Month: September 2011

The bill on “public nurturing” is ready to go

Again I have to start with the intricacies of language and Rózsa Hoffmann's choice of words in formulating her ideas on education. The Hungarian word for "public education" is "közoktatás." But Hoffmann is not satisfied with this description of the work of the schools. She is an ideologue for whom school is not just a place where teachers teach their subjects and hope that the students will retain some of the knowledge they acquire. For her school has a "nurturing" (nevelési) function where children also learn about values. What kinds of values? From the text of the bill it is obvious that they will be the ones the state finds "valuable."

In order to highlight this distinction between "education" and "nurturing," the bill that normally would have been entitled "közoktatási törvény" is called "köznevelési törvény." "Nevelni" means to "nurture." The word "köznevelés" until Hoffmann arrived on the scene to reform Hungarian education meant something else. According to Magyar Értelmező Szótár, "köznevelés" means "activities conducted in school or outside of it in the interest of raising the general and professional knowledge of youth." Well, no longer. Now each school is part of Hungary's "public nurturing" network!

I wonder how long it will take for the concept of "köznevelés" to die out. Because, let's hope, Rózsa Hoffmann and the Christian Democrats who came up with these dangerous ideas on education will one day disappear. Once the Orbán government is gone I'm sure the governmental structure will go back to normal where there will a ministry devoted to education. Surely, this ministry won't be called the "nurturing ministry."

The seventy-five-page document can be read in its entirety on the website of the Ministry of National Resources. The bill reflects the Orbán government's general tendency toward centralization. Schools will be taken out of the hands of the local governments. If the bill is accepted in its present form, the ministry will appoint the principals and 90% of the curriculum will also be centrally determined. After all, Rózsa Hoffmann is accustomed to a school system where all the children from Szentgotthárd to Debrecen and from Budapest to Szeged learned exactly the same thing from the same books. Apparently, though, even Hoffmann decided that a fixed list of textbooks might not be to the liking of either teachers or parents, but the list of possible textbooks will be shortened considerably.

Hoffmann likes to invent new concepts to which new words are attached. This gives an intellectual veneer to her rather pedestrian view of education. So, let's go back to language. "Public nurturing" is not a "szolgáltatás" but a "szolgálat." "Szolgáltatás" is "provision" while "szolgálat" is "service," but the Hungarian word is associated with "szolga" which means servant. Perhaps I'm not too far off in thinking that Rózsa Hoffmann might even have conceived of "szolgálat" in the sense of religious service.

There are other oddities in this bill that worry me. One is that schools are supposed to "produce people who are capable of independent Hungarian thinking and who are committed to the fundamental values of the national community." In another part of the document it is stated that "the goal of the public nurturing is to teach every Hungarian children to think and speak in Hungarian."

Let's start with "Hungarian thinking." Surely, Ms Hoffmann isn't simply envisaging thought processes conducted in Hungarian because if one's mother tongue is Hungarian and one lives in a Hungarian-language environment that person will think in Hungarian. No, here the bill is talking about something much more serious: they want to produce people who think in an "independent Hungarian" way. And that to me can mean only one thing. The schools will inculcate the children with a good dose of Hungarian nationalism. Moreover, the state's ideal will be the man or woman who subordinates his or her individuality to perceived national values. The community first, then the individual.

What will the schools of the "government of national cause" (a nemzeti ügyek kormánya) teach besides academic subjects? "Moral and intellectual values characterize the entirety of public nurturing. First and foremost, love, trust, honesty, work, knowledge, justice, order, freedom, equity, solidarity, and the rejection of all types of discrimination."

And finally, Hoffman promises all children the opportunity to join the ranks of "the national middle class." Don't ask me what distinguishes the national middle class from the simple middle class.

These are the most egregious ideas in the bill, at least to my mind, but I fear that it will pass without substantial revisions. After all, Viktor Orbán needs the Christian Democratic votes without which there is no two-thirds majority. And Hoffmann belongs to the Christian Democratic caucus. While Matolcsy is ruining the Hungarian economy, Hoffmann has been working hard to do the same in the field of education. Oh, pardon me! In the nurturing department!

The latest communication from Brussels to Budapest: No extra levy on telecoms

Last October the Hungarian government levied a hefty tax on the telecommunication companies. Prime Minister Viktor Orbán and his right-hand man, György Matolcsy, were hoping to receive 61 billion forints over three years from this source.

At the time of the announcement there were some–most notably Jonathan Todd, spokesman for Neelie Kroes, European Commissioner for Digital Agenda–who said that this extra tax on the telecoms might not be legal under European Union rules. A few years ago Brussels decided that member countries should assist the rapid growth of the industry because Europe was somewhat behind in the telecom revolution compared to other parts of the world. Therefore if any extra taxes are levied, they should be used only for the benefit of the industry. As we know, the Hungarian government desperately needs this money in order to keep the deficit under 3.0%, so the money collected was destined not for expanded telecom coverage but for the general budget.

In spite of warnings the government went ahead with the telecom tax. The first installment of the extra levy had to be paid by December 2010 and the tax, just as in the case of the banks, was stiff. On profits between 100 and 500 million forints, the company had to pay a levy of 2.5%, between 500 million and 5 billion forints 4.5%, and over 5 billion 6.5%. Péter Szijjártó confidently announced in March that the Hungarian decision was perfect in all respects and that it doesn’t go against EU regulations.

It turns out that the European Commission does not agree with Szijjártó’s assessment. It handed down its decision today: the levy does not comport with EU rules. The situation is as follows. Budapest can still negotiate, trying to convince the European Commission of the merits of the Hungarian government’s position. However, if the negotiation fails, there are only two possibilities. Either the Hungarian government revokes the tax and returns the already collected first installment or it will face a law suit at the European Court of Justice.

Even before I read Szijjártó’s announcement of the government’s decision to go ahead and face the European Court of Justice rather than change the law, I suspected that the Orbán government would opt for the latter strategy. It is a well known fact that these court proceedings drag on for years and by that time either Viktor Orbán will not be the prime minister of Hungary and it will be his successor’s headache if the case goes against Hungary or perhaps the Hungarian government thinks that in three or four years it will have enough money to reimburse the telecoms.

It seems that the Orbán government’s big legal gun is “the proportional tax burden” argument, which in their opinion will tip the scale in Hungary’s favor. According to Szijjártó, proportionality is a “European value,” and the telecoms will have to take their fair share in the joint effort to save the country from financial and economic ruin. “Therefore the government of national affairs has no reason to change the law concerning the levy and it is ready to continue this debate before the European Court of Justice.”

The proportionality argument most likely will not impress Brussels or the European Court of Justice because not all industries have to carry the same financial burdens. Only some, like banks, supermarket chains, and telecoms. It will be very difficult to explain that this is actually a fair distribution of tax burdens.

This and similar cases only intensify the antipathy Western European politicians feel toward Viktor Orbán. It was at the end of May that the Slovenian prime minister, Borut Pahor, rather undiplomatically announced to reporters that after Hungary’s presidency of the European Union “Hungary will be isolated” as a result of  Viktor Orbán’s behavior and policies. Pahor commented that Viktor Orbán was ignored even before July 1, 2011, the end of Hungary’s six-month tenure.

Unlike in some better organized countries where the prime minister’s calendar is readily available, in Hungary we don’t have much knowledge of Viktor Orbán’s daily schedule or his travel plans. However, today I read that Viktor Orbán paid a visit to Munich and “conducted talks” with Horst Seehoffer, the Bavarian premier (see picture below). It turned out that Orbán received a personal invitation to celebrate the 70th birthday of Edmund Stoiber, the former Bavarian premier.

Orbán apparently informed the Bavarian premier that “in the center of Hungary’s economic policy is still the reduction of the sovereign debt in addition to the creation of jobs.” In this endeavor he wants to work closely with Germany so that Hungary can become “the center of production of Central Europe.” It must have been a very enlightening conversation.

Orbán receiving a gift from the Bavarian prime minister


While reading this piece of news it occurred to me that as far as I remember Viktor Orbán hasn’t made an official trip abroad since July 1. And this one is only a private invitation to celebrate the birthday of a former premier of one of the sixteen German states. I really wonder whether there is a boycott of the Hungarian prime minister who causes so much trouble in the European Union as was predicted by the Slovenian prime minister and several papers or just a happenstance.

Where are those mysterious communists?

Originally I wanted to write about LMP's madcap idea of placing a moratorium on building new shopping centers. Perfect timing! While in the region building shopping centers has kept the construction industry alive, in Hungary no new shopping center was built in the last year and a half. A few days ago MTI reported that in the next five years one hundred new shopping centers will be built in Germany. Next year already twenty-six will open their doors. But in Hungary where the construction industry is in ruins LMP suggested that no more shopping centers be built. That was in March of this year. I decided to postpone a discussion of this crazy idea until those members of parliament who have so much business sense vote on the bill.

But instead I will write about something that caught my attention this morning, a comment by "bt" who wrote in connection with Ferenc Gyurcsány's intention to establish a party tentatively named Demokrata Párt: "Another name change. How many times has the Kommunisták Magyarországi Pártja changed its name again? They do this every time they are discredited, which is apparently every few decades. And, there are always people buying it. Döbbenet." This last word can be translated as "horrifying" or "stupefying." I guess our contributor thinks that Ferenc Gyurcsány is the direct descendant of Béla Kun. And the Demokrata Párt is the replication of Kun's Kommunisták Magyarországi Pártja of 1918. How simple. One doesn't have to spend any time learning about the history of Hungarian social democracy and its offshoot, the Hungarian communist movement.

This way one can equate Mátyás Rákosi with János Kádár and Béla Biszku with Rezső Nyerges because, after all, they were all communists. The trouble with this view is that (1) facts don't support it and (2) with this simplified generalization one misunderstands current Hungarian reality.

Mind you, this kind of primitive thinking is typical of some of the Fidesz leaders. A couple of days ago I mentioned Zsolt Németh, currently undersecretary of the Foreign Ministry. He is considered to be one of the more polished and sophisticated men in the upper echelons of Fidesz. The staff of the U.S. Embassy had a fairly good opinion of him. They considered Németh to be less provincial than some of the others in the Fidesz leadership. Yet Németh's worldview is very simplistic. There were the communists in a "monolithic MSZP" and the only people who were "post-communists" were members of and voters for Fidesz. According to him the MSZP's leadership realizes that the "present conflict is for the survival of the communist elite" and that Fidesz's goal must be the "ultimate destruction of the communists." 

The staff of the U.S. Embassy was stunned. In the comment added to the above conversation in November 2006 they remarked that "even Németh, who the party often uses in its contacts with the international community, is often more visceral than intellectual in his views. As with many in the opposition, he is quick to reduce the present situation to a caricature of 'communist oligarchs' who 'learned at Kádár's knee,' while seemingly blind to Fidesz's own mix of populism and paternalism."

Populism and paternalism. The Americans expressed their surprise that Fidesz promises to take care of people from cradle to grave while they claim to be enemies of state socialism.

As for the name changes of the different communist parties, that is the real communist parties as opposed to either Attila Mesterházy's MSZP or Gyurcsány's possible Demokrata Párt. Kun and his friends called the party Kommunisták Magyarországi Pártja because in 1918 they had no idea that Greater Hungary would collapse. So it was important to call it the "Communist Party of Hungary." In 1945 Magyar Kommunista Párt (MKP) reflected the homogeneous nature of post-Trianon Hungary in ethnic terms: Hungarian Communist Party. In 1948 they again changed names. They called the party Magyar Dolgozók Pártja (Hungarian Workers' Party; MDP), but this change just as the earlier ones didn't stem from failure. On the contrary. The communists managed to eliminate the Magyarországi Szociáldemokrata Párt, and thus the new name was intended as a kind of gesture to the social democrats.

It is true that the two last changes–from MDP to MSZMP (Magyar Szocialista Munkáspárt) and from MSZMP to MSZP–came in the wake of failure. But again MSZMP was different from MDP and MSZP was established from the reform wing of MSZMP whose members realized that the socialist regime couldn't be reformed and that the one-party system together with the planned economy based on state ownership had failed.

In MSZP there are still a few older folks who were active reformers in MSZMP, but Gyurcsány himself and the people around him, including a number of people who were never members of MSZP, simply cannot be called communists. To do so is to falsify history and distort Hungarian politics today.

Gathering storm in the Hungarian economy

First the analysts of UniCredit in London suggested that the Hungarian government might as well crawl back to the IMF and, like Poland, ask for a kind of security loan just in case. Then Nomura sent the same message from London. Now these two are joined by the analysts of Bank of America Merrill Lynch. They warn that there are "extraordinary risks" in Hungary for investors. They claim that the Hungarian government's economic policy lacks credibility and that the financial consolidation is slow and erratic. In addition, of course, there is the European financial crisis that doesn't seem to be coming to an end any time soon.

The advice Merrill Lynch is giving to the Hungarian government is unlikely to be heeded. According to the analysts cooperation between the central bank and the government should be closer. Given Viktor Orbán's hatred of András Simor–you may recall he tried to make his life so miserable that Simor would quit, it is unlikely that the prime minister would turn to Simor to coordinate economic policy. The second piece of advice is closer cooperation with the members of the European Union. After all, the banks of the eurozone are heavily involved in the Hungarian economy. This too is unlikely. Just today the prime minister announced his intention of "pushing off [elrugaszkodik] from the Eurozone." (In the last few hours everybody has been trying to figure out what this "pushing off" means exactly.) Third, they suggest sitting down with the IMF and negotiating a loan as an insurance policy.

Yesterday an important article appeared about the Hungarian mortgage crisis by Neil Buckley, the East European editor of The Financial Times. The Austrian and Italian banks "urged Brussels to investigate what they claim is a breach of European Union rules that could set a dangerous precedent." He is referring here to the government's decision to allow borrowers to repay their mortgages in full at a more favorable exchange rate. To give you an idea of the magnitude of the problem here are a few figures. Foreign currency mortgages total 5.2 trillion forints. If only a quarter of the borrowers decide to take advantage of the opportunity offered and pay back their mortgages, there would be a 20-25% loss for the banks. That amounts to 250 billion forints. The banking system was already in trouble before this latest government assault. As a result of the extraordinarily high bank levy imposed on them, their profits last year were only 10-12 billion forints and most of that was generated by OTP, the only large Hungarian bank. If the parent banks in the eurozone don't provide more capital to their affiliates in Hungary there will be serious problems with lending, which already shrank by 700 billion forints between the summer of 2010 and the summer of 2011.

An economic crisis may be developing because savings far exceed lending. Banks are protecting, even trying to shore up, their balance sheets–a wise decision given uncertainty in the Eurozone and a rapacious Hungarian government. But without credit there can be no economic growth. Indeed, investment has slowed. Earlier, economists were hoping for a 2-3% growth in investment but the latest release of data by the Central Statistical Office shows a drop of 6.9%. Thus the hope of a speedy recovery is most unlikely.

Mária Zita Petschnig, an economist at the Pénzügykutató Intézet, told a reporter for Népszabadság (September 27) that until the change of government (April-May 2010) there were signs of a recovery. Investments grew by 4-6% just as in other European countries. But in the second quarter of 2010 Hungarian investments not only slowed but came to a halt. Petschnig described the situation dramatically. When lending comes to a halt there is only one thing to do: kneel and pray because the end is near.

According to this analysis the Orbán government's economic policy, if one can call it that, is the cause of the slowdown in the economy. Public works that functioned reasonably well during the socialist regime came to a temporary halt, which meant more people without much purchasing power. The new government stopped all PPP (private-public-partnership) investments. Half finished projects were abandoned. The so-called retroactive "crisis taxes" undermined trust in the Hungarian legal system. There were too many ad hoc decisions that made the economic environment unstable. After a brief initial enthusiasm among foreign investors interest in Hungary waned and credit default swaps (CDS), a kind of insurance policy for bond investors, became more and more expensive.

Because of the misguided introduction of a flat tax the budget has been in serious trouble despite the windfall income from the nationalization of the private pension funds. Even the 2011 budget had to be amended several times, and the figures released for 2012 will most likely be impossible to stick with. Economists expect constant fiddling with the numbers throughout 2012 because the budget rests on shaky foundations. Even Zsigmond Járai, a government yes man and a member of the so-called Budgetary Council, said that most likely there would be a need for the introduction of further taxes. That is over and above those taxes that were introduced in the last month or so. Moreover, according to analysts the tax revenues for 2012 are overestimated by at least 140 billion forints.

All in all, the Pénzügykutató Intézet forecasts an economic growth of 1% for 2012, but they don't rule out the possibility of a recession either.

While The Financial Times describes the general outcry of foreign banks against the Hungarian government, saying that "this early repayment act is clearly an interference with private contracts … and the general feeling is that Hungary is not going in line with the European environment it operates in," until now Sándor Csányi, president of OTP, was quiet. But yesterday even he, a great friend and supporter of Viktor Orbán, felt he had to say something. Of late Viktor Orbán has repeatedly defined one of his causes as "waging war against the banks." He threatens to put an end to the world that was ruled by banks. I guess this was too much for Csányi. He warned that "if the government's intention is fulfilled and it beats the banking industry, it will actually defeat itself." He's spot on: the Orbán government's policies seem to be self-defeating.


The long arms of Viktor Orbán: The Balsai Report

Yesterday morning when I decided to write about Viktor Orbán's preoccupation with Ferenc Gyurcsány I couldn't have known how appropriate this backward look would be by early evening. A few hours after I finished my article, MTI reported that the prime minister had asked the speaker of the house to make "the Balsai report available to members of parliament." Orbán thought that the availability of this report on the "brutal police attack of 2006" would give the members an opportunity to discuss the details of the report.

What is this Balsai report? In its final form it is a 142-page document in which István Balsai, former MDF minister of justice in the Antall and Boross governments who later joined Fidesz and until recently belonged to the party's right wing, outlines his indictment of Ferenc Gyurcsány and his government for their role in those allegedly brutal police attacks in September-October 2006. The report was finished by March 15, 2011 and was given to Viktor Orbán, but the prime minister for one reason or another decided to hold it back.

Just to give you an idea about how important this "investigation" is for the Orbán government, it is telling that on May 5, 2010 reported that "Here is the first move of Fidesz!" It seems that the most important step for Viktor Orbán in the middle of an economic and financial crisis was to name a commissioner charged with the study of what happened in 2006. As Orbán said, "there is no place here for caution or hesitation…. Everybody must answer for their role in this affair. There will be no exceptions. We will not pay any attention to rank, title or age." Finding out the "truth" about who is responsible for the police brutality is "just as important as saving the country from economic collapse."

The man who was named to this important post was István Balsai. I have written about this man at length, especially since he was recently named one of the new hand-picked justices for the enlarged Constitutional Court. You may recall that he wasn't exactly the favorite of the taxi driver mentioned in my September 23 piece. It is easy to dislike István Balsai.

By October 2010 Balsai was certain that on the basis of the material he had seen there was the likelihood that a criminal investigation might be initiated against Ferenc Gyurcsány. In a press conference Balsai announced that once he presents his report "it will be as clear as day that an investigation must be ordered and responsibility will be established." This is an interesting statement especially since in the next sentence he admitted that "there is no concrete document" that would prove this assertion. He was relying on his powers of deduction.  An odd comment from a lawyer who should know that simple inference doesn't stand up in the court of law.

By February, Balsai's stories became more and more bizarre. In an interview on "Ma reggel" (This Morning, MTV) he came up with "witches' tales." He learned that "police units were trained to be prepared to fear the demonstrators. They were told that the demonstrators will take hostages from their ranks and perhaps they will even attack their families." When asked by the reporter who came up with these witches' tales Balsai answered: "You know exactly in whose head these ideas were born. We all know the intentions of the man were who is still a member of parliament. Without his and his minister's knowledge none of these could have happened." 

By April we were told that Balsai's report full of witches' tales was already in the hands of Viktor Orbán. Péter Szijjártó promised its release once the work on the new constitution was finished. But, as usual, bits and pieces of the report leaked out. Magyar Nemzet reported on July 16, 2011 that Balsai's report contained references to "the possibility of terrorist activities." Well, that's heavy. Terrorism! The report apparently states that the brutality of the police was the logical consequence of "the Gyurcsány government's aggressive and paranoid drive for power." Now, that's really funny especially in light of the picture that emerged from independent observers of the events by the staff of the U.S. Embassy and summarized in yesterday's post.

In the report we find no more proof than what Balsai had offered in his television interview. "Gyurcsány must have given instructions to the police." Never mind that all the people involved testified before the parliamentary sub-committee investigating the events that no such order was given. As for terrorism Balsai's two-sentence "proof" is truly laughable. The argument is that the demonstrators were intimidated by the sight of the police. Some of them might have had panic attacks, or feared death. They could have thought that the police might actually use their weapons against them. If such intentions can be ascertained, the charge of terrorism will stand because even preparation for a terrorist act is considered to be a crime.

At the end of Balsai's report there are references to people who helped him in his work. Among them we find the names of those involved in the "investigation" by the Civil Jogász Bizottság of Krisztina Morvai. Another source is the far-right Nemzeti Jogvédő Alapítvány és Szolgálat.

And now let's move back to early November 2006 because to my knowledge this was the first and perhaps the only mention of Fidesz's plan to publish a book with "horrifying charges of police brutality." The information came from Zsolt Németh, who had just returned from Washington and paid a courtesy call on Ambassador April Foley. Németh was one of the founding members of Fidesz; he has served as a member of parliament ever since 1990. He was undersecretary of the foreign ministry between 1998 and 2002 and today is again filling the same position.

Németh alleged that the police had compelled individuals to sign statements that "nothing happened" as a precondition for their release from custody. (This accusation to my knowledge never made it in the campaign against the Hungarian police.) Németh contended that "the government's goal was to portray the opposition as criminals and thus alienate the public, whatever the risk to Hungarian democracy." At this point Foley commented that "Fidesz's demonstrations had attracted violent elements whatever the party's intentions." But Németh couldn't be moved. "It was all the police." He indicated that another demonstration was being planned for November 4.

So, here we are. We always suspected that Krisztina Morvai's "independent" Civil Jogász Bizottság (Civic Legal Committee) was no more than a cover, that the so-called investigation was done at the behest of Fidesz which then used it for its political ends. But we didn't know that Fidesz was planning to publish their findings. Now the cat is out of the bag. It is also likely that Fidesz paid the bills for, among other things, Morvai's frequent visits to Brussels and elsewhere to spread the bad name of the Gyurcsány government and the Hungarian police.

The campaign was surprisingly successful. In the last five years or so, Fidesz managed to falsify the history of those days. A few months ago Magyar Demokratikus Charta asked people to contribute videos, pictures, and all sorts of evidence that would assist them in setting things straight concerning the events that took place in September-October 2006.

I myself was glued to the television and watched far into the night how the "peaceful demonstrators" set cars on fire and threw rocks at the policemen who were mostly acting in self-defence.

Just as the staff of the U.S. Embassy was not moved by the story of the innocent bystanders terrorized by the police, I will never change my mind about those days. How could I? I watched for hours the frontal attack on the police by rock-throwing skinheads who smashed everything in sight. Indeed, it is time to set things straight although, judging by Balsai's report, the falsification is being intensified. The goal again is the same: to put Gyurcsány into jail.



Viktor Orbán’s phobia: Ferenc Gyurcsány

As the day of Ferenc Gyurcsány's questioning by prosecutors approaches we might find it enlightening to look back at the long history of Fidesz efforts to get this far. Because, although most of us no longer remember, the idea of putting the former prime minister in jail was hatched as early as late October or early November of 2006. It was then that Fidesz came up with the idea of a referendum that could put an end to the contemplated reforms. Originally seven questions were posed, out of which three were approved. The road to the actual referendum was long and arduous. It was only in early August 2008 that Hungarians overwhelmingly said no to hospital fees, tuition fees, and co-payments.

What we are apt to forget is that among Fidesz's original seven questions was one that was designed to allow legal proceedings against the prime minister. The original proposition read: "The imposition of 'objective legal responsibility' for the Prime Minister and other members of the cabinet for exceeding the national budget." This particular question was not allowed to be put on the ballot. Zsolt Németh at the time explained to U.S. Ambassador April H. Foley that this seventh question of the referendum had been designed to "hold Gyurcsány accountable for his campaign promises" and their impact on the deficit. May I remind the readers that at present a parliamentary subcommittee is working on the question of responsibility for the sovereign debt between 2002 and 2008. The dates are telling. Gyurcsány resigned as prime minister in March 2009.

The Americans came to the conclusion that Fidesz's opposition to the Gyurcsány government was "emotionally deep but often substantively shallow." They noted that Fidesz politicians were flexible when it came to strategy but they had only one goal in mind: "Gyurcsány's removal."

By early November 2006 the Americans had a pretty clear picture of what Viktor Orbán was all about. It was becoming more and more obvious that Orbán's aim was the destruction of the legitimate Hungarian government with the help of the street. He was quite ready to hold a rally on September 23 when only a couple of days before there had been serious clashes between extremists and the police. Even his closest advisors thought that holding a rally under the circumstances was too risky. In the last minute, his friends were able to convince him not to go ahead.

The local elections brought a landslide Fidesz victory in almost all communities with the exception of Budapest and a couple of other cities. In the wake of that victory Orbán tried a variation on his earlier tactics. He claimed that the local elections reflected the will of the pople and demanded that the prime minister step down by October 6 at noon. If he doesn't, "100,000 people will come to parliament" and will stay on the streets until the prime minister resigns or the coalition removes him.

The Americans agreed with Gyurcsány that "this is fundamentally about the minority's refusal to accept the majority's right to govern." It seemed to the staff of the embassy that Fidesz "set few limits on its tactics whatever the potential consequences."

After Ferenc Gyurcsány received a vote of confidence from both his party and SZDSZ Orbán was furious. He refused to take part in the debate, and after the vote he addressed a crowd in front of the parliament building. He asked the crowd to come every day between 5 and 6 p.m. to protest until Gyurcsány resigns.

A couple of days later Orbán talked to the diplomatic community. He had a new plan. He claimed that there is no time for a new election and therefore asked the government parties "to change plans or change leaders." He would even be willing to cooperate with "another socialist prime minister."

A few days later Orbán again talked to G-7 diplomats. He repeated his belief that under the pressure of the streets and as a result of the austerity measures the government introduced Gyurcsány "cannot survive." He also charged the Gyurcsány government with "criminal negligence." The emphasis is on "criminal." He claimed that the economic situation is worse than the government claims and therefore "MSZP will blink first in the present showdown by withdrawing their support from Gyurcsány." He told the ambassadors that Fidesz was working with trade unions to discuss a national strike committee to coordinate strikes in the coming weeks. He predicted that Gyurcsány would be out of office by the spring of 2007.

The ambassadors had a few hard questions of their own. Orbán was asked, for example, why he didn't put forth a reform agenda of his own. He responded that there could be no "business as usual." Such a step would only "give the government our good ideas." Such tactics might work elsewhere, but in Hungary "politics is all about winning elections." This sentence pretty well sums up Viktor Orbán's attitude toward politics. And if that weren't enough, he added another devastating revelation about his own attitude. When he was asked if he himself might not be blamed for promoting instability, he responded: "that is a risk I'm prepared to take." In brief, he didn't care what the consequences of his machinations were. The American reaction was: "Orbán continues to play his zero-sum game with malicious glee."

The Americans came to the conclusion that Fidesz "believes that the opposition's role is simply to oppose rather than offer constructive alternatives." Orbán doesn't care about the consequences of his actions and has decided "to ignore the very real risk of derailing the progress Hungary has made and the very serious consequences of damaging the reform Hungary must continue."

Here I have described just a couple of months of Viktor Orbán's continuous attacks on the Gyurcsány government which former MDF Prime Minister Péter Boross described as "more in keeping with medieval siege warfare than modern politics." All that against the backdrop of a program of reforms and the necessary introduction of an austerity program.

As it turned out, Gyurcsány's "thoughtful but resolute" demeanor was irrelevant. It didn't matter that he was "very much in command of the facts and of the situation." The diplomats were impressed with him "as a leader who has considered the political, economic, and moral aspects of the issues."  But in the long run he lost to a man who didn't consider any of these issues and who thought, and I guess still thinks, that politics is all about winning elections. Or losing them.

Imre Kerényi, the brains behind the “Table of the Basic Laws”

I read a line about Imre Kerényi, the man responsible for coming up with the idea of the "Table of the Basic Laws" that every public office will have to set up, which caught my imagination. Gusztáv Megyesi, a well known journalist, called Kerényi's life "practically a complete party history."

Who is the man who stands behind this latest brainstorm of the Orbán regime? Who are the men who accept such a bizarre idea from a man whose past is at best checkered and at worst shows mental instability?

The function of and future plans for this table are not worth dwelling on. It's enough to say that the idea serves to make a legal document part of a nationalistic and party ritual. The constitution becomes a kind of sacred text to be revered. That this is precisely what Kerényi had in mind is evident from his claim that if all goes well every school child will receive a pocketbook version of the new constitution, just like American children who then every morning "chant certain sentences from it." The verb "chant" is telling, even if Kerényi mixes up the constitution with the Pledge of Allegiance.

Imre Kerényi in an interview in Magyar Demokrata, a far-right weekly, talked about himself. How much can we believe from his stories? Most likely there will be some who will believe very little. Let's start with the facts. He was born in 1943; his father was apparently an elementary school teacher. The Kerényis had four children, and the family had close ties to the Catholic Church. One of his uncles was a well known cleric in Veszprém. Another uncle a priest in Venezuela. He remembers a communist demonstration against the family in 1950: in the middle of the night the family escaped to settle in a little house without water or electricity. The father didn't get a job for a long time and the family "grew up there in deep poverty."

Some of Kerényi's stories from his childhood border on the unbelievable. First they raised chickens but "the eagle took them." Then they tried raising geese but "the fox took them. They lived in "such a wild place." The wild place was Balatonalmádi! He attended high school at the Benedictine's, yet he had no difficulty being accepted at the College of Dramatic Art. He had to be a natural talent because, according to him, he saw two or three productions in Győr and about the same number in Budapest. Yet he was admitted on the first try.

He claims that he had a serious "nervous breakdown" while a college student. One of his professors gave him the assignment of analyzing Sophocles's Antigone on the basis of class warfare. If that happened in the mid-1950s I would be less skeptical about the whole story. But in the 1960s? It doesn't sound too realistic. In any case, because of his problems with Antigone "he escaped" from college and ended up in the Bakony Mountains from where in no time he reached the Danube to wash his hands. (It must have been a very long trip!) There the border guards arrested him, but it turned out that in Budapest they were already searching for him.

He joined the communist party while in college, but he "didn't even know what it was all about." Apparently he asked his parents, who in spite of their anti-regime political views encouraged him to join. From there on his career was assured. He received a telephone call announcing that György Aczél, who was in charge of cultural policy in Hungary, wanted to have him be the theater director at Szolnok. But he was supposed to "report." He didn't even know what they were talking about, but after two years he escaped from that job because he wanted to direct a play about how politics can deform a man's character but Aczél forbade the production and told him that "in this country only pro-government artists can succeed." 

End of the autobiography. In his story there are a few gaps. Most notably that after Kerényi finished the College of Dramatic Art in 1966 he became director at the Budapest Madách Theater. Two years later he began teaching at his alma mater, and it was only between 1978 and 1980 that he was the head of the Szolnok Theater. Aczél couldn't have been so angry with him, by the way, because the next year he was already working for the Hungarian Embassy in Moscow where he organized extravaganzas for the anniversary of the Great October Revolution. He also had similar jobs in Hungary for demonstrations on April 4, the day of Hungary's liberation by the Soviet army.

At the Madách Theater he was also the communist party secretary, but by 1989 he joined MDF. In 1990 he ran for a parliamentary seat but lost. For a while he supported MSZP and SZDSZ. The great change in his political views came in 2002 when Fidesz lost the elections. "His red star past" was no obstacle and he was employed by Viktor Orbán to organize spectacular demonstrations similar to the ones he created in Moscow and in Kádár's Budapest. He began his party career with the organization of Civic Circles (Polgári körök), and he had a hand in developing "the language of the revolution." In 2006 he declared "those who love their country must join the army of the civic circles. The goal is our dominance in the next eight to twelve years. If Fidesz doesn't win we will stage a revolution."

Fidesz lost the elections and Kerényi became one of the orators of the far-right anti-semitic crowd egged on by Fidesz on Kossuth Square. Perhaps his most famous sentence was "Fidesz is God's gift." 

In spite of all of the above or maybe because of it Viktor Orbán has complete trust in Kerényi. In 1950 on the first anniversary of the 1949 constitution the Rákosi regime staged an artistic exhibition. The organizers asked a number of well known artists, among them Pál Pátzay and Aurél Bernáth, to oversee the artistic side of the celebration. This time around, Orbán didn't bother with such niceties. He gave the whole job to Imre Kerényi, who is contemplating publishing a book that will contain reproductions of new creations in the style of nineteenth-century historical canvases which even at the end of the nineteenth century was passé. I read about one painting which shows Kálmán Széll, István Tisza, Albert Apponyi, and Sándor Wekerle, all well known Hungarian politicians before 1918, seated around a table in a pub in Óbuda. If only they were playing poker it could rise to the level of the ultimate in kitsch–the "Dogs Playing Poker" series.

Kerényi's Table is the embodiment of Hungarian culture Orbán style!

Another kind of “opinion poll” in today’s Hungary

A friend of mine who goes to Hungary quite often happens to be there at the moment on a short visit. The last time she was there, which was only two or three months ago, she reported total apathy even among her politically minded friends. Life in Budapest is enjoyable, and people would rather go to concerts and the theater. They simply don't want to get involved with politics, even on the level of talking about it. They refuse to read the papers or watch TV news.

When she reported that to me, I got really angry. My reaction was that if this is the situation then the Hungarian people deserve what they get. There is nothing worse than burying your head in the sand and one day waking up to discover that the rule of law in Hungary no longer exists. Then they will start screaming about the fate that has befallen them.

Well, today I got an e-mail from her about her first impressions. They took a taxi to go somewhere. As they passed the former Roosevelt Square where with a red line the name Roosevelt is crossed out, the taxi driver out of the blue said: "These guys will not be in power for long." My friend soon found out from the taxi driver that he hates István Balsai the most but that Pál Schmitt is not far behind. He told his passengers that even his young customers "hate Fidesz." The only thing he couldn't understand was who on earth voted for Viktor Orbán's party in the first place.

At this point my friend mentioned that although this might be his experience, Orbán is still the most popular politician with 38%. That didn't impress our taxi driver who gave a whole lecture about the real meaning of that number. It turned out that yesterday he listened to Olga Kálmán's "Egyenes beszéd"(Straight Talk) on ATV and he had already read Árpád W. Tóta's blog written only a few hours before.

And since our taxi driver mentioned ATV, it is worth reporting that their Nielsen ratings are getting better and better. ATV's Híradó (News) hit an all-time record: close to 10%. Almost half a million people watch Kálmán's "Egyenes beszéd." Monday night's "'Újságíró Klub"and András Bánó's "A tét" (The stake) are also very popular. One reason is the very poor quality of the obviously slanted news coming out of MTI, the Hungarian news agency, that is feeding all public TV and radio stations with carefully picked-over news items.

Of course one taxi driver is no proof of anything, but the steady loss of popularity of both Fidesz and Viktor Orbán is quite clear from the monthly opinion polls. Unless, of course, one believes Nézőpontlaughing smileyBut beside the bare figures I can see a shift away from Fidesz even among the young. The student associations that used to be a breeding ground for young Fidesz politicians are outraged at Rózsa Hoffmann's plans to restrict the number of students and to reduce the number of tuition-free slots within the shrinking student body. They also find it unacceptable that according to the ministry's plan those students who don't pay tuition will have to sign a contract even before entering college according to which they will be tied to Hungary after graduation for a number of years. Their position could be compared to the old system of indentured servitude. I wonder what the European Union will think of such a contract since free movement within the Union is a right of all EU citizens.

Then there are other very stupid moves on the local level which will further alienate those in their twenties. There is a very popular outdoor entertainment center called "Zöld Pardon" (Green Pardon). It sits on the bank of the Danube at the foot of the Petőfi Bridge. There was a huge Fidesz victory in Budapest, and now there is a new Fidesz mayor and Fidesz city council in District XI. One of their first moves was to order Zöld Pardon to close its doors. MSZP, which can't get more than 5,000 people out on the streets, should learn a thing or two about how to rouse 45,000 people. Because that's how many people came together the other day to protest the closing of Zöld Pardon. And 130,000 people signed an Internet protest. However, that didn't impress the Fidesz leadership. The city fathers decided to ignore all the protests and banish Zöld Pardon. I would be curious how many votes Fidesz lost by that move.

And what is even worse from the governing party's point of view is that Viktor Orbán's credibility is in tatters. By now only the hero worshippers believe in him. As Árpád W. Tóta says in his most recent blog, those who didn't turn away from Fidesz after the last year and a half "would eat anything put in front of them." These are the same people who applauded madly when Tito was the chained dog and later when the President of the Yugoslav Republic visited Budapest. For these people it really doesn't matter what Orbán "sings" to them. They are hopeless. "But the others… they know that your royal highness is lying."

The flat tax is not so flat anymore

The story of Fidesz and the flat tax goes back quite a while. First we were told that the party was not thinking in terms of a flat tax because it is "not just." That was February 2010, when in a television interview Viktor Orbán claimed that a flat tax is not just "because it doesn't take into consideration the number of dependents."

Five months later, in June, the new prime minister changed his mind. Yes, the government will introduce a flat tax. The new system will be so simple that one could write it on the back of an envelope. Corporate and business taxes will be so low that foreign capital will pour into the country. It was also promised that every taxpayer will be better off after January 1 when the new tax code is introduced. First, it turned out that about 75% of the taxpayers lost on the deal and second, not enough tax revenue is being received by the treasury. The original budget is in tatters and the economy is in terrible shape.

In March economists predicted that the net income of 1.5 million people will be adversely affected by the new tax code. Once this was discovered, the government tried to pass the odium of its policies on to the employers by forcing them to make up the difference by raising salaries. One of the Fidesz luminaries got the job of heading a "salary commando" that would make sure that employers obliged. If they didn't, they wouldn't receive any government contracts. The employers who by and large had been ardent Fidesz supporters began to have doubts about their favorite party. They were really miffed that their opinions were ignored and, to top it off, they were being threatened. Moreover, the government refused to negotiate with either the employers or the trade union leaders about anything, be it suggested wage increases or the labor code.

By August it became evident that the Hungarian economy was doing very badly and that the budget deficit was becoming larger and larger by the day. Yet both György Matolcsy and Viktor Orbán insisted that no change would be made to the tax code. A flat tax or nothing. In fact, we heard time and again that the previous tax code which had two tax brackets (16% and 35%) was the cause of the economic crisis. This nonsense is frequently repeated even today.

Then at the end of August I heard István Pálfy (KDNP), a former journalist, tell György Bolgár that "there had been unofficial discussions about a temporary higher tax bracket for the better off strata of society." Pálfy must have been scolded because by the next day he explained that what he said was not what he meant. A day later Viktor Orbán himself announced that he wouldn't support "any kind of solidarity tax because that may mean that the rich people would move their money abroad."

Yet within a couple of weeks one late afternoon an announcement appeared on the website of the Ministry of National Economy (Nemzetgazdasági Minisztérium) to the effect that there will be "a temporary contribution" that must be paid by anyone who earns over 203,000 ft ( €788.00 or $935.00) a month. So, in a year and a half, Orbán changed his mind three times. First, he announced that there would be no flat tax, then five months later he insisted that there would be, and then, eight months after its introduction, he returned to his original position.

This shift had to be communicated in such a way that the Hungarian people wouldn't realize that the famous flat tax that was supposed to save Hungary from ruin and set her on the road to plenty had failed. How could the spin doctors cover up the fact that Viktor Orbán and his right-hand man, György Matolcsy, had been wrong? This was the job of the government spokesman.

We found out only a couple of weeks ago that Orbán was dissatisfied with his communication people. He has his own personal spokesman, Péter Szijjártó, and I don't think that anyone could do a better job at twisting the truth than he does. Orbán should be perfectly satisfied with him. He knows exactly what to say. He obviously has a very good memory: what his boss tells him is fixed in his mind. And he is quite capable of repeating the same sentences over and over again, fluently and with great conviction. 

However, Orbán wanted to have a spokesman for the government which he cunningly placed under the Ministry of Administration and Justice headed by Deputy Prime Minister Tibor Navracsics. According to people in the know, Orbán's idea was that the bad news which was bound to come wouldn't emanate from the Prime Minister's Office but from somewhere else. They appointed a pleasant fairly young woman, Anna Nagy, to the post; about a year later she took a leave of absence for family reasons. However, we were told that after six months she would return to her old job. In the meantime Zoltán Kovács, undersecretary in charge of communication, would take over her job. In the end, it seems that Orbán was satisfied with neither person. Moreover, he came to the conclusion that after all communication should be under his watchful eye. Anna Nagy didn't get her job back and Zoltán Kovács is not continuing her work. The former apparently wasn't quite familiar with the details of the government policy while Kovács, who came from Debrecen, wasn't at home in national politics. Thus an entirely new department was set up directly under Viktor Orbán.

A new government spokesman was found. Previously he had paraded as an independent political analyst who worked for the Századvég Intézet, which pretty well gave away his close connection to Fidesz. I used to see András Giró-Szász on András Bánó's weekly program, A tét, where he was normally the spokesman for Fidesz. Personally, I found him to be an unpleasant fellow. Every time his fellow political scientists said something he didn't agree with he had a sarcastic smile on his face that communicated to the audience his total contempt for other people's ideas and opinions. There were times when even his facts were faulty. So, I didn't know how he would fare as an official spokesman for the government.

Well, it seems that Orbán wasn't terribly happy with Giró-Szász's first performance, which was supposed to sell the idea of a second tax bracket without giving away the fact that it is really a second tax bracket. According to rumors, the prime minister told Giró-Szász and crew off. The new government spokesman denies that it ever happened, but people who know how Orbán reacts when something is not to his liking can't quite believe Giró-Szász.

But fear not. Szijjártó came to the rescue. He explained today that it is not a new tax. It is simply a different kind of calculation applied to people whose salary is over 203,000 forints. Earlier the government had calculated everyone's 16% tax on the basis of his "super gross" salary. That meant that the tax was figured on the basis of gross salary multiplied by 1.27. Then the government abolished the "super gross" calculation across the board. Now by claiming that they are merely reintroducing the "super gross" calculation, albeit only for those who earn above a certain threshold, they can say that they are not creating a new tax bracket. I doubt that even Szijjértó's clever explanation can work this time.  

Will MSZP split? It looks like it

Yesterday I discovered a brief news item in Magyar Nemzet. It was about Ferenc Gyurcsány's alleged decision to establish a new party. The article was entitled "Left wing party bloc may be established." Magyar Nemzet claimed to have "learned that the current leadership of MSZP and the followers of the former prime minister are contemplating negotiations about 'a peaceful divorce' that would resolve the irreconcilable differences between them." Magyar Nemzet's informer expressed the opinion that the debate within the party must end by the spring of 2012 when the party will hold its general meeting in order to be ready for the 2014 elections.

It's easy to dismiss information coming from Magyar Nemzet because this newspaper is notoriously unreliable when it comes to scoops about the opposition. So at first I disregarded the news as being "one of those Magyar Nemzet stories" until this morning I learned that Csaba Molnár, Ferenc Gyurcsány's right-hand man and deputy in DK (Demokratikus Koalíció), sent a letter to Attila Mesterházy in which the Koalíció suggests that the socialist MP's who received their seats in parliament from the party list resign to provide an opportunity for new, more capable people to represent the party in public. Such a mass resignation would leave only two current MSZP parliamentarians, who won their districts outright. Of course, such a decision would also entail the resignations of Ferenc Gyurcsány and Csaba Molnár. The news about Molnár's letter is accurate, and Attila Mesterházy took it seriously: he is calling together an extraordinary meeting of MSZP's parliamentary delegation to discuss these new developments.

Mesterházy's reaction to the suggestion is naturally negative. He pointed out this morning in an interview with György Bolgár that Gyurcsány's fomenting dissension within the party doesn't serve the true interests of the democratic opposition. After all, it is MSZP that most likely will be able to gather the forces of the left-liberal opposition, and these debates that are conducted in public only weaken the party.

On the surface Mesterházy's argument has merit: it seems easy to criticize what Gyurcsány is doing. After all, he is the man who most ardently desires the fall of Viktor Orbán and his regime. Moreover, he is a talented and intelligent man. Therefore, why is he forcing the issue? For personal gain? I very much doubt it.

Here is my take on the issue. Gyurcsány and his followers came to the conclusion that a "renewal" of the party from within is a hopeless undertaking. Yet, with the current leadership it is impossible to remove Fidesz and Viktor Orbán. So the decision was made to come up with a demand so impossible that it would necessarily lead to a parting of the ways. I assume that Gyurcsány is counting on his popularity within the party. According to the latest vote taken only a couple of months ago it looks as if the pro-Gyurcsány forces are in the majority. If the party membership splits, the financial resources of the party must also be split. Thus, the new party (Demokrata Párt?) wouldn't have to start from scratch. There would be membership and even financial resources in addition to real estate holdings.

Why did Gyurcsány decide to act? I think because by now he is convinced that a Mesterházy-led MSZP simply cannot inspire the anti-Orbán forces. There is something to that. Here are the results of the Szonda-Ipsos (lately only Ipsos) public opinion poll that shows the changes between May 2010 and August 2011:

Partok nepszerusege 10-05-11-08
MSZP is languishing. It doesn't matter how Mesterházy tries to chalk it up to a devastating defeat from which recovery must be slow. There is no way of explaining the stagnation away.

Medián just came out with its latest poll, and its results are in line with those of Ipsos taken just before September 8. Fidesz's share is 31%, the smallest in the last six years. Viktor Orbán's popularity stands at 38%, a historic low. The last time Orbán was doing very poorly at the polls was in December 1999, in the middle of his first tenure as prime minister, but even then his popularity stood at 41%. And yes, very few people are satisfied with the current government: less than 30%. Almost 70% of the people think that the country is heading in the wrong direction.

All this should sound like music to the ears of the anti-Orbán forces, but the trouble is that MSZP is stuck at 12%. That is bad enough, but if we consider that Jobbik is doing just as well as MSZP then we must realize the gravity of the situation. It doesn't matter how often Mesterházy announces that in the near future their strategy and communication will change dramatically, words are not enough and a lot of people are convinced that the current MSZP leadership is simply not capable of more.

I would call Gyurcsány's latest move–if my analysis of the situation holds–a bold and risky one. But perhaps in grave situations drastic actions are needed. Given the current state of affairs perhaps it is a risk worth taking. Perhaps this way one could also measure the popularity or unpopularity of Ferenc Gyurcsány. Since at the moment there is no rising political star on the horizon, it might be worthwhile to find out for sure what he would be capable of doing. If he fails, he can put a permanent end to his political career and move on to something else. And the left can go in search of another dynamic politician.