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on the "Hungarian Social Model," which appeared in the official
Party publication. Positing a peaceful "transition from monolithic
relations to pluralism," they turned to foreign models: the "strict
but effective economic policy solutions" carried out by Felipe
Gonzales and the Spanish Socialists based on the "special values
of social democracy," as well as the experiences of the
"neoconservative parties" of the West, along with the interna–
tional experiences of-South Korea, Taiwan, and Chile!
Of course, they mean to look toward the free market eco–
nomic policies and not to the authoritarian right-wing political
policies of the above regimes, which they rightly point out put a
brake on economic progress that depends on development of po–
litical democracy. Commenting privately and asking that he not
be directly quoted, one of the two leaders admitted that among
themselves, they often talk about the meaning of socialism and
fail to come up with any answers. Even calling themselves
democratic socialists, he said, is insufficient. But describing
himself as a man of the left, the HSWP leader said that under
market conditions, Hungary would have a projected 100,000 un–
employed within a short period of time. Thus he favored a
"social net" to ease the pain of those dislocated by the transition to
a market economy. In truth, he said, he and his reform
Communists were actually moderate Western European social
democrats, most impressed with the economic and political path
taken by Gonzalez in Spain. When one of our group said he
hoped their new regime would leave room for free trade unions,
he responded that of course it would, but in the short run, militant
narrow labor strikes would have to be contained lest they inter–
fere with the operation of the market.
In one context, the Hungarian Communists are operating
out of a desire to cement Western creditors' interest in
investment. Thus General Secretary Karoly Grosz, whom many
expect soon to be ousted by reformer Imre Pozsgay, wants
convertible currency and the confidence of Western banks in
Hungary's creditworthiness. Grosz recently told
The New York
Times
that his nation needs $8 billion in Western capital in the
next five years, in order to modernize its stagnant economy and
to pay off the already accumulated debt to Western investors of
$15
billion. At present, Hungary must borrow $4 billion per year
to service existing debts. And to gain this investment, they know
