chapter  11
Yugoslavia, Hungary and the vicissitudes of market socialism
Pages 18

In principle, collective ownership and control of the means of production ought to go hand in hand with some form of 'producers' democracy' and a market economy in which prices are allowed to broadly reflect relative costs and scarcities and so enable spontaneous market forces to promote an increasingly efficient use of resources to produce goods and services which consumers really want. However, until Yugoslavia and Hungary actually took major steps towards market socialism in the 1960s, the intellectually distinguished exponents of various forms of market socialism seemed to be championing a politically hopeless cause. Bazarov, Kondratiev, Trotsky and their closest associates were prematurely dispatched to the socialist Valhalla, signalling that Stalin's regime would have no truck with market socialism, and in the West Oskar Lange and Frederick Taylor epitomized the way in which 'mainstream economists escape reality by retreating into mathematical abstractions and an artificial world of formulae' (Nove, 1983, 60, 119-20). In Poland, in 1956-8, the same Professor Lange and his distinguished Polish disciples tried to steer their country towards market socialism and decentralized workers' control of the means of production, but their reforms were easily emasculated by Poland's neo-Stalinists, who naturally refused to relinquish their bureaucratic prerogatives (see Brzezinski, 1967, ch. 14; Pelczynski, in Leslie, 1980, chs 13-14). When Hungarian Premier Imre Nagy attempted to liberalize his country's economic and political system in 1956, with broad peasant and proletarian support, he merely precipitated a 'fraternal' military occupation of Hungary by Soviet troops, who crushed Hungary's incipient socialist revolution as brutally as Russian troops had previously crushed the Hungarian nationalist revolution of 1848-9 (see Lomax, 1976, on the socialist nature of the popular unrest in 1956). During the Soviet occupation over 15,000 Hungarians were wounded (2000 fatally), over 2000 Hungarian revolutionaries were executed and over 15,000 were imprisoned

(Molnar, 1971T, 240, 249). Determined to avoid Nagy's 'mistakes', the Czechoslovak Communist Party attempted a much more cautious and controlled liberalization of the Czechoslovak economy and cultural life during 1963-8; indeed, it went to extraordinary lengths to reassure its nervous 'allies' that liberalization would not be allowed to jeopardize either the Party's so-called 'leading role' in every domain or Czechoslovakia's adherence to the Warsaw Pact (see Golan, 1971, 1973; Skilling, 1976; Kyn, 1975; Sik, 1967T, 1971T, 1972T). But the Soviet Politburo perceived that any genuine liberalization of Czechoslovakia's economic and cultural life would ultimately become incompatible with the Party's monopoly of power and decision-making; that the party was in fact unleashing forces which it couldn't hope to control for long; and that, in these circumstances, Czechoslovakia's continued allegiance to the Warsaw Pact could not be assured, despite the undoubted popularity of the Party's new leaders and the strength of pro-Russian sentiments in the past (not least because the West had betrayed Czechoslovakia in 1938). So the Soviet Politburo again demonstrated its understanding of 'proletarian internationalism', by sending 1 million troops into Czechoslovakia to emasculate the communist-led reform movement of 1963-8.