KISKUNHALAS, HUNGARY — Nearly everyone old enough remembers that day when Levi Strauss & Co., whose jeans evoked the rebellious allure of the West for millions of youths trapped in the Soviet bloc, opened its doors at the edge of town and began hiring box men and seamstresses.
It was 1988. The Berlin Wall was months away from tumbling down. And there was Laszlo Varnai, a worker at a state-owned cooperative farm, watching with delight as spools of thread and crates of indigo blue were hauled into a factory beyond a row of trees.
"It was a grand miracle of the times," said Varnai, recalling how road signs went up pointing traffic to the plant. "They brought a production mentality and a way of working that was alien to the socialist system. It changed us."
The town grew. Varnai became mayor. But the fable-like quality has vanished. The Levi factory is closing.
The company's troubled balance sheet is another creak in the global economy, but Kiskunhalas, named for a clan that centuries ago sharpened swords on this furrowed land, is bitter that its fate is woven into market whims. Nearly 550 townspeople, many of whom ride bikes to work, are expected to lose their jobs in June.
"It's the suddenness that's unacceptable," said Varnai, sitting in the town hall with a big hole in his budget and a lot of worry outside his door.
"Those are people in that factory. Life is more complex than just shutting something down. It might not be to Levi's, but it is to this small town. The inhuman nature in the cold numbers of capitalism, that's what stuns you."
The global financial crisis has battered Hungary's economy, raising worries across the continent that 20 years after the Berlin Wall fell, former Soviet bloc nations are becoming costly burdens to the European Union.
The EU's goal of cohesion is straining relations between Western and Eastern Europe, and between formerly communist nations, the more prosperous of which, such as Poland and the Czech Republic, don't want to be lumped with laggards such as Hungary and Latvia, which this year have seen riots and protesting farmers.
Hungarian Prime Minister Ferenc Gyurcsany, who unexpectedly announced his resignation this month over the slow pace of fiscal reforms, has warned that a new economic "Iron Curtain" is stretching across Europe. That may be overly dramatic, but it's telling on a continent where the ideal of Europe crystallized in a West that has reluctantly embraced eastern nations. Grand plans, ideals and visions are colliding with widening debt and plummeting currencies.
