Poland at the Center of Change. Will We Seize Europe’s Opportunity?

Professor Witold Orłowski speaks with Kazimierz Krupa about what lies ahead for our wallets.

Let’s start with a bit of geopolitics. In your recent statements, you said that reports of the “death of the West” are exaggerated. How would you assess, in mid-2025, the strength of the European economy—and especially its ability to compete with the two major blocs: China and the United States?
Our “great friend” Vladimir Putin once said that the West is dying. Well, if he presented “proof” that the European economy is growing too slowly while the Russian one is booming, let me remind you: over the last ten years, Russia’s economy grew at 1.5 percent, and the eurozone at roughly the same pace—1.5 percent. But if he says the West is dying, then what should we say about Russia?

That it’s already dead.
Exactly. The question is—what do we mean by “the West”? Leaving aside issues of liberal democracy, because much is happening in politics and society, the West today is undoubtedly changing—it’s not the same as 20 or 30 years ago. Economically speaking, it’s true that some regions of the world are growing faster than the West, but they remain much poorer. The real rival here is China, not Russia. Russia? That’s a joke. Calling it an economic power—it’s basically a giant gas station.

We have to admit that within the West, the United States is growing much faster. Over the past decade, its growth averaged 2.7 percent. Western Europe has been much slower—around 1 percent. For the entire European Union, growth has averaged just over 2 percent per year. So yes, Western Europe has faced long-term growth problems over the past 20–30 years. But our part of the continent has benefited from that. We should really view Europe as a whole, not just the eurozone. This is the phenomenon of production shifting—that’s why more factories are being built here than in France or Germany, here in our part of Europe.

Naturally, production is rising faster here than there. So when we look at Europe as a whole, the results aren’t as bad as they might seem. People often compare the EU to the eurozone or to Germany, but Germany isn’t all of Europe. It’s the largest economy, yes, but not the only one. When someone says Europe is growing slowly, they should look at Poland or Ireland—it’s not that slow at all.

Yes, Europe does have its problems. Mario Draghi diagnosed them well. Maybe “diagnosed” isn’t the perfect word—because what he said was rather obvious. Diagnosis—yes. But prescriptions? You could only read them between the lines.
They weren’t exactly clear. Maybe he didn’t have the courage to spell them out. But he did say, for example, that the gap in growth between the EU and the US stems mainly from the fact that the American economy is less bureaucratic, more innovative, and more supportive of entrepreneurship.

Maybe it’s time to move away from Excel spreadsheets and focus more on the “economics of happiness,” which is gaining attention in some countries? Maybe GDP is no longer the only measure of progress?
It’s long been said that GDP growth isn’t the only indicator that matters. About 50 years ago, a king from a faraway land declared that the goal of economic policy would be Gross National Happiness, not Gross Domestic Product. I’m talking about Bhutan, which remains one of the poorest countries in the world.

But they’re really trying.
Yes, the concept drew attention. Of course, GDP isn’t some kind of fetish. It measures production and income—material wealth. It’s true that happiness doesn’t depend solely on money. But on the other hand, it’s much easier to be happy when you don’t have financial problems.

The issue is that GDP measures material well-being. There are valuation challenges—not always accurate—and other measurement difficulties. But overall, GDP growth reflects increased spending and living standards—measured in a certain way. It’s not a full picture, but when people are jealous that their neighbor has more, it’s hard for them to feel happy. And that’s where the economics of happiness comes in.

There’s also an element of social comparison, right?
Absolutely. I often tell my students that today’s standard of living in Poland and Europe is roughly five times higher than it was 50 years ago. Incomes are five times greater. From our grandparents’ perspective, we live in unimaginable wealth. But people don’t compare themselves to their grandparents—they compare themselves to their neighbors. Someone who can barely afford a used Opel looks at his neighbor with a new BMW and feels unhappy, even though his grandfather would have been thrilled with that Opel.

So money doesn’t buy happiness, but…
…but it’s easier to be happy when you don’t have financial worries. GDP isn’t the same as happiness—even a high GDP. But economists can advise on how to ensure people have more money in their wallets, and that means GDP growth. It’s the best indicator we have, though of course imperfect.

Should Europe be worried? Are the current shifts just a temporary crisis, or a deeper restructuring of the global order?
There’s no clear answer. On the one hand—yes, we have reasons to worry. The order we’ve grown used to is changing. In Poland and other post-communist countries, we faced an additional challenge—we had to catch up with the West. Western Europe has been developing since the 1950s; we only started in the 1990s. We’ve caught up—though not fully. Japan, however—we’ve already surpassed. And remember, people laughed at Lech Wałęsa when he predicted it—but he was right.

Japan helped a little.
True. But the situation is changing. I don’t want to get into democracy—that’s another discussion. But the world has become more dangerous. We’ve entered an era of greater uncertainty, including in matters of security. What once seemed obvious is no longer so. Twenty years ago, people thought war in Europe was impossible. Now we know it’s possible.

In the global economy, globalization has slowed—and even partially reversed. Protectionism is on the rise. Is that a catastrophe for Europe? Not necessarily. Europe is still one of the richest regions in the world—with the highest quality of life. Maybe not as innovative as the US, but productive and adaptable. Yes, changes are happening—and not for the better—but Europe still has the resources to cope.