International Marxist Group Archive

Magazines, bulletins and booklets of the IMG and its forerunners, 1961–1984

The hidden economy

· International, second series, Vol. 7, No. 1, January 1982 · p. 27 · 908 words

The scan: intl-v07n01-jan-1982.pdf (PDF, Marxists Internet Archive)

Read by machine from the scan, then tidied: columns reconstructed, wording unchanged. Check the scan before quoting.

Janos Kenedi, Do It Yourself, Pluto, 1981, £2.95

Hungary is a small country. Its population is roughly 10 million people, of whom a little over 5 million are, as the textbooks say, economically active. Very active indeed or so we are told in this new book from the Hungarian oppositionist writer, Janos Kenedi, especially in their spare time.

Every economy has its moonlighters, and the typical British building worker will from time to time do a little on the side. But in Hungary just about everyone has a foot in the second economy. Hungary is a country of large industrial enterprises and massive agricultural co-operatives. Some 73 per cent of all enterprises in Hungary employ over one thousand workers; the comparable figure for Italy is 17 per cent and for West Germany only 39 per cent. It's a similar picture in agriculture. The Nadudvar farming co-op is an amalgamation of over 300 farms and most of these farming co-ops are so big that they build factories and engage in industrial production on a large scale as well.

But in this economy where big seems to be beautiful there are almost 2 million small plots of land with which about 5 million people are associated (ie. half the population). And on these plots they produce 35 per cent of the country's total agricultural output. The vast majority of those farmers (85 per cent) do this part-time, in addition to their regular job in the socialist sector. In the private sphere the population also builds 40,000 dwellings each year. In small-plot farming and building alone this is the work-time equivalent of about one million people (out of a 5 million working population). So much for the enormous scale of the second economy.

But why do they do it? The state-lorry driver siphons off petrol and sells it on the side. The driver is paid only 4,000 forinths. 'Nobody's allowed to pay 10,000 forinths to a driver — that's a director's salary. But they have to. Below 8,000 forinths you wouldn't find a monkey to sit in the drivers seat.' So how is it done? The company gives them twice the amount of fuel the lorry requires. 'What the drivers lose in miserly wages, they gain on the swings of freely flowing petrol'. The black market is an essential part of the 'hidden economy' and the motivation is the same here as throughout most of this social and economic netherworld — the need to supplement official income.

Janos Kenedi is a well known figure in the growing circle of Hungarian oppositionists. He edited Profile, one of the first collections of modern Hungarian samizdat, published in 1978, and in August 1980 was one of the seven Hungarians prevented by the Kadarist police from travelling to Poland to express their support for the free trade union Solidarity. Do It Yourself was submitted for publication in Hungary but was rejected for 'generalising from individual occurrences', and 'only taking negative factors into account'. It circulates nonetheless in the world of samizdat. Kenedi is blacklisted from work because of his views. He is also prevented from travelling abroad. To join the small band of unemployable dissenters in Hungary is not an insignificant achievement. To persevere in this with optimism and wit is impressive.

Do It Yourself, in spite of the statistics above, is not an academic account of small farming, black-marketeering or bribery. As the blurb on the back cover says, this is 'a hilarious and bittersweet account of how he built his own house.' But as his description proceeds from the first bureaucratic encounter with the planning committee, the acquisition of 'non-existent' materials, the bribes, the string-pulling, the black transport, the network of favours, through to the moonlighter syndrome, a picture emerges with impelling clarity of the social and economic system 'as it really is'.

I have already explained that money was a compelling factor in sending the city workers to the small plot in the village for the weekend, or in ensuring a plentiful supply of state-employed bricklayers or plumbers willing to slip off for an afternoon or weekend with their state-owned tools and equipment into the more lucrative field of 'private' work. But money isn't all — that would be capitalism. The artisan can buy a lot of things from high earnings, but far from everything. Backdoor contacts and influence can be much more important than money.

There is a waiting list for a new car, university entrance comes up next spring, the doctor whose roof you just laid has a sister-in-law who is friends with the director of a haulage firm that could carry the timber you need for the extension on your own house. Socialism ensures, says Kenedi, 'that no such airy-fairy things as "sanctity of contract" will protect the house owner against his contractor, but personal relationships within society. We must realise that between the completion of work and payment due there stands a person. The dissonance between the two aspects can only be resolved by personal relations'. The network of influence peddling, bribery and corruption (less 'alienating' than the cash-nexus of capitalism?) is a true hallmark of Eastern Europe's actually existing socialism.

Perhaps, he says in the final sentence of the book, the powers that be 'may take to heart my experience as related here and recognise the maxim that when you close one door, another will invariably open'. An excellent book and very good value for only £2.95.

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