Month: June 2007

Constitutional flim-flam

We have just stepped onto slippery ground: constitutional interpretation. Any constitution. The observer of the Hungarian political scene occasionally has the distinct feeling that the average Hungarian doesn’t quite understand that the constitution’s interpretation depends on the jurists’ legal and political philosophy. Somehow he thinks that there is "the" constitution and the judges of the Constitutional Court simply tell the world what it says. Period. Yes, here and there you hear minority opinions but, unlike in the United States, they don’t get much media coverage.

The chief justice of the court reinforces this rather simplistic view of the role of the constitutional court. Today, for example, he said that, in handing down a decision, he and his colleagues simply follow the "constitution." The chief justice, Mihály Bihari–ironically a Socialist candidate for the court, staunchly defended the court’s decision to allow a referendum on several budgetary issues, which until now were among the items on which no referendum could be held.

The background is this. Viktor Orbán and his party, the Fidesz, simply cannot accept the fact that they lost the national elections. Ever since last September they have been trying everything under the sun to unseat the government. By repeating that Ferenc Gyurcsány’s government is "illegitimate," they gave encouragement to those right-wing elements who were ready to unseat a democratically elected government by force. When these attempts didn’t attract strong enough support, Orbán tried other schemes within democratic limits. They, however, were unrealistic. In a parliamentary democracy a government can be removed from power only if it loses its majority in the House. That didn’t happen in Hungary. In fact, a unanimous vote of confidence in the prime minister by the members of the government coalition in parliament put an end to such dreams. Then came the local elections which the Fidesz won overwhelmingly. The new slogan was: "we are the new majority," the government has lost its legitimacy. Of course, this is also nonsense in a parliamentary system.

When the new slogan remained only a slogan, Orbán pulled out yet another card. The government’s austerity program and the removal of old socialist structures (especially health care) entailed some unpopular decisions. The government introduced tuition, co-payments at doctor’s visits, and in case of a hospital stay a certain daily fee. The parliamentary majority dutifully voted on all these measures and they all passed. At this point, the Fidesz turned to the constitutional court to decide whether a referendum could be held on these and some other less important issues. In Orbán’s view, if the referendum were to be decided in the Fidesz’s favor, the government would have to resign. To everybody’s surprise the court decided that a referendum could be held on these questions.

The decision was unexpected because the common wisdom was (and still is) that the constitution does not allow any referendum on budgetary items. The exact wording is: "a national referendum may not be held … on the budget, on the execution of the budget…." (my translation from the original Hungarian). So, great was my surprise when I heard Chief Justice Bihari saying that the constitution doesn’t talk about the budget in general, but the "laws of the budget." He blamed the members of the media for distorting the words of the constitution. He called it "disinformation," which implies purposeful misinformation. But can one blame the newspapermen for what would seem to be an accurate reading?

Until now the constitutional court was a sacred cow. The judges could do no wrong. No one dared to imply that perhaps the judges are politically motivated. I cannot fathom why this naiveté because the judges are nominated by parties. The chief justice may have said a few weeks ago in an interview that although it is true that the parties nominate the judges, as soon as they sit on that bench they "consider only the constitution." But anyone who follows the U.S. Supreme Court with its 5-4 decisions knows how disingenuous this claim is.

Before this decision politicians had refrained from commenting on the court’s actions. Now this is no longer the case. Not only have socialist-liberal politicians criticized the court’s decision but Péter Boross (MDF) also found it a dangerous precedent. Prime Minister Gyurcsány called it a political decision.

Chief Justice Bihari’s position reminds me of the American Supreme Court’s "strict constructionist" judges. But one cannot rely only on the written word, especially if that written word is not even clear. At the very least, one must consider the intent behind the text and, at best, the ramifications of any particular interpretation. Surely, if every unpopular decision of the government can be questioned, governing becomes impossible. What kind of answers can be expected to such questions as "do you want to pay tuition," "do you want pay additional fees in the doctor’s office and in hospitals"?

On the bright side, the judges’ interpretation of the "budget" as "the laws of the budget" might give a wonderful opportunity to the government to squelch this whole referendum nonsense. The referendum most likely cannot be held before next spring. By that time there will be another "law of the budget" which can contain the tuition, the co-pay, and the hospital fee. Meanwhile I would suggest to clarify the language of the constitution. If the "budget" means "the laws of the budget," please change the constitution to say precisely that (költségvetési törvény). It would clear the air.

And on the lighter side, there was a man with a good sense of humor. After he heard that the Fidesz asked the court about the constitutionality of the referendum, he also turned to the constitutional court and asked them to decide whether they could hold a referendum on whether "beer would be sold free." They dutifully considered the case and decided against it!

The righteous right

Something unusual, often perplexing can happen in Hungary every day. Yesterday, for example, 20-25 people disrupted a radio program broadcast live from the city of Debrecen, a stronghold of the right-wing Fidesz in eastern Hungary. The broadcast marked the entry of Klubrádió, so named because it was originally the radio station of the Hungarian Automobile Club, into the Debrecen market. Until about a year ago the station could be heard only in Budapest. Then it expanded to Transdanubia, next to the area of Kecskemét in the Great Plains, and a few days ago to Debrecen.

The radio station is the bête noire of the Hungarian right and György Bolgár, an extraordinarily knowledgeable television and radio personality who conducts a popular interview and call-in show ("Let’s discuss it"), is especially hated. This is somewhat surprising because Bolgár is a mild mannered gentleman who goes out of his way to give ample time to right-wing callers (his fans often complain about his generosity in this respect) and treats their points of view with respect.

To mark the occasion of the station’s expansion into Debrecen, Bolgár decided to broadcast his show from a fashionable restaurant’s veranda in the middle of the city. He invited the mayor of the city, Lajos Kósa, who is often mentioned as a possible successor to Viktor Orbán as head of Fidesz.

The first hour of the two hour program went off smoothly. Kósa expanded on the themes of how wonderful his city is and what a wonderful mayor he is. The socialist member of the city council, also invited, was only mildly critical. Everybody said that lately there is more cooperation between the two sides in the Debrecen city council. So everything was great. As soon as the mayor left, however, the demonstrators who until then were peacefully sipping coffee not far from Bolgár suddenly left their tables, unfurled their flags, and started screaming: "Traitors, traitors, down with you, Gyurcsány (the prime minister) into the Danube." A few antisemitic remarks were also heard. A television reporter was attacked, another who came to his rescue was hit on the head by a flagpost while the Debrecen police looked on. The program had to be interrupted. Bolgár and company had to leave the veranda and move into the building.

Mr. Kósa was, of course, immediately besieged by reporters who wanted find out his reaction to these events. His initial reaction was that he saw nothing wrong with the behavior of the demonstrators, saying what all right-wing politicians in Hungary mouth nowadays: they have the right to express their opinions. Somehow they forget that these "defenders of the freedom of speech" had just prevented people who do not share their political view from expressing their opinions. Throughout the day, however, Mr. Kósa became less belligerent and more apologetic.

One could say that as long as the far right manages to drum up only twenty-five people in a large city like Debrecen there is no reason to panic. Some people claim that the Hungarian liberal left exaggerates the right-wing danger. These extreme right-wing gatherings never involve really large crowds. We all know that in every country where democracy flourishes there is about 10-15 percent of the population that holds far-right views. Yet I think it is dangerous to belittle the far-right danger in Hungary for the simple reason that these nationalistic, antisemitic, antidemocratic views are held by far more people than those who are willing to scream and holler at street demonstrations of this sort. It is especially dangerous because the Fidesz gives a helping hand to these groups. In fact, Viktor Orbán himself gets closer and closer to these far-right political views because he has shrewdly recognized that these ideas appeal to a large segment of the Hungarian population. The question is: how large a segment. Only time will tell.

Oily business

In the last few days the whole of Hungary can talk about nothing else but oil. No, not the current price of oil, not Iraq, Nigeria, or Saudi Arabia but an old, very peculiarly Hungarian "oil affair." The beginning of the story goes back to 1990-1991 when the right of center Antall government decided that imported fuel oil would have two different retail prices at home depending on its use. The oil used for heating would be very inexpensive, while the oil used for diesel fuel would be relatively expensive. In order to distinguish between the two uses of the same product, customs officials at the border added red dye to the fuel oil destined to be used for heating. Enter the criminal mind. Bribe the custom officials so that, for a price, they would forget to add the red dye. A simple scam: buy low and sell high, same product, different use. The difference in price was enormous and, of course, the profits also. Or, if these so-called businessmen were not successful at bribing the custom officials, they learned how to bleach the red dye out of the oil. Apparently sulphuric acid and some other chemicals did the trick.

These activities reached their peak around 1993. The methods of the "oil mafia" were varied and imaginative. Bribery, the establishment of fictive companies, forgery, premises for bleaching rented by non-existent persons were just some of the stratagems. All classic "60 Minutes" material.

After about two years of fantastic illegal profit taking, the authorities realized that there was something very wrong here. You cannot have two different price levels for the same oil: dye or no dye. In 1995–this was already during the tenure of Gyula Horn’s socialist-liberal government–the double pricing was abolished. Thus, slowly but surely the illegal activities surrounding oil came to an end. It is estimated that these illegal activities cost Hungary billions of dollars in lost revenues.

One would have thought that setting a uniform price for oil would have put an end to the whole affair. However, in 2000 (by then Viktor Orbán was the prime minister) a naive parliamentary member, a certain Dr. László Pallag (a country veterinarian), got it into his head that a parliamentary committee should be set up to re-investigate the oil scandal. Only 24 people had been prosecuted out of an estimated 4,300 felons. Moreover, there were rumors that politicians were involved. Pallag came up with an alleged witness, a former member of the "oil mafia," who pointed the finger at politicians, high-ranking policemen, customs officials, and so on. Among these were Orbán’s minister of interior, Sándor Pintér, then chief of police; Iván Szabó, former minister of finance; and Sándor Lezsák, former head of the Magyar Demokrata Fórum (MDF). No proof, just accusations. The accused sued Pallag and won. Moreover, Orbán became rather tired of Pallag’s "investigations," closed the whole commitee, and all the material pertaining to the oil affair was made top secret. But not for twenty-five or fifty years, but eighty-five!!!!

So, why all that talk about oil now? Last Friday, an investigative journalist, a woman who actually wrote a book about the "oil mafia," was badly beaten and left tied up alongside the Danube. According to the early reports she was brutally beaten and her condition grave. Considering, she has recovered relatively fast and since then has given several interviews. She also writes, from her hospital bed, a daily blog. In  one of her interviews she sent a rather strong message to the Fidesz and the MDF: "Please do not shed crocodile tears for me now, when you were the ones who wouldn’t allow the Pallag committee to come to the end of this ‘oily’ business."

The current government promised to make the documents public, but it may take some time: they have to look through 80,000 pages. Well, we will see. Will there be consequences this time? Will we learn the truth? A lot of people are doubtful.

Farm subsidies, Hungarian style

Well, let’s start, smack in the middle. No introductory course in Hungarian politics is necessary to understand all this.

Early risers in Hungary can enjoy a political intervew show on MTV (not that MTV but the Hungarian public television station) called Sunrise (Napkelte). Every day there is a different reporter who questions politicians about current affairs. Lately they have also introduced a call-in session. Hungarians adore these call-in programs, most likely because they love to complain. And they complain and complain, mind you a bit haltingly because they also want to hear themselves on the television monitor. The resulting babel can be imagined.

Yesterday, the minister of  agriculture, József Gráf, was the guest. The number of callers was "staggering" according the reporter in charge. Not at all surprising. Agriculture is big business in Hungary, but not exactly in the sense we usually think of big business. Agriculture’s share in the GDP is a mere 5%, but there are close to a million so-called farmers out of a total workforce of about 3.5 million. The explanation is quite simple. Some political and financial geniuses a few years ago came up with the idea that Hungarian farmers needed all the help they could get for the future flowering of Hungarian agriculture. So, for example, if you are a farmer, you don’t pay any taxes on income up to about $22,000! And that is a lot more money in Hungary than in the United States. If you are a farmer, your taxes are further reduced on the next $11,000 of income. In order to be a farmer, it is enough to get a piece of paper that says that you are a farmer. Let’s assume that you are actually a green grocer. You buy some fruits and vegetables which, of course, you didn’t produce. Once in possession of this piece of paper, your troubles are over. Most likely you will never pay any taxes. A quip I heard: "Who would ever have thought that so many bananas are produced in the middle of Europe?"

To be a farmer is beneficial for another reason. In the European Union agricultural subsidies abound. If you produce something you get money. If you don’t produce anything you still get money. The newly admitted countries’ farmers get only about half as much as French farmers, but it is still more than they used to get from the Hungarian government before the country joined the union.

But Hungarian farmers aren’t satisfied; they want more from the Hungarian Ministry of Agriculture and from the European Union. So the call-in segment gives them the opportunity to vent. The first caller has a tricky little question for the minister of agriculture: "When will we get to the point that Hungarian soil will serve the Hungarian people and only the surplus will be exported?" Hmmm? Let’s translate this question: "Why do we allow all this foreign garbage in? Because we are the garbage heap of the European Union. All the inferior produce comes in when the Hungarian agricultural products are ten times better than those produced elsewhere." Or put it more bluntly: We don’t want to have any competition. The same caller referred to Gráf, the minister of agriculture, as "minister-peasant." Our "peasant" before the change of regime headed a very successful collective farm of many thousands of acres (if I recall he even now owns a very substantial farm), but he had an engineering degree and doesn’t strike one as a "peasant." He is a bit of a dour-looking bird but can think straight and answers questions briefly and directly. He also seems to know his business. He is very diplomatic and begins answering the question by saying what an important question the caller posed, but at the end he manages to explain why it is so important for Hungary to export agricultural products. Of course, he ignores the question hidden behind the question.

Then comes the real complainer: 95 farmers didn’t get subsidies in 2004. Admittedly, Gráf was not then the minister. Last year "several people" didn’t get what they should have. Gráf again very politely answers: he will find out. The caller further inquires about some kind of "environmental" subsidy. Too much red tape, money doesn’t come fast enough. Gráf explains that they have to be careful because if they give money to those who are not eligible, this money will have to be returned to the European Union.

But what about the frost? After a very mild winter came perhaps two killer frosts and the fruit growers’ crop got quite a beating. From Gráf’s answer I gather that the Hungarian agricultural minister was quite a success in Brussels as far as the Hungarian farmers’ interest is concerned. You could take out insurance for such an event and there was such an opportunity last year, but very few people took advantage of it. Insurance is not exactly in the Hungarian consciousness. After the frost, Gráf somehow managed to convince Brussels’ bureaucrats that farmers whose crop was already destroyed could take out insurance after the fact. As Gráf himself admitted, this was quite a feat. As if the owner of a car after a crash, standing next to the wreck, would phone an insurance company and sign up for retroactive coverage.

The next caller was not appreciative of the minister of agriculture’s efforts. He still hasn’t received any money, and he needs that money because there are certain tasks that must be done. Aha, but the insurance pays only for the actual loss. Let’s say that an apple grower sold $100,000 worth of apples last year but this year, because of the frost, will lose half of his crop and his income will be only $50,000. He will receive compensation for lost income. But it isn’t yet time to harvest apples, so he doesn’t know the extent of his loss. Moreover, frost or no frost, he would have to finish the work in his apple orchard anyway. I am not sure whether our farmer was satisfied with this answer.

So, this is how it goes.