THE NATIONALITIES PROBLEM IN TRANSYLVANIA 1867-1940

In addition to the confiscation of Hungarian properties, Romanian economic policies contributed to the impoverishment of the Szekely region, and of Hungarian regions in general, by a special tax system. According to the official bulletin of the Romanian Ministry of Finance, from 1924 to 1926 the direct taxes paid in Transylvania exceeded those paid in Romania itself by 205 million. During those two years the direct taxes in the old Kingdom decreased by 45 million in comparison with the previous fiscal year. Yet in the same period the total amount of tax revenue increased by 31.3%. In the area of the old Kingdom the rise was 28.4%, but in Transylvania it was 72%. This rise was most conspicuous in the Szekely counties: direct taxes rose in Ciuc county by 76%, in Odorheiu county by 86.5%, and in Trei Scaune county by 110%. ⁴⁴ During the same two years direct taxes in the old Kingdom increased by 1.9%, whereas they increased by 22.2% in Transylvania. Similar divergencies may be noted in the case of other taxes.

The distinctions between the Romanian and non-Romanian population was apparent not only in the assessment of taxes, but extended to their collection as well. According to the data in the official bulletin from 1934 to 1936, the collection of taxes was far more efficient in the Szekely counties than in areas inhabited by Romanians. In the year 1934/35 the nation-wide average was 72.996 of the tax assessed. In certain purely Romanian counties of the Kingdom of Romania collection remained far below the national average. In the county of Buzau only 25.5% of the assessed tax was collected, in Dorohoi 51.8%, in Teleorman 59.4%. In the Szekely region, however, which even according to Romanian authors, was one of the poorest in the country; the result of the tax collection was far above what obtained in Romanian counties. In the county of Trei Scaune 61.4% of the taxes assessed were actually collected, in Odorheiu 74%, in Mures-Turda 103.8%, whereas in the poorest county, Ciuc 121.6% of the assessed taxes were collected. In the Romanian counties of Transylvania, as in the old Kingdom, lesser percentages were collected. In Alba [Also-Feher] the ratio was 69.596, whereas in Nasaud county, where the Romanian border guards had been able to retain their commonwealth of a quarter-million cadastral holds, merely 39% of the taxes assessed were collected. In contrast, in the

403

county of Cernauti, which had a predominantly Ukrainian population, tax collection must have been stricter, because according to the Romanian tables, 95.5% of the assessed taxes were collected.

The trend continued the following year. 75.596 of the assessed taxes were collected, but once again the rate depended on the ethnic background of the inhabitants of the county. In the Romanian counties 38.2% of the assessed taxes were collected; 55.4% in Teleorman, 57.2% in Dorohoi. In the Szekely and Hungarian counties: 85.2% in Odorheiu, 96.8% in Ciuc, 99.98% in Mures-Turda, 100.2% in Trei Scaune. In the Romanian counties of Transylvania the collection relented: 64.5% in Nasaud, 66.7% in Alba. In the county of Cernauti, with a Ukrainian majority, the ratio approximated that of the Hungarian counties: 96.5%. ⁴⁵

One might assume that this difference in the rates of tax collection was a result of a favorable economic turn in the Szekely and Hungarian areas. The official Romanian statistics indicate the opposite. In a period of ten years, from 1925 to 1935, the Szekely counties lost a large fraction of their heads of cattle. The county of Odorheiu had 55,907 head of cattle in 1925, but the figure was down to 40,470 by 1935a loss of 23%. In the county of Trei-Scaune the decrease was from 54,638 to 38,074a loss of 30%. The number of milking cows decreased in the same period from 22,959 to 17,470. Among the Szekely counties only Ciuc had sufficient cattle, but the number of pigs was far below the demand. From the point of view of meat and protein the population of Ciuc would have needed 45,000 pigs, whereas it owned a mere 14,569. ⁴⁶

It is obvious, therefore, that Romanian economic policies along the principles advocated by Vintila Bratianu achieved the impoverishment of the regions with a Hungarian population. These policies aimed at accelerating the emigration of the Szekely towards the old Kingdom of Romania by depleting their resources. Indeed, the Szekely population, because of its needy financial condition already under Hungarian rule, emigrated in large numbers towards the areas of the Kingdom of Romania at that time. Towards the end of the twenties Romanian authors realized the advantages the enhancement of Szekely emigration might offer for the Romanians and, after 1934, the Romanian authorities did their best to make the life of the peasantry in the Szekely areas truly unbearable. In some places the Romanian civil servants stationed in the Szekely areas exerted unbearable pressure on the population of the villages. They forced the Szekely peasants to build churches for the benefit of a few dozen Romanian civil servants and a

404

few other Romanians who had been settled there by the government and who belonged to the so-called Romanian National Church.

As we may read in the official calendar of the Romanian Uniate Church of Blaj [Balazsfalva] in 1938, churches had been constructed in Guaterital [Szenterzsebet], Aldea [Abasfalva], Dragu [Szentmarton], and Craciunesti [Karacsonyfalva] in the county of Odorheiu. The Ministry of Religious Affairs provided an assistance of 1,125,000 lei for the construction of churches, but these "had to be built for the most part from local contributions." ⁴⁷ Yet the local residents were Hungarian; according to the calendar, there were altogether 66 members of the Uniate Church in Aldea [Abasfalva], 117 in Martinia [Homorodszentmarton], 120 in Craciunesti [Karacsonyfalva]; these could not have built the churches out of their own resources. Paging through the registers of the governing councils of the Unitarians residing in this area we run across the following bitter observation: "the Romanian bourgeois class goes far beyond the requirement of love for one's neighbor in not merely requesting but demanding that the Unitarian Szekely farmer carry the foundation stone of the Orthodox Church to be built in his village." ⁴⁸ Of course, it was not just the Unitarians; Reformed and Roman Catholic peasants were likewise forced to participate in the construction effort. The political community was often ordered to take care of the construction and maintenance of the Romanian National Church building. More than once, within the same Szekely village, a separate parish would be set up for the benefit of 15 to 20 Romanian parishioners mostly teachers and other civil servants assigned there in addition to the already established Romanian parish which likewise had but few parishioners.

The Romanian weekly published in Miercurea Ciuc, the Gazeta Ciucului, noted with irritation in 1937, under the headline "Mistakes in the Policy of Romanianization" that the Romanian Orthodox bishopric of Sibiu [Szeben] was establishing a parish for 15 Orthodox churchgoers at Ditrau [Ditro]. The paper explained that this was superfluous zeal, because the Romanian Uniate Church was already established at Ditrau, moreover, it was harmful, because now "the community had to provide financially for both churches."

By this time the majority of the Szekely communities were led by Romanian teachers and notaries resettled in their midst. It was primarily these Romanians, not natives of the village, who were appointed to the community council. The councils were constituted in such a way that the Hungarian peasantry was hardly represented. Such a council would naturally be most generous in awarding the revenues and taxes of the community for Romanian national purposes.

405

In the official Romanian bulletin of January 23, 1940 (No. 19), we may read a directive authorizing the managers of the community of Sindominic [Csikszentdomokos], in the county of Ciuc, to provide a lot as a present for the site of a Romanian Orthodox Church. The justification for the request states unequivocally:

that the construction of an Orthodox Church in the community of Sindominic is not only for the beautification of the community, but is necessary from the national point of view as well, since it is the task of the church to bring the residents back to the ancestral faith. ⁴⁹

In such cases the residents of Szekely villages constructed, at their own expense, Romanian churches called upon to Romanianize them.

The Szekelys were forced to construct state schools with the same objective in mind. As we shall see in our chapter on school issues, the Szekelys and Hungarians had to build, in addition to their own denominational schools, the Romanian public schools as well. This double school funding burden was considered quite natural by the person introducing the law of 1924 on public education because, as he explained:

If a community has a minority school supported by the minority, but the community decides to establish a public school as well, the citizens of the minority group may not withhold their contribution on the grounds that they are already burdened by having to support their own school. ⁵⁰

In addition to the larger taxes assessed and the far stricter collection of these, in addition to supporting their own church and school, they had to build and maintain the National Churches and public schools established in order to Romanianize them. This terrible financial burden eventually became quite unbearable. All the more so, as the Romanian state employees transferred to the Szekely region seized every opportunity to persecute the Szekelys. By 1936 this activity of the Romanian civil servants had assumed such proportions that well- intentioned Romanians writing in the weekly of Ciuc admitted it was too much. One of them tried to express clearly the more impartial Romanian point of view:

The Szekely peasants are regarded as a chauvinistic minority group. All their ideas and moves are followed with suspicion. We do not realize at all that the unbridled nationalism with

406

which so many of us are persecuting the Szekely peasant from morning till night alienates him from us and forces him into an antagonistic stance.... This is a profound error! Whoever possesses the criteria for understanding the Szekely peasant knows that he expects sympathy and peace, not a policy of irritations. Let us deal with him humanely, otherwise we turn him into an enemy in our own home.... This is what those of us Romanians who would die unless they swallowed one Szekely a day must understand. ⁵¹

As a consequence of the economic policies of the Romanian government in the Szekely areas, the number of male and female emigrants depleted the population increasingly year after year. Some regions of the old Kingdom soon filled up with men and women migrating from the Szekely areas. According to certain computations almost 50,000 Szekelys found room in Bucharest, since living there was much easier. They did not have to pay higher taxes there, nor were they expected to maintain two kinds of churches and schools; in fact, they paid lower taxes than in Transylvania. Moreover, Bucharest, as the capital of Greater Romania, had embarked on the path of large scale development, and the various works undertaken offered intelligent Szekelys good financial opportunities. At the same time migration in the opposite direction got under way from the areas of the old Romanian Kingdom: civil servants, teachers, notaries, and other Romanian state employees flocked to the Szekely villages and towns. ⁵² It was for their sake that the Szekelys had to build those Romanian churches. But Szekely emigration was directed not only towards the old Romanian Kingdom. Many who had the possibility left for America. In 1936, for instance, 110 Hungarians emigrated from the county of Trei Scaune, all but one of whom went to America. In the absence of statistics during the 22 years of Romanian rule, a precise picture of emigration cannot be gained, but one could assume a massive Hungarian exodus.

Apart from emigration, the population of the Szekely region and other Hungarian areas was depleted by the low birthrate. The average population increase in the county of Odorheiu in 1930 was 8.1 per thousand, well below the 11.7 nation-wide average. By 1938 this rate had decreased to 6.9. The rate was even lower in the county of Trei Scaune; in some places it did not even reach 3.8 per thousand. The population also decreased in the county of Ciuc. Indeed, most of the migrants to Bucharest and other parts of old Romania came from this .area. A bus would depart from Ciuc-Casin [Csik-Kaszon] twice a week carrying emigrants to Bucharest. In some communities the houses were

407

closed down, the doors and windows boarded up, because a third of the population had left for Bucharest and other parts of old Romania. Some left their families behind for a few years, and the head of family remained tied to Bucharest by income and interest. These two-homed beings replied to a pastor inquiring about their spiritual welfare: 'Why should we build a cultural center here, when we have one in Bucharest?" ⁵³

While the population of Hungarian background fell into dire straits in the Szekely region, in some areas of Transylvania with a mixed population the financial opportunities were more favorable. In particular, where the Hungarians lived interspersed with Saxons, they were able to penetrate into the Saxon areas and set footing financially. At Medias [Medgyes], Brasov [Brasso], and other Saxon centers such as Sighisoara [Segesvar] the number of Hungarian residents increased during the Romanian rule, and their financial situation improved. There were even some areas in the Szekely region where some fortunate cooperative venture led to financial betterment. In the county of Mures two significant Hungarian institutions came about: the Agricultural Association of Mures county, and the Transylvania Dairy Settlement. These two institutions earned immeasurable merits in the protection of the economic interests of the Hungarian peasantry. After 1930 the Association engaged in large-scale agricultural extension work, organized exhibitions, formed smallholder's societies, acquired sowing machines and breeding animals, etc. In this work it relied on assistance from the Transylvanian Farming Union, which supported it financially and with its prestige.

The dairy settlement "Transylvania" was founded by the Association of Agricultural Cooperatives and Credit Unions in 1936. The Association transformed the existing milk stores into cooperatives and organized the collection of dairy products from the villages. The dairies worked on the Danish model. At the beginning 17 communities supplied the milk. Later, 72 communities participated in the transportation of milk, as a consequence of which excellent butter could be manufactured at Tirgu Mures [Marosvasarhely]. Thanks to the efforts of the Association the price of milk rose, the income of the smallholders increased, and the quantities shipped in 1936 increased in value by 2.065,061 lei as compared to two years earlier. The dairy center sold most of the butter in the larger towns of Transylvania and in Romania itself. It established 27 agencies spread around the country, six of which were on the territory of the former kingdom. It exported as far as the United Kingdom and Palestine. In 1936 it processed 2.680,000 liters of milk, and 6.205,100 liters the following year; in 1938

408

it reached this amount already by August. It tied in the cooperative of the neighboring Tirnava Mica [Kis-Kukullo] county and even of Cluj county. In 1937 it organized a special dairy center at Cristuru Secuiesc [Szekelykeresztur] for the milk cooperatives of Odorheiu county on the model of the one operating at Tirgu Mures. ⁵⁴

In other Szekely and Hungarian areas the only possibility for economic betterment lay with the cooperatives. The Hungarian cooperatives enjoyed relatively the best treatment among all Hungarian organizations because the policies of the Romanian National Peasant Party favored the cooperative movement, as manifested in the law on cooperatives. The Hungarian consumers' cooperatives gathered in the Hangya (Bee) cooperative center at Aiud [Nagyenyed], whereas the producers and credit cooperatives established their center at Cluj [Kolozsvar]. These cooperatives had to rely entirely on Hungarian resources. As one of the Romanian specialists noted in 1933, they had to offer less income than the Romanian or Saxon cooperatives. This was natural, according to the Romanian author, since the Romanian and Saxon cooperatives received loans on better terms. "The Romanians received loans from the central cooperative bank, the Saxons from the Agricultural Center at Sibiu." ⁵⁵ Indeed, the Romanian author put his finger on the gist of the matter. One of the greatest difficulties facing the Hungarian cooperatives was the shortage of credit, since the Romanian National Bank gave very limited loans to Hungarian agricultural institutions and eventually refrained from granting them loans altogether.

The legal status of the Hungarian cooperatives was defined by ordinance 33,000 of 1922, issued by the Cluj office of the Romanian Ministry of Justice. This directive authorized the Hungarian cooperatives to continue to operate on the basis of former Hungarian rules. Thus the autonomy of the cooperatives was preserved for the time being but, on the other hand, they could not benefit from the advantages granted to Romanian cooperatives. The law on cooperatives, promulgated on March 28, 1929, preserved the autonomy of the Hungarian cooperatives, under state supervision, until September 1, 1938.

The new law on cooperatives, promulgated on June 23, 1938, drastically altered the predicament of the Hungarian cooperatives, subordinating them to organizations representing Romanian national interests. The law dissolved the associations which until then exercised supervision over the cooperatives of minority groups and established the National Institute of Cooperatives, which became the only supervising and guiding body. This new institute was under the control of the

409

Romanian Minister of National Economy. The law deprived the Hungarian cooperatives of the opportunities available to them until then and put a break on their evolution. The regulatory legislation of January 20, 1939, completed the process. This regulation banned all cooperatives that were not registered with the National Institute of Cooperatives. The law also authorized the Minister, i.e. the National Institute of Cooperatives, to dissolve the board of directors or management of any cooperative without explanation, and to replace it with a board of directors consisting of seven plenipotentiary members. This entailed a complete change in the significance of the Hungarian cooperatives. The Hungarian cooperative centers were allowed to operate by the Minister of National Economy only with the proviso that half of the members on its board of directors, including the executive director, be appointed by the Minister. After this Romanianization the Hungarian cooperatives no longer could pursue activities in defense of Hungarian economic interests. ⁵⁶

It follows, therefore, that under Romanian rule the Hungarian peasants could make economic progress only for a short time. The promising beginnings of the cooperatives were thwarted by the Romanianizing and nationalizing measures of 1938. The Hungarian peasantry did not have opportunities such as those enjoyed by the Romanian peasants under Hungarian rule. Very seldom could the better-off Hungarian peasants purchase land, because various Romanian laws made it most difficult to transfer land in Greater Romania, almost to the end. Article 47 of the land reform law of Transylvania and other similar measures limited the possibility of purchasing holdings. Estates of over 50 hectares which came on the market at the beginning had to be offered to the Romanian state first. Eventually, in some areas naturally mainly in areas with a Hungarian population the preemptive right of the Romanian state was extended to all kinds of real estate offered for purchase. Similar limitations applied to acreage that became available as a result of the land reform. The mid-size estates that remained after the land reform could not be purchased by individuals of Hungarian background.

A new law was promulgated on March 29, 1937, limiting the transfer of real estate. According to this law the state had preemptive rights to hamlets that had been wholly or partially expropriated together with the improvements thereon. Moreover, the state had preemptive rights to all those estates, including improvements, which exceeded in part or in whole the 50 cadastral holds, regardless of how these estates were described at the time of expropriation, whether the area was considered cultivable or not, nor did it matter whether it was

410

subject to expropriation at the time of the land reform or not. The conditions for the exercise of this preemptive right were to be examined at the time of purchase, and this right could not be curtailed or abrogated on the ground of the registers of titles or the nature of the expropriation order.

In connection with this law Elemer Gyarfas, a senator belonging to the Hungarian Party, intervened in the Romanian Senate when the government attempted to prevent the purchase of land Arpad Gyergyai, professor emeritus of the University of Cluj, contracted two years earlier. "One of the Counts Teleki," noted Gyarfas,

sold his estate to a former professor of medicine for three and a half million, two years ago, and they have been running around ever since - here you can observe the implications of the law on preemption - to finalize this purchase and to find out whether the preemptive right of the state applies in this case or not. The question came up two years ago, a whole series of suits are in progress and, as far as I can see, this law was devised precisely to win the suit which otherwise they would have lost. ⁵⁷

The incident which prompted this intervention by Gyarfas was well known both in Romanian and in Hungarian circles. It referred to the Teleki estates in the community of Luna de Jos [Kendilona] in the county of Cluj, purchased by Gyergyai in 1935. Some Romanians also had their eyes set on the estate and, in order to prevent the purchase by Gyergyai, they mobilized their political connections, eventually leading to the adoption of what in Hungarian circles became know as the Lex Gyergyai.

Thus very few opportunities remained to the Hungarian peasantry in Greater Romania, economically speaking. These possibilities were not even comparable to those enjoyed by the Romanian peasantry under Hungarian rule. Under Romanian rule the Hungarian peasant could survive only by lowering his expectations considerably, and trying to engage in some secondary occupation. Often the peasants undertook artisanry. Elsewhere they hired themselves out as laborers, but most often they seized the opportunity to emigrate. Emigration was often organized by Romanian agents with contacts in high places. The process of exodus started in Hunadoara county in 1922, then spread to Arad county, and later to the German and Hungarian villages of the Banat [Banat]. Thanks to the support of undersecretary of the Interior Richard Franasovici, an agent named Gyula Herberger launched a large-scale propaganda campaign among the Hungarians of Hunadoara

411

county to promote emigration. As the Romanian police superintendent of Deva reported to his chief

The propaganda asserts that the lands of the Hungarians will be expropriated come next spring. I bring your attention to this movement, which may have harmful consequences, because the Hungarians will not fail to use this opportunity as propaganda against us. ⁵⁸

In response to the report, the chief of police received instructions by cable from the Ministry of the Interior "to take measures to ensure that his subordinates do not place obstacles in front of Herberger for the sake of personal advancement." ⁵⁹ But since not all police officers were aware of these instructions, one uninformed policeman arrested Herberger. Then, the examining judge was instructed, by cable number 56,259/924, marked strictly confidential, that Herberger be released. During the interventions in parliament, Iuliu Maniu criticized the emigration propaganda sponsored by the government, but Foreign Minister Ion G. Duca responded in a peculiar way: "I would like Mr. Maniu to answer my next question with a yes or a no: does he object to the fact that non-Romanian individuals leave the country, or doesn't he?" Maniu did not provide a definite answer. Then Duca went on to add that if individuals who had become Romanian subjects wished to take advantage of international treaties and emigrate, true Romanians could see no harm in that. Thus the Minister of the Interior easily parried the charges against him, and could calmly read out, for the sake of undermining the query a report from the chief of police in Transylvania, which included the following observation: "We are dealing here with individuals who are troublemakers; and we are glad to see them leave as soon as possible, so that their lands may be transferred to Romanian peasants." ⁶⁰

In 1924, according to official Romanian data, 811 emigrated to America from the Old Kingdom, 1,425 from Bessarabia, 2,361 from Bukovina, and 18,015 from Transylvania. Over four times as many individuals emigrated from Transylvania as from all the other provinces of Romania combined. It is obvious that most of the emigrants from Transylvania were not Romanian. ⁶¹

During the entire period of Romanian rule the Hungarian peasant seldom enjoyed any economic progress. Those in charge of Romanian economic policies followed the basic principles advocated by Vintila Bratianu most faithfully. The Hungarian peasants received from the pertinent Romanian agencies - the Ministry of Agriculture or other

412

economic institutions nothing of the kind of support - the Romanian peasants had received from Hungarian agencies. If the farmers in the Hungarian villages needed machines, breeding animals, or hybrid seed, they obtained these through the cooperatives, or with the help the Transylvanian Farmers' Association. Not once did Romanian economic entities provide the Hungarian communities or farmers with free breeding animals or any other economic service. Thus the government applied the chauvinist Romanian economic policies of Bratianu even to the agricultural stratum, the least dangerous to the Romanian state.

In addition to the social class of peasants, the Hungarian workers also constituted a significant stratum, on account of their solidarity and their numbers. In the formerly Hungarian area the majority of the workers in heavy industry were of Hungarian ethnic background. ⁶² A sizable portion of the workers had gathered in trade and political organizations to struggle against capital. The first mass movement of workers under Romanian rule was the four-day railroad strike, beginning on January 20~ 1919. The strike was easily put down by the Romanian military authorities. The same happened with the general strike launched on October 20, 1920. In 1923, the socialist workers of Transylvania, most of them of Hungarian background, joined the International of Amsterdam. In 1927, they united with the Socialist Democrats active in other Romanian provinces, and from then on the Hungarian workers of Transylvania operated within the Social Democratic Party under Romanian leadership. The party was aware that in the formerly Hungarian areas the majority of the workers were of Hungarian background, and therefore, included protection of minority rights on its platform. But since the leaders of the party never sent a representative with Hungarian background to parliament, the defense of minority rights was mostly for the sake of appearances, and did nothing to mitigate the discrimination suffered by workers of Hungarian background. The Social Democratic Party intervened several times on the issue of language examination for Hungarian railroad workers, or the forced dismissal of Hungarian workers from private enterprises. It was unable to obtain significant results, however, precisely because of the national sentiment of the leaders and the absence of Hungarian ethnic representatives.

Until 1930, before the economic crisis, the situation of the Hungarian workers was bearable, and even satisfactory, in most places. The Romanian government adopted from Belgium and France many

413

measures for the protection of the workers, serving the interests of the working class. Unfortunately, when it came to applying these measures, it turned out that the interests of the workers were taken into consideration mainly if their ethnic background was Romanian. The conditions of the Hungarian working class became increasingly deplorable after 1930. Under the excuse of various language examinations the Hungarian railroad workers were released from their job one after the other. After ten or twenty years on the job, thousands of workers with families found themselves on the streets, even though they had performed outstandingly on their jobs. Yet according to the regulations, they were entitled to pension only after the age of 57. Having lost their job and left without a pension, they lived in utmost misery, awakening in them an awareness of their common Hungarian fate. Those who passed their language examination lived in constant insecurity as well because, according to the court of appeals, their knowledge of the language could be retested at any time.

Having lost their government jobs, the Hungarian workers were also forced out of private firms. The first hints of this trend can be traced back to the Numerus Valachius movement launched by Alexandru Vaida-Voevod who had split from the National Peasant Party. Vaida published fictitious data regarding the role played by the minorities in economic life, and demanded that in every area the ',aboriginal Romanians" occupy places in appropriate numbers. Under the influence of Nazism, the extreme right-wing movements, including the Iron Guard led by Captain Corneliu Zelea Codreanu, the ranks of which were increasing at an alarming rate year after year, disseminated among large masses of Romanians ideas so dear to the nationalists, demanding the firing of the non-Romanian workers. State enterprises, or those with significant state contracts soon dismissed the greater portion of workers with Hungarian background. In any case, it was part of the program of the Liberal Party in power to support economically the Romanians in every area or, in other words, to discriminate against non Romanians, leading to the notorious labor defense law of 1934. ⁶³

This law demanded that economic, industrial, commercial and other private companies employ at least 80% Romanian citizens in each of the categories defined in the law. Moreover, they were forced to select at least 50% Romanian citizens as members of their board of directors, their executive committee, or their supervising committee, including the chairperson. The categories indicated in the law were the managers, technicians, skilled workers, and laborers. In case where the ratios defined in the law were disregarded, the law prescribed penalties extending from a warning from the Ministry to closing down the firm.

414

The application of the law showed that the measures "in defense of the workers" were aimed at excluding blue-collar and white-collar workers of Hungarian extraction. While the law mentioned Romanian citizens, the application of the law demonstrated that this was merely to mislead the outside world, because the 80% ratio was not applied to Romanian citizens, but to ethnic Romanians. At first some companies could not carry out the inhuman regulation because they could not find a sufficient number of competent skilled workers of Romanian back ground to replace the Hungarians.

When the law was debated in the house and the senate, and Elemer Gyarfas intervened in the issue, the Romanian Minister of Industries and Commerce specified that the term Romanian meant Romanian citizen; in practice, however, ethnically Romanian was meant and, by June 3, 1936, the control committee in charge of the application of the law had penalized 298 enterprises, with fines totaling 24 million lei; because it could not identify a sufficient number of Romanian nationals among the employees. By August 1938 the Ministry had excluded 155 minority enterprises from public freight privileges, and 106 further enterprises a few weeks later. ⁶⁴ In vain did the term Romanian mean citizen in the official interpretation of the law, if in practice the term meant a person of Romanian ethnic background. According to the instructions accompanying the law, the enterprises were required to provide yearly tables indicating among other things the ethnic background of their employees. The results were slow to manifest themselves since officially, according to the interpretation, the companies could not be forced to send away the Hungarian workers. Then, in 1937, Valeriu Pop, the Minister of Industries and Commerce, summoned the companies in a confidential circular to employ ethnic Romanians in the ratio indicated in national workers' defense law. The Hungarian Party obtained a copy of Pop's confidential circular and complained to the League of Nations. After which, Pop retracted the circular. ⁶⁵ The retraction, however, did not stop the damage, and companies received all kinds of penalties, including exclusion from public freight privileges, for non-compliance. These measures cut off many thousands of workers of Hungarian background from their source of income.

415

With regards to industry, the former Hungarian territories deserve attention first of all because of the fate of the Hungarian artisans. There were hardly any Hungarian entrepreneurs in the area. The large enterprises, firms, or factories were owned primarily by Germans or Jews. During the Hungarian regime the Jews had considered themselves Hungarian. The Romanian census and practice, however, had consistently regarded them as a separate entity, and did everything to make the Jews themselves accept the consequences of discrimination. Many of them did disassociate themselves from the Hungarians, no longer feeling responsibility towards their Hungarian employees, while many others retained their Hungarian allegiance and, resisting all kinds of official pressures, continued to employ a sizable proportion of Hungarian workers at their plants. This attitude became very significant after 1934, and in some cases amounted to an act of heroism, since the firms were doubly penalized for it. Under the influence of pronounced Nazi and Iron Guard ideas, the Romanian authorities became strongly anti-Semitic and persecuted these Jewish entrepreneurs both because of their religion and because of their pro-Hungarian sentiments. In spite of this, there were several, like the executive director and owner of the well-known Dermata works (tannery) at Cluj [Kolozsvar], Mozes Farkas, who preferred to pay the fines rather than release his workers of Hungarian background.

From the Hungarian point of view artisanry was much more important than large companies. The Hungarian artisans formed a significant proportion of the population even before World War I. According to the census of 1910, 18.7% of the Hungarian population consisted of artisans. Of course, under the Romanian regime their opportunities were curtailed. They soon became the target of antagonistic measures by the Romanian authorities on account of their strong Hungarian sentiments. Within a few years they would definitely feel the crunch of the economic measures initiated against them. The first such measure was the excessive taxation to which they were subjected. According to the official bulletin of the Romanian Ministry of Finance, in old Romania the taxes of the artisans and small businessmen decreased by 11% by 1924-26, but in Transylvania they rose by 24.5%. The rise in Transylvania was most pronounced in the Szekely counties. In contrast to the average, the tax on artisans and small businessmen increased by 28.6% in the county of Odorheiu [Udvarhely] 31.2% in Ciuc [Csik] county, 42% in Trei Scaune [Haromszek] county. ⁶⁶ As the years passed the pressure on

416

Hungarian artisans increased. Elemer Gyarfas intervened in the Romanian Senate, and Beni Szabo in the House of Delegates, to denounce the disproportionate rise in the taxes paid by Hungarian artisans. Gyarfas explained that on the basis of the sales tax promulgated on December 25, 1929, the tax assessment committee operating at the revenue office of Tirgu Mures (which was manned entirely by Romanians), struck the Hungarians of Reghiu [Szaszregen] with taxes four, five and even ten times as high as in the preceding year. Gyarfas presented a table upon which he had noted the extent to which the tax affecting the Hungarian artisans had increased. A person who had to pay 600 lei in taxes in 1929 was charged 1,600 lei under the same circumstances. In other instances the taxes increased from 560 to 1,540, from 134 to 1,980, from 350 to 3,850, from 203 to 2,420, from 750 to 4,400 lei, even though the rise was not warranted by any increase in sales or any other criterion. In his intervention Szabo pointed out similar manifestations on the basis of complaints he received from all over the country. ⁶⁷

As a result of the excessive taxes, the Hungarian artisans were forced to give up their licenses. At Turda [Torda], Cluj [Kolozsvar], Odorheiu-Secuiesc [Szekelyudvarhely], Mircurea Ciuc [Csikszereda] and other Hungarian towns the artisans closed down their businesses by the hundreds. They either sought some other occupation, or felt forced to emigrate. According to the Romanian census of 1930 the number of Hungarian artisans dropped by over 2%, and this decrease continued in the years following, as becomes clear from certain local censuses. According to the figures provided by the artisans' guild of Sfintu- Gheorghe [Sepsiszentgyorgy], the number of artisans in the town decreased by 22.5% in the period from 1926 to 1936. Only 303 of 391 were able to keep their former trade. The number of apprenticeships likewise declined in the same period from 144 to 89, and the number of apprentices graduating declined from 147 to 87 . Similar causes brought about similar results in Tirgu Mures and Odorheiu-Secuiesc. The number of artisans at Tirgu Mures decreased from 136 to 92 between 1920 and 1935, that of small businessmen from 107 to 39, whereas the number of artisans who did not require licenses dropped from 303 to 70. A few years later there was some improvement, but after 1937 further trade licenses were lost as a result of Romanianization. ⁶⁸

The taxes assessed on artisans were collected punctiliously. The Romanian statistical yearbook reveals that the collection of taxes was far more effective in towns with a Hungarian majority than in Romanian towns. In 1934-35 the national average for the collection of taxes was 76.1%, but the results in certain cities varied according to its

417

dominant ethnic group. For instance, in the territory of old Romania, in the town of Dragasani, 52.1% of the tax assessed was collected. In Plenita it was 42.3%, in Focsani 60.2%, in the Romanian town of Blaj in Transylvania the rate was 47.6%, and in the purely Romanian town of Nasaud 27.7%. In contrast, the taxes collected at Odorheiu-Secuiesc, where the population consisted predominantly of Hungarian artisans, collection was 74.1%; at Miercurea Ciuc it was 79.9%; at Tirgu Mures 93.2%; at Sfintu-Gheorghe 97.5%; at Petrosani [Petrozseny] 95.696. In the following fiscal year, 1935-36, the national average was 78.5%. The rate at Dragasani was 45.4%, at Plenita 31.6%, at Focsani 60.9%, whereas it was 88.5% at Mircurea Ciuc, 82.8% at Odorheiu-Secuiesc, 88.5% at Sfintu-Gheorghe, and 91.2% at Tirgu Mures. At Petrosani where, in addition to the artisans, there were masses of Hungarian miners, the collection rate was 99.6%. ⁶⁹

In addition to overtaxing the Hungarian artisans, Romanian economic policies were aimed at bolstering artisans of Romanian background and increasing their sources of income. The express goal of the law setting up the National Industrial Credit Institute, promulgated on June 23, 1923, was to promote Romanian industry. By Romanian industry the law meant industry in the hands of ethnic Romanians. The objective of the law regarding the Industrial Credit Institute was to provide credit to Romanian artisans. The representative of the Transylvanian and Eastern Hungarian region on the committee in charge of the funds of the Institute, as specified in the law, was a member of the center of Romanian artisans and businessmen of Cluj. The measure completely excluded Hungarian artisans, who constituted the large majority in those areas, from the administration of the funds. The modification to the law, adopted on May 4,1939, added unequivocal measures favoring Romanian racist policies. According to this modification, the Institute could issue loans only to Romanian employers, and only Romanian employers were eligible to serve on the board of directors of the Institute. ⁷⁰ At the same time the government promoted legislation to close down artisan guilds catering to Hungarians. These guilds, within which the members could secure economic protection, professional training, and arbitration, united the Hungarian artisans. The Act of April 29, 1936, regarding professional training and licensing dissolved these guilds and transferred all their funds to the artisan section of the Labor Chambers established a few years earlier. From then on the artisan section within these Labor Chambers had jurisdiction in the most important matters affecting Hungarian artisans. The funds amassed by Hungarian artisans over several decades were now turned over to Romanian artisans who, of

418

course, were in a haste to use these for Romanian purposes. The case of the Hungarian Artisans' Home of Satu Mare, followed by many similar cases, created a big stir. The artisans turned to the courts, requesting that their property rights be recognized. The court decided in their favor. In spite of this the Labor Chamber of Oradea [Nagyvarad] did not restitute the Home to its rightful owners. ⁷¹

The anti-Hungarian intent of the 1936 Act on trades appears most clearly in that provision of the law which allowed the association of the Romanian merchants and artisans of Transylvania to continue. ⁷² These laws were followed by measures aimed at ensuring that apprentices of Romanian ethnic background received training at the hands of Hungarian artisans in percentages prescribed by law. As a consequence of these measures we have the peculiar situation where the Homes that were the fruit of decades of work by Hungarian guilds fell into the hands of Romanian artisans who barred Hungarian ethnic artisans from those homes. Hungarian artisans were not allowed to employ apprentices of Hungarian background, but were obliged to train Romanians. Thus economic freedom ceased to exist for the artisans as well and, in accordance with Vintila Bratianu's chauvinist economic policies, the Romanian state ensured the economic progress of the Romanian population by means of legislation, while preventing the replacement of Hungarian artisans by another generation of Hungarians or even their use of the Homes they had built from their own earnings. After the promulgation of the minority statute, negotiations were undertaken regarding the livelihood and organization of artisans belonging to the Hungarian ethnic group. These negotiations achieved success in 1940. The Hungarian National Artisans Association, created to defend the professional interests of the Hungarian artisans, was founded at that time, but before it could begin to operate the Hungarian artisans were facing a new situation as a result of the Second Vienna Arbitration Treaty (Award).

In the formerly Hungarian areas attached to Romania Hungarian merchants constituted but a small percentage of the business class. These Hungarians were mainly shopkeepers, since the Hungarians had never felt particularly attracted to business. A sizable proportion of the merchants were Jews who identified themselves with the Hungarian population. These experienced the same treatment as the artisans under Romanian rule. Because of their Hungarian identity they were constantly compelled to undergo extraordinary expenses. If they

419

insisted on displaying the Hungarian version of the shop's name on their sign, they had to pay a surtax several times the normal tax. According to the Act of June 26, 1923, dealing with the assessment of community taxes and dues, taxes of 8,000 lei had to be paid to the community for any shop-sign in a foreign language. ⁷³ According to the tabulation accompanying the Act the 8,000 lei were in lieu of the 500 lei normally paid in towns, or the 200 lei normally paid in the villages. Thus, in the villages the tax on Hungarian signs was forty times the normal amount. According to the law published in the official bulletin of April 1, 1935, those artisans and merchants who were assessed according to their bookkeeping would have to pay a surtax if their books were not in Romanian. According to the Act of 1936 on administration, if the shop-signs were displayed only in a foreign language, the owners were assessed eight times the regular tax to be paid to the community. In accordance with the law the Romanian fiscal authorities did assess the eightfold tax at Tirgu Mures, Cluj, and Oradea, even though by that time the Hungarian signs were merely translations underneath the Romanian name. Naturally, there were but few Hungarian businessmen who could undertake to pay the eightfold tax for a Hungarian shop-sign over an extended period of time.

The Romanianization of the employees of businesses started very early. The Romanian Governing Council of Sibiu issued a regulation in April, 1919 requiring financial institutions and other businesses to include Romanians in their management and to transfer to them a certain number of shares free of charge. In the uncertain atmosphere of the times the Hungarian banks and other businesses were worried about their survival and hastened to comply with the regulation. This was the beginning of the Romanianization of Hungarian businesses. After the Governing Council disbanded, the Romanian government of Bucharest took over the Romanianization effort. As a result of its measures the spirit of enterprise soon abated. The Romanian daily of Cluj noted regarding this period that:

economic life in Transylvania has been agonizing for a long time.... Not only did they not introduce legality, but have trampled on the basic freedoms. Everywhere there is a reign of terror, such as we had never seen under the Hungarian regime. They treat Transylvania as if it were a colony. ⁷⁴

After 1922, when Vintila Bratianu took over the direction of the Ministry of Finance, a renewed assault of Romanianization was directed against businesses in Transylvania. This time the ruling Liberal party

420

intended to nationalize (i.e. Romanianize) not only the enterprises owned by the minorities, but even the Romanian enterprises belonging to the sphere of interest of the Romanian National Peasant Party, in order to bring them under the influence of banks in which the Liberals had vested interests. The authors of the French-language leaflet distributed by the Romanian opposition parties in 1924 condemned this economic activity of the Liberals in strong terms. The leaflet stated that the mining and lumber enterprises were compelled to accept:

under the guise of nationalization, the direct influence of the banks belonging to the Liberal Party.... Under the veil of economic chauvinism we find the monstrous attempt of certain economic and political nabobs to gain hold of the economic potential of the entire country.... In order to disguise these reprehensible activities, they pin the Romanian flag over their shadiest transactions; and the most dishonorable deals come about with the help of the highest patriotism. Ad hoc laws are on the agenda. These laws would put a halt to any kind of economic enterprise and strangle all effort and initiative. ⁷⁵

This French-language protests by members of the Romanian National Peasant Party discloses some of the objectives of Romanian economic policy guided by Vintila Bratianu. It is obvious that Bratianu himself intended to purloin the enterprises owned by non-Romanians into the hands of Romanian individuals or at least under the leadership of a Romanian majority. The economic agencies of the Liberal Party derived large profits from this "nationalization" process and their activities affected even enterprises that were already in Romanian hands. It is understandable, therefore, that the owners of such enterprises protested angrily against this side-effect of the nationalization program. As we have seen and shall see further on, they too approved of the plans for Romanianizing the enterprises in minority hands and, when they came to power, Vintila Bratianu's policies against the minorities were adopted and continued.

The legislation concerning industry, the increase in taxation and the stricter collection thereof, as well as the measures aimed at hiring Romanian personnel and excluding minority employees affected commerce along with industry. Consequently, Hungarian businesses also encountered the difficulties we have already discussed in connection with the artisans. The higher taxes assessed in towns with a Hungarian majority and the stricter auditing procedures were attempts to weaken and impoverish the Hungarian merchants along with the

421

artisans. These tendencies of the economic policies became particularly acute after 1934.

One of the greatest difficulties confronting Hungarian commerce under Romanian rule was obtaining adequate credit; hence, credit institutions and the credit policies of the Romanian state assumed considerable importance from the Hungarian point of view. These policies provided credit to Romanian and Hungarian merchants according to the principles advocated by Vintila Bratianu. The details of these credit policies are revealed through the issue of discounting to Hungarian banks. Naturally, until 1919 financial institutions with a Hungarian character were tied to Budapest, the country's economic hub. In fact, most of them functioned as branches of Budapest banks. When power changed hands, the connection with Budapest had to be severed. After reorganization the banks had to stand on their own feet and attempted to conduct business by adapting to the altered circumstances. As mentioned, they elected Romanians into their management, in accordance with the directive of the Governing Council of Sibiu, hoping t the latter would be of assistance in securing the goodwill of those in control of credit policies.

They soon attempted to group Hungarian ethnic banks into a cooperative. The cooperative did come about under the name of Transylvanian Syndicate of Banks, but the Romanian government would not authorize it and therefore had to disband. Finally, on December 13, 1923, they succeeded in reforming at Cluj thanks to a permit obtained with great difficulty. At this time the Syndicate included 98 member institutions with a total base capital of 228 million lei. Since the development of financial institutions is always a function of the discount credit provided by the central bank, this applied to the Hungarian banks as well; but when the direction of the Transylvanian Syndicate of Banks inquired regarding the possibility of discounting from the Romanian Banca Nationala (National Bank), it turned out that the latter, dominated by the Liberal Party, was prepared to provide only very limited credit to the Hungarians banks. The Syndicate received altogether half a million lei discount credit, in spite of its base capital of 228 million. The following year the credit rose somewhat, but it was noted at the annual general meeting of June 8,1925, that for its capital of 322 million lei provided by its 119 member institutions they received merely 19.9 million lei discount credit. At the same time the Banca Romanesca, with a base capital of 380 million, received 866 million, the Banca Maramures, with a base capital of 287 million, received 874 million, the Banca de Credit Roman with a base capital of 195 million

422

received 529 millions of discount credit. ⁷⁶ The proportions did not change the following year. In 1926 the annual meeting of the Syndicate of Banks held at Oradea noted that the Syndicate had 214 members with a base capital of 398 million, yet the Banca National offered it merely 26 million in discount credits. Eight other minority institutions with a base capital of 125.5 million received discount credit of 10.2 million, whereas the Transylvanian Credit Bank, a prestigious old institution, received no credit at all. In the same year the Banca Maramures, with a base capital of 125 million, received 799.9 million in discount credits.

In 1927, at the fourth annual meeting held at Cluj, it was noted that although the Syndicate had 214 member institutions with a base capital of 531 million lei; it still was granted no more than 30 million in discount credit; while the Romanian banks continued to receive in the same proportions as before. The situation improved somewhat in 1928, since the 207 Hungarian member institutions with a capital of 642 million received a discount credit of 107 million, that is one sixth of their base capital. Nevertheless, the Romanian banks continued to receive three or four times their capital in discount credit. The same ratios prevailed in the following year, demonstrating all too clearly that the Romanian National Bank, within the sphere of interest of the Liberal party, faithfully applied the chauvinistic economic principles advocated by Bratianu.

For the above reasons the Hungarian banks could, of course, loan out only at higher rates of interest; basically, Hungarian business life had to make do without the so important credit support during the entire Romanian regime. The financial institutions had to rely exclusively on deposits and on each other. Nor were those banks that did not join the Syndicate any better off. All of them could survive only by paying lower interest on deposits and charging higher interest on loans. The consequence of this, in many places, was that Hungarian and other businesses preferred to turn to Romanian institutions, bypassing the minority banks. Zsigmond Szana noted in 1925 that:

the financial institutions in the Old Kingdom paid less interest on deposits than our own institutions. But we must consider that those banks, for the most part, enjoy credits from the Banca Nationala that amount to several times their base capital, whereas our own institutions receive an average of 20% of their base capital. ⁷⁸

As regards to discount credit, the Hungarian banks got into even more dire straits later on. During the world economic crisis they

423

received practically no credit and by 1935 many Hungarian banks had to close down. After 1935, thanks to international contacts, they gained access to foreign credit, thus avoiding further cases of bankruptcy.

Hungarian institutions were discriminated against not only in the matter of discount credit, but also as a consequence of the Act regarding debts. This Act included several measures to alleviate the condition of the indebted in the villages and the towns. As a result banks throughout the country suffered great losses. Article 62 of the Act compensated the state supported Romanian financial institutions for the losses suffered as a consequence of the tax reform, but minority financial institutions received no such compensation at all. Many Hungarian banks were forced to close down as a result of discrimination and of the measures adopted to promote the principles advocated by Bratianu. ⁷⁹

These Romanian credit policies hampered considerably and at times completely paralyzed the development of Hungarian business. Since they did not have access to adequate discount credit, Hungarian banks paid less for deposits and charged more for loans than Romanian institutions. Hungarian economic life in general became subject to serious difficulties.

THE NATIONALITIES PROBLEM IN TRANSYLVANIA 1867-1940