History of the Hungarian People’s Republic (PART 2: Democratic Coalition Government)


WWII caused massive destruction in Hungary, mostly because the German fascists stole everything they could and took it to Germany, and what little they couldn’t steal they blew up, burnt and destroyed.

WAR DEVASTATION

“The siege of Budapest lasted fifty-one days before the Russians captured the city. Hardly a house was intact and thousands of soldiers and civilians had been killed” (Pryce-Jones, The Hungarian Revolution, p. 17)

“The Germans, departing, had taken 214,000 tons of goods, including machinery and food, by barge or railway (32,000 waggons) or lorry (8,000 loads); 70,000 dwellings had been destroyed, and a quarter of the inhabitants were homeless… a gold train had taken away the valuables stolen, mainly from Jewish families. (The property stolen from Jewish families and others, and the gold reserve of the National Bank, ended up in mining shafts in Austria.) The Holy Crown of King Saint Stephen I and the crown jewels were also transported west…” (Stone, Hungary: A Short History, pp. 363-364)

“Half of the industrial plant, the railways, the bridges, the livestock, had gone.” (Stone, p. 365)

“Budapest was a city of rubble, burned tanks and rotting corpses… every bridge over the Danube destroyed by the Nazis. Of 35,500 apartment houses, 29,987 had been destroyed or badly damaged… Bands of starving children roamed in the streets, wailing for bread and their parents. Of the city’s fine bus service, 16 buses were left, the Germans had driven off in the rest. Gas, water supply, and electricity services were disrupted… all telegraph and telephone poles had been cut down by the Germans, railway lines had been cut through at regular intervals by special sabotage machines. Every road leading into Budapest had been mined, every bridge over thirty feet long destroyed.” (Burchett, People’s democracies)

“1,200 locomotives and over 40,000 railway wagons were driven off to Germany… there was no food in the country… livestock had been reduced from 8.6 millions to 3.2 millions. Budapest in early 1945 was a hopeless city of rubble, stench and starvation.” (Burchett)

“[M]ost of the agricultural machinery, tractors and combines had been destroyed or shipped back to Germany, eighty per cent. of the draught cattle had been killed” (Burchett)

“the German invaders and the Arrow Cross agencies endeavoured to take away everything they could lay their hands on… wherever this was not prevented by the resistance of the Hungarian people or the advance of the Soviet troops…” (Nemes, History of the Revolutionary Workers Movement in Hungary: 1944-1962, pp. 31-32)

“three-quarters of the pool of railway trucks, two-thirds of the operable locomotives and most of the motor vehicles. The value of the goods taken to the West amounted to about 2,000 million dollars. The retreating fascists had made 40 per cent of the rail network unusable and demolished thousands of railway and load bridges.” (Nemes, p. 83)

I’ve cited a lot of numbers here, but the level of destruction is almost impossible to comprehend. More then half a millions Hungarian jews had been killed in the holocaust, and hundreds of thousands of others had lost their lives at the hands of the fascists. Two-thirds of trains, almost all cars and buses and the vast majority of livestock had been destroyed in Hungary, while practically all homes in Budapest had been destroyed, electricity and railnetworks had been clipped into little pieces by sabotage machines, all major roads had been mined and practically every bridge had been cut. Half of industry had been stolen or destroyed, all the national bank’s gold reserves had been stolen. The fascists had left the country destroyed and starving.


“The Red Army tried to preserve Budapest and especially its citizens as much as possible, heavy artillery and bomber plains didn’t bomb the city.” (SKP vuosikirja VI, p. 122)

Despite their own problems, the USSR was able to send food aid to Hungary, for example:

“At the end of March, the Soviet Union sent 1,500 wagons of cereals, 300 wagons of meat and 200 wagons of sugar to Hungary as loan.” (Nemes, p. 60)

“After liberation the Red Army was first to deliver food supplies and medical aid to Hungarians, saving the citizens of Budapest from starvation and epidemic.” (SKP vuosikirja VI, pp. 122-123)

LIBERATION. END OF THE WAR. DEBRECEN PROVISIONAL GOVERNMENT.

While the fighting was still going on, a provisional anti-fascist government was set up in Debrecen. This anti-fascist government, was a coalition of the Communist Party, Social-democratic Party, The National Peasant Party, the Smallholder Party, as well as trade-unions and other democratic forces. National Committees of trade-unionists, communists, partisan fighters and others also spontaneously emerged in liberated areas. These united to the Debrecen government and became the foundation of a new democratic state.

“Tanks and field-guns stood blackened where they had been hit and the bodies of soldiers lay unburied in the winter, but politics were beginning. In villages, towns, districts, and counties occupied by the Russians, ‘national committees’ sprang up, run by representatives of left-wing movements or trade unions. A National Council on these lines was installed in Debrecen on 21 December 1944…”
(Pryce-Jones, p. 19)

“…230 delegates assembled, a third of them Communists, from villages and townships liberated by the Red Army, and they elected a new government from all the anti-Fascist parties. Its programme included land reform and confiscation for war criminals…” (Stone, p. 361)

“For the first time after 25 years underground, the Communist Parly began to freely operate and it was the first to begin the work of reconstruction and the creation of a new power.” (Nemes, p. 33)

“The great cause of national reconstruction and joining in the war against the nazis required the creation of a new central power, a new Hungarian state. A clear-cut programme had to be drawn up to rally the national forces and rebuild the country. The Communist Party issued such a programme for a democratic national rebirth published on 30 November 1944 in the Debrecen newspaper Neplap.

This document stated:

“Our country is experiencing the most disastrous catastrophe in its history. The leaders of Hungary, hiring themselves out to the Germans, plunged Hungary into the Hitlerite imperialist war… They aligned themselves with the German fascists, because with such help they intended to subjugate the neighbouring peoples and ruthlessly suppress the Hungarian people within the country and keep them in slavery. The country is suffering under the fatal consequences of this criminal policy. Despite this, the Communist Party proclaims that there will be a Hungarian rebirth!”” (Nemes, pp. 34-35)

“In April the provisional government moved to Budapest… The Communist Party line for the moment was that Hungary was experiencing a [bourgeois democratic] revolution… and that all [democratic] elements should therefore co-operate. ‘Unite All Forces for Reconstruction’, was the slogan coined by Matyas Rakosi, First Secretary of the Hungarian Communist Party. As a proof of goodwill, Communists helped to rebuild churches. They also activated the other political parties permitted by the Allied Control Commission.” (Pryce-Jones, pp. 20-21)

Zinner also points out “The apparent concern of the Communists with national welfare and the zeal with which they led the reconstruction of war-damaged installations, including churches…”

(Revolution in Hungary, p. 50)

“The provisional government undertook to conclude an armistice with the Allies, to pay the reparations, to wage war against Germany, to repeal anti-Semitic and antidemocratic laws, to guarantee democratic rights and to institute universal and secret suffrage, to disband right-wing political movements and punish war criminals, and to effect a land reform.” (Kovrig, The Hungarian People’s Republic, p. 64)

“The leader of the Hungarian Communist Party, Mátyás Rákosi, stepped onto the tribune. He was welcomed with immense enthusiasm. “Long live Rákosi! Long live Rákosi!” resounded from the crowd… “Freedom!” Comrade Rákosi began his speech and hundreds of thousands roared back from every corner of the square: “Freedom!”” (Apor, The invisible shining, p. 58)

By April 4th the whole territory of Hungary had been liberated from the Nazis. (Ignotus, Hungary, p. 152)

“Hungary received aid from the Soviet Union for restoring the economic life and production e.g. to replace the horses stolen by the Germans, new horses and cars were brought for transporting food supplies. The Soviet Union aided the development of the Hungarian national economy and living standard of the citizens by reducing war reparations by 50%.” (SKP vuosikirja VI, pp. 122-123)

LAND REFORM

The most important political action of the provisional government was land-reform. It was undeniable, that the Hungarian peasants had suffered horribly under the rule of the Hapsburg monarchy and then under Horthy.

“In Hungary, peasants… were… more then the rest, oppressed and exploited.” (Ignotus, p. 171)

“…the greatest problem of modern Hungary: the vast inequality of landholding. It was a largely peasant country, and the peasants often farmed with primitive methods.” (Stone, p. 50)

“…smallholders only amounted to about one-third of the rural population; the rest were either totally landless or ‘dwarf-holders’: compelled, that is, to sell their labour on a market where manpower was cheaper than anything else.” (Ignotus, p. 172)

“before the war some 400,000 Hungarians possessed so little land that they had to sell their labor power as agrarian serfs in order to keep from starvation, and another 400,000 had no land at all.” (Behind the curtain, p. 181)

Historian Elizabeth Wiskemann wrote “In Hungary the distribution of land remained… the most unjust in central Europe” (in R. R. Betts, ed., Central and South East Europe, London, 1950, p. 98)

“Among East European countries, Hungary was the worst instance of the system of giant landed estates and their complement, a vast agricultural proletariat, living below subsistence level. This state of affairs was preserved unimpaired up to 1945.” (Ilonya Polanyi, World Affairs, a magazine published by the London Institute of World Affairs April, 1949, p. 134.)

Before WWII “it was calculated that… In Hungary 24%… of the rural population belonged to the category [of unemployed or under employed].” (Nevalainen, marxilaisen taloustieteen oppikirja osa 2, p. 67)


“In March [the Debrecen government] carried through a land reform. This was long overdue, in a country where almost half the arable land had belonged to one percent of the landowners. Four and a half million acres were now distributed among 660,00 peasants… Tremendous posters everywhere claimed this reform as an achievement of the Communist Party.” (Pryce-Jones, p. 19)

“Committees dominated by Communists and the National Peasants’ Party people carried out the redistribution… and within three months 8 million acres had been taken over, some for state farms but the greater part (5 million acres) given to 500,000 new owners… The Catholic Church lost 90 percent of its lands…” (Stone, pp. 370-371)

“[The second largest landowners in Hungary] The Eszterhazys between them owned 750,000 acres of which the senior member of the family, Prince Paul Eszterhazy, owned 300,000. They owned 15 castles in Hungary, several more in Austria and Bavaria… There was only one larger landowner in Hungary and that was the Roman Catholic Church.” (Burchett)

The Peasants had lived in misery, while the richest 1% had owned half the land in the whole country. The land had primarily belonged to the clergy and the nobility, who now lost most of the power they had held century after century. They had literally lived like kings, standing over the peasants. The Land-reform was necessary, to destroy feudal social relations, to free the peasants from the total power of the church and the noble families. Although land-reform was only the first step, it immediately produced favorable results. Economist Warriner writes:

“The land reform has brought a complete social and economic transformation in the countryside… In 1947, I visited again the same villages that I had known in 1936, where land had now been distributed.

The most noticeable change then was better food: the new peasants were eating wheat and rye bread regularly, instead of maize, and drinking coffee with sugar, unknown before… Peasants who had been

estate labourers before, and had now become owners of the standard 12 acre holding, said that in a bad year their real income was twice what it had been before, and with a good harvest would be three or four times as high. Their money income was large enough to buy boots for the whole family. Two years later, in 1949, the dominant impression in the villages was the good supply of consumer goods; ‘Nepboltok’— ‘People’s Shops’— had been started, with a wide range of textiles, shoes, aluminium saucepans, china.” (Warriner, p. 134)

Journalist Wilfred G. Burchett interviewed one of the noble families after the land-reform. The nobility had lost their massive land holdings, and their numerous castles, mansions and private parks:


“[Countess Eszterhazy] shuddered when I asked what had happened to the properties at Tata. “It’s too dreadful to speak about.” she said. “The castle has been turned into a lunatic asylum, the beautiful old Hunting Lodge has become a Communist Youth Hostel, the English Park was turned into a training ground for the Olympic team, because they said the atmosphere and climate was like that of England and would help the team that was going to England for the Olympic Games. The parks are all thrown open, anyone can wander through them,” and her china-blue eyes filled with tears.” (Burchett)

“I made a tour of some of the Eszterhazy castles to see for myself what was going on. Tata is a beautiful village, about ten miles off the main road between Budapest and Vienna. Sure enough the main castle had become a hospital for the insane, the Hunting Lodge – was full of gay young people, including a group of Canadians who had been working on one of the volunteer youth brigade projects. It was Sunday, in mid-summer, the two magnificent parks were crowded with villagers and peasants, reclining in the shade of massive oak and elm trees. More peasants and some workers from the nearby Tata coal mines (Eszterhazy property before they were nationalised), were splashing away in a fine swimming pool that had formerly been a private preserve of the Eszterhazys.” (Burchett)

“[L]ives [of the Tata peasants] are still hard, they still work from dawn to dark and have little enough at the end of the month to buy clothes or other necessities with. They are still plagued by priests who tell them it’s sinful to have taken the land of their masters, and that God and the Americans will punish them for it.

“My boy’s at the university,” said one brown old peasant, squatting on the ground in the English park at Tata. “He’s learning to be an engineer. D’ye think I could ever have managed that in the old days? If I’d saved up everything and could sell a pig or two, I couldn’t even keep him at school after he was twelve. Now they even pay him for learning. He’s at one of the People’s Colleges and they pay him enough that he sends me and the missus a bit on the side.”

Of the land reform, he said, “We could have done with a bit more land. It’s hard to make do without 10 acres, but we live all right. We eat better than we ever did”” (Burchett)

“At the village of Eszterhazy the castle had been turned over to an Agricultural College. On the Sunday I visited it, there was a big Mothers’ Day meeting in progress. In the castle courtyard, seats had been set out in the warm autumn sunshine, and parents were watching a performance by the school children. On other Eszterhazy estates parks had been thrown open to the public, in some cases used as plant research stations, castles used as hospitals, schools, orphanages, youth hostels.” (Burchett)

Rakosi had said “in front of the [horthyist] court in 1926 that “land will only be distributed in Hungary by the Communists!”” (Apor, p. 55) Now his promise became reality!

““Blessed should be the name of he who has granted us land,” a delegation of farmers from Szolnok
County told Rákosi in early March…” (Apor, p. 55)


FACTORY COMMITTEES

It was essential to begin normal production as soon as possible, to produce necessary goods, electricity, and to repair war damage. Factories destroyed by the war, and looted by the Nazis, had to be restored. Workers organized into Factory Committees, took over the management and control of factories.

“The management of industrial plants was taken over by the factory committees as they were known. For the time being these did not change the legal status of the plant: this remained in private ownership. Since, however, in most cases the owners and the company management had fled the country the factory committees assumed responsibility for the most important tasks linked with the starting of production.“ (Borsányi & Kende, The History of the Working Class Movement in Hungary, p. 103)


“with the setting up of factory committees under Communist leadership workers’ control was realized in practice.” (Nemes, p. 37)

“[Communists and Social-Democrats] jointly pushed through a government decree which was passed in February [1945] for the recognition of the activities and jurisdiction of the factory committees. The factory committees were officially authorized to take control of production as well as the trade activities of the industrial companies, and could play an active role in the regulation of labour relations and the administration of companies. Control by the workers in factories and mines was established as soon as they started to operate, but pressure had to be exerted on the right wing… to give government approval to this practice. The right wing considered this a forced concession. At the same time they emphasized the capitalist ownership of the factories, in order to be able to limit later the jurisdiction of the factory committees to the settlement of labour disputes. However, the factory committees were power positions of the working class which strengthened the government’s influence among the workers and at the same time reduced capitalist exploitation.” (Nemes, p. 65)

The masses had already dealt two serious blows to the landowners and capitalists: the land had been redistributed to the peasants, and workers established themselves in Factory Committees, which already had an important role in managing factories even though they were still privately owned, and they were a position from where the workers could defend their interests against the capitalists. Capitalists no longer had total control over the factories, and if Hungary was to build socialism, transferring factories to socialist ownership could happen smoothly since they were already worker controlled. The workers were already learning to manage the factories themselves, without the capitalists.

1945 ELECTIONS


“In November 1945 the first completely free election, under secret ballot, ever held in the history of Hungary took place” (Behind the Curtain, p. 177) (There actually were elections with universal secret ballot already during the 1919 Hungarian Communist Revolution, but ignoring that Gunther is correct)


The four largest parties received the following results:

“Smallholders received 57 per cent., Communists and Social Democrats 17 per cent. each, National Peasants 6 per cent. The coalition government or “People’s Front” continued in office.” (Burchett)

It was significant that despite decades of intense anti-communist propaganda, and a prevailing environment of reactionary nationalist and religious ideology, the Communist Party emerged as one of the largest parties. In fact, the Communists had the same amount of votes as the Social-democrats, despite the fact that the Communists had never been able to organize legally before, and had been heavily persecuted. Of course, the Communists had some supporters from their underground years. They also received new support because they were the main organizers of the anti-fascist resistance movement and partisan movement. The Communists were also the main organizers of the land-reform. They had quickly emerged as the leading force in the Factory Committees and as an equal partner with the Social-Democrats in the Trade-Unionions. The Communists were used to underground conditions, and thus their organization was not paralyzed by the Nazi occupation and Arrow-Cross coup de’tat to the same extent as the other parties.

“Despite the persistence of popular stereotypes concerning the Communists, the first few months of 1945 witnessed a remarkable increase in the MKP’s popularity. Membership skyrocketed: the organization had only a few thousand members in January, but by October, Party membership had reached half a million” (Apor, p. 36)

“the party’s main newspaper Szabad Nep, whose chief editor was comrade Revai. The newspaper soon increased from 100,000 to 300,000 copies.” (SKP vuosikirja VI, p. 126)

Some right-wing anti-communists might want to claim that communists simply rigged the elections, or used some kind of election fraud, but this was not the case. Even anti-communist historians like Paul E. Zinner, were forced to admit that:


“…the election was free; it met the highest standards of democracy; it was secret, universal, and direct and everyone could vote according to his conscience… On the basis of the conduct of the election and the reaction of the Communists to its outcome, no one could describe their behavior as anything but impeccable. They obviously did not tamper with the ballot” (Zinner, p. 40)

According to Zinner there were “Liberties seldom, if ever, experienced before (free election by democratic franchise, free press, free speech, an intensive formal parliamentary life)” (p. 37)

“in Hungary… free elections took place” (Kertesz, S. D., The Methods of Communist Conquest: Hungary 1944-1947)

The big winner of the election, was the Smallholders party, a rather amorphous centrist party without any clear ideology or message. It was logical that the Smallholders could receive a lot of votes, but their popularity was of temporary character, the Smallholder Party appealed to everyone, and at the same time, didn’t fully satisfy anybody. In a country where the vast majority of the population had never been able to vote before, the Smallholder Party seemed like a safe bet. It would’ve been unrealistic for them to suddenly jump to the Communist Party or Social-Democratic Party. Likewise the National Peasant Party was distinctly left-wing, and thus couldn’t appeal to everyone, and also focused primarily on the Peasants, and thus didn’t appeal to the urban population.


NEW CURRENCY

The devastation of the war, massive theft of Hungarian property and gold by the Nazis, the terrible shortage of goods and black-marketeering had caused massive inflation.

“In 1945 and 1946 Hungary was in the grip of the greatest inflation in history… People rushed out with their whole week’s salaries to buy a few bus tickets or a loaf of bread.” (Burchett)

In order to make the situation tolerable, workers at factories often received their wages in food and other products directly, and other goods were rationed.

“Most experts were of the view that a stable currency could not be established without a foreign loan.”
(Borsányi & Kende, p. 110)

The inflation was so bad, that the Communists suggested a completely new currency:

“On the initiative of the Communists a currency reform was worked out and put into effect on August 1, 1946. One new Forint was valued at 426, followed by twenty-seven zeros of the old pengoes. Overnight Hungary had a stable currency which could buy real goods which now began to appear in the shops. Currency reform won the Communists great prestige…” (Burchett)

Hungary’s gold had been stolen and production had been decimated. There was a shortage of everything and black market prices skyrocketed. But as soon as production got going again, it was possible to solve the inflation since prices remained stable and the currency could actually get consumers what they wanted.

After the currency was stabilized, right-wing anti-communist ‘historians’ changed their narrative. Nowadays they describe the ending of the worst inflation in world history, as nothing special. They do not want to give communists credit for this achievement, and instead suggest that the inflation really could have been easily ended and blame the communists for ending it too slowly. For example, in his book Revolution in Hungary, Zinner says: “once inflation was in progress, the communists refrainted from halting it.” and “Hungary’s currency could have been stabilized long before August 1, 1946”! (p.54)

Even putting an end to the worst inflation in history, is not good enough for anti-communists. They don’t give communists any credit for it. I would like to ask mr. Zinner, if ending the inflation was supposedly so easy, then why did the capitalist opposition parties or the Smallholders Party not do it, and instead claimed that it could only be solved with massive loans from the West?

The communists had emerged as one of the biggest parties in Hungary, and clearly as the most active political force in the country. They had a plan for the reconstruction of the country and solving economic and social problems. They led the creation of the anti-fascist democratic coalition government. They organized workers into factory committees, which began to restore production. The communist party grew into a mass party of hundreds of thousands of members. The communists also carried out land-reform together with the national peasant party, and stabilized the currency. As a result of these and many other successful policies the popularity of the communists would continue to grow rapidly, while the popularity of the right-wing and reformist forces would begin to diminish.


SOURCES:

David Pryce-Jones, The Hungarian Revolution

Norman Stone, Hungary: A Short History

Wilfred G. Burchett, People’s democracies

Dezső Nemes, History of the Revolutionary Workers Movement in Hungary: 1944-1962

SKP vuosikirja VI

Paul E. Zinner, The Revolution in Hungary

Bennett Kovrig, The Hungarian People’s Republic

Balazs Apor, The invisible shining, p. 58)

Pal Ignotus, Hungary

John Gunther, Behind the curtain

R. R. Betts, ed., Central and South East Europe

Ilonya Polanyi, World Affairs, April, 1949

Doreen Warriner, Revolution in Eastern Europe

Eino Nevalainen, marxilaisen taloustieteen oppikirja osa 2

Borsányi & Kende, The History of the Working Class Movement in Hungary

Kertesz, S. D., The Methods of Communist Conquest: Hungary 1944-1947

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