Capitalism in Zakopane

One day late last November, several truckloads of tough, blackbooted militiamen roared into the streets of Zakopane, a normally placid town of 30,000 in the heart of Poland's Tatra mountain-resort country. Using dogs to keep the townspeople at bay, and snatching film from anyone who tried to take pictures, the men led a procession of bulldozers and demolition workers through the town. Within a matter of hours, the wrecking crews had reduced six spanking new houses to rubble. The owners were arrested and forced to pay fines of up to $1,364. The offense: building without a permit.

The man who arranged this draconian method of enforcing Poland's building code was Zakopane's staunchly orthodox Mayor Stanislaw Bafia; in his view, the punishment fitted the crime. The capital of a scenic region billed in the brochures as "the Switzerland of Poland," Zakopane had in recent years become known among smart Poles as a good place not only to take a vacation but also to turn an easy zloty or two in illegal housing, building and real estate. As the dimensions of Zakopane's non-Communist economy were revealed in the wake of the November raid, one Warsaw paper charged that the whole area had become "a mini-capitalist state."

Under-the-counter capitalism is practically a way of life in the Tatra highlands, where the goradi, as the fiercely independent local mountain men are known, have never been reluctant to deal outside of the regulated state economy. In recent years, the action in the Tatras has shifted from minor-league trade in furs and sheep skin coats to deals in real estate big enough to perk the interest of lawyers, engineers and other professional types from Warsaw, Katowice and Krakow with investment cash to spare. Lured by the tenfold rise in tourism in the area since the end of World War II, and the inability of the slogging state construction agency Podhule to keep up with the demand for decent lodging and restaurant facilities, wealthy Poles have invested about $54 million in the Zakopane area-roughly as much as the government has spent there over the past ten years.

Stretching laws intended to enable Poles to build or buy homes and small shops, investors have been putting up luxury vacation villas and guesthouses with as many as 30 beds. Much more often than not, the buildings are never licensed or put on the tax rolls. All told, the 1,300 private guesthouses in the Zakopane region produce about $45 million a year in mostly tax-free revenue -one reason why the goradi say that "every time the fog closes in, the guesthouses grow like mushrooms."

Rare Pleasures. So do Zakopane bankrolls. Prosperity has enabled many families to buy new Polish-made Fiats and even to visit relatives in the U.S. -rare pleasures in a country where the average annual income is $1,380. Bureaucrats are offered-and often accept -bribes for authorizing private use of scarce, rationed building materials, signing building permits, or simply not noticing the existence of brand-new villas in the countryside. As the national daily Zycie Literackie put it: "There was a saying in the town that an official arrives with a briefcase, and after two years he has a car and after three more a luxury villa."

In fact, it may all be too good to have ended. Curiously, there has been no sequel as yet to the November crackdown, even though some 300 unlicensed guesthouses continue to operate illegally right inside Zakopane itself. The word among the sullen gorali is that most of the victims of the bulldozers were simply too poor to get up the necessary bribes; Stanislaw Suchowian, 30, the father of two, who was arrested at 4 a.m. on the morning of the raid, lost his life's savings when his house was smashed down.

The long-run loser, though, may well be Mayor Bafia. Sensing the ugly mood of the mountain men, he transferred his teen-age daughter from the local school to one in far-off Warsaw. When he ventures out of his office nowadays, a bodyguard is always at his side.

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