Interwar Hungary
After the collapse of a short-lived Communist regime, according to historian István Deák: On October 31, 1918, the Hungarian Democratic Republic was created by revolution that started in Budapest after the dissolution and break-up of Austria-Hungary at the end of World War I.
Kun emerged from jail triumphant when the Social Democrats handed power to a government of "People's Commissars," who proclaimed the Hungarian Soviet Republic on March 21, 1919.
On June 25, Kun’s government proclaimed a dictatorship of the proletariat, nationalized industrial and commercial enterprises, and socialized housing, transport, banking, medicine, cultural institutions, and all landholdings of more than 40.5 hectares or 100 acres.
Kun undertook these measures even though the Hungarian communists were relatively few, and the support they enjoyed was based far more on their program to restore Hungary’s borders than on their revolutionary agenda.
A "white terror" ensued that led to the imprisonment, torture, and execution without trial of communists, socialists, Jews, leftist intellectuals, sympathizers with the Károlyi and Kun regimes, and others who threatened the traditional Hungarian political order that the officers sought to reestablish.
The White Terror continued to plague Jews and leftists, unemployment and inflation soared, and penniless Hungarian refugees poured across the border from neighboring countries and burdened the floundering economy.
In January 1920, Hungarian men and women cast the first secret ballots in the country's political history and elected a large counterrevolutionary and agrarian majority to a unicameral parliament.
In March, the parliament annulled both the Pragmatic Sanction of 1713 and the Compromise of 1867, and it restored the Hungarian monarchy but postponed electing a king until civil disorder had subsided.
[9] The government of Horthy immediately declared null and void all laws and edicts passed by the Karolyi and Kun regimes,[10] in effect renouncing the 1918 armistice.
His right-wing government set quotas effectively limiting admission of Jews to universities, legalized capital punishment, and to quiet rural discontent, took initial steps towards fulfilling a promise of major land reform by dividing about 385,000 hectares or 950,000 acres from the largest estates into smallholdings.
He fashioned a political machine by amending the electoral law, eliminating peasants from the Party of Unity, providing jobs in the bureaucracy to his supporters, and manipulating elections in rural areas.
[12] Bethlen restored order to the country by giving the radical counter-revolutionaries payoffs and government jobs in exchange for ceasing their campaign of terror against Jews and leftists.
Charles IV's death, soon after he failed a second time to reclaim the throne in October 1921, allowed the revision of the Treaty of Trianon to rise to the top of Hungary's political agenda.
Bethlen's strategy to win the treaty's revision was first to strengthen his country's economy and then to build relations with stronger nations that could further Hungary's goals.
Hungary's signing of the Treaty of Trianon on June 4, 1920, ratified the country's dismemberment, limited the size of its armed forces, and required reparations payments.
The territorial provisions of the treaty, which ensured continued discord between Hungary and its neighbors, required the Hungarians to surrender more than two-thirds of their prewar lands.
Despite economic progress, the workers' standard of living remained poor, and consequently the working class never gave Bethlen its political support.
[17] Hungary's foreign debt ballooned as Bethlen expanded the bureaucracy to absorb the university graduates who, if left idle, might have threatened civil order.
This was because Hungary, like the rest of Eastern Europe, had an educational system primarily focused on the liberal arts and law rather than science, engineering, or other practical subjects that might have helped the country's development.
Following the Wall Street Crash of 1929 in the United States and the beginning of the Great Depression, world grain prices plummeted, and the framework supporting Hungary's economy buckled.
Hungary's earnings from grain exports declined as prices and volume dropped, tax revenues fell, foreign credit sources dried up, and short-term loans were called in.
Hungary sought financial relief from the League of Nations, which insisted on a program of rigid fiscal belt-tightening, resulting in increased unemployment.
The radical right garnered its support from medium and small farmers, former refugees from Hungary's lost territories, and unemployed civil servants, army officers, and university graduates.
He assembled a political machine, but his efforts to fashion a one-party state and fulfill his reform platform were frustrated by a parliament composed mostly of Bethlen's supporters and by Hungary's creditors, who forced Gömbös to follow conventional policies in dealing with the economic and financial crisis.
In September 1936, Gömbös informed German officials that he would establish a Nazi-like, one-party government in Hungary within two years, but he died in October without realizing this goal.
With German help, Hungary extended its territory four times and doubled in size from 1938 to 1941, even fighting a short war with the newly created Slovakia.
Darányi's government attempted to appease the anti-Semites and the Nazis by proposing and passing the first so-called Jewish Law, which set quotas limiting Jews to 20 percent of the positions in certain businesses and professions.
By the June 1939 elections, Hungarian public opinion had shifted so far to the right that voters gave the Arrow Cross Party — Hungary’s equivalent of Germany's Nazi Party–the second highest number of votes.
The prestige and respect accompanying landownership were evident in many facets of life in the countryside, from finely shaded modes of polite address, to special church seating, to selection of landed peasants to fill public offices.
[22] Between 10 and 18 percent of the population consisted of the petite bourgeoisie and the petty gentry, various government officials, intellectuals, retail store owners, and well-to-do professionals.
