PRAGUE and Budapest are neighbors, a short plane or train ride apart - and yet the two cities seem in different worlds. Budapest is painted in big, broad strokes of blazing blue. New private restaurants and shops open almost daily on either side of the sparkling Danube. New independent associations form constantly. Street demonstrations are common. As in Poland, where Solidarity is forming a government, Hungarian Communist Party leaders are setting up a ``multiparty'' state.
Prague is colored in dry gray, stuck back in the 1960s. There are almost no private eating establishments. Night life is nonexistent outside of state-run theater and opera. Independent activities are denounced as ``antisocialist'' and banned, their leaders imprisoned. Just Monday, on the 21st anniversary of the Soviet invasion, riot police broke up a peaceful demonstration on Wenceslas Square, arresting 370 people.
The Soviet empire is breaking apart. Instead of looking like a uniform band of satellites, the Communist regimes from the Baltic in the north to the Black Sea in the south are becoming more and more different - from each other and from the Soviet Union.
As Moscow's influence wanes in region, unresolved ethnic quarrels, religious rivalries, and social tensions are spiraling out of control. Hungary and Romania are back fighting over Transylvania and its large ethnic Hungarian minority. Bulgaria persecutes its Turkish minority. Meanwhile, East Germans are furious with the Hungarian decision to tear down the barbed wire on their border with Austria, letting hundreds flee to the West.
In World War II's wake, Soviet leader Joseph Stalin envisioned a monolithic communist bloc controlled by Moscow. Only occasional deviations from rigid Soviet patterns were permitted. Budapest flirted with the market while Moscow upheld centralized planning. Warsaw courted the Roman Catholic Church while Moscow remained intolerant toward religion.
But the scope for real autonomy was limited. When Czechoslovakia's Dubcek abolished censorship and began questioning one-party rule in 1968, Soviet tanks invaded.
Today, with Mikhail Gorbachev as Soviet leader, deviations from rigid Soviet patterns have swelled into open disagreements, either a willingness as in Hungary to move far ahead of the Soviet example, or a refusal, as in Czechoslovakia, to contemplate the consequences of change.
A majority of East-bloc regimes are resisting perestroika (restructuring) and glasnost (openness). Poland is Hungary's only fellow reformer. The Czechoslovaks have united against reform with East Germans, Romanians, and Bulgarians.
When Solidarity first asked to form a government, Polish President Wojciech Jaruzelski refused, citing the worries of his Czechoslovak and East German neighbors. A Solidarity government nonetheless is being installed in Warsaw. One of its preoccupations will be its neighbors' reactions.
Czechoslovak officials are waiting for Mr. Gorbachev either to fall from power or abandon his reformist ambitions. Their argument is that rapid reform leads to disaster, a point which they back up by comparing their relatively stable financial situation with the high inflation and foreign debt in Hungary and Poland.
Despite Budapest's bustling energy, the average Czech in Prague enjoys a higher standard of living than the average Hungarian. He is more likely to have his own modest apartment, own a Skoda automobile, and eat meat with his dinner. All this, while working fewer hours than in Hungary and enjoying fixed prices.
Where the risk of economic collapse and social explosion are lower, so is the willingness to take chances. Along with Czechoslovakia, East Germany offers its citizens the highest living standards in the Soviet bloc. Romania and Bulgaria both are Balkan countries with little tradition of popular resistance to despotic rulers and which long have suffered from backward economies. All four communist regimes can count on fearsome secret police forces to keep their citizens in line.
``Why doesn't the average Czech like what's going on in Hungary and Poland?'' asks Frantisek Jelenik, foreign editor for the Communist Party daily Rude Pravo. ``Because we don't like empty stomachs. We know what it's like in Poland, there's nothing in the stores. We go to Hungary, and say, `Oh, it looks nice.' Then we look at the prices, and say, `Maybe it isn't as nice as we thought.'''
How long can the hard-liners resist? Czechoslovakia is living off its rich bourgeois past. Before World War II, it was one of the world's industrial powerhouses. Today, its industrial base is aging, its exports to the West are falling. New signs should be put up at the borders, Czechs like to quip. They would read, ``Welcome to the museum of the Industrial Revolution.''
Official communist economists have drafted a blueprint for improvement. It calls for closing inefficient factories and ending high subsidies on basic consumer goods. These measures translate into unemployment and inflation.
``I'm afraid we can happily stagnate for a while longer,'' says Karel Dyba, an official at the Institute of World Economy. ``It would be far less painful to reform now, when the economy hasn't collapsed, than to wait when we have even less room for maneuver.''
Pressure from abroad could begin to break this strong inertia. Gorbachev has unsettled all of the hard-liners. East German youth have massed along the Berlin Wall shouting, ``We Want Gorbachev.''
When French President Fran,cois Mitterrand earlier this year visited Bulgaria, the most docile Soviet satellite, a group of independent-minded youngsters managed to evade strict police controls and attend a meeting at the University of Plovdiv. They asked Mr. Mitterrand why he had bothered to give the Legion of Honor to their aging leader, Todor Zhivkov, party leader since 1956.
Czechoslovakia is much more politically sophisticated than backward Bulgaria. Alone among Soviet satellites, it enjoys a deep democratic tradition. Soviet Army tanks crushed the Prague Spring movement in 1968 and put in power present-day leaders Gustav Husak and Milos Jakes. These weary, wooden Brezhnevite leaders see a danger in the new Moscow Spring: How can they endorse the very policies they were installed to suppress?
``For years, our leaders said, `We must follow the Big Brother Soviet Union,''' says Jaroslaw Jiru, an editor of the underground Lidove Noviny newspaper. ``Now they say, `We know best for ourselves.' The contradiction is blatant.''
Dissent no longer is confined to a small group of Prague intellectuals in the human rights organization Charter 77. On the 20th anniversary of the 1968 Soviet invasion last year, angry youngsters stood up in Wenceslas Square and began shouting, ``We want freedom.'' Passers-by joined in. Soon up to 10,000 people were marching through the center of Prague.
The protests swelled in the following months. For six straight days this January, mass demonstrations rocked the center of Prague. Police used heavy force to disperse the rallies, and arrested hundreds of protesters, including the playwright and Charter 77 activist Vaclav Havel.
When Mr. Havel was jailed back in 1979, few fellow artists defended him. This time, almost 700 people in theater and television signed a petition in his support. Czechoslovakia's problems, the petition read, ``cannot be resolved through denials, imprisonments, or violence.''
Eager to appease this mounting domestic opposition and to improve its international image before a human rights conference in Paris, the Prague authorities paroled Havel in mid-May.
``The demonstrations will just keep on growing,'' a somber Czech official predicts in private. ``We just don't know how to deal with them. If we give a little, there are demands for more. And if we don't give in, there still are demands for more.''
So sooner or later, convulsive change will come to Eastern Europe. The question is how to manage it, to make sure it does not spiral out of control. After his release from prison, Vaclav Havel outlined a stark choice: dialogue or violence, evolution or revolution.
Havel hopes to avoid violence, both for practical and moral reasons. Reviewing the armed suppression in 1956 in Hungary, in 1968 in Czechoslovakia and in 1981 in Poland, he realizes that the state has the weapons and the will to use them. He also knows that violence corrupts, that violence and hatred, and above all, lies, are the methods of their oppressors. To adopt them would mean to lose their battle.
For these reasons, he wants to talk with Czechoslovakia's Communist Party. His model is Poland's recent Round-table Agreement between Solidarity and the communist regime, setting up a step-by-step path toward parliamentary democracy. In Czechoslovakia, however, he fears that such a breakthrough is still a long way off.
``I told my interrogators in prison that in five years there will be a Round-table in Czechoslovakia like in Poland,'' he explained. ``They told me they would send this suggestion to our high authorities. The next day they came back and told me it is a joke. I am ready to talk with everybody, immediately. They still are not prepared to speak to me.''