Budapest, January 11, 1990
It has been a long long time since we have spoken to each other, and I feel even more now the need to speak to you about these explosive days in Eastern Europe.
I can recall one of our earlier discussions in 1983 on the evaluation of the 1956 turmoil in Hungary. I called it counterrevolution.
My general evaluation now is that although very necessary and progressive reforms, institutions and rules of political democracy have been implemented, Eastern-Europe is still burning in a counterrevolutionary fire. We are living through how forces produced and activated largely by the insufficiencies of my "undersocialist" system are kicking aside socialism as such for a long long period of time in Eastern-Europe. Capitalism is being restored.
Some political forces, including the dominant ones of my own party, try to baptize the emerging system "democratic socialism". However, the telling facts are that political power is shifting to the hands of open anti-socialist forces, national assets are being privatized at a dramatic speed, left ideology is unsellable. Economic power is shifting into private hands. One of the most famous daily newspapers has been purchased by Maxwell. The first private university should start next September (1990). Part of the largest steel mill of the country was purchased by one of its former workers. Most of the industrial assets are bought by their current managing directors (at uncontrolled price and under uncontrolled mechanisms).
The terrible dialectic of things is that the democratization of socialism, partly initiated by the party in power, is leading to the destruction of socialism. Justifying these fundamental changes, many argue that the emerging system will be more democratic then dictatorial socialism was. And any democracy is better than dictatorial socialism -- follows the argument. Yes! Nevertheless, if it is so, we have to ask ourselves whether Lukacs was right in saying that "the worst socialism is superior to the best capitalism".
There is another big, big, issue here. Is not a democratic capitalism or an undemocratic socialism a contradiction? Can we really have a highly developed democracy if assets are privately owned? Or can assets really be publicily owned if there is not democracy? Lukacs's point is an academic issue, anyway, since the capitalism we are going to have will be very very far from the best capitalism (Swedish, Canadian), I am afraid.
And this is the point! Our capitalism will be brutal and mostly unfair. Hopefully, it will not be bloody. (Last night, as meat prices went up by 40 per cent, there was an attack against a major meat depot. The same night a man froze to death in downtown Budapest.)
However, at best, as remnants of present socialism, a more extended welfare state can be expected as compared to the non-best capitalist countries. But even this will not be easy to achieve. The terrible constraint is that an under-oriented economy (with threatening hyperinflation and massive unemployment) does not allow many welfare programs to be implemented. Even the existing ones can hardly be maintained (Pensions are already quickly devalued, state apartments rents are not longer subsidized, etc.).
Elections are coming in March (1990). The power relations are boiling and shifting day by day, therefore all predictions are risky. However, I expect the Hungarian Forum of Democrats (HFD) to win and to lead a coalition government. The HFD represents a Kohl-type Christian Democratic center, though it is a loose …