WAY BEYOND THE TAXI BLOCKADE

NSZ: Contemporaneous debates in Parliament and various memoirs make it clear that the gas price hike which triggered the taxi blockade in October 1990 was a contested issue within the government itself. What do you recall about the controversy as Minister of Industry and Trade back then?

PÁB: To understand the events you need to know about that Cabinet Session on Sunday where, after protracted debate, we reached a decision on regulated energy prices, among many other difficult issues. This was one of the few cases when two versions were submitted to the Cabinet to choose from. The Minister of Finance proposed a steep price increase, and I proposed a less drastic version. After a heated debate, I was overpowered in the vote. And I can tell you why. Cabinet members felt under stress because the budget had been stretched to the limit. We as incoming cabinet had honoured the IMF loan agreement signed and handed down to us by the outgoing Socialist government of Miklós Németh because we had no choice. If the new government had reneged and set about working on a new loan agreement, we would have forfeited access to the emergency loan. In March 1990, just days before the first free election, the Board of the Monetary Fund decided to release the stand-by loan conditional on a nearly balanced budget for that year, the loan agreement stipulating ten billion forints as the ceiling of the 1990 annual deficit. By October, however, it had become clear to the Antall Cabinet that some additional government spending items would be inevitable. This meant a need to raise additional revenues to cover these expenditures if we wanted to keep deficit target under control. However, the Ministry of Finance could not tell precisely in September how much extra revenue was needed by year-end. You would need a sophisticated IT system for such a forecast which we did not have at the time. In fact, we were groping in the dark. In any case, ministers at that particular cabinet meeting all agreed that raising the energy prices was unavoidable. The debate was about the rate, and whether to implement the hike in two phases or in one fell swoop.

Back then, government regulated prices were still prevalent as part of the baggage inherited from the previous regime. Prices were not set by market agents in accordance with supply and demand conditions. After the democratic turn, centrally fixed prices were phased out one by one as a result of decisions, negotiations and compromises made on a case-by-case basis.

Now, in this particular case, I as the competent Minister was of the opinion – and I was confirmed in this view by my own staff of experts – that a single massive price hike would be too much of a shock, and not just for the consumer. The particular price package of October 1990 also involved wholesale prices. This aspect was not much talked about during the Cabinet meeting, but for me as the Minister for Industry it mattered more in terms of substance. The retail consumer, you see, is but one segment of the economy, while a significant rise of producers’ prices in the energy sector affects everyone, directly or indirectly, and has an impact on the future of entire industries. Refraining from raising the artificially low wholesale prices would have been tantamount to implicitly subsidising energy- intensive, environmentally unfriendly sectors. The rational argument proposed by Minister of Finance Ferenc Rabár favouring a single massive raise of wholesale and residential prices was that a sharp increase would not be followed by another official price rise in January. What he did not say but obviously had in mind was that the autumn hike, while imposing a burden on the population, would provide the state with extra revenue, possibly even a little buffer in the budget. In the end, Rabár’s proposal prevailed and was adopted by the cabinet. We decided to go ahead with announcing the price hike, effective as of midnight on Thursday, 25 October.

NSZ: It follows that József Antall went into surgery in the knowledge of the decision having been made. Is that correct?

PÁB: That is correct. But let me add that decisions in public administration concerning changes of regulated prices are subject to a press embargo. This is crucial for forming a correct view of the events, particularly as the government was often accused of lying to the people – the pet trump card of our detractors. The sheer fact is that no civil servant was supposed to air the price change until the decision entered into force. The institution of news embargo is common in both business and the public sector. Yet here was a case known to hundreds of people. I informed my staff as soon as the decision had been made in favour of plan A over the plan B proposed by us. They called OKGT, the National Oil and Gas Trust, so they could gear up for the required measures to adjust producers’ prices as well as internal gas rates applicable to Áfor, the Trust’s own retail branch. On a tangent, let me mention another factor. The reigning CEO of OKGT at the time had been a member of the Central Committee of the Communist Party (that is the Hungarian Socialist Workers’ Party or MSZMP) who, along with many other senior officials, had personal ties to the previous regime. I presume they did not cotton to the new democratic forces and I had reason to question their loyalty to the democratically elected bodies. By then, we had begun reforming the senior management of large state-owned corporations, but do not forget that the case we are talking about was still just a few months after the Cabinet had taken the oath. Evidently, much of the press was aware of what was going on concerning the energy price package, and I would not rule out the possibility that the OKGT’s CEO, along with other officials of the company, had a hand in this. It is conceivable that they leaked the news to their former comrades, some of whom were active in the successor party, who in turn probably relayed the information to the media outlets close to them. Now, since the vast majority of the media at the time was left-leaning, specifically to the Hungarian Socialist Party (MSZP) or the Alliance of Free Democrats (SZDSZ), it came as no surprise that the insider journalists had learnt about the details of the cabinet decision within minutes.

NSZ: When approving the drastic price hike, did the government expect the decision to trigger as violent a reaction as it did?

PÁB: No, it did not, as the unfolding events clearly showed. But it is important to remember that the Cabinet Session was not held mid-week as usual but on a Sunday, because the Prime Minister had to undergo surgery. Now, at this particular session the gas price hike was just one of the 14 or 15 issues on the agenda. In fact, as for the price issue, the Cabinet members wanted to get it over with as soon as possible. Not that any of us was oblivious, but the general mood was such that most Ministers saw the proposal as concerning an essentially technical and financial issue. Perhaps the Prime Minister himself was a bit distracted. In any event, those “political alarms” never went off.

NSZ: Word got around that Hungary was running low on fuel reserves. Had this been the case at the time the new government assumed power, or did the reserves begin to dwindle after the handover? Did the depletion of reserves have anything to do with the timing of oil deliveries from the Soviet Union?

PÁB: That is a valid question. That the People’s Republic of Hungary had not possessed considerable fuel reserves and physical capacities to fall back on was something we, in opposition, all guessed, but I had never known it for a fact until I became Minister. Then the already tight situation deteriorated further with the global oil shortage caused by the Gulf War of 1990. In our special niche in Hungary we would historically buy very little from the free market, relying on Soviet imports instead. The Soviet Union was falling apart, but it still existed at the time, although plunged in financial crisis and poised on the brink of insolvency. As a result, it tried to raise oil prices, contravening former contracts every way it could. There were interruptions in transports. The Soviets were invariably offering various explanations, citing pipeline failure or else, but I was unable to ascertain the truth of these excuses. All I knew was that the oil supply was intermittent. Every time I went into my office in the ministry, I would start by looking at the daily report on my desk about the current availability of electricity, gas and oil. On some days, we would have all three; on other days, we could not be sure.

NSZ: Are you suggesting that this was a problem from the get-go?

PÁB: Yes. This was one reason why it was unfeasible to announce a harsh price hike ahead of time, say a week before the effective date, simply because we did not have sufficient reserves at our disposal to face the immediate consequences of such a premature announcement. Even so, in the early phase of the evolving crisis, we had paramedic vans and police vehicles knock on the door of military bases to get some gas, because the gas stations were all blocked by long queues of motorists waiting to fill up at the old price in the last minute once they heard of the price jump. Under the circumstances, allowing people to stockpile fuel would have triggered utter chaos. So the national supply system was unstable, to say the least. Moreover, what Hungary traditionally imported was not gasoline but crude oil, which requires refineries to be converted into vehicle fuel. In 1990, we had but very modest capacity to store crude, far outstripped by fuel storage capacities, which is an anomaly. Its explanation went back to military considerations in the old system: should the People’s Republic of Hungary, as part of the Warsaw Pact, launch an attack against NATO, it had to have enough fuel to wage a tank war. This is now past history but this meant for the incoming government that we did not have oil reserves for 200 days as any decent country would. We had much, much less than that. Professionally, it made perfect sense to raise gas prices, as the most self-evident means of curbing consumption. And the decision had to be made fast.

NSZ: The replacement of several industrial executives in the wake of the democratic turn left them and their circles disgruntled with, possibly hostile to, the government. Did this contribute to the onslaught and unfolding of the taxi blockade?

PÁB: It was not the senior executives relieved by the Antall government who took to the streets. Or if some of them did, they surely cannot have amounted to a crowd among the cabbies or the demonstrators who supported them in the streets. Society was deeply divided over the taxi blockade. At first all we saw on TV was the crowds demonstrating in support of the truck-drivers. Later on, tens of thousands of counter-demonstrators turned up. As far as the taxi drivers themselves, I think the wind blew from a different corner. It was a strange period, rife with tension. There was the question of the workers’ militia, for example, the paramilitary arm of the Communist Party (MSZMP). In 1989, in anticipation of the regime change, Prime Minister Miklós Németh had disarmed them quite courageously. Still, when I took office, we still found Kalashnikovs and other weapons in the premises of the ministry. Those must have belonged to the militia. Then there were those hundreds laid off from the secret police. If you are a higher rank police officer finding yourself on the street at the age of, say, 37, what do you do if you don’t feel like rounding up vandals in the housing estates as the local sergeant-in-charge? You can reinvent yourself as a truck driver, or a cabbie. You have a professional driver’s license and you know your way around the city. I think it is not unreasonable to assume that the cabbies and even the management of the taxi companies included a high number of employees who had been dropped from secret police and semi-military organisations as part of the democratic transition.

NSZ: Let us get to what really happened. As soon as the price hike was announced on Thursday afternoon, the taxi drivers began to stir. Was the government still taken unaware by the violent reaction at this point?

PÁB: I happened to be out of the country, talking to an audience at the annual event of business chambers in Germany, in lieu of Prime Minister Antall. It was while being driven back to Hungary that I was informed about the events via the field telephone in the car – there were no cell phones back then. When I got home in the evening, my wife greeted me with the news that the caretaker Prime Minister Balázs Horváth wanted to talk to me, asking me to show up at 8 Friday morning in the Ministry of the Interior as part of a delegation assigned to negotiate.

NSZ: What did the government have in mind? How far were you willing to go? Were there alternative offers being considered?

PÁB: Rescinding the price hike was out of the question, not because of considerations of ethics or authority, but because of the prevailing situation. It was also pointless to expect a massive and lasting downturn in global oil prices. Then again, it was inconceivable to restart the tug of war about regulated prices every time the global price edged up. I considered that meeting on Friday pointless – there was really nothing to bargain about. The taxi drivers insisted that this drastic price hike would destroy their business and livelihood. When you think about it, this was a plain lie, because it’s ultimately never the cabbie but the client who pays for the gas. True, if the driver charges 15 instead of 10 forints per kilometre due to increased cost, then many people on a budget will not take a cab, so the demand for the service will obviously drop to some extent. At the time, some forty thousand cabs roamed the streets of the city. It had become an inflated trade. If all the cabbies were concerned about a fuel price tailored to track global prices, finding it prohibitively high for their trade, then the point of any negotiations would be to find a provisional solution for that. If high gas price was a problem essentially affecting a single industry, one could tell them to go home in the reassurance that the government would develop a scheme of reduced fuel price for the taxi industry in three days, along the lines of discounted diesel for farmers to fuel up their tractors in many countries. But they would not hear of it. Indeed, it became increasingly clear that they did not really seek a compromise. Instead of trying to solve the problem, they wanted to aggravate it. They said they were acting on behalf of the society and would never settle for mere charity. So what next? Obviously it was not the taxi lobby but society itself to consult with… Then someone somewhere came up with the idea of involving the National Negotiation Council (OÉT), an institution which had already been up and running, to provide the framework for further talks. This reshuffle was all the more necessary because by Friday noon the issue had clearly outgrown mere disagreement over retail prices or the interests of the taxi lobby. It had become a national affair, with others claiming a place at the table, including the trade unions. The MSZOSZ, the socialist-leaning union, and the non-socialist unions all jumped on the wagon clamouring for position. In fact, the unions and the employers, the members of the OÉT, ended up sidelining the cab drivers. After a while, I did not meet a single taxi driver there. What really mattered was that the country had come to a standstill, jeopardising industrial production. Livestock being driven to export markets on public roads got held up in the blockade. Animals needed water to drink or they would have perished. People wanted to get away for the weekend. All Souls’ Day was around the corner, and they could not get to the cemeteries. Access to the airport was severed, at a time when Russian Jews were being flown to Israel via Hungary under an agreement on that: this was another very sensitive issue, given the special exposure of these people to the potential threat of terrorism. Tourists flocking into the country (after the system change, Hungary had become a desirable destination) were unable to get into the city from the airport. So all of a sudden we found ourselves facing a complex set of problems that far transcended the interests of forty thousand cabbies.

NSZ: The question arises what to call this whole phenomenon. Was it a coup? Or was it simply a spontaneous concatenation of events that catapulted the affair way beyond the taxi trade? Did you perceive any signs of a deliberately organised effort behind it all?

PÁB: I regard the affair as but one episode during my tenure as minister responsible for the industry, albeit certainly an important one. I never pursued the question of whether the whole thing had been orchestrated. It is a fact, though, that the blockade locations seemed to have been planned systematically. It is the political aspect that is interesting. The victory of the Hungarian Democratic Forum (MDF) in the spring of 1990 was convincing but not a landslide. First of all, voter turnout was 65% (one third of the eligible population did not bother to vote), which I find scandalously low rate for what were the first free elections in many decades. There were more than a dozen parties to choose from, so the lack of options could not have been the problem. Of the 65% that did go to the polls, nearly 25% voted for us and 21% for the SZDSZ, with the MSZP and the Smallholders each netting about 10% of the vote. The rest of the parties gained even less than that. Because of the second round, our 25% of the vote ultimately yielded us 42% of the seats in Parliament, with 20% more brought by our two coalition partners. Seeing their majority in the benches, our MPs probably thought they enjoyed the confidence and support of the country at that rate. Then the first polls after the elections came out and showed that the MDF’s approval rate was no more than 15%. The news proved devastating for our ranks, despite the fact that the party had been supported all along by roughly the same proportion of the entire population. In addition, we happened to have a coalition government, in which each of the two other, and much smaller, parties left no stone unturned to enforce its own special interests. The Smallholders, in particular, were in a special position, with internal strife underway between the old-school smallholders and the populist, swashbuckler new wing epitomised by József Torgyán. But let us forget about all that. What about the losers of the spring election? What about the MSZP, the rump successor of the MSZMP, or the Workers’ Party, which did not even make it to Parliament because it failed to clinch 4% of the vote? As for the MSZP, they were dropped from power and forced into opposition, even as they hung on to their extensive infrastructure, including their own telephone lines, party headquarters and party media. Although the regional daily papers had been privatised, they remained virtually unchanged in terms of editorial staff, reporters, format, readership and, most probably, political views. The dailies with nationwide circulation included Népszabadság and Magyar Hírlap, the latter being extremely critical of the government. The editors of Magyar Nemzet were straddling the fence, but its journalists were already trying their fledgling skills – on the government, of course. We thought of ourselves as having been elected by the people, who would no doubt elect others at other times. We served the country, and considered the freedom of the press as a quintessential value of civic society. But the press, teeming with old-guard professionals, was unable to unconditionally relish the joy of a new, freely elected government. Many defined themselves as our opponents and kept insinuating in the media that the Hungarian people had made the wrong choice. Then the summer brought its own disappointments, and then came the local elections in October, where we, the ruling coalition, essentially suffered a defeat. Of course, legally speaking, local election results had no consequence for our seats in Parliament, but it was still a flop. The SZDSZ figured it could win general election next time by discrediting us. They turned out to be wrong, as József Antall knew they would. Early on he predicted that the real opponent to defeat at the next elections would be the MSZP. This was really the reason why he made gestures of overture to the SZDSZ, except that the liberals did not get the message and failed to respond in kind. The SZDSZ grabbed every opportunity to define itself in opposition to the civic government. For all intents and purposes, with the Democratic Charta of 1991, the SZDSZ was to rescue the MSZP from the political quarantine. Helping to perpetuate post-Communist structures was a historic mistake, ultimately an act of self-destruction, on the part of the SZDSZ.

NSZ: How would you tally the political consequences of these events?

PÁB: I think one major political fallout was that the SZDSZ irreversibly overturned the Opposition Round Table and the cooperation it stood for when, as a party in opposition, it closed its ranks with the MSZP, also in opposition. This became apparent soon after the establishment of the Charta. Meanwhile, Fidesz (Hungarian Civic Party) was faced with the dilemma of whether to assist this pact as some sort of a youth division of the Liberals or to take up their positions somewhere near the political centre.

NSZ: Was it apparent already during the taxi blockade that party attitudes were formulated along these guidelines?

PÁB: Yes, it was. The MDF did not think of Fidesz as an opponent but merely as a party of the opposition with whom it was conceivable to fashion a constructive relationship in the government vs. opposition framework. Of course, I knew a few MDF MPs from the regions who did not think very highly of those “flippant country boys”. The Fidesz MPs we would meet most often were the leaders who could see for themselves how some top SZDSZ politicians followed an ultraliberal vision that was unrealistic and far from constructive. I was saying that, in a sense, these Fidesz politicians were the sons we had brought up. Critical statements from Fidesz corners were sharp and acid, but formulated in such a way in Parliament that they amused Antall instead of exasperating him, although he was not always happy to hear them. By contrast, he felt personally hurt by the attacks from the SZDSZ, which were often not only ignoble but senseless as well. I believe that Antall was offended in both his ethical and rational being when he saw that the liberals failed to comprehend what the game was all about. They thought of themselves as being very smart, but in reality they had a blinkered vision, and they remained trapped in their own prejudices. And later they paid the price for it, too.

NSZ: In a newspaper column László Bogár said the stalemate reminded him of situations foreshadowing a civil war…

PÁB: We must remember that there were some 70 thousand legal weapons out there. The government had reclaimed some of them little by little, but not all. Then again, some people somewhere must have had a good number of illegal weapons which you could buy from the Soviets. I am no psychologist, but I personally believed – and so did some other cabinet members I talked to about this – that the taxi blockade could not go on for more than two or three days without risking lives and causing enormous financial damage. Luckily, the end game was speeded up considerably by the pro-government demonstration. As we were bogged down in negotiations in the building of the Ministry of Labour, we suddenly heard a great roar from a crowd of 20 thousand outside. “Hang in there, Ákos!”, they were chanting. You could hear the words clearly, even though the windows were shut tight. And I saw the faces of the MSZOSZ delegates turn pale. By then, the public had begun to catch on. People realised that the cabbies had gone too far, paralysing the country, and that the opposition, taking advantage of the chaos after it had lost the elections, was now eyeing to take over the government. So the political fulcrum had shifted, owing in no small part to the fact that PM Antall had begun to recover from surgery and assert himself. By Friday, he had become fully engaged even while lying on his convalescent bed. The gist of his instructions at one point was to forget about administrative prices, go ahead with energy price deregulation, and do it quickly. In a word, he wanted us to move forward. It was his decision, and it eventually solved the problem. It was a very good decision, given that liberalisation would have become inevitable sooner or later anyway.

NSZ: Are you saying that he recommended the liberalisation of prices as a vantage point for further negotiations?

PÁB: He did not recommend it; he decided it.

NSZ: What were the specific steps that led to the compromise?

PÁB: Saturday morning I went into my office and started working. We were taking care of energy affairs, the import deliveries and the movement of tankers. By then, goods freight on public roads had come to a halt. There were severe interruptions in the supply of basic staples like milk and bread. I had my hands full with bare essentials. Yet in some way, in terms of the energy reserves, the forced vacation the country had been sent on allowed us to buy some time. Business was as usual at the refinery in Százhalombatta, but all that fuel had to reach the gas stations somehow… In a situation like this, you get your instructions from your boss and you implement them. The caretaker Prime Minister Balázs Horváth would relay the latest message – or was it Antall’s Chief of Cabinet, Pista Forrai? – from Antall requiring me to go into the studio, represent the government at the negotiating table, or take a step backwards, as the case might be. At the cabinet session on Sunday we ended up retracing our steps to my own plan B, which became incorporated in the settlement reached with the OÉT, along with the early liberalisation of gas prices in January.

At that emergency meeting on Sunday, the government made its decision, then talked it over with the political parties behind us. This is why we had to stand up from the negotiating table at dinner time that Sunday, to discuss the decision with the government faction. We explained to the OÉT that we needed to take an hour off to go back to Parliament. Needless to say, we were accused by some of only trying to buy time.

NSZ: Well, was this among the government’s intentions?

PÁB: No, not at all. We simply had to walk from one building to another where the MPs were waiting to talk with us. A government can only stay in power as long as it is backed by Members of Parliament. I do not recall whether we met the entire faction or just the presidency. It was probably the latter. But I do remember vividly what they authorised us to do. This led to hammering out a deal with the OÉT later that Sunday evening. It boiled down to the government agreeing to cut the price hike in half, with the provision that these newly reduced raised prices would then remain in effect until the promulgation of liberalisation Acts to be adopted by Parliament. It was essentially a compromise satisfying the bare minimum of demands articulated by each party.

The cabbies realised that the tide of public sentiment had turned against them. All they wanted at that point was to go home. As for the government, we made a commitment to liberalising prices as of 1 January. Come that deadline, the national oil corporation – which reported to the Minister of Industry as the entity exercising ownership rights – duly announced market prices, effectively reinstating plan A, give or take a forint or two on the price per litre of gas. This was the realistic price taking into consideration several factors, including prevailing global prices of crude, the dollar–forint exchange rate, actual production costs and consumer demand. The price hikes of January 1991, including fuel prices, were part and parcel of the external opening of Hungary, and were accomplished without anyone taking to the streets. There must have been a handful of disgruntled people, of course, but I do not recall anyone blockading Chain Bridge on the morning of 1 January.

NSZ: How would you assess the overall conduct of the state apparatus during the taxi blockade?

PÁB: I must say that the national administration passed the test quite well. So did the local administration, despite having been in office for just one week. By contrast, the media did not do much to improve my opinion of it. And I sensed a certain hesitation on the part of the police. There was this new democratic law and order with its rules that said that kicking and beating up people was a no-no. We had a well-meaning, jovial fellow lawyer from the countryside serving as Minister of the Interior. All of the mid-ranking police executives had been members of the MSZMP. Some of them probably thought they would be decorated if the government fell. It was plain to see that the police was in flux. They were also scared of certain challenges. For instance, they were ill-prepared to live up to tasks such as demonstration control. The officers of the day were told that the single- party state had ended; we were now a democracy in which everyone was entitled to equal rights – at a time when unprecedented poverty and crime raised its head. The criminals were the first to exploit all that freedom. The police had a hard time in those days. I did not envy the leaders, who performed poorly on this test. As for the military, it has no constitutional obligation or authorisation to interfere in such situations. A case in point is the recent crisis of Syrian refugees seeking to enter the country. When the government resolved to avert the flow of refugees and mobilise troops to help build the fence on the border, it had no choice but to ask the consent of Parliament. The only way military involvement ever came up during the taxi blockade was in the context of the police borrowing heavy lifting equipment from the army, in case we needed them to clear vital public roads.

The story of Árpád Göncz is a sad one. He was a cog in the wheel of the pact aimed at screening out laws requiring a two-third majority. As part of the deal with the SZDSZ, the MDF assigned the power to elect the President of the Republic to the SZDSZ, even though it would have been able to vindicate that right for itself by dint of its overwhelming majority in Parliament. Such a political deal could not have been made with Fidesz because it was too small, and less with MSZP because that party was “on the other side of the street”. We reasoned that only another party to the Opposition Round Table could be eligible as a partner for a bargain that would allow us to get rid of certain unrealistic provisions of the Constitution that had been severely hindering effective governance, and to do it at a price that was not too high to pay. Then the candidacy of Árpád Göncz was finally announced. A former Smallholders’ Party member, Göncz had served time in prison under the Communists after the crushing of the 1956 Revolution, and had even been sentenced to death. Above all, he was an artist and intellectual with a winning personality. At the time, nobody would have guessed that he was also a very ambitious man or one so subservient to his party. Soon after he had been elected he began to act as some sort of power centre for the opposition. Free from any administrative responsibility that would make him stand up for unpopular causes now and then, he became the jovial President who always cropped up in agreeable contexts – everyone’s favourite Uncle Árpi. For a while, this was all right. He would shake hands with generals and university professors, receive ambassadors, and represent the country to the world outside. But when the crisis broke out, the first thing he did was visit the blockade for a few publicity shots to show he was on the side of the demonstrators. Then he began to advise the government about what to do, what to repeal, what not to do… In the end, he went so far as to say he would forbid the army to lend the equipment we requested, insisting he could do it in the capacity of Commander in Chief. This was an utter confusion of roles, because the President can only exercise that prerogative in the event of an officially declared emergency, which was not the case. Göncz’s intervention was detrimental as it interfered with the negotiation process and in fact postponed the settlement of the conflict by a full day. Quite apart from this, I take a rather negative view of his presidency. I think he hurt the cause of democracy in Hungary. But this is not how most of the people see him. The majority of Hungarians remembers him fondly as the jovial old gentleman.

NSZ: You have said that Árpád Göncz’s stance in support of the blockade caused disturbances. Did these make themselves felt in the progress of the talks?

PÁB: Of course they did. By encouraging the drivers, he contributed to the stalling of the negotiations. The government was not in the least bit interested in prolonging those conditions for three or four days. The longer it lasted, the deeper the chaos, we thought. Göncz himself was convinced – and this was echoed by the media close to him – that he was the repository of peaceful settlement and just compromise. This was a dishonest misrepresentation of the facts. I think others were pulling the strings behind him. Göncz’s tenure in public office was a personal problem for Antall, since the two had been friends before. Antall felt let down by Göncz, and for a reason. Antall was pretty good at controlling his emotions, but having his former friend stab him in the back had obviously taken its toll on him. Many people sensed this, and before long the President found himself beset by seething censure. In one official ceremony, he was booed at by the crowd – a thing that had not happened before during our peaceful transition. The booing wasn’t staged, nor needed to be: he had it coming.

NSZ: You have mentioned the significance of the pro-government demonstration. Among many other charges, the press accused you of having orchestrated it.

PÁB: The pro-government demonstration was not organised by the Cabinet but by the MDF, one of the parties backing that government. The government was too busy for things like that. Nevertheless it is a fact that there were people, and not just a few, who sided with the government openly and had the courage to take to the streets that had been invaded by anti-government demonstrators for days. And it was not just members of the MDF who went out because they had been fed up with the blockade that had paralysed the entire country. When I looked out the window during the talks, I saw this huge crowd in front of the building. I had been unaware of the preparations and would never have expected such a crowd to gather. This speeded up the talks because everyone realised it was now a face- off between two crowds. It made us feel good, while apparently embarrassing those across the table. In the aftermath I would read all kinds of “independent” accounts reproaching the government for what they said was the irresponsible and foul act of pitting “infuriated professors’ wives” against peaceful taxi drivers. Now this is what I call double standard. If demonstrators can organise freely and even get hot tea delivered to them by opposition political parties, then who is to keep the ruling parties from saying to their own supporters, “Come along and show them where you stand?” It was a turning point. Until then, our partners in the talks had felt safe and snug sitting high above the turmoil, and failed to come up with a single constructive idea. I think it was when they saw that crowd show up that bringing the whole affair to a close suddenly began to matter to them. Even then, they did not seem able to bring themselves to a compromise. The group was too heterogeneous for that. It included the MSZOSZ, with an MSZP-party MP at the helm, the supposedly pro-government, anti-Communist Workers’ Council and the Employers’ Federation, with quite a few company executives I recalled seeing in the Central Committee of the ruling MSZMP before.

NSZ: How did the crisis influence the work of the government further down the line?

PÁB: Some people say that the crisis weakened the government and checked its verve. This was not the case. The local elections proved much more of a shock for us. Almost all subsequent governments learned the lesson and, without regard to cost to taxpayers and our grandchildren, followed up their victory in the spring by pumping money into the economy all summer long, making promises left and right, just to avoid losing the local elections in autumn. In the spring of 1990, we considered that our job was to govern, that we could not afford to put off unpopular measures until after autumn. For instance, we first raised gas prices in the summer, long before the infamous major price hike in October. In my opinion, the blockade fortified the government instead of debilitating it. Had it not been for all that upheaval, we would have had to struggle harder and longer with the large corporations over the energy price issue. The executives would surely have unleashed their own employees on me. An industry price raise of 60 per cent inevitably implies that a number of companies in sectors like fertiliser production and the heavy chemical industry will either have to shut down or think twice about whether they will be able to sell that same product given the globally adjusted costs of production. This price correction brought about a welcome rejuvenation across Hungarian industry. The most energy-intensive companies – those notorious for polluting the environment more than the others – simply found themselves in a financial predicament, faced with a choice between going down the drain soon or reforming themselves in terms of their technologies and energy management.

As for the social aspect, I think it was then that the country really owned up to its problems and realised how high the stakes were. Until then, most people had not been aware of the mess we were in. There had been this naïve belief that it would all work out for the better in a short while. Antall’s detractors often accused his government of having failed to expose the true depth of the country’s difficulties. This is simply untrue. Moreover, it would not have made sense. Why would any incoming government want to paint a rosier picture of an inherited situation? It was really the taxi blockade that opened the eyes of people to the severe problems, tensions and failures of cooperation. I think the crisis ultimately improved the relationship between the government and the governed instead of undermining it as many have claimed. People became more accepting when they saw for themselves how hard it was to stand the country back on its feet.

There were changes inside the government, too. I, for one, offered my resignation because the whole thing naturally had not played out the way it was supposed to, but mine was one that the Prime Minister declined to accept. By contrast, he relieved Minister of Finance Rabár and State Secretary Matolcsy of their duties, getting rid of two bickering Cabinet members who had consistently eroded each other’s work performance. Péter Boross came on as a more soldierly Minister of the Interior. Balázs Horváth reinvented himself as Minister of Youth and Sports.

He was very good in that role. In fact, the whole structure of running things was slowly transformed. The PM brought in Mihály Kupa, a self-assured and more easy-going man, who was also better at dealing with the media. Ultimately, I believe that those few days of ordeal were a useful test for us to take, if only because the Prime Minister had never had a chance to assess our abilities in a “live” situation when the government had first stood up. So we had a starter team, and then a new one. I think we all began to function more smoothly afterwards, without experiencing any glitches in the work of the government. Momentous events followed one another in quick succession, including the dissolution of the Soviet-run trade block (Comecon) and our secession from the anti-NATO military alliance Warsaw Pact. Quite independently from this specific conflict, the economic crisis was deeper and longer here than elsewhere. It placed a heavier burden on a society that had no reserves to fall back on, financial or other. People simply got tired of it all and ended up cheering the Socialists back on stage for an encore. And this had nothing to do with the taxi blockade. The blockade was certainly an intriguing and important episode, but I would never link it to our defeat at the next elections.

(A translation of the interview published in Hungarian in the December 2015 and February 2016 issues of Magyar Szemle, edited and abridged by Hungarian Review and the author. It follows an interview with Gyula Kodolányi on the same subject, in the May 2016 issue of Hungarian Review.)

Translation by Péter Balikó Lengyel

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