cteristics, started its sessions. In May, Hungary began taking down its barbed wire fence along the Austrian border – the first tear in the Iron Curtain.
June brought the reburial of former Prime Minister Imre Nagy, executed after the 1956 Revolution, drawing a crowd of 250,000 at the Heroes' Square. The last speaker, 26-year-old Viktor Orbán, publicly called for Soviet troops to leave Hungary. In September, Foreign Minister Gyula Horn announced that East German refugees in Hungary would not be repatriated but would instead be allowed to go to the West. The resulting exodus shook East Germany and hastened the fall of the Berlin Wall. On 23 October, Mátyás Szűrös declared Hungary a republic.
The majorities in the decisive bodies of the state party agreed to give up their monopoly on power, paving the way for free elections in March 1990. The party's name was changed from the Hungarian Socialist Workers' Party to simply the Hungarian Socialist Party (MSZP] and a new programme advocating social democracy and a free-market economy was adopted. This was not enough to shake off the stigma of four decades of autocratic rule, however, and the 1990 election was won by the centre-right Hungarian Democratic Forum (MDF), which advocated a gradual transition towards capitalism. The liberal Alliance of Free Democrats (SZDSZ), which had called for much faster change, came second and the Socialist Party trailed far behind. As Gorbachev looked on, Hungary changed political systems with scarcely a murmur and the last Soviet troops left Hungary in June 1991. In coalition with two smaller parties, the MDF provided Hungary with sound government during its hard transition to a full market economy.
The economic changes of the early 1990s resulted in declining living standards for most people in Hungary. In 1991 most state subsidies were removed, leading to a severe recession exacerbated by the fiscal austerity necessary to reduce inflation and stimulate
