"Inflation was now running at an annual rate of 17000 per cent. ..January 1, 1990, was the day of the ‘big bang’, the promulgation of Balcerowicz’s shock therapy, the critical salvo in the market revolution. And it was a shock–a decisive break with the communist past. Most prices were freed. The currency, the zloty, was devalued and made convertible. Controls were imposed to forestall an explosion in wage increases. The government deficit was to be reduced from 7 to 1 per cent of the GDP. Taxes were reformed and a restrictive monetary policy put in place. Balcerowicz and his colleagues waited nervously to see what would happen. They knew prices would go up, but they estimated a 45 per cent rise.
"Instead, prices jumped 78 per cent in a matter of days. Reserves of grain, meat and other foods were low and the shortages continued. They held their breath. Food riots, demonstrations in the street–these could undermine the entire reform program and send Poland spinning back to authoritarianism. But by the end of January, something began to happen. First in a trickle, then in growing numbers, farmers started to drive into the cities from the countryside, bypassing the state distribution system and selling their produce from cars and trucks or on the sidewalk. Industrial wares showed up in the same way. Instead of demonstrators and rioters, Poland had acquired merchants overnight. As shortages disappeared and supplies increased, prices started to come down. Balcerowicz’s aides tried to reassure their tense boss by telling him to focus on eggs. Yes, eggs would be the critical indicator of success or failure. By the end of the month, it was confirmed: the price of eggs had levelled off, and in some part of the country it had actually declined. Balcerowicz heaved a great sigh of relief. The eggs constituted a great victory. Markets were working."
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