Janos Kadar and Hungary after 1956.

1. Janos Kadar and Hungary after 1956. Meeting 8.

2. http://www.fototapeta.art.pl/2010/i/cnd/Janos-Kadar-Chris-Niedenthal-1986.jpghttp://www.fototapeta.art.pl/2010/i/cnd/Janos-Kadar-Chris-Niedenthal-1986.jpg

3. 1956 20 October– first demonstrations in Hungary 23 October– revolution breaks out in Hungary – clash with AVH; Soviet tanks are defeated; Imre Nagy, who broke with Matyas Rakosi in early 1950s is brought to power 30 October– Soviet government declares willingness to review its relations with socialist states 1 November – Hungary declares neutrality and withdrawal from Warsaw Pact; Janos Kadar appears in Szolnok and forms a government under Soviet tanks 4 November– Soviet military intervention of 2000 tanks and 60,000 soldiers; the revolution is crushed; about 200,000 emigrate through Austria; Janos Kadar becomes new p.m.; Imre Nagy with accomplices flee to Yugoslav embassy, which they leave later to be arrested; they are held prisoner till 1958, when they are executed by Janos Kadar. After 4 November – numerous workers’ councils are organized to protest against Soviet intervention in Hungary 14 November – KMT – Central Workers’ Council formed in Budapest / strikes and street fighting 3 December – Kadar confirms the dissolving of AVH in Hungary 9 December – KMT dissolved (its members were arrested) 11 December – Martial Law introduced in Hungary

4. 1957 January – a one-party system re-introduced in Hungary; all social and political organizations dissolved and whole social life put under strict control in Hungary; finalization of forming of state agricultural farms – end of private farming 1-4 January – meeting in Budapest of representatives from USSR, Hungary, Romania, Czechoslovakia and Bulgaria to discuss faster solutions in Hungary 13 January – a decree passed in Hungary introducing death penalty for actions directed against the state 20-28 March – Kadar visits Moscow – decision is taken to allow him to continue as the 1st secretary; Soviet-Hungarian treaty signed 27 May – agreement about Soviet troops in Hungary (80 thousand) January-December – the regime introduced a reign of terror. The consolidation of the regime lasted till 1963 with Janos Kadar looking to prove his loyalty and usefulness for Moscow.

5. 1958 1 January – beginning of a three-year economic program in Hungary 16 June – Imre Nagy and his collaborators executed 7 December – collectivisation of agriculture in Hungary terminated 1961 1 January – beginning of a five-year program in Hungary 13 August– East German workers build the Berlin wall 26 August – last executions of 1956 revolutionaries in Hungary Beginning of changes in Czechoslovakia. 1962 January – Kadar’s declaration – “who is not against us, is with us”

6. 1963 21 March – amnesty for most people sentenced after 1956 in Hungary, except those charged with murder July – Who is not against us is with us. 1964 March – work begins on a plan to improve economic performance through reform. Many elements are based on program initiated by Nagy, what remains a secret. 1966 28 November – 3 December – 9th congress of the Hungarian Workers Party (Hungarian Socialist Workers’ party)– decision about the New Economic Mechanism taken, even though enemies of the reform prevail. 1968 1 January– Hungary introduces a set of economic reforms called New Economic Mechanism (NEM) August – Hungarian troops take part in the invasion of Czechoslovakia

7. 1963 (July) • Who is not with us is against us. • Who is not against us is with us. (J.Kadar)

8. NEM (after Wikipedia) On May 7, 1966, the Central Committee of the HSWP announced Kádár’s plans for the reform of the economy, known as the New Economic Mechanism (NEM). The reform is considered as "the most radical postwar change" of any Comecon country. The plan, which became official January 1, 1968, was a major shift to decentralization in an attempt to overcome the inefficiencies of central planning. The NEM represented a move away from the Stalin economic system of compulsory plan indicators in favor of a policy that states profits as the enterprises main goal. The new economic policy was a "comprehensive reform of the economic system", creating market relationships among firms, using prices as allocative functions and firms responding to prices to maximize profits, and using profits to budget new investments.

9. The Central Committee’s document on May 7 details changes in the firm’s role under the new economic policy. The reform gave producers the freedom to decide what and how much they produce and offer for sale and to establish commercial or co-operative relationships. Buyers were also given the freedom to choose between domestic goods and imports. Additionally, firms were given greater autonomy in carrying out investments and hiring labor. As dictated by the Central Committee, success is to be measured by a firm’s profitability. The decentralized structure of the New Economic Mechanism marked an improvement in the decision making process, allowing for basic decisions to be made at the local level without information having to be transmitted upward for a more centralized decision. The Hungarian government made 50.5% (enterprises 49.5%) of the investment decisions for the 68 billion Forint invested in 1968, while in 1974 enterprises accounted for 53.1% of the decisions for the 128 billion Forint invested.

10. The New Economic Mechanism also aimed to create a more active role for prices. A system of free prices reflecting market conditions was implemented. The government wanted flexibility, but also to combat inflation. To do so, they introduced a new practice of price controls declaring an item’s price as fixed, limited or free. Fixed prices were classified as material and basic intermediate goods. The price was fixed because of the good’s impact on the economy and the overall need to ensure stability. The price was determined by ministries. Limited prices referred to particular products or products in some product group for which there were no substitutes, such as bread. It was applied on the average price over a period or a window within which prices are free to fluctuate. Free prices were assigned to goods that have small parts of individual expenditures or were regarded as luxuries. The price reform allowed for prices to better reflect the cost of production, valuation by the market and to correspond more closely to "some measure of socially necessary inputs", helping reach market equilibrium.

11. 1969 June – At a meeting in Moscow Hungarian back Soviet bid to condemn China; the idea fails 1970 November – Congress of HSWP declares full agreement with Soviet party and continuation of economic reform 1972 Kadar visits Romania signing bilateral agreement 1975 July-August – Hungary signs the Helsinki Accords