The Peoples Republic of Hungary By: Timur Dautov, Raki Wane,
Charlotte Richards, Thais Caprioli
Slide 2
Economy of the Peoples Republic of Hungary Initially a
centrally planned economy: Shaped along Soviet lines All industry
and enterprises nationalized and under control of state planning
organ Five-year plans which set goals Emphasis on heavy industry
State regulated production, prices and all foreign trade
Slide 3
Economic reform In 1968, a set of reforms called New Economic
Mechanism was introduced Its main goal increasing the efficiency of
the economy by: Decentralisation of decision-making Increased
autonomy of enterprises Introduction of some free market principles
Relaxed price regulations
Slide 4
Stability of the 1970s International relations in the world
enter the period of dtente As tensions relaxed, trade and economic
cooperation between the East and West were encouraged mentioned in
Basket II of the Helsinki Accords Hungary takes large foreign loans
from the West in the first half of the 1970s Loans bring stability
and an improved standard of living compared to the rest of Eastern
Europe Because of the seeming successes of the economy due to
foreign loans, the reform programme was deemed unnecessary and was
frozen; centralisation of economy reintroduced
Slide 5
Change in economic policy In the late 1970s, dtente was over
Hungary set to repay the foreign debt to the West In 1979, New
Economic Mechanism reforms continued, another drive for
decentralisation began and more market innovations were introduced
The goal was set to develop an export industry capable of competing
on the world market in order to earn hard currency to repay the
debt However, this turned out to be impossible as economic problems
set in
Slide 6
Economic problems and recession All Eastern Europe was in a
crisis by the 1980s As dtente was over, the East-West confrontation
was restored and the arms race began anew; Soviet Blocs military
spending increased drastically, placing a burden on the economies
of East European countries Soviet Union was no longer able to
provide economic aid and oil supplies to its fraternal countries,
causing damage to Hungarian economy as well
Slide 7
Continuing crisis and collapse The latter half of 1980s was
marked by reformism in the Soviet Union, headed by Gorbachev
Reforms also introduced in Hungary, including further political and
economic liberalisation Inefficiency of planned economy and
shortages continued, forming discontent of the population (however,
not as bad as in the rest of Eastern Europe) Pressure for further
economic reforms a factor in the 1989 downfall of communism; new
government introduced extensive liberal free-market reforms This
caused certain economic difficulties in the early 1990s many
inefficient businesses and factories closed, rising
unemployment
Slide 8
Opposition to the communist regime Shown through posters of the
time
Slide 9
Alliance of Free Democrats [1988] 1956 Soviet invasion to put
down the Hungarian revolution
Slide 10
Hungarian Democratic Forum [1989]
Slide 11
Alliance of Young Democrats [1990]
Slide 12
Opposition to the communist regime Through actions
Slide 13
Hungary announces 1956 is a "People's Uprising [1988]
Personally, I think that it was a people's uprising; our
declaration in December 1956 acknowledged it in the first
paragraph, labeling it as the rightful discontent of the people. I
do maintain, though, that hostile enemies gradually joined in, and
they could have turned the wheel of history backwards, so the
danger of counter-revolution was imminent.
Slide 14
Government opened the border with Austria [1989] In spite of
the verbally declared willingness on behalf of the Hungarians to
solve the problem facing the GDR ... Hungarian media provoked and
supported a campaign directed against the GDR
Slide 15
Opposition Roundtable in Hungary met [1989] [Communist
party]...has made hardly any progress on the most important
concrete issues. ... [no intension of] ending party organizations
at workplaces... abolishing the workers' militia... [eliminate] the
political monopoly of the Party in the army and the police
force...
Slide 16
Everyday Life Rationing meant no clothing for children Used
acquaintances abroad Schooling: There were kindergartens with
normal schedules which allowed you to drop off the children in the
morning and to pick them up at five when you finished workthere was
much more order. I think from this perspective, things were
better
Slide 17
Everyday Life Subject to political rape (ordered around) Smooth
times people tolerated it Bad times people didnt tolerate things
from before It [Decree 770 and attendant policies] was purely and
simply a crime! A crime... it was one of the worst things that
happened.... It was political rape... we were raped, obligated, at
all times to do what the party wanted