Second Hungarian Republic

Beginnings

From September 1944 until April 1945, as World War II in Europe drew to a close, the Red Army occupied Hungary. The Siege of Budapest lasted almost two months and much of the city was destroyed. Neither the Western Allies nor the Soviet Union supported any changes to Hungary's pre-1938 borders, so the peace treaty signed by Hungary in 1947 declared that "The decisions of the Vienna Award of 2 November 1938 are declared null and void". ^[5] This meant that Hungary's borders were moved back to those that existed on 1 January 1938 and it lost the territories it had regained between 1938 and 1941. The Soviet Union also annexed Sub-Carpathia, some of which had been part of Hungary before 1938.

The Soviets set up an alternative government in Debrecen on 21 December 1944 ^[6] before capturing Budapest between 18 January and 13 February, 1945. Zoltán Tildy became the provisional prime minister. The Soviet government would demand not merely the return of all materials taken from the USSR, but also the payment of 300 million USD in commodities to Moscow, 200 million to Czechoslovakia and 100 million to Romania. ^[7]

Hyperinflation

The combination of high demand for finance to pay war reparations with a very weak system of tax collection meant that during 1945 and 1946, the national currency, the pengő, would be destroyed by the most ruinous hyperinflation in recorded history. ^[8] The hyperinflation was largely due to the inability of tax revenues to pay the country’s war debts, but some historians argue it was a deliberate policy of the Soviet Union to destroy Hungary’s middle class. ^[9] The only way to restore sanity to the economy was a new currency, so the forint was introduced in 1946.

German deportation

Between 1946 and 1948, half of Hungary's ethnic German minority (around 250,000 people) ^[10] were deported to Germany and there was a forced "exchange of population" between Hungary and Czechoslovakia. ^[11]

Soviet control

In elections held in November 1945, the Independent Smallholders' Party won 57% of the vote. The Hungarian Communist Party, now under the leadership of Mátyás Rákosi and Ernő Gerő, two veterans from the Hungarian Soviet Republic of 1919, received support from only 17% of the population. The Soviet commander in Hungary, Marshal Kliment Voroshilov, refused to allow the Smallholders Party to form a government. Instead Voroshilov established a coalition government with the communists holding some of the key posts. Under Parliament, the leader of the Smallholders, Zoltán Tildy, was named president and Ferenc Nagy prime minister in February 1946. Mátyás Rákosi became deputy prime minister.

László Rajk became minister of the interior and in this post established the security police (ÁVO). In February 1947 the police began arresting leaders of the Smallholders Party and the National Peasant Party. It also pressured both parties to expel those members who weren't willing to do the Communists' bidding as "fascists."^{[ citation needed ]} Several prominent figures in both parties escaped abroad. Later, Rákosi boasted that he had dealt with his partners in the government, one by one, "cutting them off like slices of salami." ^[4]

By 1947, the power of the other parties in the coalition had been reduced in favour of the Communists, and they became the largest single party in elections held that year. The Communists were the dominant partners in the coalition People's Independence Front government. Nagy was replaced as prime minister by the more pliable Lajos Dinnyés.

In October 1947, Rákosi gave the leaders of the non-Communist parties an ultimatum: cooperate with a new, Communist-dominated coalition government or go into exile. ^[12] The Social Democratic Party effectively ceased to exist as an independent organization, and Independent Smallholders' Party secretary Béla Kovács was arrested and sent to Siberia. ^[13] Other opposition leaders such as Anna Kéthly, Ferenc Nagy and István Szabó were imprisoned or sent into exile. ^[14]

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History of Hungary
Early history Hungarian prehistory The Carpathian Basin before the Hungarian conquest Roman Pannonia Hunnic Empire
Early medieval Kingdom of the Gepids 454–567 Ostrogothic Kingdom 469–553 Avar Khaganate 567–822 Hungarian invasions of Europe ~800–970 Hungarian conquest 862–895
Medieval Principality of Hungary 895–1000 Kingdom of Hungary 1000–1301 Personal union with Croatia 1102–1918 Golden Bull 1222 Mongol invasion of Hungary 1241–1242 Kingdom of Hungary 1301–1526 Ottoman Wars 1366–1526
Early modern Reformation 1520 Ottoman Wars 1526–1699 Eastern Hungarian Kingdom 1526–1570 Royal Hungary 1526–1699 Ottoman Hungary 1541–1699 Principality of Transylvania 1570–1711 Bocskai uprising 1604–1606 Wesselényi conspiracy 1664–1671 Principality of Upper Hungary 1682–1685 Kingdom of Hungary 1699–1867
Late modern Rákóczi's War of Independence 1703–1711 Principality of Transylvania 1711–1867 Hungarian Reform Era 1825–1848 Revolution of 1848 1848–1849 Hungarian State 1849 Austro-Hungarian Monarchy 1867–1918 Lands of the Crown of St. Stephen 1867–1918 World War I 1914–1918 Interwar period 1918–1941 Hungarian People's Republic 1918–1919 Hungarian Soviet Republic 1919 Hungarian Republic 1919–1920 Treaty of Trianon 1920 Kingdom of Hungary 1920–1946 First Vienna Award 1938 Governorate of Subcarpathia 1939–1945 Second Vienna Award 1940 Revisions of Délvidék 1941 World War II 1941–1945
Contemporary Second Hungarian Republic 1946–1949 Hungarian People's Republic 1949–1989 Revolution of 1956 1956 Goulash Communism 1956–1989 Third Hungarian Republic 1989–2012 Hungary since 2012
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The Republic of Hungary effectively ended in June 1948, when the Social Democrats were forced to merge with the Communists to form the Hungarian Working People's Party. However, the few independent-minded Social Democrats still left in the party were pushed out in short order. For all intents and purposes, this left the MDP as the MKP under a new name. In August, Tildy was forced out as president in favour of Social Democrat-turned-Communist Árpád Szakasits. That December, Dinnyés was replaced as leader of the Smallholders and prime minister by the openly pro-Communist István Dobi. At the 1949 elections, voters were presented with a single list from the Communist-controlled Independent People's Front, which carried 95 percent of the vote. By this time, fellow travelers had taken over the other parties and turned them into loyal partners of the Communists.

On 18 August 1949, the Parliament passed Hungary's first written constitution (1949/XX.) – a near-carbon copy of the 1936 constitution of the Soviet Union. The name of the country became the People's Republic of Hungary, "the country of the workers and peasants" where "every authority is held by the working people".^{[ citation needed ]} Socialism was declared as the main goal of the nation. A new coat of arms was adopted with Communist symbols, such as the red star, a hammer, and an ear of wheat.