This presentation discusses selected impacts of fiscal policy conducted by Poland’s government from 2020 to 2022. The countermeasures implemented then in the public finance area in response to the COVID-19 pandemic, which primarily aimed to support industries most affected by lockdowns and local governments, mainly through special-purpose funds, entailed an uncontrolled surge in public spending as well as increasing public debt, centralisation of decision-making, and opaqueness of the entire public finance system. The unfolding crisis was aggravated by the war in Ukraine and its consequences.
The article’s main focus is on analysing local governments’ financial independence, which suffered from the establishment of special-purpose (out-of-budget) funds and the reform of the national tax system. Changes in local financial independence are examined based on structural ratios of local authorities’ own and total revenues, as well as less quantifiable measures enabling the expansion of authoritarian executive power. The analysis is set in a wider historical context that Michael Wohlgemuth, a German economist, philosopher, and historian of ideas, brought up in relation to COVID-19 pandemic and the so-called Leviathan hypothesis. Special governmental measures and regulations introduced in response to crises and extraordinary situations can impair the mechanisms of democratic control and be used as an excuse for a government to expand its executive and political powers. Historical experience shows that special processes, instruments, and practices are hard to uproot in post-crisis times; as a result, they become part of a new system, frequently leading to Leviathan.

Authors:
Beata Guziejewska, University of Lodz, Poland

About the Presenter(s)
Professor Beata Guziejewska is a University Professor/Principal Lecturer at University of Lodz in Poland

See this presentation on the full schedule – Friday Schedule

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