Even before the communists came to power in 1947, the turbulent years of World War II had weakened or eliminated much of the old stratified society. Devastation from the fighting in 1944 and 1945, land reforms instituted by the government in 1945, and the nationalization of commerce and industry between 1948 and 1953 destroyed the economic base of the old social system. The country lost about 300,000 Jews, including much of the Jewish business community, to various war-related causes--deportation, massacre, disease, and hunger. Only about 260,500, mostly from Budapest, survived (see World War II , ch. 1).

After the communist takeover, the traditional ruling class was virtually eliminated. More extensive land reform undertaken by the new regime eventually collectivized the majority of the peasantry. In the countryside, anti-kulak measures and compulsory deliveries of produce to the state at extremely low prices destroyed the prosperous peasant class. (In 1948 the term kulak came to be defined officially as anyone who owned more than seven hectares of land or had a landed income roughly approximating such ownership. Political conditions caused many with less property also to feel threatened.) Rampant inflation disrupted all aspects of economic life.

In keeping with Marxist-Leninist ideology, during the first decade of communist rule the government sought to create a classless society through policies such as equalization of incomes, collectivization of agriculture, expropriation of property, and tight control over educational opportunities (see Rakosi's Rule , ch. 1). On the remaining peasants with average incomes and on prosperous peasants, the government imposed steeply progressive income taxes and requisitioned large amounts of produce. Collectivization in the early 1950s caused many peasants to seek alternatives to agriculture. Many retained their rural residences but commuted daily or weekly to other jobs, leaving part of the family to continue some agricultural work. Others moved to entirely new jobs, as government policies promoted rapid development of heavy industry (see Economic Policy and Performance, 1945-85 , ch. 3).

The social and economic changes that took place after World War II promoted social mobility. During the early years of forced industrialization and continuing to a lesser extent until the early 1960s, the prewar worker strata and peasant strata had enhanced opportunities to rise into white-collar positions. Large numbers of peasants entered the industrial labor force, and the bureaucracy, which grew as a result of centralized planning, was open to persons from all social groups.

Some downward mobility also occurred. Disincentives for formerly independent professionals, crafts people, and merchants were overwhelming. Opportunities also dwindled for prewar executives and managers. Members of the old elite lost property and political power and werca6 ere forced into the middle or lower class. A large percentage of the prewar elite left the country.

Despite such mobility in the early 1950s, an inegalitarian social system remained in place. The new political elite enjoyed material and symbolic privileges, such as access to special stores containing scarce goods or the free use of secluded and well-guarded villas, that separated it from the rest of the population. A second stratum of the elite consisted of valuable persons such as directors of large enterprises and of the best collective farms. They too lived in comparative luxury. The new elite also included intellectuals who endorsed the party and its interests. Their task was to provide legitimacy for the new regime. In return, they enjoyed living standards superior to those of the working class.

In the aftermath of the Revolution of 1956, career restrictions on the prewar middle class and intellectuals began to ease somewhat as the government ceased most of its social engineering efforts (see Revolution of 1956 , ch. 1). Among workers and peasants, political loyalty, although important, could no longer serve as a vehicle for upward mobility in the absence of other qualifications a person also needed to have appropriate educational credentials or skills. However, political considerations remained paramount for persons who wanted to be part of the ruling political elite.

As the economic reforms introduced in the 1960s increasingly affected all aspects of society, stratified social groups again made their appearance. By the mid-1970s, the regime's objective of a classless society appeared to be increasingly unattainable. To reconcile ideology with these realities, ideologists began modifying Marxist theory. The regime all but abandoned the goal of a classless society, ideologists arguing that in a socialist industrial society certain skills and occupations were more necessary than others. Thus, those persons with greater skills and responsibilities should receive more compensation than those making less valuable contributions. Ideologists rationalized society's inequalities by maintaining that socioeconomic distinctions that evolved under a communist system were qualitatively different from those found in capitalist countries.

Data as of September 1989