of the Confederation of HungarianEmployers and Industrialists

1902-1947 Between 1890 and 1900, the years when the thousand year anniversary of the establishment of a Hungarian State were being celebrated, Hungary experienced development on a large scale. The national capital consolidated and became conscious, encouraging remedy of the adverse situation within the Austro-Hungarian Monarchy. On these grounds, the Federation of Industrialists was established in 1902, whose aim was to bring together the nation's capitalists. The Federation, however, intended to do more than handle the issue of customs frontiers, it also concerned itself with the wave of immigration to America that was dangerously draining the Hungarian labour market. The new organisation rapidly gained strength: through individual members, regional organisations and the professional federal unions that integrated themselves into it, it became an organisation fundamentally affecting the Hungarian economic policy and realising the unity of national capitalism. The Federation was receptive to a modernising world and was rejecting the policy of national segregation. From an ideological point of view, the management of the Federation promoted national liberalism. Its openness to the arts and its sponsorship of the arts also stemmed from this.

In the years between 1902 and 1913, Hungarian industry underwent huge development. Large-scale industry was primarily concentrated in and around the capital city of Budapest, from which the country's road and railway system radiated. This was the era of a rapid and extensive economic development. Great fortunes, serious capital formation and Western-type corporations were born in this decade of abundance.

The Federation became stronger and stronger, extending its size, reach and scope. Its own Budapest headquarters became the nerve-centre of Hungarian economic policies. Its leaders were members of different governments in economic and financial posts. This idyllic situation, later simply called the golden age of peace, was ended by World War One. This cataclysm resulted in hyperinflation, the collapse of industrial production and the disintegration of the Monarchy. After the implosion, the Federation backed the new, civic government, and made tremendous efforts to help the country recover from the catastrophe, to restart life and production. In the beginning of the 1920's, the Federation of Hungarian Industrialists did its best to consolidate life and production within the new frames, as soon as possible. In this decade, the Federation of Hungarian Industrialists maintained and even increased its pre-war position and influence. The consolidation in the economy, finances, home affairs and culture, which was finally in place by 1930, was also a period when state monopolist capitalism dynamically developed. Production and trade saw a large-scale concentration, cartels and trusts controlled both the financial and commercial sphere. The influential leaders of the Federation regularly became ministers and government advisors. Another breach was the economic crisis of 1931-32, just as in Europe and across the world. The new and recently consolidated nation-state, however, endured the shock, and precisely because of the expertise and unselfishness of the national capitalists united in the Federation of Hungarian Industrialists, managed to control the economic crisis. The Federation of Hungarian Industrialists actually became stronger in these years, partly due to its sensitivity to social issues. But trouble then came from outside. Hitler's National Socialism and a re-arrangement of the balance of power in Europe affected Hungarian conditions. The Hungarian extreme right became stronger and stronger, and this brought increasing ideological pressure on the Federation of Hungarian Industrialists and the national capital it embodied. With the anti-Jewish Laws, Jews in Hungary were stripped first of their living, then of their personal freedom, of their property and, finally, their very lives. As long as it could, the Federation resisted this process; as an organisation, it was nazified, its original spirit discarded, its leading figures went into exile abroad or were forced into hiding within the country. World War Two dealt a heavy blow to the Federation. The sound of weapons was still being heard in the Western part of the country, when the Federation resumed its activities.The basic aim was to restart life, production and trade. The survivors, of course, hoped that the pre-war
capitalist structure would be resumed. In 1945-47, the Federation was one of the engines for a democratic restart, but it was not able to regain its former weight and role. In 1947-48, the years of the Communist take-over, it came under increasing criticism and accusations, and not just as a centre of capitalist, and thus "exploiting" power, but even as a "saboteur".

This pressure increased to the point that in 1948 the organisation ceased its activities. This was a logical step, since the communists had nationalised all private property. A tried and tested form of capitalist production was replaced by one which was called socialist for four decades.

1990-1998 In March of 1990, a multiparty parliament was again elected in Hungary. The first freely elected government was conservative and democratic. In May 1990, after forty-two years, the Federation of Industrialists was born again. It declared its final independence in June 1991. The revived Federation virtually set itself again the basic goals of 1902. These were national economic sovereignty, a harmonic capitalist development and to set the role of the country's capitalists in this. It should be said that, in the last decade of state socialism, there was a limited possibility to accumulate and operate private capital. The dynamic new Hungarian capitalism was fed from several sources. From the abilities of the nation's capitalists, from the investment and sales that derived from the opportunity to be again a part of the international division of labour, from participation in the re-privatisation of the former state property, from co-operation with incoming foreign capital and from successful joint ventures. Between 1990 and 1994 and during the four years of the left wing government that followed, these basic processes were successfully seen through. Privatisation was virtually completed, and the country successfully integrated itself into the developed world economy of producers and traders. By 1997 and 1998 the economy was on a balanced, export-led economic incline. In the meantime, the Federation of Hungarian Industrialists gradually became the strongest and most respected organisation representing employers' interests. At the forum called to reconcile social interests (Council for the Reconciliation of Interests) the Federation virtually dominated the activity of the employers' side. Its membership, organisation, and those working for the employers united in it quickly grew. By 1998 it had reached the current membership of 6000 members and member organisations, which together give work to 1.2 million employees. In these years, solid leadership, inner structure, central management and an apparatus evolved. The main working methods of the Federation were consolidated — those means by which the state and society can be influenced even in a modern age in the interest of a harmonic national capitalist development. The consultations within the Federation's professional forums, the frequent large-scale meetings with the leaders of the state and economic administration, the regular expression of opinions via the press, the ever-rising quality of the professional materials published by the Federation, the domination of the employers' side of the Council for the Reconciliation of Interests, and a continuously increase in professional and political prestige gradually restored the Federation to its former position. Departmental ministers and leading advisors to the government are again being chosen from the Federation's leading figures. The organisation's prosperous relations with the federations of industrialists in developed countries have also justified the revived Federation's activities.

1998-2002 The past four years saw the second conservative government since 1989. In July 1998, the Federation merged with the organisation that succeeded the Hungarian Chamber of Commerce, with the Hungarian Employers Association. Its abbreviated name MGYOSZ remained the same; now the acronym reads as Confederation of Hungarian Employers and Industrialists -MGYOSZ. With this merger, the Confederation has definitely become the largest, best established and most influential organisation for safeguarding employers' interests.

This, along with the increased weight of the Confederation, meant that the Confederation's views had to be considered: on matters such as matters of national economic policy, labour legislation and in exchange-rate policy, the key points of the government's economic development package, were identical with the recommendations made by the Confederation. The reason for this, however, is not to be found within the Confederation. Instead of fully completing privatisation, a kind of re-nationalisation and re-centralisation process took place. All that was aggravated by the liquidation of the Council for the Reconciliation of Interests. Despite all of this, the Confederation remained the most significant organisation for safeguarding employers' interests. Even, perhaps as a result of the negative phenomena, the Confederation drew its ranks closer. The professional forums it arranged, the economic suggestions it elaborated, its various public statements public are all evidence of work being done on an ever higher standard.

The membership, power and scope of the Confederation gradually increased, its already excellent foreign contacts extended and strengthened with partner organisations not only within and outside Europe. In these years, the Confederation radically renewed both its internal and its external communications. It stepped out on the global highway of the Internet, which is now the means for most of its external and internal communications. The Confederation's own official journal, Magyar Gyáripar (Hungarian Industry), established in 1916, was given a make-over in appearance and in contents. The liberal-social democratic coalition that came to power following the elections of 2002 proved to be open to restore consensus as the means for reconciling social interests. The Council for the Reconciliation of Interests is again operational. According to some signs, the government is ready to request and accept the leading employers' business federation's opinion in important matters of economic policy. First time in its history, the Confederation sees individuals directing key economic ministries that it feels very close to itself, and even a former member of the board of the Federation as Hungarian Prime Minister. All this makes the Confederation confident that it will be able to make further steps ahead. The Confederation set as a goal the creation of a unified business federation, the Confederation of Hungarian Employers. Similarly to the Confederation, it would be accommodated in the House of Hungarian Economy, a building that stands in the heart of the Hungarian capital opposite Parliament, and which has been a home to the ever strengthening Confederation for years.
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