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Meanwhile, to keep people happy, Gierek was allowing wages to rise 40% from 1970 to 1975, compared with an increase of only 17% over the previous decade. To give Poles enough meat, Gierek quadrupled imports of grain and fodder; the per capita consumption of meat jumped from 132 lbs. per year in 1970 to 1541bs. in 1980.
The state's pricing system, designed to hold down food costs to consumers, was a blueprint for bankruptcy. The state was paying farmers 10 zlotys for a liter of milk that it sold in stores for 4 zlotys. Live hogs were bought from farmers at 130 zlotys per kilogram and sold as butchered pork at 70 zlotys per kilogram. Farmers bought bread and fed it to their livestock because it was cheaper than the wheat it was made from. Price subsidies began absorbing a staggering one-third of the national budget.
The whole absurd structure was bound to collapse, and it did. When the OPEC nations raised the price of oil in 1973-74 and caused a worldwide recession, Poland's exports, instead of continuing to rise as Gierek planned, began to falter. Unable to lay off any workers—a taboo under the full-employment doctrine of Communism—Gierek had to borrow more and more money from the West to keep going. Poland's foreign debt rose from $4.8 billion in 1974 to $25.5 billion in 1981. Servicing and repayment of the loans, which are owed to 15 Western governments and 501 Western banks, now consume all of Poland's hard currency export earnings, estimated at $6.5 billion for 1981 (see ECONOMY & BUSINESS).
When Poland was forced to reduce its borrowing, the country began to suffer from a lack of spare parts for the spanking new equipment already in place. Round and round the vicious circle spun. The nation's factories operated in 1981 at only 60% of capacity. To make matters worse, poor harvests from 1974 to 1980 ravaged the country's agriculture, which Gierek had foolishly ignored in favor of industrial development, despite the fact that agriculture accounts for 20% of Poland's domestic gross national product. Moreover, a disproportionate amount of supplies and equipment went to the inefficient state farms, while the far more productive private farmers, who own 75% of Poland's arable lands, were shortchanged.
Fearing a national outcry, Gierek was reluctant to ease the strain on the budget by raising prices. He was right. When he finally increased prices in 1976, there were major riots in Radom and at the Ursus tractor factory. The brutal repression of these riots led to the formation of the Committee for Social Self-Defense (KOR), a precursor of Solidarity. The organization was the first significant link between the dissident intellectuals like Jacek Kuron and the workers who later founded Solidarity. Inspired by KOR activists, small independent—and illegal—labor unions cautiously began to form in various parts of the country. Lech Walesa joined such a unit and was arrested and briefly jailed scores of times.
Catholic intellectuals also began to work with the movement. In Cracow, meanwhile, Karol Cardinal Wojtyla emerged as a strong advocate of human rights and promoted an