Commodities: Poland’s Ruling Party Faces Tough Election as Voters Cast Ballots

Sun Oct 25 05:38:45 2015 EDT

By Martin M. Sobczyk

     WARSAW--Voters in Poland headed to the polls Sunday in a parliamentary election that could boot the government
after nearly a decade in power, as a nationalist party has gained renewed traction with people who feel they haven't
benefited from a healthy economy and see the ruling party as out of touch.

     The opposition Law and Justice party, which promises higher welfare spending, a focus on traditional Catholic
values and more assertive relations with powerful neighbors Russia and Germany, has consistently led opinion polls for
months as it campaigns to unseat the center-right Civic Platform party after eight years.

     Law and Justice governed Poland in a messy coalition with fringe nationalists and populists in 2005-07, but has
regained voter confidence as it harnesses popular discontent with the standard of living in Poland, still visibly worse
than in Western Europe despite two decades of uninterrupted growth.

     Many Poles are fed up with Civic Platform, which has been hit hard by the embarrassing release of taped
conversations between politicians offering candid views about policy, often different from those presented in public.

     Polls indicate Law and Justice will win more than 30% of the vote and the most seats, while the ruling party is
expected to come second with more than 20%.

     Only a handful have suggested Law and Justice will get an outright majority of seats in the Sejm, the lower house
of parliament. That will largely depend on the performance of smaller parties, whose agendas range from socialism to
Tea Party-style conservatism. It could mean Law and Justice will face the challenge of building a coalition over the
next few weeks.

     During the election campaign, its leader, Jaroslaw Kaczynski, said the party's interest aim is to win an outright
majority in the lower house. No Polish party has achieved such a feat in parliamentary elections since 1989.

     "There's a real chance for change only if we get absolute majority in the Sejm," Mr. Kaczynski told a recent
rally. "I know nobody's managed that but we must. Coalitions haven't worked out."

     The outspoken Mr. Kaczynski, the identical twin brother of late President Lech Kaczynski, was until recently seen
as a divisive, unelectable figure. His rule a decade ago was marred with daily political struggles in the governing
camp. He lost in the presidential election that was called soon after his brother's death in a plane crash in 2010.

     This year, Mr. Kaczynski's party toned down its message. It put together an agenda that proved popular with
voters, including cheaper housing and higher benefits for families with children, funded by new taxes on mostly
foreign-owned supermarkets and banks. Those proposals sparked fears among economists that Poland would boost deficits
and scare off foreign investors, concerns the party has said were overblown.

     The party wants to stand up to Vladimir Putin's Russia and be less politically aligned with Poland's largest
trading partner, Germany. Relations were sour with both countries when Mr. Kaczynski's party ruled previously.

     Despite an appearance of deep divisions, both the ruling camp and the nationalist opposition want a big role for
the government in the economy and have kept the largest industrial companies under state control. They want coal-rich
Poland to continue burning the resource, opposing the European Union's goals for cutting carbon-dioxide emissions. They
don't see the euro replacing the zloty any time soon.

     Poland has been a relative economic success. On Civic Platform's watch, the country's economy grew by nearly a
quarter from 2008, while Europe's was stagnant.

     Yet Civic Platform is also responsible for years of delays in the completion of highways. Some sections still
under construction were supposed to be ready ahead of the UEFA European Championship soccer tournament in 2012, which
Poland co-hosted with Ukraine, but still aren't complete.

     Scandals within the party's ranks have also weighed heavily. Last year's leaked recordings have eroded trust in
the government and forced many of the officials involved to leave politics. Polish authorities are conducting an
investigation into who ordered the recordings to be made.

     Low wages in the EU's largest emerging economy have also featured heavily in the election campaign, having
contributed to the migration of more than two million people out of the country to the more affluent west of Europe
since it joined the bloc in 2004.

     Unemployment was at 9.7% in September, below the European average, but the average take-home pay was the
equivalent of just $750 a month. Most parties want a higher minimum wage and have urged businesses to innovate rather
than rely on cheap labor and a mostly undervalued zloty to export goods, more than half of which go to the eurozone.
Poland is a key supplier to Germany but has few brands of its own that are internationally recognizable.

     Yet Civic Platform has insisted during the election campaign that the country has never been more prosperous.

     Many Poles have been irked by this position.

     "This way of thinking of the liberal elites, which display full satisfaction with how Poland's developing while
completely overlooking the growing frustration of a significant part of the society, has stoked the growth of support
for Law and Justice," said Adrian Zandberg, leader of the socialist Razem party.

     Defeat for Civic Platform on Sunday would be the party's second this year. In May's presidential election, it
endorsed the incumbent, Bronislaw Komorowski, who lost his re-election bid despite high initial approval ratings to
Andrzej Duda, put forward by Law and Justice.

     Write to Martin M. Sobczyk at martin.sobczyk-wsj.com


  (END) Dow Jones Newswires

  October 25, 2015 05:38 ET (09:38 GMT)

  Copyright (c) 2015 Dow Jones & Company, Inc.

102515 09:38 -- GMT

SID(DJG0074Y51025)