Over the years, a special relationship evolved between the peoples of Poland and the United States. Poles and persons of Polish ancestry made enormous contributions at every stage in the development of the United States. For Poles, family ties and genuine admiration for the United States negated decades of official anti-American propaganda. As official relations between Washington and Warsaw deteriorated after the December 1981 imposition of martial law, the United States maintained communication with the centers of Polish opposition, including leaders of labor, the intelligentsia, and the Roman Catholic Church. During the 1980s, United States policies of economic sanctions against the regime and support for the opposition contributed to the ultimate fall of the communist government.

Immediately after Jaruzelski imposed martial law in 1981, the United States invoked economic sanctions against Poland. In 1982 the United States suspended most-favored-nation trade status and vetoed Poland's application for membership in the International Monetary Fund. In the following years, Warsaw repeatedly blamed such United States policies for Poland's economic distress. For the period 1981 to 1985, the Polish government claimed that United States-inspired sanctions and Western refusal to reschedule debts and extend additional credit had cost the Polish economy US$15 billion in export income and other losses.

Despite the end of martial law and limited amnesty for political prisoners in 1983, relations with the United States did not improve. In the mid-1980s, Warsaw's determined efforts to prove its loyalty to the Soviet Union made rapprochement with Washington impossible. Poland supported the Soviet version of events surrounding the shooting down of a Korean Airlines passenger plane in 1983, an incident that greatly heightened Soviet Union-United States tensions. In 1984 Warsaw joined the Soviet boycott of the Los Angeles Olympic Games in reprisal for the United States boycott of the previous games in Moscow. Jaruzelski delivered a scathing attack against United States sanctions policy in a 1985 speech at the United Nations. And in 1986 the Polish government condemned the United States air strike against Libya.

Official relations between Washington and Warsaw began to improve after the Jaruzelski government's 1986 general amnesty released all political prisoners. By early 1987, the administration of Ronald W. Reagan lifted all economic sanctions and restored Poland's most-favored-nation trading status. Vice President George H.W. Bush visited Warsaw the following October and promised United States support for debt rescheduling in return for the Polish government's pledge to respect human rights. In 1988, however, the United States decided to withhold economic aid until Poland reestablished political pluralism.

After the Round Table Agreement of mid-1989, the United States moved quickly to encourage democratic processes and assist economic reform in Poland. Toward this goal, President Bush initially promised some US$100 million in economic assistance, and a three-year package totaling US$1 billion was proposed later in the year. In November Walesa visited Washington and addressed a joint session of the United States Congress, which greeted his unprecedented speech with promises of additional economic assistance. The Congress enacted the Support for Eastern European Democracy Act (SEED) to streamline the delivery of humanitarian aid and assistance for the development of democracy and freemarket institutions in postcommunist Eastern Europe. An interagency coordinating council led by the Department of State was established to direct assistance to Eastern Europe. The privately managed Polish-American Enterprise Fund (PAEF) was created in May 1990 to provide credit for Polish entrepreneurs to start businesses. Contingent on the level of congressional funding, the PAEF estimated that it would make US$130 million in loans in 1991. Another nongovernmental organization, the Overseas Private Investment Corporation, began providing loans, loan guarantees, insurance, and advice to facilitate United States private investment in Poland and other East European countries. In 1990 the United States led an international effort to create the US$200 million Polish Stabilization Fund, which was instrumental in making the zloty convertible with Western currencies.

As a major player in such international financial institutions as the World Bank, the IMF, the Organisation for Economic Cooperation and Development (OECD), the Paris Club, and the European Bank for Reconstruction and Development (EBRD), the United States led the effort to provide debt relief and other economic assistance to Poland. In early 1991, the United States pledged a further 20 percent reduction of Warsaw's debt to Washington. In a mid-1992 visit to Warsaw, President Bush praised Poland's political and economic reforms and proposed using the currency-stabilization fund to spur private-sector growth.

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Source: U.S. Library of Congress