ARANY JANOS AGRICULTURAL COOPERATIVE IN FELSBMARAC, HUNGARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80T00246A068800220001-4
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 10
• Document Creation Date: December 23, 2016
• Document Release Date: September 4, 2013
• Sequence Number: 1
• Publication Date: July 30, 1963
• Content Type: REPORT

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INFORMATION REPORT INFORM
CENTRAL INTELLIGENCE AGENC
This material contains information affecting the National Defense of the United States within the meaning of the Espionage Laws, Title
18, U.S.C. Secs. 793 and 794, the transmission or revelation of which in any manner to an unauthorized person is prohibited
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COUNTRY
SUBJECT
DATE OF
INFO.
PLACE &
DATE ACQ.
Hungary
Arany Janos Agricultural Coopera-
tive- in Fe ls Bmarac, Hungary
REPORT
DATE DISTR. 30mit
NO. PAGES
REFERENCES RD
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TUIC IC IIMVAIlIATr INFORMATION. SOURCE GRADINGS ARE DEFINITIVt. Arr8AibAL or ..oI4Icr4I I. 111.1NIP%. ?
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EXCLUDED FROM AUTOMATIC
DOWNGRADING AND
DECLASSIFICATION
STATE
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ORR x
'(Note: Washington distribution indicated by "X"; Field distribution by "#".)
INFORMATION REPORT INFORMATION REP,
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COUNTRY
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Hungary
SUBJECT Arany tinos Agricul-DATE DISTR:
tural Cooperative in
11 July 63
FelsaMaric, Hungary
DATE OF INFORMATION:
NO. OF PAGES 9 50X1-HUM
PLACE ACQUIRED
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DOWNGRADED AT 12-YEAR INTERVALS
NOT AUTOMATICALLY DECLASSIFIED
DOD DI R 5200.10
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GROUP 1
Excluded from automati.,
downgrading and
declassification ?
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Background.
1 On 20 January 1960 Ihe?Arany JLos Agricultural Cooperative
was founded in FelsomarAc,,Bungary. CommUnist propagandists
were in the area about.two weeks before the cooperative was
founded to convince the farmers it was advisable to join.
All 251 farmers in thecommunity of 800 persons joined and
all the available land was collectivized. AHoldings and
livestock were the mutual property of all the members.
2: Each farmer was paid an annuity, based on the number of
cadastral acres he had owned when joining the cooperative.
The annuity was calculated in gold crowns, which was the
established basis for landholding values before World War
I. The standard value of each gold crown was set at five
kilograms of wheat or 10.40 forints, the present price of
wheat. -Annuities of members of the cooperative represented
120,000 forints or an average of 500 forints per member
per year.
.3. On 31 December 1961 only 29 members of the cooperative were
under 50 years of age; about 70 of the members were retired
or receiving disability allowances. On l'September 1962
the number of members had decreased to 235. .About half of
the members were women. .Only persons who had reached re-
tirement age in some occupation other than farming, joined
the cooperative after it was founded. They were actually
not qualified to join, but local authorities accepted,their
applications. .The other inhabitants in the community worked
in the mines, on road construction or in the forests.
Organization.
4. The three principal nominal Offices in the cooperative Were
the president, who was the director of all the cooperative's
functions, theagronomlst, who handled the agricultural
functions, and the chief bookkeeper, who was the cooperative's
office manager and, in addition, responsible for financial
and administrative matters.
5. The top governing body of the cooperative was the general
assembly, which convened every third month. Their meetings
never dealt with important matters of the cooperative. They
listened to the president's report and then handled personal
matters such as. assignment of better household plots to
members. .Subordinate to the general assembly was a 13-member
'board, which held regular 'meetings fortnightly. Their meet-
-ings were also of little value in dealing with any important
matters.
6. The president of the cooperativeAladthe over-all responsi-
bility for its activities and functions., but his power was
limited by orders received from his Communist Party superiors.
From January to .June 1960, Vince KOBLI,?was president of
the cooperative. ,He was forced to resign because of his
lack of agricultural knowledge and ability. ,Jozsef PINTER,
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a: former independent farmer and sufficiently experienced
on agricultural matters, was the next president. .He
attempted to administer his duties to the best interest
of the members. PINTER's deputy, Istvan.NEMETH, who was
a Communist Party member And secretary of the cooperative,
was forced to resign because of his misappropriation of the
cooperative's funds.
7. A.peoples' control committee of seven members was elected
by members of the cooperative. At the end of the year the
head of the committee read a report to the general assembly.
The figures in the report were fabricated and meaningless.
The committee was powerless and exercised little or no con-
trol on the activities of the cooperative.
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Management.
8. The business office of the cooperative actually managed
and controlled the cooperative. It assigned the work norms,
handled the finances, legal matters, insurance and all
other business affairs of the cooperative.
9. The agronomist, who had a desk in the office, controlled 50X1-HUM
and guided the agricultural policies of the cooperative in
line with the agricultural policies of the Communist govern-
ment,in Hungary. .Ferenc MIHALYI,
was the agronomist.
10. The two leaders of the crop brigades and one, leader of the
-stock breeding brigade, which were the two main activities
of the cooperative, supervised the agricultural activities.
The cooperative hired a storekeeper, who was responsible
for Material and goods owned by the cooperative.
11. The chief bookkeeper was the office manager, Other office
personnel were a bookkeeper and an employee, who calculated
and verified the work units of the members by data submitted
by the brigade leaders. _A double-entry bookkeeping system
was used. Office personnel handled contract matters, corre-
spondence, and, drafting of reports required by the district
council, central statistical office and the trade unions
social insurance centers, 50X1-HUM
12. The office of the cooperative had to report monthly the
number of members and their status to the social security
center of the trade union, which was the basis for the members'
social-security deductions. The cooperative paid for each
working member 37.50 forints per monthl. If the member?was
in retirement status, 10.50 fort/Its per month was paid for
his social security deductions.
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13. Each month the cooperative had to report to internal revenue
their income and amount paid for services rendered. An
excise tax, varying from eight to 15 percent,_was levied
on the cooperative. A detailed report had to be sent
quarterly to the central statistical office containing data
on number of members, livestock, fields under cultivation,
plan fulfillment, milk and egg production, losses and
damages. The report to the district council contained in- 50X1 -HUM
formation on accidents, fulfillment of work quotas by
tractor drivers, sowing, harvesting, etc.
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Work Units.
19. A work unit book, issued by the?Ministry of Agriculture,
contained directives on work units based on national
averages'of,state-owned farms 'and other agricultural co-
operatives founded many years ago in Hungary. Theoretically
work units of members of the Arany Janos Cooperative were
?based on -theSe- norms, however, leaders of the cooperative
were forced to deviate from the general rules, since workers
could never meet the requirements with the lack of fodder,
poor soil, scarcity of fertilizers, untrained workers, and
poor equipment. In 1961 the total number of work units
earned by members Of the cooperative was 66670. .The total
number of working members was 200, which represented 330, .
work units per member. The value of a work unit An the co-,
operative was as follows:
1960 9.97 forints
1961 18.50 forints
1962 20.43 forints (planned)
During the first year members were very embittered with
their returns. In 1961 the cooperative was able to pay
the 18.50 forints by requesting a loan of 163,000.00 forints
from the state. In 1962 the cooperative would have to re-
ceive an additional loan to pay this sum.
20. Members of the cooperative received about half of their
earnings in cash and other half in produce.' The members
had to pay their taxes and social security payments from
their cash income. Each year the cooperative had to pay
more taxes and dues. In 1961 the cooperative was granted
a 20 percent deduction by the State Machine Tractor Sta-
tion, but in 1962 the full amount had to be paid. In 1961
the cooperative received a 30 percent deduction on the
price of fertilizer, but in 1962 this was not given. In-
crease in other expenses in forints were as follows:
Retirement Fund
Income tax
Insurance policies
1961
38,000
58,000
78,000
1962
75,000
95,000
135,000
Investment credit in-
stallments
none
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In addition the property tax was increased from 634 quintals
of wheat to 638 in 1962.
Agricultural Land.
21. The cooperative controlled about 2500 cadastral acres (one
cadastral acre equals 1.42 acres). The acid soil in south-
western Vas County needed lime and fertilizer. In 1961 the
cooperative had only 650 quintals of fertilizer, which in-
cluded nitrogen, phosphate and potassium. The land was
utilized as follows:
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Cadastral Acres Purpose
1400 Cultivation of crops
500 Hay fields
100 Pasture land
500 Forests
Crop Production.
22. Crops were raised on about 1,230 of the 1400 cadastral
acres assigned for cultivation. The remaining 170 cadastral
acres were used by the members of the cooperative as house-
hold plots. The cadastral acres were tilled as follows:
Cadastral Acres Crops
450-480 Grain for flour
170 Oats
100 Corn
50 Potatoes
50 Flax
20 Sugar beets
20 Poppy seeds
100 Silage corn
20 Fodder beets
23. They also raised alfalfa and clover and several acres were
left as fallow land. Because of ,the lack of mechanical
equipment and manpower, about 100 cadastral acres were
untilled a year. The hay fields were poorly cared for
and wintering of livestock raised a serious problem. ?The
forest lands were exploited and reforestation suffered from
the lack of professional knowledge and inefficient planting.
Leaders and members of the cooperative were not too con-
.cerned, because they figured that the state would eventually
nationalize all forests.
24. The State Soil Ameliorating Company applied 100 to 200
quintals of marsh lime per cadastral acre per year on about
200 to 300 cadastral acres of the cooperative's land. In
1962 the cooperative experimented with the use of lignite
powder, but the results of the experiments were unknown.
It cost the cooperative about 300,000 to 400,000 forints
a year for their.soil amelioration program.
25. After collectivization, the cooperative permitted only 40
to 50 cadastral acres of rye to be raised on the acreage
assigned to grain. Emphasis was on raising .wheat even in
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areas where rye would be more suitable. Government pressure
stressed the raising of a Soviet wheat called Bezostaya
and Italian San Pastore and Produttore wheat, which emphasized
the need for quantity more than quality. In 1961 the yield
per cadastral acreH of the principal crops by the cooperative
was as follows:
Product Quintals per acre
Wheat 8.1
Rye 6.0
Oats 6.9
Barley 7.0
Shelled corn 9.0
Potatoes 16.0
26. No date was available on the number of bales of hay per
acre, but farmers always had hay for sale before collecti-
vization. Under collectivization, the supply was depleted
by March 1961 and farmers were forced to bed down their
livestock with leaves and bark. In early summer 1962,
leaders of the cooperative predicted that the supply of hay
would be used by January 1963. Members of the cooperative
had a passive attitude about crop production. The brigade
leaders lacked experience and were unable to create an en-
thusiastic response among the members, which affected the
production figures of the cooperative. Many acres were un-
cultivated because of the shortage of labor.
27. The rcgrouping of the arable land into 20 to 30 cadastral
acre units was unsuccessful. The supervisors or brigade
leaders followed country averages and did not consider local
characteristics. The farmers had only hope that the govern-
ment would have to return to the system of independent farm-
ing.
Livestock.
28. In August 1962 livestock owned by the cooperative was as
follows:
130 milk cows
180 head of cattle
250 pigs (20 sows)
5000 chickens
42 horses
In Januaryl 1960 the cooperative owned 230 cows and 70 horses,
but by August 1962 the number of cows had decreased to 130
and horses to 42. Because of the lack of fodder and poor
handling of the animals, the number of livestock owned by
the cooperative was decreasing. Milk production averaged
1.8 to 2 liters per cow and to fatten a pig to 100 kilograms
required about 14 or 15 months. The cooperative sold off
about 30 to 40 cows each year which netted about 200000 to
2500/00 forints.
(./
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Agricultural Equipment.
29. The cooperative lacked funds to purchase new, modern farm
machinery. It owned the following;
2 Hungarian, G-35 tractors
1 Rumanian, 45-horsepower, Utos tractor
1 Czechoslovak, 30-horsepower, Zetor-
3011 tractor
1 East German, 15 horsepower,.Maulwurf-
type tractor
The cooperative had sufficient plows but they were unable
to obtain blades for them. Because of the inefficiency of
the tractor drivers, about 70 percent of the tilling and
cultivating work was done by the State Machine and Tractor
Station in Kormend, which cost the cooperative about three-
quarters of a million forints per year.
Barns and Buildings.
30. Livestock was housed in stalls and stables of members until
the necessary buildings had been built. As of 1 September
1962 the cooperative had built the following:
Building
2 cow barns
3 calf stables
1 calf nursery
2 pig nurseries
1 pig feeder house
1 chicken hatchery
1 cornloft
Capacity
204
150
100
40
240
3000
10 carloads
of corn
Value in Forints
2,600,000.00
790,000.00
300,000.00
100,000.00
160,000.00
160,000.00
100,000.00
31. Buildings were hastily built with careless workmanship
and required repairs almost before being completed. The
construction companies did not consider the local charac-
teristics and worked by country-wide standards. The
technical controls were the responsibility of the County
Investment Bureau, but they were overworked and did not
have time to carry out their duties effectively. The
engineers in the bureau had been employed by the same con-
struction companies that built the buildings for the co-
operative, and they did not attempt to correct the errors
in the construction work on the buildings. The Bureau
collected two percent of the monetary value of all con-
struction work as their fee.
Blacksmith and Carriage House.
32. In the carriage house there were four cartwrights and
joiners for making and repairing carts and wagons. There
were two blacksmiths and two bricklayers working for the
cooperative. The grist mill was operated by one man and
the oil press operated only in the wintertime. No funds
were available for purchasing new equipment. The trades-
men were unable to make a living and engaged in illegal,
private business activities and were occasionally forced
to steal in order to survive.
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Communist Party Organization and Influence.
33.. Five persons in the cooperative were-Communist Party members
and there were 15 Communist Party members, including candi-
date members, inJ'elsOmax4c. .Kalman TOTH, who was the
Communist Party secretary in the community; was also the
Communist Party supervisor of the cooperative. His salary
was 1,800 forints per month. TOTH called a meeting once .a
month to read the Communist Partydirectives andA.nstruc-
tions. During 1960 Communist Party members frequently
visited the cooperative. .Their control and direction of the
cooperative diminished as their visits gradually decreased.
They were too busy Arguing over .personal matters and con-
vincing their superiors they were not Stalinists to be con-
-cerned with the cooperative.
Household Plots.
34. The majority of members of the cooperative fed and clothed
their families from the income they earned from efficiently
utilizing their household plots of one cadastral acre. .Each
member was permitted to own one cow, a calf under one year
old, and as many pigs and fowl as they wanted. Their total
sale of milk to the collecting agency was greater than the
cooperative produced and sold. .Young beef cattle brought
about 16 forints per kilogram in the market. Only young
pigs weighing 20 to 30 kilograms were sold, because they
lacked fodder to fatten them and pork prices paid by the
state purchasing companies were low. In general one-third
of the household plot was used to raise potatoes and the other
two-thirds for corn. Tilling and fertilizing was done col-
lectively by the cooperative and it cost about 300 forints a
year for this service. In addition, property taxes had to
be .paid on the land.
Outlook for Cooperatives.
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35. The future outlook of the Arany Janos Cooperative was not
encouraging and there were no indications that the situation
would improve. Charts on the cooperative's production con-
tinued to indicate a downward trend. -Authorities tried to
encourage members to work harder with the idea that this would
result in better times. .Members secretly hoped that the
government would eventually be forced to liquidate the weak
and inefficient cooperatives and return the land to the farmers.
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