally count on several weeks off after returning from a business trip. The data above demonstrates that employment in the long-haul foreign shipping was limited. Other evidence indicates that it has also been sought-after, difficult to obtain 5 and closely monitored ‘politically’ by the secret police and related services.6

Working in the long-haul capitalist foreign trade sector was a profitable enterprise, both for crews and executives. Sailors who worked on the ships visiting capitalist ports received the so-called dodatek dewizowy – a hard currency supplement. It is estimated that even in the autarchic years of Stalinism this supplement alone7, if converted on the black market into zlotys,8 provided more real annual income than the regular salary.9 But the supplement was merely one of the many entrepôts supplying the second economy running on hard currency. The supplement has practically never been simply exchanged on the Polish black market for zlotys. The standard procedure was to acquire Western consumer goods in ports like Hamburg or Antwerp; products that were not available and strongly desired on the Polish market were preferred. This operation required making the purchased product invisible to the customs officers or necessitated offering them some shares in order to make the goods pass unnoticed. Furthermore, there exists ample evidence indicating that the customs officials were very much an integral part of the system.10

4 A. Polańska, Stan i struktura zatrudnienia w gospodarce morskiej (Sopot: Instytut Gospodarki Morskiej WSE, 1970), 44.5 The average length of employment in the long haul shipping sector between 1966 and 1976 ranged between 8 and 10 years. In the Netherlands, for example, 30 percent of crews left their job without working through one year, 50 percent before they reached their third year and only 15 percent stayed until their firth year. In the UK, only 10 percent of crews reached ten years of employment. Sławomir Borowicz, Polskie Linie Oceaniczne w Latach 1951 - 1978 : Studium Ekonomiczne (Gdańsk: Wydawnictwo Morskie, 1980), 285.6 On ‘political’ oversight over the foreign trade sector performed by the Służba Bezpieczeńswa (Security Service), see, for example: AAN, KC PZPR 1354, V/90 (microfilm 2829), Sprawozdanie z działalności Resortu Żeglugi, 31 VIII 56, Notatka 1481/56.7 Usually equivalent to 10-30 USD, with sums up to 100 USD for long-haul senior officers. 8 The official PLN-USD exchange rate was fixed at 1:4. The black market prices varied, but were much higher, upwards of 1:20.9 According to a detailed survey, this statement was true of the entire 1948-59 period. Sławomir Borowicz, Polskie Linie Oceaniczne…, 289.

In 1964, for instance, the aggregate value of the hard currency supplement distributed among Polish sailors amounted to 1.369.000 USD. According to official data, not even 300.000 USD had been spent in the stores specially designated for the purpose of supplying the sailors abroad such as Baltona. At the same time, in 1964, various legally registered private shops in Tricity had officially acquired goods from sailors that amounted to a total sum of 5.640.000 PLN. It was an amount exceeding by a factor of four the sum total of the hard currency supplements distributed.11 Again, the supplement was only one among many inflow channels supplying the second economy of Tricity. What was decisive was what kinds of operations were performed in foreign ports and how the acquired and smuggled goods were liquidated on the Polish market.

When bribes were deemed inadvisable, traditional smuggling techniques were quick to emerge in Gdynia’s port. An official inspection of incoming shipment in December 1948 led to the following report:

“Contraband is hidden in water, gasoline and oil tanks, under the coal stored at the ship’s ground level, even in various hatches under the storage rooms. In practice, to inspect the ship effectively one has to tear up the floors and ceilings, remove the shelves and other equipment attached to the ship’s walls.12

This type of contraband could naturally be best applied to drobnica13 (retail) shipment. By the 1970s, Gdynia serviced approximately half of all drobnica passing through Polish ports.14

Gold, gemstones, alcohol, cigarettes and clothes were among the staples of commonly smuggled goods. Delicacies like soda or candies were also in high demand. For example, local police reported that twenty four crew members of MS Kopalnia Wirek smuggled 1 ton of garlic from Spain. It was worth 260.000 PLN at the time – in the late 1960s. “In other words, every single sailor who paid 3-4 USD for garlic in Spain earned 10.000 PLN at home”15 after ‘liquidating’ the contraband through private pawn (commission) shops. 10.000 PLN was at the time worth several monthly salaries earned by a senior shipyard worker and up to ten times what someone like Lech Wałęsa could hope to legally earn per month.

10 For example, according to an inspection by the Naczelna Izba Kontroli [Supreme Audit Office] in 1960, 12.000 watches were officially bought by Tricity’s pawn shops. The number of watches for which appropriate duties have been paid during the same year – five. The total value of duties the Polish state has failed to collect: 15.817.750 PLN. See: AAN, NIK II, 19/46, k. 3611 After: S. Sumiga, Szkodzą dobremu imieniu ogółu, „Tygodnik Morski” 1965, nr 7.12 Quoted in: AAN, Ministerstwo Skarbu, sygn. 1006, k. 57.13 It has been estimated that unit value of the so-called drobnica (an umbrella term for all foreign trade goods other than bulky raw materials and products such as oil, coal or copper, weakly processed industrial goods such as steel or unprocessed foodstuffs) was up to several dozen higher than the same unit (weight) of a load of raw materials or agricultural goods. The total drobnica turnover in the Polish ports increased from 1.632.000 t. in 1951 to 9.737.000 t. in 1978.14 Sławomir Borowicz, Polskie Linie…, 84.15 AAN, Sygn. XII-1795, Sprawozdanie zespołu badającego problemy społeczno-ekonomiczne wybrzeża gdańskiego, k. 55.

The 1960s were merely a prelude to the brave new future for the life of the sea. In 1981, during the liberal period now remembered as ‘the carnival of Solidarity’, a non-employed Tricity resident has cumulatively managed to smuggle 9.600 kg of laundry powder and 2.300 kg of soap while a barista employed at the Polish Baltic Lines brought 2750 liters of hair shampoo only after one excursion, all from Sweden.16 The perceived societal value of such products in a country soon to be submerged in the austerity of the Martial Law is hard to overestimate. Poland’s secret police could not hold a candle to the Stasi, but it is highly unlikely that contraband of similar proportions (or its consumption) could have been unnoticed.

The Polish official consumer market became infamous in the Soviet Bloc for its scarcities and long lines, especially for essentials such as meat or toilet paper. But customers lucky enough to be supplied by the other market were quick to refine their tastes. During one of the (often prearranged) inspections, the Gdynia Customs Office clerks studied what kinds of products entered the Tricity market through legal channels. Twelve ships were full of items clearly at odds with communist austerity and collective spirit – 387 pairs of artificial eyebrows, 3.2 kg of artificial nails, 2567 kg of artificial fur and 1481 wigs.17 It is worth noticing that objects of this type are meant to be seen or at least to cover what was not meant to be seen. Again - that particular inspection was carried out for shipment officially declared at the customs office.

After successfully smuggling the goods through customs, the sailors – since it usually was a coordinated group activity - would visit a komis: a semi-legal, private commission-pawn shop, by and large tolerated by the regime. Hard currency payment (USD and DM were preferred) was received for the goods, which in turn, through various channels, entered the alternative distribution chain. Pawn shops and black markets might evoke - among Western readers - associations of underworld criminality happy to position itself on the margins of mainstream of social life, if visible at all. It was often the other way round in Tricity. Those who - in official terminology - “adopted a petty bourgeois value system” and “fetishized money”18 made all kinds of attempts to make it shine.

In consequence of the ‘battle for trade’ initiated in 1947 by the increasingly self-confident communist regime, pawn shops had been actively suppressed, many had to close and some went underground. But the party line has changed after 1956. The new and “unusually liberal regulation” was a part of the destalinization package and was accompanied by a special instruction – discovered a Trybuna Ludu journalist in 1960. The instruction specified that pawn shops could not purchase goods from individuals “intoxicated” or “with unambiguous symptoms of mental disorder” or if the goods bore clear marks of theft.19 Otherwise - it was all fine and legal. Only the officially registered pawn shop turnover in Tricity exceeded hundred million zlotys annually in the late 1960s.20

16 100.000.000 PLN was then roughly equivalent to 5000 years of labor by a well-paid, full-time shipyard worker.AAN, Urząd Rady Ministrów, Sygn. 32/113, k. 249.17 ANN, Główny Urząd Ceł, Sygn. 30/78, k 1-14.18 Quoted after: AAN, KC PZPR, WA, LI/3, Informacja o wynikach kontroli kompleksowej województwa gdańskiego przeprowadzonej w dniach 16-28 I 1984, k.4.19 O przemycie portowym bez osłonek, „Trybuna Ludu”, nr 250, 8 September 1960.20 AAN, Sygn. XII-1795, Sprawozdanie zespołu… , k. 55.

There were two other main channels of liquidating Western goods and obtaining or consuming hard currency: illicit street money changers (cinkciarze) and prostitutes, equally illegal. The number of cinkciarze was estimated to reach five hundred in Tricity as of 1971.21 “As long as you are not caught with hard money in hand, there is practically nothing they can do to you” – a journalist was told straight up by a local cinkciarz - “and it is not easy to catch us. Dewizówka [special police units designated to counter illegal hard currency circulation] knows virtually everyone and often raids our premises. But the doorman is usually on our side and quietly lets us know when something is about to happen.” 22 The fact that the police knew “virtually everyone” or that a certain cinkciarz has continued his operations even after suffering through thirteen (temporary) arrests makes it plausible to suspect that the dewizówka was also a part of the very same closed system, especially when considered the low wages of police officers operating directly in the streets.

Port towns are (in)famous for their red light districts and Tricity was no exception. No street or area compared to Hamburg’s Reeperbahn, but there was a high-rise “universally known as the house of dollar prostitutes” instead.23 According to a secret investigation ordered by the PUWP after the 1970 massacre and leadership change, the dollar prostitutes purchased apartments in the high-rise thanks to the dollars earned from the members of the provincial National Council. The local police estimated that around 1220 prostitutes in Tricity were officially “registered” – that is: under surveillance. This occupational group could be divided in two very distinct categories: hard currency prostitutes and regulars. The former “would not even look at you”24 if domestic currency was offered. It was also estimated that up to 50.000 sailors from the capitalist world, mostly from West Germany and Scandinavia, visited Tricity annually spending up to 4.000.000 USD, acquiring currency and services mostly through cinkciarze and the dollar prostitutes.25

While cinkciarze and prostitutes belonged to the rhetorically decried underworld and often led a quiet life, there was nothing inherently anti-socialist in being a sailor. Yet it was a profession equally (if not more) central to the functioning of Tricity’s second economy. By the 1970s, rodzina marynarska (a sailor’s family) became a byword for comfortable life and not infrequently – for conspicuous consumption. However, a truly lucrative business could be opened if one made it into the executive ranks of a foreign trade centrala such as the Centromor. It was an administrative unit responsible for managing Poland’s foreign trade shipping.26 Centromor boasted offices in Moscow and Varna, magazines in France, the UK and Bulgaria, permanent representatives in Yugoslavia, Romania, Denmark, Norway and Finland and agents in sixty other countries around the world. C. Hartwig, an international forwarding agency, was a safe bet as well. State-controlled companies of similar type employed a total

21 J. Olszewski, Waluciarze i Przemytnicy, „Trybuna Ludu”, nr 129, 9 May 1971.22 K.W. Dębicki, Komu zielone, komu? „Tygodnik Morski”, 1973, nr 38.23 AAN, Sygn. XII-1795, Sprawozdanie zespołu… , k. 55.24 Piotr Włóczyk, Prostytutki i SB, „Historia Do Rzeczy”, Nr 9/19, September 2014, s. 1525 AAN, Sygn. XII-1795, Sprawozdanie zespołu…, k. 55.26 In the early 1970s, Centromor was Poland’s only ‘company’ responsible for ship export, one of the biggest ‘companies’ of its kind in the world. According to the Lloyds Register of Shipping for 1972, Poland held sixth place globally in ship exports, after Japan, Sweden, West Germany, France and the Netherlands. This ranking did not take into consideration the quality, size or market value of the ships, nor the fact that most of them were ‘exported’ to the USSR. See: “Głos Wybrzeża” nr 66, 19 March, 1973.

of merely 2109 people.27Janusz Lewandowski, a student in Gdańsk in the 1970s, a leading polish neoliberal after 1989 and then the EU Financial Planning and the Budget Commissioner (2010-2014), summarized the process:

The mechanisms of capitulation [to the regime] were quite simple and effective. Graduates of the trade-and-sea oriented schools made it into state-run companies such as the Polish Oceanic Lines, Polish Sea Shipping, Polfracht, Centromor, Navimor, advisory boards of the ports. Office work was merely a step on your way to an overseas branch and this has set you up in material terms for good. The entry ticket for advancement was the party card. And that was it.28

Lewandowski chose an academic path, which in material terms was - in his words - “a road to nowhere.”29

Living in the Baltic coast cities guaranteed quick graduation from “the school of comparative materialism.”30A resident of Gdańsk exchanged cigarettes with his Swedish colleague only to find the Polish pack in a trash bin a moment later. He reflected: “we were not building socialism, we were building shit.”31 But the West did not treat some as well as it seemed to promise. A dockyard worker left Poland to settle in Hamburg in 1979 only to be bitterly disappointed. He had worked in Gdańsk for years filching some peanuts from the deliveries he unloaded. “He could no longer derive additional income from work, which has now turned into his sole source of livelihood.”32

The Tricity school of comparative materialism has left a lasting impression on the current EU President Donald Tusk. He remembers his youth in Gdańsk in the following way:

“The awareness of how life looks like in the West was incomparably higher in Gdańsk than in any other city in Poland. This self-evident, unquestionable knowledge that the West is better led to an early attempt at reflection: why is it better? I do not remember when exactly, but certainly before the Martial Law, we have discovered that it is better not only because there are no Soviet tanks around, but also because there is private property.”33

3. The Golden Decade, 1971-1981.

The golden decade for black market bonanza fell between 1971 and the introduction of the Martial Law in December 1981, which soon turned out to be a temporary hindrance. In 1970, the East-

27 Sławomir Borowicz, Polskie Linie…, 138.28 Janina Paradowska, Jerzy Baczyński, Teczki Liberałów (Poznań: Obserwator, 1993), 119-120.29 Ibid., 120.30Lawrence Goodwyn, Breaking the Barrier : The Rise of Solidarity in Poland (New York: Oxford University Press, 1991), 105.31Quoted in: Ibid., 105.32 Wedel, Janine R., Prywatna Polska (Warszawa: Trio, 2007), 89.33 Paradowska, Baczyński, Teczki Liberałów…, 50.

West trade amounted only to about 2 percent of total world trade. The climate of détente and Gierek’s 34 ‘import-led’ ‘New Strategy of Growth’ changed the picture completely, in Poland more than anywhere else in the Soviet Bloc. Polish foreign debt skyrocketed from negligible amounts to 20 billion USD by 1980. The Baltic ports of the Gierek decade were usually struggling to service the increasing amounts of goods passing in both directions. Massive port investments such as the brand new North Port in Gdańsk were turned into flagship propaganda projects of the decade. While few products more sophisticated than steel left Poland travelling westward, consumer delicates such as coffee, chocolate or oranges began to be imported for the first time. Such products were grist to the second economy’s mill.

The Eldorado world of the alternative economy had been built chiefly on abusing the convoluted financial-legal regime of foreign currency exchange and the fantastic differentials it has generated between nominal and real (black market) exchange rates. The connections between the communist nomenklatura and that world began to emerge immediately after the war, but now were officially confirmed by a ministerial decree in 1975. Its full name was: Decree nr 58 by the Ministry of Foreign Trade and Sea Economy of July 11 1975 with respect to removing the customs inspection duty from certain persons crossing the state border. The decree has been passed quietly and its legal status was such that it did not have to pass through the Sejm. The title said it all and who the ‘certain persons’ were was specified in the appendix – the new law applied to twenty five highest state office holders and “members of close family (partners, children)” as well. The list included top police and justice officers and professors of the Polish Academy of Sciences. A. Mączak, a historian who did not allow that degree to pass unnoticed, wrote in 1992 that it resembled a classic feudal herrschaftsvertrag legally securing inheritance of privilege for the ruling class.35

The Decree Nr 58 raised the consumption of privilege in the world of really existing socialism to a new, now unabashedly shameless, level. As noted by a renowned (and recently deceased) historian Jerzy Holzer, Władysław Gomułka has never failed to emphasize communism’s egalitarian promise and obligations even while “unsuccessfully requesting them from the power apparatus.” Holzer concluded: “it is legitimate to say that communism has achieved one of its few ideological victories precisely in a field where the practice was furthest removed from the declared slogans.” 36 The new enriches-vous permissiveness had been aided by an official establishment of a two-currency regime in Poland. The hard-cash only PEWEX stores were opened in 1974 and citizens were now free to open a foreign currency bank account and many did – the total value of funds deposited in the special PKO ‘A’ accounts had reached one billion USD by the end of the decade.

Jerzy Kochanowski, a leading expert on the Polish black market under communism, sharply summarized the new reality: “the hard currency supplying cinkciarze now began to lead a curious kind of pro-state activity.”37 The overleveraged Polish state neared bankruptcy in the late 1970s and cinkciarze

34 Krzysztof Rybiński, eds. Dekada Gierka : Wnioski Dla Obecnego Okresu Modernizacji Polski (Warszawa: Uczelnia Vistula, 2011), 7.35 Bronisław Geremek, eds. Biedni i Bogaci : Studia z dziejów społeczeństwa i Kultury, Ofiarowane Bronisławowi Geremkowi w sześćdziesiata Rocznice Urodzin (Warszawa: Wydawn. Nauk. PWN, 1992), 203.36 Jerzy Holzer, "Solidarność", 1980-1981 : Geneza i Historia (Warszawa: Wydawn. Krąg, 1983), 55.37 Jerzy Kochanowski, Tylnymi Drzwiami : "Czarny Rynek" w Polsce 1944-1989 (Warszawa: Wydawnictwo "Neriton", 2010), 86.

were - for a good reason - seen as a more reliable source of hard currency than the rather adventurist attempts to sell Polish manufactures in the West. As long as a citizen’s goal was to eventually consume his dollar income in a state-run store, his or her method of obtaining foreign currency remained irrelevant.38 In 1977, 60 percent of Polish ‘export’ revenues were acquired through ‘internal export’ – PEWEX stores, PKO accounts and similar institutions designed to capture the (formally illegal) hard currency reserves from its own citizens.39 “Every kid growing up in the Polish People’s Republic in the 1970s learned this fundamental rule early on: there are two kinds of money - real and Polish.”40

In the 1970s, the divergence between official and all kinds of secondary distribution cycles and markets grew constantly and became ubiquitous in many regions. Nonetheless, Tricity and to lesser extent Szczecin both retained their specificity. As early as 1957, a pair of local journalists reported on the price differentials caused by the easier access to second-market goods on the Baltic Coast, where the abundance of supply began to put downward pressure on prices. The differentials led to the following phenomenon:

“a shopkeeper from the Coast, if he still does not own a car (surprisingly, there are some who do not) simply takes a cab and travels to Lublin, Rzeszów or Zamość where he can sell the Kiwi shoe polish to a state store for 24 PLN per unit, while entire heaps of them are available on the Coast, 16 PLN per unit.”41

In 1968, 41 percent of all Polish exports passed through the Baltic ports and the figure kept growing.42 Most of foreign trade with the capitalist world (and practically all exchange of considerable value) was still serviced by the two cities. At the same time, both of them maintained a large heavy industry sector centered around the shipyards – the Lenin Shipyard in Gdańsk was the largest and employed directly 20.000 people with many more thousands in related service jobs. It was precisely the contrast between the proletarian ethos and the laissez-faire black market capitalism that made the two cities boil in 1970 and 1980. The laissez-faire nature of black markets in Eastern Europe at the time was aptly captured by Mary Neuburger:

This indeed was one of the greater ironies of the period, namely, that a ‘free market’ – far more unfettered than Western capitalism – was tolerated in the interstices of the official market. In the end, perhaps, it was the forms of entrepreneurship it engendered, more than the persistent shortages, that created the conditions for the black market to blossom and grow in the course of the period.43

In other words, while shipyard workers such as the Solidarity heroes - Anna Walentynowicz or Andrzej Gwiazda - toiled for long hours in shipyard assembly halls, sailors who were lucky enough to sail the ships the workers had built West could enjoy a nice trip, see the world, return, sell the contraband and have several weeks off to relish the fruits of their labor and plan their next escapade. It was also not

38 G. Kurkiewicz, „Change money”… czyli dolary dla operatywnych, „Czas” 1978, nr 41; also: R. Czerniawski, Gra w Zielone, „Prawo i Życie”, 1983, nr 15.39 Jerzy Kochanowski, Tylnymi Drzwiami…, 269.40 W. Orliński, Dzieci Peweksu: Muzeum narodowe kultury masowej, „Gazeta Wyborcza”, 20 December 2000.41 J. Koźliński, K.W. Olszewski, Dwie stopy na złotym wybrzeżu, „Kierunki”, nr 36, 8 September 1957.42 Główny Urząd Statystyczny, Gospodarka morska 1945-1967 (Warszawa: GUS), 1968.43 Paulina Bren and Mary Neuburger, eds. Communism Unwrapped : Consumption in Cold War Eastern Europe (New York: Oxford University Press, 2012), 255.

without importance that differences between the profiles of ports in Gdańsk and Gdynia were marked. It was in some ways a legacy of the interwar period and in some a conscious policy of ‘selective growth’ favored by the central planners. Gdynia’s foreign trade and global orientation contrasted with Gdańsk’s attachment to the socialist world (e.g. most ships produced in the Lenin shipyard were ‘exported’ to the USSR) and its more working class social makeup. To make the picture even more colorful – the two were separated by Poland’s only seaside resort at least remotely resembling Cannes or Yalta – Sopot.

3. View from the Other Side

Further evidence confirming the scale of the black market in Tricity is ample. For the purposes of this paper, we need to turn our attention to the question whether the conspicuous consumption of wealth generated through black market activity could in fact be a significant source of the workers’ discontent. Why was it perceived as unacceptable? How strongly was it condemned? How deeply did the communist egalitarian ideology shape the workers’ worldview? Did subjective feelings of injustice lead to polarization and clear articulation of class or occupational interests? I argue that while social stratification was of course among the great many reasons contributing to the causal nexus leading to Solidarność, a vicious circle of mutually strengthening conditions transformed this particular source of social discontent into an extremely powerful sense of injustice that kept the flame of Solidarność burning long after 1989.

Days after the December massacre, a secret Commission for investigating the socio-economic problems of the Coast was established. Its report was then circulated among top party members in February 1971. The final part of the report read:

“There exists a strict link and dependency between […] phenomena of criminal and dewizowa [hard currency] activity, frequent contacts of sailors with ‘the Western style of life’ and the existence of an impressive world of private wealth on the Coast and the demoralizing influence of that style of life […] on a certain group of younger workers, especially those poorly paid. This influence is reflected both in recruiting some of them into that world, e.g. as dummy cinkciarze [the ones actually engaging in street transactions, the most dangerous job] as well as evoking, among a considerable group of workers, hatred of the world of wealth and resentment of the authorities who tolerated it. All of this has certainly played its part in the December 1970 events.”44

Assuming the report has been read by Gierek and others, it must have been pretty clear to them why the socioeconomic makeup of the Baltic coast turned out to be so explosive.

The 1970 riots have been brutally put down by heavily armored units. The flames of protests kept on burning and strikes continued for the next two months until Edward Gierek has finally managed to convince the workers to go back to work while he was going to right the wrongs and take a better care of them. As he put in his famous monologue with workers in Gdańsk: “we [the leadership], just as you, are made of the same clay. We have no other interests than to […] [help you]. Will you help us?”

44 AAN, Sygn. XII-1795, Sprawozdanie zespołu… k. 57.

His speech was followed by a storm of applause.45 While Gierek’s wage policy and the general extension of social welfare provisions in the 1970s favored industrial workers, his foreign trade policy in fact strengthened what has already been the main source of their protest in 1970 – social stratification.

The first half of the 1970s indeed brought significant improvements. The problem was that most of them were sponsored through foreign debt, mostly from the West. In the second half of the 1970s due dates for repayment were nearing while the regime struggled to generate hard currency and had to rely increasingly on the black market to obtain it. The structural lack of competitiveness of the Polish export sector could not be changed in months or years. What could be done was finding us many products offering even an illusory hope of finding a customer in the West as possible, loading them onto ships in Tricity and Szczecin and hoping to see the ships return with hard currency. The prospect of bankruptcy made the Baltic ports absolutely vital to the ability of the Polish economy to survive. This meant more trade and more shipment with laxer levels of control, crew selection, customs inspections and political oversight. The Customs Office in Gdynia launched 409 investigations against illegal transfers of hard currency, up from 195 in 1965 and 29 in 1950.46 But it was merely a drop in the sea of the state’s own currency needs and usually involved small sums later made public to make sure citizens know that their state punishes social parasites appropriately.

The authorities were aware of the dangers posed by the growing stratification and undertook countermeasures. In the fall of 1978, the Department of Planning and Economic Analysis at the Central Committee prepared a special project that envisioned measures to enforce stricter customs protection, lowering the number of PEWEX stores, stricter policies of foreign currency conversion and others - all aimed at lowering the attractiveness of arbitrage on the existing forex differentials.47

An average sailor and a shipyard worker such as Lech Wałęsa were likely to share a similar background in terms of social origins and formal education. Their nominal wages were also similar. However, as it was put by a local expert A. Tymowski, “looking at official wages alone is pure stupidity since it does not include access to shortage goods, inflation and illicit income”48. Raising nominal wages when purchasing power was increasingly determined by the supply available exclusively in the second economy and the so-called ‘commercial stores’ led to hidden inflation, shortages, lines and frustration. This phenomenon is visible when one compares household supply in ‘essential’ and ‘luxury goods.’ There were only small disparities in supply of essential goods (of the 1970s) such as TV sets or refrigerators between intelligentsia and workers. But in terms of cars, the difference was noticeable: only every firth worker family owned one while one in four of intelligentsia families did not. Worker families usually did not have a phone and only every third intelligentsia family did not. Suburban dacha ownership was similarly characteristic – ownership rates of 2 and 11 respectively, sailing boats – 0 and 5 percent. These figures indicate that Gierek’s regime indeed had managed to increase the basic level of

45 Some witnesses held that the applause had been added in a TV studio later.46 E. Graban, „Niektóre aspekty powstania i funkcjonowania Urzędu Celnego w Gdyni”, in: Korzenie Gdyni, Mała Stabilizacja. Materiały z konferencji historycznej 22 września 2004, p. 29.47 AAN, KC PZPR, XIA/511, Społeczno-ekonomiczne aspekty czarnorynkowego kursu walut krajów kapitalistycznych, 2 XI 1978, k. 18-21.48 A. Tymowski, Hierarchia zadań polityki społecznej a ruch związkowy, „Więź” nr 11/12, 1980, p. 28

consumer supply, but the more ‘commercial’ a good was, the larger the disparities between social groups.49

It was not intelligentsia, however, that most workers saw as a group responsible for the worsening situation. Telling data emerges from in-depth surveys conducted by a local sociologist Marek Latoszek in the 1980s. For instance, he found that 71 percent of workers saw intelligentsia as a group close and friendly to them. 23 percent thought differently. Traditional axes of class conflicts and discriminatory factors such as educational level “have receded into the background in light of the common disapproval of abusing the universally accepted norms of success in life and against the currently fashionable career paths.”50 Furthermore, nominal income differentials between lowest and highest paid employees of the Lenin Shipyard, for example, were unremarkable by current capitalist standards – they reached a maximum of 10:1, with differences between senior physical workers and top executives closer to 5:1. This is visible in the original texts of the Twenty-One Gdańsk postulates submitted during the August strike, in which the workers demanded reducing the highest legally allowed differential from 6:1 to 3:1.

The primary source and target of resentment was the so-called ‘private initiative’ which “was usually associated with ostentatious wealth that has often been acquired illegally.”51 In a similar survey conducted in 1974, 60 percent of the respondents pointed to the private initiative and 15 percent to the wealth of “the people of the margins”52 as reasons for their dissatisfaction. Private initiative has also been mentioned as the easiest way to get rich, followed by top state offices and frequent travels abroad. Travelling abroad was seen particularly lucrative by those “who could use their head” and were “too poor to spend holidays at home.”53 Getting rich was associated not with extra work or risk, but with “dishonesty, cunningness and dealing under the table.”54 The respondents reached a consensus that “qualifications, honest work or saving do not guarantee achieving a stable level of material well-being.”55

A special report on “threats to internal stability in the country in July 1978” prepared by the Ministry of Internal Security emphasized the overwhelmingly negative social perception of the commercial and PEWEX stores. The ubiquitous character of such views made it “justified to claim that there exist social divisions in terms of ‘categories’, ‘castes’, ‘haves’ and ‘have-nots’ […] that the stores are designed for privateers, thieves and hustlers. It is pointed out that the situation contradicts socialist principles.”56 This mood found reflection in the Twenty One Postulates – the workers did not want to see

49 Marek Latoszek, Wiezi i Przejawy Integracji w Grupach i Zbiorowościach Społeczeństwa Gdańskiego Pod Koniec Lat Siedemdziesiatych (Gdańsk: Uniwersytet Gdański, 1987), 238.50 Ibid., 258.51 Ibid., 255.52 Ibid., 255.53 See: J. Kochanowski, “Jesteśmy za biedni, aby urlop spędzać w kraju” - masowa turystyka i nielegalny handel w latach sześćdziesiątych XX wieku. Perspektywa polska. „Rocznik Dziejów Społecznych i Gospodarczych” nr 68, 2008, pp. 125-150.54 Ibid., 256.55 Ibid., 257.56 AAN, KC PZPR, XIA/815, Informacje MSW o zagrożeniach bezpieczeństwa wewnętrznego w kraju w lipcu 1978 r., 7 VIII 1978, k 11.

domestically manufactured ‘shortage goods’ sold in the PEWEX stores.57 Tadeusz Fiszbach, a high party official, read the workers’ mood well when he promised them that “excessive enrichment of certain individuals” will be curtailed.58 After signing the August Accords, the regime did undertake measures to limit the elemental forces of the free-black market that it has itself ignited, fueled and profited from for many years. It was only the Martial Law that brought a semblance of proper socialist austerity back, but not for very long.

The Twenty One Postulates are well known and widely discussed. What is less know is the state of utter shock that many Poles found themselves in after hearing about the twenty billion dollar figure of foreign debt, publically announced in late August. Gierek’s ‘propaganda of success’ (with slogans such as: ‘building second Poland’, ‘the Pole can do it’) and news of the country making it into the first ten of industrial nations in the world was in fact supported by the most dramatic increase in overall material well-being since the first decade of the century. The boom started to turn sour after the June 1976 strikes, but only a handful of people were aware of how much debt needs to be repaid very soon. Stanisław Nowak, a retired steelworker from southern Poland, wrote about his reaction after hearing the news: “a cosmic sum”, “we will live from hand-to-mouth for ages”, “our country is ruined”, “people were speechless”.59 Such were the thoughts on his mind and the word on the street. On August 28, the evening TV news service Dziennik Telewizyjny urged the workers to go back to work because of the dozens of ships waiting in the Gdańsk Bay (and near Szczecin) to be serviced by the ports and that losses were already reaching millions of dollars daily. It is thus clear that the idea behind making the debt figure public was to pressure the port cities to go back to work in light of ‘the state of national emergency’ related to foreign debt. Each passing day with the ports on strike (and most port workers joined the striking shipyards a few days later) made the vision of bankruptcy even more real for the leadership. More research is required to gain clarity on whether the port crews understood the enormous bargaining power they held in August 1980.60

1981 saw a return of measures well-remembered from the Stalinist years. After months of preparation, on October 12, the Council of Ministers created a new administrative body: The Central Anti-Speculation Commission. With a slightly different name and more gentle instruments, the

57 Edward Jarecki, Stocznia Gdańska Im. Lenina : Życie Społeczno-Polityczne w Latach 1945-1984 (Warszawa: Książka i Wiedza, 1985), 225.58 Wystąpienie tow. Tadeusza Fiszbacha, „Nowe Drogi” nr 9/1980, s. 30-31.59 Memoir by Stanisław Nowak entitled „Znajdowałem Wspólny Temat z Rodakami”, reprinted in: Marek Latoszek, Konflikt Społeczny w Perspektywie Pamietnikarzy i Badaczy (Gdańsk: Gdańskie Towarzystwo Naukowe, 1989), 158.60 It is beyond doubt that the scale of foreign debt was generally unknown until the moment it had been announced. The Baltic Coast workers realized they worked in an important part of the national economy – it was something they heard from the officials regularly – but the vital role of port services for the survival of the national economy at that moment was generally not known. The announcement of the foreign debt figure associated with Gierek’s dismissal – a classic scapegoat operation – led to shock and disbelief and only a gradual, post-factum realization of how critical the situation was due to the striking ports. In some ways, the announcement of the debt figure had fulfilled some its intended purpose – it has amazed the citizens and left them ‘speechless’, but has not managed to turn many other workers against the striking Baltic cities: the reasoning was that the hooligans in the relatively wealthy port cities were threatening the country’s reputation while fighting for their own material interests. Poland was de facto bankrupt after 1980 and its next decade very much resembled the current plight of Greece.

Commission was to achieve the objectives so ardently pursued by its legendary predecessor: The Special Commission for Liquidating Economic Abuse and Sabotage, 1945-1954. A local body of similar type was created in Gdańsk earlier, in March 1981. Under the Martial Law, special ‘activist-worker’ brigades had been mobilized, of course on a ‘voluntary’ basis, to fight with speculation. While the Baltic Coast had been a peripheral object of interest for the first Commission, which focused primarily on the areas of the former General Government and not in the post-German ‘Recovered Territories’, it emerged as number one in 1981. In 1982, the number of ‘activists’ participating in various ‘control actions’ in the Gdańsk Voivodeship equaled 6920 while in the Warsaw Voivodeship – 2902, the Katowice Voivodeship – 3173, both with higher population figures than the Gdańsk Voivodeship. In the peripheral eastern voievodships the numbers were as low as 35.61 These figures indicate that, even if participation in the brigades had been ‘encouraged’ from above, the new anti-speculation line of the regime must have been met with substantial grassroots, authentic response in Tricity.

After the Martial Law was lifted in 1983, the old patterns returned will full force. By mid-1980s, black market ruled supreme in the entire country and the centrally planned economy was functioning well only on paper. It is worth emphasizing again that the situation on the Baltic Coast was unique compared with the rest of Poland before 1980. Earlier forms of Polish resistance to communist (or Russian) domination – military uprisings, conspiratory or dissident activity in many ways served to strengthen the regime – the anti-Semitic, anti-intelligentsia drive in 1968 is the best example. What happened on the Baltic Coast in December 1970 was entirely different and caught the regime by surprise. Evidence presented here demonstrates that it took a peculiar combination of ‘ideal Marxist’ (big concentration of labor in heavy industry) and ‘ideal laissez-fair’ (unregulated world of great many private transactions) conditions rubbing against each other in one small area. This combination occurred at two spots of strategic significance– a new geopolitical reality after Stalin’s decision to move Poland west. The country was now in control of the former German industrial capacity and the rivers, railways, ports allowing to ship goods out onto the world market. Additionally, Gierek’s unsustainable policy of ‘opening Poland’ to the world turned these two spots, Tricity and Szczecin, into elements without the cooperation of which the entire export capacity was immediately paralyzed. Given Poland’s foreign debt in 1980 – it meant bankruptcy. The geopolitics, infrastructure and plain geography of the Soviet Bloc rendered Tricity and Szczecin (in particular)even more crucial as they serviced a considerable part of the landlocked Czechoslovak and Hungarian foreign trade. Given these facts and the leadership’s awareness of them, it is safe to assume that if the strikes occurred anywhere else in Poland, especially in the old, pre-1945 Poland with little industrial capacity, the strategy of gentlemanly negotiations and the willingness to compromise would be less pronounced. It would likely not lead to Solidarność, but to compromise wage deals that have been in fact reached in Lublin and elsewhere in the summer of 1980.

The Soviet dominance in Eastern Europe lasted nine more years. After the successful implementation of the Martial Law, a vast majority of people around the world thought it would last indefinitely. Solidarność would have been able to topple the Polish communist regime on its own had there been no Soviet threat, but Poland alone was too small to pose an existential danger to the Empire.

61 AAN, URM, sygn. 32/178, Brygady antyspekulacyjne 1982-1987, k. 32-34.

But as it was put by a French political scientist Pierre Hassner: “on December 13 [1981], the USSR has certainly won a battle. But at the same time, it lowered its chances of winning the war.”62

5. Rostock and Kaliningrad

There were two other German ports that found themselves in the Soviet world after 1945: Rostock and Kaliningrad. Rostock was a third-rate provincial port that had been turned into GDR’s only international port out of necessity. Königsberg was a port in many respects similar to the neighboring Elbing and Danzig – a remote provincial port servicing the agriculture and forestry of Ostpreussen. Under the Soviet administration it has remained a closed naval base. My research in Poland shows that there existed second-economy connections between Tricity and Kaliningrad, but more research in Kaliningrad and elsewhere is needed to verify this information and say more of their scale.

While Kaliningrad’s case does not appear to be extraordinarily interesting – the Soviet military grip on the area has perhaps permitted little grassroots activity, Rostock’s case certainly deserves more research that it has received by now. After Rostock emerged as GDR’s only international port in the 1960s, its role grew steadily until 1989. The GDR’s export sector has been much more important (as percent of GDP) than in Poland and Rostock was its main outlet. Thus the ports potential ‘bargaining power’ was even greater than, for example, Tricity’s alone. It can be said that Rostock’s case demonstrates the virtually reverse mechanism of communism’s demise in the GDR – the core of protest was located in the south – gradually spreading north from Dresden and Leipzig. Rostock, on the other hand, saw little oppositional activity after 1953 and also the most violent post-unification riots and high levels of dissatisfaction. My research so far demonstrates that the kind of second economy described in this paper was negligible in Rostock. Berlin and the land borders of the GDR played a more important role in this respect, but the penetration of the second economy nationwide has never reached anything remotely resembling the Polish case.

There are great many reasons explaining the striking differences between Kaliningrad, GDR and Poland. They offer many interesting avenues for comparative research. The broadest conclusion that can be stated with full certainty at this point is that the undiscriminating, monolithic view of the centrally planned economies of the Soviet Bloc sometimes hides more than explains. Comparing port cities alone shows that the social economies of Poland, GDR and (to some extent) the Soviet Union operated very differently. Beyond the dull façade of gray plattenbauten, Marxist-Leninist dogmas and (occasional) Stalinist methods hid a vibrant world of shadow economic activity that is sometimes unnecessarily reduced to simplifications and stereotypes built around the incomplete description of centrally planned economies derived from official tables and figures.

62 Pierre Hassner, Świat epoki Jalty. Szkice polityczne (Warszawa: In Plus, 1990), 30.

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