Price rises that panic the Poles don't faze the Hungarians
Vienna — As price increases set off a political storm in Poland, similar ones were greeted with relative calm in Hungary. The difference in public reaction shows how far apart the two communist countries are in their ability to bring about economic reform. That discrepancy reflects the relative stability in Hungarian politics and lingering crisis in Poland.
This week Hungary introduced price rises averaging 20 percent. From the start of its reform efforts years ago, Hungary has given top priority to progressive elimination of subsidies. The latest increases continue that process.
This week's price increases are the biggest in recent years. The 21 percent increase in meat prices and 20 percent rise in home heating oil, for example, will certainly pinch the lower-paid workers.
Despite the effects of world recession and Hungary's own local difficulties like last year's disappointing harvest, the Budapest leaders are holding to their reform objectives. They say it is ultimately in the consumers' interest to accept the higher prices, which will give producers incentive to produce more goods. They also point up the link between harder work and higher living standards.
The linchpin of Hungarian success has been agriculture and - despite the bad 1983 harvest - that success is still visible in shops and markets filled with food and consumer durables of all kinds. The higher prices will mean, as before, that most people probably will have to eat somewhat less but will still eat quite well.
The Polish government has no such room to maneuver. Neither the economic nor the political conditions that allow Hungarian leaders to implement reforms exist in Poland.
There a drastic restructuring of economic (i.e., pricing) methods is much more pressing than in Hungary. But economic common sense still runs second to sensitive social-political pressures. These pressures - especially from the new government-approved labor unions - have just compelled the Warsaw government to take the teeth out of a plan to raise prices.
The average price increase to take effect Feb. 1 was reduced from 15 percent to 10 percent. The party newspaper Trybuna Ludu reported at length on the way the new unions had forced the government to remove some increases, reduce others , and raise bonus payments for low-income earners.
But on Monday the paper's economics editor weighed in to criticize both the unions and the government for the reversal. The increases, he brusquely wrote, should have been twice what they are now. Moreover, they should have been instituted eight months ago, when farmers were awarded a 20 percent increase in the prices of meat and dairy products supplied to state markets.
He admitted that the original plan for greater increases in food prices - of 30 to 40 percent - would have made the decline in real income too steep. But, he wrote, the government will have to make significant cuts in food subsidies sometime if prices are ever to be adjusted to market conditions.
But food prices are not the only contrast between the two countries.
Hungary's own political trauma in 1956 is almost a matter of history - which is clearly not the case in Poland. There has developed in Hungary a fairly comfortable life style and a degree of political tolerance that no other East-bloc people enjoy.
All this obviously helps the Hungarian government reach public opinion in its handling of economic problems.
A striking example of Hungary's economic ''liberalism'' is the growing number of stores selling Western luxury goods for Hungarian currency. Prices are high, but the amount of business done shows there are many people with enough money to buy.
Similar shops in the other East European countries sell these goods only for Western hard currencies.
Furthermore, this year Hungary relaxed restrictions on foreign travel - to the West as well as East. Last year, nearly half a million Hungarians visited Western countries. Now, with greatly simplified procedures, it looks like that figure will increase significantly.
New passports have just been introduced: no more red ones for travel to communist countries and blue ones for the West. All will now be blue. Moreover, they are to be valid for five years and renewable for five more before a new one is needed.
Hungarian dissidents, especially those linked with a highly active samizdat press, are subject to periodic harassment but are still handled mildly. One, a sociologist, was tried last month for an assault on the police in which he himself was beaten up. But the court imposed only a suspended six-month sentence , with a probationary period of three years.
One of the best-known clandestine publishing activists, Laszlo Rajk, recently gave an interview to a Madrid newspaper. In it, he asserted that harassment was increasing, but he admitted that in Hungary ''we do have more freedom'' than exists elsewhere in the East bloc.