Truth in the free market Hungarians have been fed lies consistently since 1989 - it is post-communism's dirty secret
Mark Almond Wednesday September 20, 2006 The Guardian History loves the irony of an anniversary. In 1989, commemorations of 1789 were overshadowed by upheavals. Now, 50 years after the Hungarian uprising sent shockwaves through the communist world, what Hungary's prime minister called the country's worst violence in those five decades has shattered the complacency about post-communism's stability and success. Remember the rhetoric of anti-communism in 1989. "No more lies." Well, today it is back with a vengeance. In 1956, when Khrushchev's "secret speech" revealing the truth about Stalin's rule was leaked, it set off a crisis across the communist bloc, peaking in the Hungarian revolt. This Sunday, the fuse was lit by the leak of the Hungarian prime minister's crude admission to a secret Socialist party meeting in May: "We lied throughout the past one and a half or two years. We lied in the morning, we lied in the evening and also at night." The scenes outside Budapest radio 50 years ago and outside state television now could be confused. Then, students and nationalists ripped up the communist flag. Now they tear down the EU flag. Each time the regime's defenders denounced hoodlums and fascists, but each time it was the revelation of government deceit which set off the explosion. In April, Ferenc Gyurcsany's "post-communist" socialists had apparently defied voters' cynicism to win re-election. He promised that he could square the circle of prosperity for his voters and meet EU and IMF demands for fiscal probity. Behind closed doors Gyurcsany admitted that planning for the U-turn went on well before: "We did whatever was possible to do in secret ... making sure that ... what we were preparing for would not surface in the last weeks of the election campaign." When the goulash hit the fan, Gyurcsany's spin doctors tried some quick footwork. They claimed that admitting lying to the electorate is truth-telling: "Trust me. I'm a liar." The opposition is also discredited. Demonstrators jeered opposition deputies when they arrived at Budapest's parliament. Gyurcsany's own words are true in this regard: "Lying is a crime of the entire Hungarian political elite." To be fair, it is true of the whole post-communist elite from Bulgaria to Estonia. In reality, electorates have been consistently lied to since 1989: that is post-communism's dirty secret. Promised west European levels of prosperity and welfare if only they support reformers, time and again ordinary people east of the old iron curtain have been told the day after the polls that austerity measures are now essential. Locked into a macro-economic framework dictated by Washington and Brussels - meeting IMF requirements and convergence criteria for the euro - New European politicians offer their electorates no real choices. The transition from communism to capitalism has not altered the political rhetoric that much, least of all in Hungary. As Gyurcsany was coming into the world 45 years ago, communist leader Janos Kadar was about to launch the first cycle of reforms to accelerate Hungary's development. They have gone on ever since. The Polish dissident, Adam Michnik used to joke that "all communists are reformers" - but so are all post-communists. It is just that the bright dawn of prosperity for all always shimmers just over the horizon. Gyurcsany is the classic post-communist success story. As a model young post-communist he knew that government contacts are vital to business success in the "free market". When a state socialist economy is privatised it is essential to have inside knowledge about what is worth buying at the fire-sale of communist assets. Nothing illegal in that. There were no rules. Just as before 1989 there was "only one path to communism" now - despite rhetoric about "hard choices" - no alternative is permitted. Neither the Washington consensus nor the EU allows deviation from the party line. Hungary's budget deficit of 10% of GDP is the result of depressive macro-economic policies, which have increased the country's huge foreign debt and trade deficit by pursuing a strong currency to meet euro entry requirements, squeezing Hungary's few export industries in the process. Gyurcsany's proposed welfare cuts will eat into Hungary's £400 average monthly pay. After 1989, top dissidents and the communists who jumped ship to join them did well out of adopting "the market economy" and occupying its commanding heights. But mass unemployment and cuts in health and social services have plunged people into poverty. Real wages have fallen and birth rates have collapsed across eastern Europe. The children of the 1980s - the last generation born under communism - are voting with their feet as they flee west, just as their parents dreamed of doing. The Hungarian uprising in 1956 was symptomatic of the general malaise stretching across the "socialist sixth of the world". Events in Budapest today ought to mark the crisis of the dogmatic "free market model". For all of the rhetoric about democracy and free enterprise going hand in hand, in reality voters find all options foreclosed. The tragedy is that democracy is being discredited by the economic misery inflicted in the name of the dogmatic market model. Will even capitalism remain stable if the punters start revolting?
