Around 1970 Poland took on a large debt in an attempt to increase investments and modernize it’s industry (the previous attempt to find funds by decreasing spending on everyday goods caused a massive price spike and led to large protests which where violently put down). Things greatly improved in the country for about a decade. Unfortunately the return on the aforementioned investments was insufficient to pay off the loan and due to the situation on the global market restructuring the debt also proved impossible. Poland went “unofficially” bankrupt, having to strike a deal with the lenders, and its economy, along with the standards of living, took a nosedive as a result. This once more led to massive protests which were, once more, violently put down. By the late 80s opening up to foreign investment (enabled by the weakness of the USSR which was no longer in any position to interfere with such a “desertion”) was pretty much the only way out of the rather dramatic situation. Even with that, and with large portion of our debt being forgiven after the transition to capitalism, Polish economy only managed to return to the late 1970s level around 2000.
Moral of the story? Be careful when borrowing money, you may cause your government to collapse. Also, bankruptcy sucks.
“Working” in communism, lmao xD.
People coming drunk to work was a part of work culture back then.
3 comments
That’s communism’s for you
Around 1970 Poland took on a large debt in an attempt to increase investments and modernize it’s industry (the previous attempt to find funds by decreasing spending on everyday goods caused a massive price spike and led to large protests which where violently put down). Things greatly improved in the country for about a decade. Unfortunately the return on the aforementioned investments was insufficient to pay off the loan and due to the situation on the global market restructuring the debt also proved impossible. Poland went “unofficially” bankrupt, having to strike a deal with the lenders, and its economy, along with the standards of living, took a nosedive as a result. This once more led to massive protests which were, once more, violently put down. By the late 80s opening up to foreign investment (enabled by the weakness of the USSR which was no longer in any position to interfere with such a “desertion”) was pretty much the only way out of the rather dramatic situation. Even with that, and with large portion of our debt being forgiven after the transition to capitalism, Polish economy only managed to return to the late 1970s level around 2000.
Moral of the story? Be careful when borrowing money, you may cause your government to collapse. Also, bankruptcy sucks.
“Working” in communism, lmao xD.
People coming drunk to work was a part of work culture back then.