Living Within the Limits

By John Kohan/Budapest

A Moscow ally remains loyal while flirting with capitalism

A Hungarian is knocked unconscious in the Stalinist era and miraculously comes to his senses in a hospital in 1984. To his amazement, he learns that physicians are no longer addressed as "comrade doctor" but as just plain "doctor." Moreover, Janos Kadar, once out of favor with the Kremlin, now leads the Hungarian Socialist Workers' Party. The man's wife appears in the company of a punk rocker in black leather; she has remarried, she says, and has opened a fashion boutique. "Where am I?" moans the Hungarian. "Can this be socialism?"

That punch line sets off a howl of laughter in the Budapest cabaret Vidam Szinpad, where audiences flock to see Go Hungarians, a comedy revue with a heavy dash of political seasoning. In the nearly three decades since Soviet tanks crushed the 1956 uprising, Hungary has learned to live and prosper just within the limits of what Moscow will tolerate. Budapest presents ample evidence of the cautious changes that have made Hungary's 11 million people the most Westernized and best fed in the Soviet bloc.

Long lines and empty shelves may be common in many other parts of Eastern Europe, but the shop windows of Budapest display everything from stylish eyeglass frames and fur coats to swimming rafts and potted cactus plants. The main market near Vaci Street is a colorful cornucopia of scarlet paprika garlands, pigs' heads on hooks, mounds of emerald melons and fish tanks teeming with carp.

Since 1968, when the Hungarians began to reorder their economy and abandon strict Soviet-style central planning, the country has pieced together a new system of economic management that mixes state ownership with individual enterprise. Hungarian agriculture, for example, has prospered by encouraging the cultivation of private plots on state-organized cooperative farms. The government is giving factory managers the power to make many of their own decisions about production quotas and reinvestment of capital and to reward efficient employees with bonuses. The latest reforms have given workers a say in choosing their bosses. Soon to come, say government economists, will be a cut in state subsidies that keep prices of some goods artificially low. "We do not deny that we are pragmatists, but our final goal of creating a socialist society remains unchanged," says Gyula Kovacs, vice president of the National Planning Office. "The ways of reaching that goal are different. We leave it to history to judge which is better."

There is some anxiety that the economic changes will result in higher prices and open the way for such capitalist troubles as bankruptcy and unemployment. In any case, the success of Hungary's flirtation with capitalist economics will ultimately depend on Moscow: every dip in the East-West temperature hits Hungary like a cold spell. Budapest downplayed East German Leader Erich Honecker's decision not to visit West Germany; instead it emphasizes the possible improvements in superpower relations that might result from the Washington meeting between President Reagan and Soviet Foreign Minister Andrei Gromyko.

The Hungarians remain loyal members of the Warsaw Pact, and observed Moscow's boycott of the Los Angeles Olympics. But officials in Budapest stress the need for "the small and medium-size" countries to keep the dialogue with the West going. "The deterioration of the international situation does not necessarily have to lead to the disruption of relations between countries of different social systems," says Foreign Ministry Secretary of State Janos Nagy. "The bulk of East-West relations is still there and works."

As a landlocked country with few natural resources, Hungary must earn roughly 50% of its gross national product from trade, about equally divided between the Soviet bloc and the rest of the world. Despite disapproval from Moscow, Hungary continues to trade heavily with the West, which means that it is constantly in need of hard currency to pay for imports and to service its $8 billion foreign debt. For this reason, Hungarian trade officials are particularly anxious to have the U.S. extend most-favored-nation status beyond the one-year periods granted successively since 1978. Says Tibor Antalpeter, the director-general of the Foreign Trade Ministry in charge of commercial relations with the West: "We have to run the 100-yd. dash over hurdles while others race on a flat track."

Hungary has been adventurous in economic reform but cautious about political change. There has been talk is of giving more power to what is now largely a rubber-stamp parliament. Under new election laws, more than one candidate must compete for most of the parliamentary seats in elections scheduled for 1985, although, of course, all candidates will be approved by the Communist party. With little recent experience of political debate to draw upon, Hungarians are scratching their heads about the form such campaigns will take. There is also much speculation about who will take over from Kadar, 72, who has been in power for 28 years and has yet to name a successor.

Whether or not Hungary's Communist allies feel threatened by the changes sin Budapest is another imponderable. Hungarians often quote the late Leonid Brezhnev's words of praise for their agricultural experiments. No matter who is in power in the Kremlin, certain verities and limits are not likely to change. Two performers at Vidam Szinpad sing a ditty on the subject. "We are all sailing in the same boat," the lyrics go. "If you want to jump overboard, go ahead/ Splash in the water if you like/ But then get back in and help us row." The duo then launches into a chorus of the Russian folk tune, The Volga Boat Song.

--By John Kohan/Budapest