This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS WARSAW 004050 
 
SIPDIS 
 
Sensitive 
 
STATE FOR EUR/NCE DAVID KOSTELANCIK AND MICHAEL SESSUMS 
USDOC FOR 4232/ITA/MAC/EUR/JBURGESS AND MWILSON 
TREASURY FOR OASIA MATTHEW GAERTNER 
FRANKFURT FOR TREASURY JIM WALLAR 
 
E.O. 12958: N/A 
TAGS: EFIN ECON PREL PGOV PL
SUBJECT: Lepper undergoes a transformation on economics 
 
 
This cable is sensitive, but unclassified, and NOT for 
Internet distribution. 
 
¶1. (SBU) In a recent interview for business daily "Puls 
Biznesu" Andrzej Lepper, the leader of Samoobrona (Self 
Defense) the third largest party in the Polish Parliament, 
presents himself as a social-liberal as opposed to his 
portrayal as a dedicated socialist during the election 
period.  His views on privatization, taxes and particularly 
Leszek Balcerowicz'e role in Poland's transformation 
process, have changed a 180 degrees.  Is it part of his 
populist game or does he really mean to support business 
friendly solutions proposed by the governing Law and Justice 
Party (PiS) in its economic program?  The first opportunity 
to verify Lepper's revelations to Puls Biznesu will be in 
upcoming votes on amendments to the 2006 budget. 
 
¶2. (U) The comparison of what Lepper said on 26 August 
(before the parliamentary elections) and then on 18 November 
(after elections) illustrates his unexpected 
"transformation" from a declared socialist to a social 
liberal: 
 
- On privatization: (Before elections) "95 percent of 
privatizations in Poland have been carried out by violating 
the law.  It has to be looked into.  If an investor violated 
the law, the plant should not stay in his hands!";(After 
elections) "Privatization is good provided Poles benefit 
from it.  What is left, with the exception of a few 
strategic companies should be sold.  This is what I have 
always said." 
 
- On Personal Income tax: (Before elections) "We should have 
a progressive tax.  The highest rate should be 50 percent 
for incomes above 12,000 PLN per month"; (After elections) 
"The 50 percent rate makes no sense.  No one would pay it 
anyway" 
 
- On socialism and his views: (Before elections) "I am a 
socialist.  We are a leftist party of socialists.  Yes we 
are socialists"; (After elections) "I am a capitalist.  A 
socialist party has no chance today!  I chose a social 
liberal direction." 
 
- On Leszek Balcerowicz: (Before elections)"He should be put 
before the State Tribunal!  At least for privatization and 
for economic reforms"; (After elections) "He does not have 
to go, he performs well at what the law requires of him. 
Every economist would have done the same." 
 
- On liberal economists: (Before elections) "They have no 
idea how to rescue Poland, how to govern!  Governments 
listen to advisors who support liberal policies..." (After 
elections) "The Adam Smith Center supports us, Mr. Robert 
Gwiazdowski!  I've met with business, with Mr. Kulczyk 
Niemczycki, and Malinowski.  I listen to their advice, I see 
some things in a different light." 
 
- On Open Pension Funds (OFEs): (Before elections) "Order 
must be brought to the OFEs.  There should be a unit in the 
Social Insurance (ZUS) were the OFE funds are collected. 
This will guarantee that the funds belong to pensioners and 
grow..." (After elections) "We no longer talk about 
liquidation of OFEs, but there is need to modify them in 
such a way that not only the owners benefit." 
 
 
¶3. (U) Comment: When examining the financial situation of 
PiS members and Self Defense members there well may be more 
businessmen in SO than in Law and Justice.  From this point 
of view, Lepper and his party colleagues may now realize 
that they have an interest in reforms that ensure economic 
growth.  His statements seem to indicate that he plans to 
become an advocate of business and employers in the new 
Parliament.  Higher salaries for good managers, Corporate 
Income Tax (CIT) at 10 percent, maximum Private Income Tax 
at 28 percent, credits for young entrepreneurs, these are 
not Civic Platforms words but proposals of a "new" Lepper. 
Although many here are understandably skeptical, if Lepper 
really has changed his spots, it's good news for businesses 
hoping for continued economic reform.  End comment. 
 
ASHE