Eugen Varga

Eugen Varga.

Eugen Samuilovich Varga (November 6, 1879, Budapest – October 7, 1964, Moscow) was a Marxist economist of Hungarian origin.

He studied philosophy and economic geography at the University of Budapest. In 1906, he started writing in socialist and academic journals, mainly on economic subjects, but also on other topics. Before World War I he gained some fame by discussing with Otto Bauer about the origins of inflation in the Austro-Hungarian Empire. In this period he belonged to the Marxist Centrists, of whom Karl Kautsky and Rudolf Hilferding were the most prominent spokesmen. He participated as minister of finance in the short-lived Hungarian Soviet Republic of 1919. After the overthrow of the Soviet Republic he fled to Vienna. In 1920 he went to the Soviet Union, where he started working for the Comintern, specializing in international economic problems and agrarian questions. In years 1922-1927 he was working at the department of trade in the Soviet embassy in Berlin. In the 1930s he became an economic adviser to Joseph Stalin. He survived the purges of the 1930s. During World War II he advised the Soviet Government in matters of post-war reparations. He attended the Potsdam Conference of 1945 as an expert. Like most of his compatriots living and working in Moscow, he joined the Communist Party of the Soviet Union, but he also remained active in the Hungarian Communist Party.

He authored the economic reports the congresses of the Comintern discussed between 1921 and 1935. A large number of his writings were studies of the international economic conjuncture, in which he made great effort to assess quantitative trends in output, investment and employment using official economic data from numerous countries. He also extensively studied German imperialism.

In 1946 he published The Economic Transformation of Capitalism at the End of the Second World War, in which he argued that the capitalist system was more inherently stable than had been hitherto believed. This led to the closure of the Institute which he headed. (See: Paolo Spriano, Stalin and the European Communists. London: Verso, 1985). Finally, in 1949 he would make his self-criticism. Though he remained a leading academic economist, his prestige had diminished. In the second edition of the Great Soviet Encyclopedia he was qualified as a "bourgeois economist". After Stalin's death in 1953, he reappeared on the scene, but the new men in power in the Kremlin believing in the virtues of peaceful co-existence were not interested in Varga's predictions of the outbreak of a "necessary" economic crisis in the United States. In 1954 and 1959 he received the Lenin Orders, in 1954 he obtained a Stalin Prize and in 1963 a Lenin Prize. After his death, his selected works in three volumes were published in the Soviet Union, Hungary, and East Germany.

Varga never returned to living in his native Hungary. Because he was very close to Mátyás Rákosi, he was several times invited as an economic advisor to Hungary. In this period (1945-1950) he had specialized in economic planning, pricing and monetary reforms, i.e. reforms the Hungarian Communists now in power were carrying out. After the fall of Rákosi caused by the Hungarian Revolution of 1956 and the take-over by the Kádár team, Varga's advisory work was not appreciated anymore.

References

• Gerhard Duda, Jeno Varga und die Geschichte des Instituts für Weltwirtschaft und Weltpolitik in Moskau 1921-1970, Berlin, 1994
• Peter Knirsch, Eugen Varga, Berlin, 1961
• Laszlo Tikos, E. Vargas Tatigkeit als Wirtschaftsanalytiker und Publizist in der ungarischen Sozialdemokratie, in der Konimtern, in der Akademie der Wissenschaften der UdSSR, Tübingen, 1965
• André Mommen Eens komt de grote crisis van het kapitalisme. Leven en werk van Jeno Varga, Brussels, 2002
• André Mommen, Stalin's Economist. The economic contributions of Jenö Varga, London and New York, 2011.