Memorandum by the Director of the Office of European Affairs (Matthews) to the Under Secretary of State (Acheson)

Subject: Hungarian Political Situation

The moderate, majority Smallholders Party, which received a clear mandate (60% of the popular vote as against 16% each for the Communists and Social Democrats) from the Hungarian people in the free national elections of November 1945, is at present under severe attack by the Communists and other leftist parties. This situation, which constitutes the most serious of the recurrent crises provoked by the Communist leaders over the past year, arose late in December when the Communist Minister of Interior1 and the Communist Chief of the Political Intelligence Department in the Defense Ministry,2 acting on their own responsibility without the foreknowledge of the Prime Minister (Smallholder),3 began to carry out a series of arrests of non-Communist army officers and Smallholder politicians allegedly engaged in a “conspiracy” against the State and looking to the restoration of the Horthy4 regime. These arrests have involved over 100 persons to date, including some closely associated with the Prime Minister, and are continuing. The Minister of Reconstruction (Smallholder)5 has been forced to resign and is now under arrest, and eight Smallholder deputies, whose legislative immunity has been suspended by vote of the National Assembly on demand of the Communists, have been arrested and face trial.

While the alleged conspiracy appears to have some basis in fact in terms of the existence of loose anti-Communist groupings which may [Page 261] have engaged in indiscreet interchanges, its significance appears to have been greatly exaggerated by the Communists. The timing and weight of Communist pressure in this regard suggest that the leaders of that party are seeking to entrench themselves in power before the Soviet forces withdraw and the peace treaty comes into force6 by (1) fastening sole responsibility for the conspiracy on the Smallholders, (2) forcing the disintegration of the Smallholders Party and thereby nullifying the results of the free 1945 elections, and (3) forming a new “front” regime under complete Communist control.

While complete capitulation by the Smallholder leadership to this pressure is by no means a foregone conclusion at this juncture, the Party seems badly shaken and confused and the Prime Minister has thus far evinced little intention to take a firm stand against these new encroachments. Moreover, the present situation appears to have nullified a previously anticipated split in the Social Democratic ranks by strengthening the hand of left-wing elements who wish to cooperate with the Communists.

The Prime Minister has denied that the Soviet authorities have intervened in any way in the present crisis, but it is very probable that Soviet influence in support of the Communist drive is fully operative behind the scenes and that the Prime Minister has made this statement under some sort of personal pressure.

While our most recent telegram from Budapest states that tension has markedly declined for the time being, in the light of the foregoing, EUR believes that the political struggle in Hungary may well be entering its most critical phase and desires to have the recommendations of Minister Schoenfeld (see the attached draft telegram7) before determining what, if any, steps should be taken to assist the democratic elements in Hungary to maintain the position to which they are legally and morally entitled by virtue of the 1945 election.

H. Freeman Matthews
  1. László Rajk.
  2. Gen. Gyorgy Pálffy-Österreicher.
  3. Ferenc Nagy.
  4. Adm. Miklós (Nicholas) Horthy, Regent of Hungary, 1920–1944.
  5. Andrej Mistéth.
  6. The Treaty of Peace with Hungary was signed in Paris on February 10, but did not come into force until September 15. Documentation on the signing and ratification of the treaty is presented in volume iii .
  7. The telegram under reference here was subsequently sent as telegram 69, January 24, to Budapest, p. 263.