THE SITUATION IN HUNGARY (INFORMATION AS OF 1700 EST 31 OCTOBER)

Created: 11/1/1956

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THE SITUATION IN HUNGARY (information as0 ESTctober)

The American legation in Budapestonctober0 Budapest time that "it became virtually certain In Budapest this morning that thorevolution wasact ofhe legation said thatobservations, newspaper stories, and radio broadcasts tended to confirm mggmmWml ,ne complete withdrawal of Soviet troops iromlhecity. There ls no indication, however, that these Soviet forces have as yet returned to their garrisons.

' Apparently in direct response to theof the increasingly powerful Revolutionary Military Council of the Hungarian army, Premier Nagyrowd gathered ln Kossuth Square in mioon oft that not he but hie predecessors had asked for Soviet military aid, and that his government is demanding not only thewithdrawal of all Soviet troops from Hungary, but also withdrawal of Hungary from the Warsaw pact.

The Military Council was established onctober by army and police units, insurgent workers, and youth groups. Itebel leader, Colonel Pal Maleter, who led the insurgents in their defense of Ulloi Ut barracks. The council, officially recognized by the Nagy regime, apparently ls backed by major elements of the Hungarian army and air force, and appears strong enough to maintain order in Budapest, in addition, it has probably gained wide popular support by threatening onh to attack Soviet units if they did not leave Budapest "withinours" and withdraw from Hungary byecember.

Strenuous efforts are being made by one major "free" regional government--the Transdanubian National Council located at Gyoer--to line up support from insurgents elsewhere in the provinces In order to unifyInterests" and withhold recognition of the Nagy regime

until their demands are met. There is no firm evidence toelationship between the two seemingly most powerful revolutionary units, the Revolutionary Military Council--recognized by Nagy--and the Transdanubian National Council. They both appear to Include Communists and non-Communists. Both seem willing, If Nagy willto their basic demands, to recognize his government, at least until peace can be restored and free elections held.

The Transdanubian Council claims the support of the national councils of several West Hungarian counties and military units ln the western part of theas well as the Hungarian army's 9th Division. It enunciated its demandspecial session onctober. Thesehe proclamation of Hungarian neutrality at theree and general election, at the latest by the end ofhe namingationalfor the interim period with the right to appoint ranking militaryhanges in the national government to ensure adequate representation of "freedom fighters" in the government;uarantee of the freedom of speech, press, assembly and religion. This regional council, which ls now apparently supported by the Insurgents at Miskolc, also expressed the view that the rebel demands should be met by the government before individual parties arepossibly In fear that the Nagy government would utilize the coverock coalition to hold back on the granting of further demands.

Following Nagy's callultiparty system onctober, the Smallholders and Peasant Parties were reorganized. However, the Budapest radio reported onctober that Bela Kovacs, strongly anti-Communist Smallholder leader.eeting of hia party in Pecs that he had not accepted his appointment to the government as minister of agriculture; he now planned to go to Budapest to discuss the political situation with Premier Nagy.the Social Democratic Party, which continues tofrom joining the Nagy coalition, announced on the same day its reorganization and the election of Anna Kethely as president.

To maintain his leadership, Nagy continues to work feverishly for an accommodation with the

difficult taskuaranteeoviet troopApparentlyirtue of necessity, thehas restored all civil and ecclesiastical rights to Cardinal Mlndszenty, who had already been freed by the rebels. All proceedings and allegations against him were branded false. In addition, Nagy continues to shufflefigures. Hungary's chief delegate to the UN, Peter Kos, was recalled onctober; Laszlo Hay, president of the National Bank, was fired, and Prosecutor General Gyorgy Non--allegedly guilty of criminal activity in the past few days--was ousted. Nagy may also yield todemands for the removal of Ferenc Muennich, newly appointed minister of Interior.

Original document.

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