Democracy Lab

The Star Student

Poland is the classic market economy. But it knows that its future depends on staying close to the European Union.

The leaders of most E.U. members all too aware that European integration must move forward if it is to avoid moving backward, but are reluctant to take the plunge. Poland, by contrast, suffers no such angst. For while it weathered the E.U. recession and the euro crisis with aplomb, it's well understood that the country's long term prospects for economic convergence with its far more affluent neighbors to the west are closely tied to European integration. (The Polish Prime Minster Donald Tusk is pictured above at the Nobel Prize ceremony with German Chancellor Angela Merkel and French President Francois Holland.)

To understand where Poland wants to go, consider where it's been for the past few decades. Long gone are the days of post-communist trauma, when shock therapy transformed the centrally-planned economy to a free market model. Poland was the only country in the European Union to avoid recession altogether in 2008-2009. The economy grew by 12 percent between the third quarter of 2008 and the first quarter of 2012 -- a striking contrast to zero growth in the European Union as a whole. Polish exports did take a knock in the peak year of the crisis, falling 16 percent in 2009. But in 2010 they rebounded by 23 percent, then settled down to a healthy 12 percent growth rate in 2011.

Poland's economic stability, moreover, is recognized by the capital markets. The yield on Poland's euro-denominated 10-year government bonds is now hovering around 2.5 percent. Comparable Spanish bonds yield 5.8 percent, while Hungary is paying 7 percent.

Poland's bright record is due to several factors -- chief among them are good governance, the structure of its economy and pure luck. Poland developed enviable macroeconomic tools long (and the will to use them well) long before they proved essential. A ceiling on public debt was written into the constitution adopted in 1997. Meanwhile, post-communist reforms left the economy with efficient bank supervision and a relatively flexible labor market.

Arguably most important, when the crisis hit, Polish authorities came up with the appropriate level of fiscal stimulus to cushion the shock without leaving a legacy of waste or inflation. Outlays on planned infrastructure projects (co-funded by the European Union) were frontloaded to offset falling demand from recession-hobbled trade partners.

As for the second factor -- the structure of the economy -- Poland is fortunate to have a relatively large internal market with a well-developed ecology of small and medium-sized enterprises that reduce the economy's dependence on exports. Moreover, the Polish labor force is highly mobile (some two million Poles work elsewhere in Europe), which reduced cyclic pressure on local markets. Finally, Polish exporters have proved remarkably adaptable: While sales to the eurozone grew by a modest nine percent in 2011 (a reflection of eurozone fiscal austerity), exports to Russia, Ukraine and other post-soviet republics jumped by 18 percent.

Then there's the aforementioned element of luck: As an outsider to the eurozone, Poland was able to buffer the impact of external events through sharp depreciation of its currency in 2009. There was an element of luck, too, in the fact that Poles did not indulge in the consumption credit bubble that left most Europeans overleveraged and deeply in debt when the bubble burst in 2008.

A variety of obstacles still threaten Poland's march toward economic convergence (its per capita income in purchasing power terms is still just 60 percent of the E.U. average). The obvious threat is the ongoing euro crisis. A eurozone break-up that led to a deep recession in Europe would almost certainly echo through the Polish economy. About one-quarter of Poland's exports go to Germany and another fifth end up in France, Italy and the Netherlands combined.

Consider, too, that Poland must walk a narrow line between fiscal austerity (needed to retain the confidence of global lenders) and maintenance of adequate demand to sustain growth and employment (joblessness is chronically in double digits). For the moment, the emphasis is on the former: The huge budget deficits of 2009 (8 percent of GDP) and 2010 (7 percent) were brought below 5 percent in 2011 and will run about 3.4 percent in 2012.

While Poland's policymakers must continually adapt to the changing political and economic environment, Polish policy toward Europe is firmly rooted in a handful of formal goals: openness, competitiveness and solidarity.

It seeks openness and competitiveness -- here meaning a level playing field in the European Union for Polish enterprise, the free movement of capital, and liberal immigration policy, as well as an open door with respect to both E.U. enlargement and trade with non-members. By the same token, it favors a light regulatory regime and low taxes as a means to increase productivity and hasten convergence with northern Europe.

As for the third principle, having benefitted from many E.U. policies aimed at narrowing differences in living standards and productivity -- among them, the Common Agriculture Policy and subsidies for infrastructure -- Poland has strongly opposed initiatives that would undermine the principle of solidarity as the cornerstone of the integration process. Poland's leaders rightly suspect that a "two-speed Europe" would consign a non-euro country with a relatively low per capita income to the second tier of integration in the continent. But the goal of solidarity, it's worth noting, does not only apply to policies aimed at redistribution; it is at the heart of Poland's commitment to collective European defense and a common European foreign policy.

In the near term, joining the euro currency would be risky (like the countries on the eurozone's southern periphery, Poland would be vulnerable to speculative attacks) and unpopular (a majority of Poles strongly oppose accession, which is not surprising in light of the trials of Greece, Spain and Portugal). But in spite of the fundamental coordination problems exposed by the ongoing euro crisis, Poland wants to join the common currency area in the medium-term. This is based in part on geopolitical considerations, but also on economic logic: Poland's private sector needs the access to capital and low transactions cost that only a single currency can assure.

Meanwhile, Poland must deal with the difficulties of influencing the European integration process while being outside of the eurozone. This explains why Poland signed the fiscal austerity pact pressed on the European Union by core eurozone countries. Poland expects to meet all the Maastricht macroeconomic criteria for eurozone membership by 2016. That should be not be much of a reach, as the country already meets the criteria for price stability and the public debt.

Poland's economy fate has long been intertwined with Germany's -- and that hasn't changed in recent years. This has proved a blessing, as German demand for Polish exports helped sustain growth through the crisis. And it explain in part why Poland's  Foreign Minister Radoslaw Sikorski has openly embraced Germany's leadership of Europe in spite of historical enmity. As he put it: "I fear Germany's power less than her inactivity [in the fight to keep the eurozone intact]."

Poland's economic interests in European integration are even more direct: Between 2007-2013, the country received around € 70 billion in infrastructure subsidies from the E.U. budget as part of the E.U.'s "cohesion" policy. And, as noted above, it is a net beneficiary of the Common Agricultural Policy. Changes in E.U. priorities in the wake of the eurozone crisis that undercut the goal of cohesion would thus slow the pace of public investment in Poland, perhaps drastically.

Actually, Poland's growing economic ties to western Europe are part and parcel of a broader movement toward the integration of western and central Europe. Poland is the largest national economy by far among the so-called the Visegrad Four (with Slovakia, Hungary and Czech Republic, all of which joined the E.U. in 2004).  The region's economic clout is growing rapidly; its collective GDP now exceeds $1 trillion -- a four-fold increase since the mid-1990s. And Germany's trade with the V4 now exceeds that with France (its largest single trading partner) and is almost three times higher than with Russia.

Along with being a testament to Poland's determination to distance itself from the Soviet nightmare, the country's economic transformation is proof positive of benefits of European integration. Poland has thrown in its lot with a united Europe -- a gamble, in essence, that the union will not be fatally damaged by the flaws in the eurozone's rules for economic coordination. If the E.U. flourishes, so will Poland. Indeed, for the first time in its modern history, Poland's uncomfortable proximity to Europe's great powers will prove an asset rather than a liability.    

Photo by Nigel Waldron/Getty Images

Democracy Lab

Born Free, But Not Indifferent

Yes the government should protect free speech. But that doesn’t mean it shouldn’t speak out.

Reactions to Innocence of Muslims, the anti-Islam video made by a Coptic Christian resident of California, have divided on two familiar lines that separate the United States from most other nations in the world. "Prohibitionists" called for free speech to be limited in the face of blasphemous or hateful expression. In the United States, the most vocal defenders of free speech, the "neutralists," have argued that the government should express no opinion about hate speech. For example, the conservative press reacted to President Obama's condemnation of the video by calling it an apology for our rights of free expression.

Lost in these two familiar reactions, however, is a third way of thinking about free speech that lacks the flaws of prohibitionist bans and neutralist refusals to condemn even the worst hate speech. This alternative approach, which I call "democratic persuasion," protects all viewpoints, even racist and anti-religious ones, from coercion. But in my view, the protection of free speech must be combined with a strong defense of the value of equal respect. The state should use its status as an influential speaker to defend democratic values and to argue against hateful viewpoints. It is essential that the state criticize hate speech to avoid the misperception that protection means indifference or endorsement. This kind of misperception is endemic in the structure of free speech rights, which protect all viewpoints.

The State Department and the president used this third approach in their public statements and advertisements run on Pakistani television. Far from being a flawed "apology," as conservative media charged, the advertisements released by the State Department suggested how we might appeal to democratic values to condemn hate speech. This approach allows American foreign policy to articulate and explain our uniquely robust free speech tradition. The policy avoids the blunt instrument of prohibiting hate speech as well as the anemic refusal to condemn it.

Our First Amendment doctrine of "viewpoint neutrality" protects all matters of opinion on politics, religion, and philosophy from punishment. Our free speech jurisprudence allows declarations about the falsehood or truth of religious beliefs. This right of free speech respects the autonomy of citizens and their ability to decide for themselves on matters of conscience and politics. This protection is extended to all citizens based on the value of equality.

The right of free speech protects the freedom to express "blasphemous" viewpoints that may be seen as defaming or disparaging the fundamental tenets of a religion. The free exercise of religion, also a right respected in the United States, may depend partly on the freedom to assert the truth of one religion's beliefs and to disparage assertions of another religion.

The Supreme Court, while allowing threats to be prohibited, has extended  free speech to hateful viewpoints, such as those of the Ku Klux Klan and American Nazi party. The anti-Muslim video is also protected by this standard.

The video is meant to cause offense in its depictions of the Prophet Mohammed as a child molester. It combines homophobia and anti-Muslim animus in asserting that homosexuality is fundamental to Islam. In the United States, however, attempts to ban this work would be restricted on free speech grounds.

But the fact that the video is protected on free speech grounds has been confused throughout the world with the endorsement of the content of the video. This misperception that the state's protection of an anti-Islamic video means that it endorses the video has sparked riots throughout the world. One widely circulated clip that is typical of these denunciations uses the video to suggest that democracy is inherently disrespectful to Islam, because it allows hateful anti-Islamic speech to be expressed without punishment. An impassioned critic goes so far as to suggest that disrespect of Islam is "what democracy is all about."

The confusion of protection and approval is deeply linked to the structure of our rule of viewpoint neutrality. If the government wants to condemn a message, it often does so through a ban. Government sends the message that murder is wrong by punishing murderers. We condemn racial discrimination by banning it in the workplace and in other domains. Conversely the protection of an act is often thought to signal indifference to it. For instance, the state does not ban interracial marriage, and this is taken to mean that the state does not disapprove of it. So it is not surprising that protection of the video might be wrongly thought to signal that the state condones or even approvals of it. Free speech has an "inverted structure" in that the right of free expression can protect viewpoints that are hostile to the very reasons for protecting rights. We protect Nazi speech, even though Nazism would deny free speech protection to others and even though it stands in deep opposition to the democratic value of equal respect that underlies our free speech protection.

Although the conflation between protection and approval is understandable given the inverted structure of free speech, it is a mistake to think that free speech entails government indifference to hate speech. The entire reason we protect free speech is to respect the autonomy of all citizens equally. As the legal scholar Alexander Meikljohn suggests, we protect the right of our citizens to hear all viewpoints precisely because we trust them to make good decisions in the public realm of democracy. This entails enough respect to trust that citizens can hear even the most evil viewpoints while retaining the good sense to reject them.

The basis for free speech in the democratic value of equal respect is expressed throughout the Constitution, and in particularly in our commitment to equal protection. The state has an obligation to articulate the democratic value of equal respect, which is the basis for the right of free speech, even when it allows dissent from the value as a matter of law. It rightly condemns the hate speech that it protects. And it does so often, at least implicitly. When the state "speaks" through public holidays or school curriculum it does take a side on behalf of our own liberal democratic values. We celebrate Martin Luther King Day to express the commitment to equal protection.

The Ku Klux Klan was founded in opposition to the 14th Amendment to the Constitution, which guaranteed equal protection of the law based on race. When we teach in schools the importance 14th Amendment, the government is taking a stand against the views of the Klan and other hate groups. These acts of state speech serve to clarify that while hate groups can say what they wish, the state is not indifferent to these messages. It condemns and argues against them.

The need to clarify that robust free speech commitments are compatible with condemnation of hateful viewpoints is important domestically. But it is also clearly urgent abroad. When the state "speaks" in its public diplomacy it is essential that it explain the values that underlie free speech.

Confusion about the meaning of the United State's commitment to free speech has drastic consequences. Rioters in Pakistan appeared to believe that the American government was neutral towards or even approving of the hateful views in the video. The nation and its representatives need to explain to the world that we do not protect free speech because we are indifferent to the content of those who abuse it. We can clarify that the United States protects all viewpoints, but that it condemns those viewpoints that violate the democratic value of equal respect.

It is essential to clarify what kinds of viewpoints are rightly subject to criticism, if the United States is to successfully deliver internationally the subtle message that it protects the right to express hateful viewpoints, but criticizes their content. What precisely merits government criticism in the video? One option is to criticize it as being blasphemous.

But blasphemy is the wrong frame of criticism. Our free speech and religious freedom traditions require that the state not take a position on which religions are false and which are true. That is the core idea of our ban on the establishment of religion. But blasphemy takes a side in disputes between religions. This is not a perspective that we can endorse. Citizens must not only be free from coercion but also free from state criticism if they assert the truth of one religion and the falsity of others.

The content of Innocence of Muslims is not merely about asserting the "falsity" of Islam and the truth of another religion. Instead, it is filled with hostility towards the Muslim people as child molesters. It is analogous to the famous blood libel, myths about Jewish ritual used to slander the Jewish people as a whole. The blood libel is anti-Semitic hate speech masked as criticism of religious practice. Similarly, Innocence of Muslims claims to criticize religious practice but it actually aims to disparage the Muslim people. The video should be regarded as a form of hate speech against Muslims.

The United States government should articulate why our tradition of free speech and religious freedom is founded upon an ideal of equal respect. That ideal is violated by the anti-Muslim video. The government has a duty to articulate why the right to free speech is protected in the case of the video, even though it condemns the video's message. This can clarify for an international audience that the state's protection of hateful expression does not imply approval of the content of that expression.

The State Department adopted this response when it aired ads in Pakistan to quell riots there. The videos show President Obama and Hillary Clinton giving an official defense of our free speech traditions while condemning the video. They took neither a neutralist nor a prohibitionist approach to hate speech, but a third approach: "democratic persuasion." They defended free speech protection for the videos. Yet they made use of state speech to clarify that the protection does not imply approval or indifference towards the message in the video. Instead, they articulated that protection of the right of free speech was based on the value of equal respect. They clarified that the same values that lead us to protect hate speech also can lead us to condemn it.

With the lens of this third view of "democratic persuasion," we can see the State Department ads as a principled defense of democratic values, and as neither an apology nor a pragmatic concession to the need to quell the riots. Of course the violence abroad provided an impetus for these advertisements. But rightly understood, the aim to protect and criticize hate speech should be a broader part of United States public diplomacy beyond the specific commercials run in Pakistan. Such a policy of democratic persuasion would articulate why we defend free speech, while condemning hateful expression. 

Photo by ADEK BERRY/AFP/GettyImages