Socialist Hungary, officially the Hungarian People's Republic
Analysis
- One poll has found the population looks at the experience with more positivity than current Hungary. "A remarkable 72% of Hungarians say that most people in their country are actually worse off today economically than they were under communism. Only 8% say most people in Hungary are better off, and 16% say things are about the same. In no other Central or Eastern European country surveyed did so many believe that economic life is worse now than during the communist era."[1]
Economic Development and Standard of Living
Immediately after the establishment of the Hungarian People's Republic, the nation instituted a traditional Soviet-style planned economy. However, in the late-1960's, an economic reform plan (known as the New Economic Mechanism, or NEM) was instituted, which somewhat restored the role of market forces, while retaining state ownership over the means of production, distribution, and exchange.
The 1960's saw the state focusing on expanding industry. According to the US Federal Research Division:
After this period, the economy shifted focus towards consumer production with the introduction of the NEM:
This time was marked by high rates of economic growth. Hungary reached the level of a middle-developed nation:
By the mid-to-late 1980's, Hungary had achieved a very high standard of living compared to the pre-communist era. Food availability was high, and selection was relatively diverse. The US Federal Research Division reports:
Hungarians also had high rates of ownership for various consumer goods, and the quality of goods was increasing as well:
Despite these good statistics, the Hungarian economy was not free from problems; an over-reliance on Stalinist orthodoxy (particularly in the early years) caused Hungary to lean heavily on the development of heavy industry, ignoring other forms of production which would have better suited the nation's material conditions. In addition, the country's enterprises and farms suffered from low levels of relative productivity, which contributed to a slowing of growth in the 1980's. The Encyclopedia Britannica summarizes these issues:
Finally, in 1982, Hungary became the second Eastern Bloc nation to join the IMF. This was a tremendous mistake, as various loan conditions during the 1980's eventually contributed to the collapse of the socialist system, and its replacement with a brutal strain of capitalism.
Overall, the Hungarian economy offers several lessons for modern socialists and communists:
- Economic
development should focus on the comparative advantage of a given nation, rather than dogmatic dependence on heavy industry.
- The
production of consumer goods and an increasing standard of living are essential for winning (and keeping) the support of the people.
- The
socialist economic system, when properly directed, is indeed capable of transforming semi-feudal states into developed countries. The other Eastern Bloc nations (along with China) prove this as well. Healthcare and Social Welfare
Healthcare in pre-communist Hungary was of low quality, and the population suffered from poor health and low life-expectancy. However, after the establishment of the Hungarian People's Republic, healthcare conditions began to improve significantly. The US Federal Research Division reports:
The Encyclopedia Britannica notes:
The social welfare system was also improved significantly, providing coverage to the vast majority of working people in Hungary. The US Federal Research Division notes:
These advances are confirmed by the Encyclopedia Britannica:
However, these improvements in social welfare came with a strange downside. As people began to live longer, and access to social welfare was expanded, the system was placed under more strain. The US Federal Research Division states:
In addition, various social ills, such as alcoholism, had begun to pose a problem for public health:
To compound these issues, the Hungarian government spent a worryingly low percentage of GNP on healthcare:
Despite these problems, the socialist system in Hungary objectively provided clear benefits to the people in terms of healthcare and social welfare. There are a number of important lessons that we can learn from the Hungarian experience:
- It
is essential that the proper resources be dedicated to healthcare and social welfare. Austerity benefits nobody on these issues, because the resulting decline in quality and availability will lead to instability and unrest, not to mention a reduction in living standards. The dictatorship of the proletariat must put the needs and interests of the proletariat as a top priority; otherwise, what's the point?
- It
is also essential that a socialist government should take steps to resolve social problems such as alcoholism and drug addiction, which contributed massively to declining health throughout the Eastern Bloc in the 1970's and 1980's. The importance of these issues can be seen by contrasting the Eastern Bloc with other socialist nations, such as Cuba, which does not have such widespread substance abuse issues, and which has seen steady and stable improvements in health outcomes for decades (even during the "special period" following the fall of the USSR).
- Despite
these factors, the socialist system in Hungary did manage to vastly improve the health of the population, as well as working people's access to social welfare. These improvements should not be ignored. Educational Achievements
Pre-communist Hungary had a highly elitist educational system, largely dominated by religious institutions. The US Federal Research Division reports:
However, after the Communists came to power, the educational system was drastically reformed. The Encyclopedia Britannica notes:
The educational system was greatly expanded. The US Federal Research Division states:
These reforms succeeded in drastically expanding the educational standards throughout Hungary:
However, the system suffered from similar problems to the healthcare and social welfare systems. Specifically, it was underfunded; Hungary spent a very low percentage of GNP on education compared to other nations, which resulted in shortages:
Thus, the major lesson that we can learn from the Hungarian People's Republic in his field is that education must be properly funded, in order to ensure that all people are able to access education of sufficient quality. It is essential that sufficient supplies be made available, as well as funding to hire and train sufficient staff.
Post-Communist Nostalgia in Hungary
Despite the issues of the Hungarian People's Republic, many people in Hungary have since found themselves longing for the return of the socialist system. A poll conducted by Pew Research Center found the following:
Even reactionary news sources have been unable to ignore the favorable opinion that many Hungarians have of the old socialist system. The Daily Mail (one of the most hard-line right-wing papers in Britain) published an article by a woman from Hungary, which made some interesting statements:
The author notes that cultural life was expanded to include all Hungarians, not only the upper-classes:
She notes that advertising and consumerist culture was virtually nonexistent in Hungary:
She laments that the perspectives of ordinary working-class people from the Eastern Bloc are typically ignored by the West:
Finally, she notes that the losses of the post-communist era have vastly exceeded any potential gains:
Sources
- US Federal Research Division | Hungary: A Country Study
- Encyclopedia Britannica | Hungary
- Pew Research Center | Hungary: Better Off Under Communism?
- Daily Mail | Life in Communism Hungary