Mikaly Body, a 33-year-old Hungarian automobile worker, represents a unique new communist hybrid. He is a combination of state employe and private entrepreneur.
For eight hours every day until 2:30 p.m., Body works as a supervisor on the production line at the giant state-owned Icarus bus factory in Budapest. Then he switches roles and, for the next three or four hours, manages a small subsidiary company that sells services to Icarus.
The subsidiary is made up of 30 moonlighting Icarus workers. They use Icarus tools free of charge to repair and maintain vehicles and do the work on the factory's premises. After paying a 17.5 percent turnover tax to the state, they divide the remaining profit among themselves.
Experiments like this have helped make Hungary the pacesetter in economic reform within the Soviet Bloc. While the attention of the world has been focused on the labor upheavals in Poland, this small nation of 10.5 million people has quietly been chipping away at the Soviet model of central planning that was once obligatory for all Eastern European countries.
Last year, Istvan Lele, 36, and some friends competed in an auction to manage a state-owned wine bar. Their bid, guaranteeing to pay the state 5.3 million forints (about $120,000) over a period of three years, succeeded. Today they have turned the once run-down wine bar into a flourishing private restaurant, the Golden Bridge. They work 12- to 14-hour days in the knowledge that any extra profit they earn is theirs.
Other private enterprise plans sponsored by the government have included the establishment of privately owned stores, repair shops and cooperatives specializing in such areas as computer software.
The principal objective of the reformers has been to tackle one of the thorniest problems of socialist economics: how to persuade people to work. Their solution is to introduce market mechanisms into the economy and encourage a measure of private initiative.
According to Ivan Berend, an economic historian at the University of Budapest, the economic reform movement in Hungary has passed through several stages. The first stage, in the late 1950s, saw a rise in agricultural production due to the collectivization of land combined with the retention of small private plots. The second stage came with the introduction in 1968 of what was known as the New Economic Mechanism, which transferred economic decision-making from the central planners to factory managers.
The third, and present, wave of reform began in the late 1970s and is described by Berend as consisting of "the legalization of the second economy."
In Hungary, as in other Soviet Bloc countries, the second economy has assumed staggering proportions. Sometimes dubbed the underground economy, it operates on the basis of private business transactions hidden from the state. A plumber, for example, moonlights from his regular job to perform private services for a wide range of clients. An office worker uses his car to work as a taxi driver in his spare time.
Economists estimate that in Hungary as many as three families out of four work for the second economy in their spare time. Earnings can typically be three or four times as much per hour as from state employment.
In many Eastern European countries, this private enterprise activity serves to undermine the official economy.
Workers steal materials from state factories for their own use while black marketeers are encouraged by the topsy-turvy price and exchange rate system. Needless to say, no one pays taxes on their underground earnings.
Csaba Gyimebi, a company lawyer at Icarus, argues that the new plan for setting up small cooperatives represents a way of integrating the second economy into the official economy.
"Many of our workers were moonlighting before in any case. This makes everything more convenient for them since they can now do their second job right here in their own factory. But it's rather more than legalized moonlighting since, through this method, we are attempting to solve problems that were frequently neglected in the first economy," he said.
On paper, everyone would appear to benefit. In practice, though, the plan seems to have run into some political opposition. Jealousies have been aroused among elderly workers who see their younger colleagues earning much more than they do.
Last summer, a Communist Party committee from the Zuglo district of Budapest complained to Prime Minister Georgi Lazar about a small workers' cooperative in the Danubia tool factory there. Why, they asked, should any worker put his best efforts into a job for which he is paid 20 forints (45 ) an hour when others are earning four times as much moonlighting on company premises after hours?
Lazar tried to reassure them that the plan was still an experimental one designed to improve services and fill production gaps. Only a very limited number of cooperatives would be allowed to operate in any one factory.
The issue of income differentials has sensitive political implications in Hungary. The New Economic Mechanism reforms were partially rolled back between 1973 and 1978 after hard-liners within the Communist Party leadership argued that they were damaging workers' living standards and creating class divisions.
Some Hungarian sociologists maintain that the political power base of the conservative faction in the ruling establishment lies in the big state-run factories--among older workers, trade union officials and Communist Party activists who are more concerned with preserving their privileges than increasing their money incomes. These people feel threatened by any type of reform that rewards individual initiative.
By going against their wishes, the Hungarian leadership runs the danger of a conservative political backlash.
At Icarus, as at other factories, it is the younger, more dynamic, workers who have shown most enthusiasm for the new cooperatives. Body, who has just returned to Hungary after 1 1/2 years in Angola, says his colleagues saw the cooperative as a means of fulfilling their private hopes for a better life.
"Everybody wants something more. If they have an apartment, they want a car. If they have a car, they want to earn enough money to take their holidays abroad," he said.