Is Poland’s luck about to run out?

Lately, I’ve been writing about Poland’s shining economy. Poles skating through the global financial meltdown with healthy growth is amazing. However, I hinted at the close of last month’s column that Poland’s lucky streak might be near the end.

Well, what could go wrong you might ask.

Poland assumed the EU presidency on July 1, 2011. The timing is unfortunate because the tires are about to fall off the economic wagon of several countries. There is plenty boiling right near the surface regarding the finances of PIIGS (Portugal, Ireland, Italy, Greece and Spain). Stress in Europe is mounting, especially now that England is distancing itself from the Euro Zone and German citizens don’t want more of their tax dollars propping up failing member States.

Publicity wise, it would look pretty bad if countries started defaulting and the economic contagion started spreading like an epidemic while Poland held the six-month term presidency. Many economists say it is not a matter of if, but when countries go bust. If the Polish term as head of the EU can get through the end of December, then it will be Denmark’s headache when they succeed Poland at the helm.

But, what would really be devastating is forced radical changes in Poland’s own economy caused by misguided and mistimed EU rules and policies.

I think we would agree that during the midst of economic turmoil and massive sovereign debt across the western world now is not the time to implement programs and regulations that will hinder recovery and growth, or in Poland’s case cripple it’s strong economic footing.

Poland is a young democracy and making great strides fostering free markets and industries that were short on productivity during the Communist era. While the EU environmental activists call for the abatement of coal in Poland - the continuation of plentiful coal powering the heavy industries making up the largest part of Poland’s industrial output is not a situation any country can turn around on a dime. There is no other energy source close to the cheapness of coal. The major cause of Spain’s 21% unemployment and debt crisis for instance stems from their reckless speed at adopting exorbitantly expensive green energy.

Last month the Polish Ministry of Economy received some bad news. Major companies said if energy costs go up, heavy industry would cut production or pick up and leave for Asia and Africa. A large exodus in sectors like chemical, metallurgy, mining and cement are considered certain and will affect thousands of good paying jobs. That would plunge Poland into an economic calamity of its own.

Coal may not be the villain it is made out to be. It wasn’t too long ago when Time and Newsweek rang the alarm about the coming ice age, devoting nearly a dozen covers to the topic in the mid-1970s. This past decade has been the opposite – hysteria about global warming presumably caused by CO2 emissions. But, lately there has been increasing interest in our sun’s affect on global temperatures being way more potent than so-called greenhouse gases. Read this article - NASA Data Blow Gaping Hole In Global Warming Alarmism

Sunspots emit solar winds that heat the earth and last month the American Astronomical Society said the solar cycle is going into a hiatus meaning a lack of warmth producing sunspots. It might take as little as two years to determine if we’re headed toward another mini ice age like the Maulder Minimum experienced from 1645-1715 coming after the Medieval warm period which produced an abundance of food. Anecdotally, it snowed in Colorado on the first day of summer this year.

So, for Poland’s sake you’d think there is pretty good reason to hold off on expensive carbon dioxide permits that would debilitate one of the healthiest economies in the western world.

On the topic of fracking shale to capture billions of cubic meters of natural gas, Poland has another horde of enemies to fend off. While the prospect of becoming an exporting energy giant and removing itself and EU partners from the evil grip of Russia’s Gazprom, the environmental organizations are turning up the heat to impose a moratorium on this type of gas extraction like they were successful in doing across France.

Although there are worries about potential contamination of ground water, gas shale deposits are located several thousand feet below most water tables. If care is taken boring through the water table to get at the gas there is less danger of tainting well water.

Overall, one would think Poland was dealt a pretty good hand with coal and now the abundance of natural gas. But, changing the rules in the middle of the game might make Poland have to ‘Go fish’. Those increasingly colder winters in Poland have taking their toll on poorer folks freezing to death over the last couple years. Hot soup ain’t gonna be a substitute for much needed cheap energy.