Hungary

Hungary and the Russian-Ukrainian crisis

A couple of days ago I wrote about the Hungarian far right and Russia and mentioned the Russian accusation that Hungary has been supplying T-72 tanks to Ukraine. At that time the Hungarian government categorically denied the charge, but the case of the “missing” Russian-made tanks is still a subject of debate. First of all, the stories out of the Ministry of Defense were confused. The spokesman for the ministry first claimed that the tanks never left the country: they were just moved from one storage area to another. Then the story took a different turn. The ministry informed the media that T-72 tanks (70 in all) were actually sold to a company called Excalibur Defense Kft. of Székesfehérvár, which received permission from the Czech Ministry of Industry and Trade to transport the tanks to Czech territory.

That deal and the transportation of the tanks to the Czech Republic is most likely for real:  Magyar Nemzet published a facsimile of the “International Import Certificate” attesting to the arrangement. On August 25 the government informed the media that the tanks had begun their j0urney to the Czech Republic. Yet the documents published by Magyar Nemzet did not convince anyone about the final destination of the tanks. Vice Magazine published an article which took it for granted that the T-72 tanks did or will end up in Ukraine. The deal with Excalibur is only a decoy. And this belief is shared by the Russians. Vyacheslav Nikonov, a Russian political scientist and adviser to Vladimir Putin who also happens to be the grandson of Vyacheslav Molotov, in an interview on CNN accused Hungary of illegally selling military supplies to Ukraine.

Today several  newspapers reported that Csaba Hende, minister of defense, may leave his post sometime after the municipal elections. The exact reasons for his sudden departure are not known, but perhaps the clumsy handling of the T-72 tanks might be one of them. Given Prime Minister Viktor Orbán’s excellent relations with Vladimir Putin and his outright antagonism of any sanctions against Russia, providing Ukraine with illegal shipments of weaponry is more than strange. If true, Orbán’s relations with Putin might be greatly damaged and his tarnished reputation in the West is unlikely to improve.

This is not the only strange turn in Hungarian foreign policy. There is also the government’s sudden change of heart about its support for NATO’s anti-Russian moves. Already in his last radio talk Orbán hinted that there might be more willingness on his government’s part to spend 2% of the Hungarian GDP on defense. This figure is the minimum NATO members, including Hungary, agreed to. Since 2010 the government has spent less and less on the armed forces, with the current expenditure a mere 0.88% of the GDP. In that talk he admitted that the country is in noncompliance.

Indeed, two days ago Magyar Nemzet reported that Hungary will arrive in Newport, Wales for the NATO summit with several proposals concerning the Hungarian contribution to the common effort to contain Russian encroachment into Ukraine. The semi-official newspaper is usually very well informed, and therefore we can be pretty certain that the news is correct. Hungary will send a contingent of 100 men to the Baltics to join an international NATO force there. In addition, Hungary will develop the air force base near Pápa. Moreover, Hungary will spend more money to improve the Hungarian military.

Aerial photo of the Pápa Airbase

Aerial photo of the Pápa Airbase

Yesterday HVG reported that several NATO member countries would like to see additional NATO troops in all countries that define the eastern borders of the organization. That would naturally also involve Hungary. According to an unnamed diplomatic source, if such a request is addressed to Hungary it will be almost impossible to refuse it.

Given all these developments one can only marvel at László Kövér’s performance yesterday. The occasion was a meeting of four prominent participants in the change of regime in Hungary–Sándor Lezsák, László Kövér, Mátyás Szűrös, and Péter Tölgyessy–with 20 young historians, journalists, and artists who travel through European countries following the footsteps of 1989. The project, called Freedom Express, was organized by the European Network of Remembrance and Solidarity. The group arrived in Budapest yesterday from Gdańsk and Warsaw. Well, the young visitors were treated to quite a tirade from the third highest dignitary of the country. It was an extraordinary performance that revealed Kövér’s antagonism toward Ukraine and her aspirations.

First, Kövér got upset about some of the questions that had more to do with Hungary’s pro-Russian views than the fine points of regime change in Hungary twenty-five years ago. Then a Romanian participant in Freedom Express asked Kövér a question that included a reference to the Romanian occupation of Budapest in 1919. He indicated that the Romanian army came to Hungary to liberate it from the communists. That really set Kövér off. He began by saying that “there is no reason to bring up topics with which we only irritate each other.”  So, he was in a bad mood even before all the questions poured in about the Russian-Ukrainian conflict and Hungary’s role in it.

Kövér gave his own version of the conflict. “What is going on in Ukraine is a manipulated affair in which the Ukrainians have the smallest role,” he claimed. “The goal of this circus is that it should forever separate Europe from Russia.” Although Kövér expressed his satisfaction with the NATO umbrella over Hungary and although he understands the Poles and the Baltic people who are worried about Russian expansion, Russia has its legitimate security needs. “Who was the American or European politician who asked what the Ukrainians want?” As far as Western media coverage of the conflict is concerned, “the western press lies just as much as Pravda did in the olden days.”

Kövér is also convinced that no democratic developments can be expected from Ukraine because one of the first moves of the Ukrainian government was the suspension of minority rights. (Kövér failed to add that a day later that move was reversed.) As far as he is concerned, there can be no question about the outcome of a military encounter involving “the nonexistent army of the nonexistent Ukrainian state.” Instead, the real solution would be “normal cooperation between Europe and Russia,” but “the chance of that has been lost for the foreseeable future.”

If there is a circus anywhere, I’m afraid it is what Hungarian government politicians have managed to create in the field of diplomacy. And the clowns in this circus are not at all funny.

Learning history in Orbán’s Hungary

The new school year began yesterday and with it an entirely new system as far as textbook distribution is concerned. As you most likely know, a couple of years ago all schools were nationalized and put under the authority of one monstrous organization called Klebelsberg Intézményfenntartó Központ (KLIK), named after Kunó Klebelsberg, minister of education between 1922 and 1931. Critics predicted the failure of such a centralized system where KLIK was to be the employer of about 150,000 teachers. They were right. It was a disaster, which even Zoltán Balog, who is in charge of education, had to admit. The head of KLIK was sacked and right now the government is in the midst of a “reorganization” of KLIK.

One of the important demands of Rózsa Hoffmann, former undersecretary in charge of education, was a reduction in the number of textbooks teachers can choose from. Indeed, as of this year, teachers can only pick one out of two. The textbook publishing industry was also nationalized, so government control over education became all embracing. The new textbooks appeared on the market only a few days ago and therefore each teacher had to decide within a couple of days which one she will use. At the same time a number of “experimental” textbooks were written and introduced in 150 schools picked by the ministry.

Since the “experimental” textbooks have been available for only a few days, critics haven’t had time yet to find all the objectionable passages in them. According to some, at first glance these textbooks are “problematic” in pedagogical terms and reflect “an anti-modernization world view.” There are just too many “political-ideological” messages. One history book spends far too much time on the injustices of Trianon, which only adds to the self-pity of the current generation instilled by the nationalism of the current regime. Others looked at a book on literature (grade 7) that reflects the authors’ distaste for our modern market economy and expresses antagonistic feelings toward life in western countries. For example, to eat hamburgers, visit Disneyland, watch MTV or CNN  means to be satisfied with a lower level of culture.

The same grade 7 textbook is full of anti-American sentiments. In it one can read that “we ought to be proud that according to sociologists for the average Hungarian person the most important value is logical thinking while in the eyes of the Americans this is the least valued trait.” Hungarian medieval poetry that praises war and Petőfi’s calls for struggle can be explained by our “biological roots.”

After reading a few of these critical articles I decided to take a look at a grade 10 history book, one of the experimental textbooks available online. The book covers the period between the age of discovery (15-16th centuries) and 1848. It didn’t take me long to find some glaring problems with the book.

tortenelem 10

At the beginning the students are told–thank God–that they don’t have to learn absolutely every fact in the book but that the concepts that appear in boldface are very important. So, I decided to see how our author deals with some basic concepts. Since anti-Semitism is a topic we encounter a lot nowadays, I decided to start there. To my great surprise, the word appeared only twice in the textbook. Both times as a concept of the utmost importance. But nowhere in the book do we find a definition of the term.

My second search was for the word “nationalism.” That initially looked more promising. The word “nationalism” was mentioned eleven times, but I found no instance that dealt with the concept per se. On page 131 the student learns that after the French revolution there was a new interpretation of the historical nation (nobility) and that it was the “national idea” (nemzeti eszme) or “nationalism.” Proponents of the movement desired national renewal. They tried to form a common national identity and made efforts to discover the national past. So, what does this young man or woman learn? Nationalism is a good thing! Not a word about the negative connotations of the term.

The most controversial discussion of nationalism occurs in connection with the “nationality question” in the so-called reform period, i.e. the last twenty years or so prior to the 1848 revolution. The Hungarian “reform forces” greatly feared the Pan-Slav ideology supported by Russia and were frightened by Gottfried Herder’s vision of the Hungarian language disappearing in the sea of Slavic people. (Pan-Slavism is not explained anywhere in the book.) Therefore, the Hungarian reform generation paid a great deal of attention to the Hungarian language and culture. At the same time they wanted to be sure Hungarians maintained their political primacy in the Carpathian Basin, to which they felt entitled by their 1,000-year history of statehood. Hungarians were able to establish a viable state (államalkotó nemzet) while the others–Slovaks, Romanians, Ruthenians–were not. Rights and privileges were to be extended to all regardless of nationality. This Hungarian concept of nation was based on the definition of the term in the French Encyclopédie. What the authors neglect to mention is that the famous encyclopedia was published between 1751 and 1772, that is before the French revolution. What was a viable way to unify the people of France was no longer true in Eastern Europe.

After this brief discussion, the authors move on to interpretations of Hungarian nationality problems in the first half of the nineteenth century. “Central-European, non-Hungarian historiography unanimously consider the Hungarian language laws of this period as ‘Magyarization’. However, nowadays Hungarian historians present a more complex, more layered study of the question. It recognizes that there were abuses, but the political forces urged a liberal handling of the nationality question.”

I’m trying to imagine myself as a studious fourteen- or fifteen-year-old acquiring a basic knowledge of Hungarian history. What kind of a picture would I get of the history of my own country? By and large a very positive one. I would learn that Hungarians are superior to others living in the Carpathian Basin because they had the ability to establish a state. And that this would entitle them to have political primacy within the historic borders of Hungary. I would learn that non-Hungarian historians are prejudiced against the Hungarians and that in the past Hungarian historians were far too hard on the Hungarian political elite. Lately, I would come to understand, a much more balanced view is emerging that shows liberal tolerance toward the nationalities.

I just heard that István Hiller (MSZP), former minister of education,  is launching a kind of alternative curriculum called “School of Reasoning” (Gondolkodás iskolája). It will be a series of video lectures given by outstanding teachers who donate their time to the project. I think it is a capital idea, and next week when the project begins I will be one of those listening to the lectures on modern history. It will be interesting to compare these lectures to the experimental textbooks.

The Hungarian far right and Russia

There has been a lot of discussion about the Russian sympathies of the extreme right parties in Europe. I have written extensively about Jobbik’s close ties with Russia. I’m sure that many readers remember the strange story of Béla Kovács, Jobbik EP MP, who, by the way, was just barred from the territory of Ukraine by the Ukrainian government. The reason? Most likely Kovács’s participation in the group that found everything in perfect order in the Crimean elections. Gábor Vona also visited Moscow, accompanied by Béla Kovács, and met important Russian political leaders.

The same affinity for Russia holds for France’s National Front, whose leader, Marine Le Pen, visited Moscow last summer and met similarly high-ranking politicians of the Russian Duma. Golden Dawn, the Greek fascist party, also has close connections to Moscow from where it receives financial assistance. When the Greek government imprisoned Nikos Michaloliakos, the party’s leader, Alexander Dugin, the author of Putin’s “Eurasian” ideology, actually sent him a letter in prison. Just to remind people: Gábor Vona also met Dugin in Moscow. And then there is Bulgaria’s far-right party, Ataka, that also has links to the Russian embassy.

All these parties and other right-wing fringe organizations support Russia’s annexation of Crimea and stand by Russia in the Russian-Ukrainian conflict. They are all against the European Union and the United States. Most of them are also anti-Semitic, definitely anti-Israel, pro-Palestinian and Iranian.

A previously lesser-known right-wing portal in Hungary, Hídfő (Bridgehead), has recently come into prominence. It was this site that first broke the story that Hungary is secretly supplying tanks to the Ukrainian army. One of their readers saw a tank being transported by train toward Debrecen, which the editors of the portal found suspicious. Soon enough word spread that the tanks were destined for Ukraine. The Hungarian ministry of defense explained that the tanks had been sold to a Czech businessman who deals in used military equipment.

Later the Russian foreign ministry published an official statement stating that “weapons supplied to Ukraine by the EU member-countries … violate legally binding obligations–the Arms Trade Treaty.” The Russian foreign ministry was fairly well-informed on the details: “Hungary’s Defense Ministry is supplying Ukraine with armored vehicles, including T-72 tanks, through a ‘proxy agency.'” The Hungarian Foreign Ministry denied the Russian claim as “groundless.”

As a result of its revelation Hídfő, which apparently has a readership of 3,000/day, became internationally known.  And naturally that aroused the interest of investigative journalists in Atlatszo.hu, one of those NGOs that receive financial support from the Norwegian Civic Fund. They discovered a few interesting items about the organization that is likely behind Hídfő–Magyar Nemzeti Arcvonal, a Hungarist organization that came into being in 1989. Originally it was called Magyar Nemzetiszocialista Akciócsoportok (National Socialist Action Groups) . It considers itself to be the legitimate successor to Ferenc Szálasi’s Arrow Cross Party.

Hídfő, as far as I could ascertain, was established on September 25, 2012, or at least that is the date when the first article appeared. The portal is full of anti-Israeli, anti-American, anti-European Union articles while it is fiercely pro-Russian, pro-Palestinian, and pro-Iranian. Their Russian connections must be substantial. While internet sites normally invite readers to express their satisfaction on Twitter and Facebook, Hídfő has only Vkontakte, a kind of Russian Facebook.

Hídfő is well informed on the exact military situation in Eastern Ukraine

Hídfő is well informed on the precise military situation in “New Russia”

An interesting article, originally published on tarsadalmivirtus.lapunk.hu, appeared in Hídfő in 2013. If one can believe the introduction, a single person writes all the articles; he sees himself as a great observer and analyst of international affairs. He also looks upon the European Union as an enemy that until now has been unable to grab only two countries: Ukraine and Belarus.  But the EU has plans concerning Ukraine. If it manages to get hold of Ukraine, its influence in Europe would be complete while “Russia would be squeezed into the Asian region.” European pressure is great on Ukraine and in case of a civil war “it is possible that Moscow will try to save the Russian population and the country will fall into several pieces.” This, however, will not satisfy the European Union. The final step of the evil European Union will be “the execution of Russia.” Romania will incorporate Moldova while the West will incite the Muslims of Russia to revolt. Eventually Russia will fall apart without any outside military action. Our man seems to know that “the Russian military leadership” has already worked out a strategy to prevent such an outcome. It includes the support of Russia nationalists in Ukraine, to be followed by “tremendous pressure on the Baltic states.” Whoever our man is, he predicted the events on the Russian-Ukrainian border fairly accurately.

Another far-right site is “Jövőnk” (Our Future). This Hungarist site has been in existence since January 2009. It would be fascinating to learn more about this group because the site suggests that they have plenty of money. They publish articles not only in Hungarian but also in English, French, German, Russian, Romanian, Slovak, and Serbian, which is a very expensive undertaking. The people behind Jövőnk are so enthusiastically pro-Russian that their articles could have been written in some Russian government office in Moscow and translated into Hungarian. This particular page will give you an idea about the editors’ infatuation with Vladimir Putin. In one of the articles there are enthusiastic lines about Putin building a Eurasian Empire, and not for a moment does the author worry about the implications of such an empire for his own country, Hungary.

A strange, inscrutable world about which we still know very little. We especially know very little about the nature of these groups’ ties to Russia and Iran. One can only hope that the Hungarian secret service is keeping an eye on these people, although I have my doubts about both the talent and the will of the security agents. When one reads articles in these extremist websites about the decline of the West and glowing descriptions of the East, one has the awful feeling that Viktor Orbán has quite a bit in common with these fellows. A rather frightening thought.

Procreation and pensions in Hungary

In the last month or so article after article appeared about the conclusions of a group of economists and demographers who have been discussing possible solutions to the interrelated problems of the low Hungarian birthrate and the eventual depletion of the state pension fund. This group, the Népesedési Kerekasztal (Demographic round table), seems to have the support of the Orbán government. It is deeply conservative and a promoter of family values.

One of the most vocal proponents of pension reform among the group is Katalin Botos, an economist who was a member of parliament between 1990 and 1994 and also served as minister without portfolio in charge of the banking sector in the Antall government. Prior to the change of regime she was a department head in the Ministry of Finance (1971-1987). Lately, she has been teaching economics at various universities.

The Hungarian media acts as if this is the first time the public has heard about the outlandish plans of Katalin Botos. But in May 2012 Népszava ran the following headline: “One must give birth for one’s pension.” At that time Katalin Botos and her husband József Botos were active in the Working Group for a Family Friendly Hungary, which was organized under the aegis of the Ministry of Hungarian Economy. The study that appeared at that time was entitled “A középosztály gyermekvállalási forradalma” (The revolution of childbearing of the middle classes). In it, the Botoses explained the logic behind the introduction of a sliding scale of pension payments depending on the number of children. After all, pensions are being paid by current wage earners, and if a couple did not produce at least two children they are freeloaders.

At that time the group made calculations on the basis of 2010 maximum, minimum, and average salaries and came to the conclusion that an employee earning an average salary would get 14.4 points but only if he/she produced at least two children. Extra points would be earned for each additional child. On the other hand, employees with one or no child would be docked a certain number of points. According to this system, someone with an average salary of 113,000 forints with no children would receive a pension of 70,000 forints while a person with four children would get 142,000!

Triplets

The more the merrier

Members of the working group did address the problem of couples who cannot have children for physical reasons but somewhat heartlessly remarked that “the fact still is that there is no one behind them who is responsible for their pensions.”

When this study was made public the vast majority of experts found the scheme unacceptable and ineffectual. To hope for a higher birthrate by linking it to higher pensions thirty or forty years later is totally unrealistic.

The public reception was anything but friendly, and the government promptly announced that they have no intention of introducing it in the near future. But, as we can see, this plan has remained on the government’s agenda because the latest scheme released by the Demographic Round Table is practically the same as the one in 2012. The few additions to the new report in fact make it even less attractive.

As far as the government was concerned, the original Botos plan had one huge flaw: in the Roma population families are large and girls begin to reproduce early. Surely, the argument went, you don’t want to encourage them with a pension system that might increase family sizes. So, an additional restriction was added: only children who finished high school (matriculation) or trade school would count. Not surprisingly, this was considered by critics of the plan as anti-Roma.

This time around the authors of the scheme also addressed details that were not considered in the 2012 version. For example, a person whose child died before he could finish high school would be exempt. The same would be true of children with a mental disability. But many questions remain. What will happen to young people who decide to work abroad? Will their departure be accompanied by a drastically reduced pension for their parents?

Although the plan was fleshed out a bit, by and large the “mad” scheme, as many commentators called it, remained intact.

Across the whole spectrum of the Hungarian media the reaction was uniformly negative. And real panic set in when Péter Harrach, leader of the Christian Democratic parliamentary delegation, announced that the report of the Demographic Round Table was in line with the thinking of the government and therefore there was a good possibility that the suggestions will be adopted, perhaps as early as September.

This was unfortunate from the government’s point of view. Right before the municipal elections such an announcement could have disastrous consequences, especially among those under the age of 35 whose pensions would be directly affected by the new law. Mihály Varga, minister of national economy, quickly reassured the voters after Harrach’s unfortunate interview that “it will not be necessary to have more children for higher pensions.” The Hungarian pension system is stable and there is no need to make any changes before 2030. But then why all the talk about a scheme that has been on the table for at least two years?

Well-known experts on the pension system, like György Németh, are convinced that the entire economic framework that lies behind the Botos couple’s scheme is wrong. In fact, in Németh’s opinion, it is unacceptable. Raising the birthrate is desirable, but it can be achieved only by the introduction of government measures that lower the expenses of child rearing. Compensation forty years down the road for the heavy financial burden of bringing up children today will not achieve anything. It is no coincidence that this interview appeared in Magyar Nemzet.

I would like to believe that this madcap idea will not be adopted, but I have a strong suspicion that in spite of Varga’s assurances to the contrary something is afoot. I would not be at all surprised if within a few months parliament passes a law that links procreation with pensions. If such law is passed, even more people will leave Hungary and settle elsewhere where the state does not interfere in their private lives. Oh well, at least the state won’t have to worry about their pensions.

The Hungarian central bank goes on a buying binge

It was on August 3 that I first read about the so-called Borbély castle in Tiszaroff. It was refurbished after the change of regime and was owned by a German businessman who made a four-star luxury hotel out of it. In the wake of the recent downturn in the economy, however, the business failed, and the owners put the property up for sale. The article I read in Vasárnapi Hírek reported on rumors circulating in the village that the Hungarian National Bank had purchased the castle for use as a vacation resort for the central bank’s employees. And indeed, a week later it became official. The bank purchased the property for €1.3 million (415 millon HUF).

Kester Eddy, a reporter for the Financial Times, had a great time writing a story about the purchase. It reminded him of the days when, under communism, state companies and institutions owned holiday properties so their employees could spend two weeks splashing around in Lake Balaton. The bank struck back and explained that “the Magyar Nemzeti Bank, like other EU central banks, seeks to provide its more than one thousand employees with fringe benefits.” Moreover, the castle-hotel is located in the country’s least developed region and by opening the hotel again “more than 30 new jobs have been created.” Between May and the end of August it will function as a recreational center and between September and April as a training center.

The Borbély Castle-Hotel in Tiszaroff on 3.5 hectares

The Borbély Castle-Hotel in Tiszaroff on 3.5 hectares

Earlier the Hungarian National Bank had seven different vacation homes, but by 2009 the bank sold them off one by one. In these still difficult economic times it is hard to justify buying a luxury hotel even if the price was apparently attractive. The owners asked 680 million forints for it, but the bank managed to purchase it for a mere 415 million. Moreover, Matolcsy pointed out that the bank had earned a profit of 26.3 billion forints and therefore the purchase did not cost taxpayers a penny. An interesting explanation from a central banker.

The brouhaha over the purchase of the castle-hotel had barely died down when HVG learned that the Hungarian National Bank also bought perhaps the most expensive office building in Budapest, the eight-story Eiffel Palace. Originally it was rumored that some of the offices of the central bank would be moving into the building. Portfolio thought that purchasing a class A office building was an acceptable business concept. Others were less sanguine. For example, the popular blogger orulunkvincent.hu. According to him, the price was €57.5 million (18 billion forints) and the building has 14,000 square meters of rentable space. In calculating the potential return on this investment he assumed the top rental rate for space in a green building, €13.5 per square meter. In downtown Pest 86% of the available office spaces are occupied. If the Eiffel Palace has the same occupancy rate its gross annual rental income would be €1,950,480. Assuming an 80% profit and 10% tax, the net rental income would be €1,404,346 per year. That means a return of 2.44%. Five-year government bonds have an interest rate of 4.70%. So, says the blogger, this deal does not sound so fantastic to him.

According to critics of the deal, the Hungarian National Bank grossly overpaid the owners of the Eiffel Palace. They paid almost 18 billion forints when according to real estate assessors it is not worth more than 11-12 billion. E-PM will go to court in connection with the purchase of the office building because it suspects malfeasance or a breach of fiduciary responsibility on the part of the central bank.

But these two purchases were nothing compared to yesterday’s revelation. HVG learned that the central bank had transferred 200 billion Hungarian forints to its five foundations named after Pallas Athena, the goddess of wisdom, courage, inspiration, civilization, law and justice, just warfare, mathematics, strength, strategy, the arts, crafts, and skill. A perfect description of Hungary today!  This amount is one and a half times more than the Hungarian government spends a year on higher education.

Initially it was known only that this money will be spent on education. Today the central bank released details of its project. “We are creating a faculty of economics and finance at Kecskemét College, a faculty of finance in Marosvásárhely/Târgu Mureș (Romania), a doctoral school in the Buda Castle, and an intermediate financial training center in Pest.” The reason? “The already obsolete doctrines and mistakes of the neo-liberal school of economics continue to dominate Hungarian education in economics and finance.” Since Matolcsy thinks that mainstream economists in the country–and that means practically all respected experts–are wrong and since he cannot get rid of them, he will build parallel economics departments that will teach his unorthodox economic theories. Just as the Orbán government needs an alternative Holocaust Museum and an alternative academy of artists it also needs a new set of economists who will be the high priests of unorthodoxy.

Matolcsy admitted that it will be an expensive undertaking because, after all, they need “new institutions, professors of new vision, and new teaching materials.” Creating new institutions will probably be the least of Matolcsy’s problems. Where will he find those professors of new vision? Where is he going to find new teaching materials? Perhaps he is planning to write them himself because I can’t believe that any self-respecting economist would be willing to write textbooks acceptable to Matolcsy.

I tried to find out more about the institutions mentioned and, as far as I can see, only two seem to exist. The Kecskeméti Főiskola at the moment does not teach economics. It has one section that produces elementary school teachers, another where they teach information science, and another that specializes in what Hungarians call “kertészmérnöki kar”–less elegantly put, gardening and landscaping. This college was established in 2000, i.e. during the first Orbán administration. The second institution, in Marosvásárhely/Târgu Mureș, is not mentioned by name, but I guess it is the Sapentia Hungarian University which was established in 2001 and heavily subsidized by the Hungarian government. I remember that shortly after the 2010 election Viktor Orbán made a trip to Târgu Mureș and gave a billion forints to the institution. As for the others, I assume they will be established sometime in the future.

I used to think that I could not be surprised by anything that is done by this administration, yet I am surprised time and again. It is really frightening how much power is in the hands of people whose sense of reality is greatly impaired.

Did Viktor Orbán backpedal in his address to Hungarian ambassadors?

The consensus seems to be that in his address to the Hungarian ambassadors Viktor Orbán retreated from his previously articulated doctrine of illiberalism. In so doing he followed the lead of several right-wing analysts and journalists who tried to downplay the significance of the radical speech he delivered in Tasnádürdő/Băile Tușnad. In fact, they went to great imaginative lengths to explain the “true” meaning of the word “illiberalism.”

A friend called my attention to an editorial by Matild Torkos of Magyar Nemzet who argued that Orbán’s criticism was not of liberalism per se. What he meant was the kind of liberalism that existed in Hungary before 2010 when the Hungarian state did not defend state assets, when it did not recognize Hungarians living in the neighboring countries as part of the Hungarian nation, and when it allowed the country to be indebted. Or, there was an editorial by Zsolt Bayer of Magyar Hírlap, according to whom Orbán was not talking about the elimination of liberal democratic rights but only about people who make their living by work and not by welfare payments.

Tamás Fricz admitted that the choice of the word “illiberal” was unfortunate because since 1997 it has been equated with autocracy and semi-democracies. He even had a suggestion about a better way to describe “the new state and social model.” It should perhaps be called “national democracy,” where the emphasis is on the community as opposed to the individual.

George Schöpflin, formerly Jean Monnet Professor of Politics at the School of Slavonic and East European Studies, University College London, is Fidesz’s “political philosopher.” He gave some learned answers to questions posed to him by HVG. For Schöpflin “liberalism” is a dirty word because “it seeks to coercively impose its ideals on the whole world.” In his interpretation, “Orbán was referring to economic liberalism, to market fundamentalism and the damaging impact that this has had on the Hungarian economy.” Later in an interview which is still unavailable in its entirety online he argued that in the United States “illiberal” has a different meaning than it does in Great Britain and therefore “its use was unfortunate.”

Fidesz analysts came to the conclusion that the word “illiberal” should be avoided, and indeed Orbán used the word only once in his address–by now available online–to the ambassadors. Orbán talked about the necessity of raising the number of the actively employed. In this context he said: “Our labor policy cannot be considered liberal because it does not give primacy to the individual but wants to have an equilibrium between individual and community interests. In plain language that means that we will not be able to provide social assistance to someone who is able to work and is offered a job by the government but is unwilling to work . This is an illiberal point of view. György Schöpflin is right that this word should be avoided because the Americans’ understanding of the word is different from that of the Europeans.” Of course, what Schöpflin claims is nonsense. Americans and Europeans have the same negative understanding of the word “illiberal.”

Suggested reading on "illiberalism"

I think it’s fair to say that as far as “illiberalism” and the admiration for authoritarian states or outright dictatorships are concerned, Orbán backpedaled in his address to the ambassadors. In fact, he stressed that “his country is anchored firmly in Western culture and political institutions.” As Ildikó Csuhaj of Népszabadság wrote today, Orbán must have listened to the critical voices coming from conservative circles and changed his tune. Of course, that doesn’t mean that he has given up on building an illiberal state, a project that has been going on for the past four and a half years. He has no intention of abandoning his goal. He just realized that it is not a good idea to talk openly about his plans.

The speech was crafted to avoid controversy. It was basically a pep talk to the ambassadors urging them to encourage foreign investment. There was relatively little about foreign policy, which in Orbán’s opinion has lost its importance.

When it came to the question and answer session, however, Orbán was less guarded. He addressed the subject of the Russian-Ukrainian conflict in response to a question from the Hungarian ambassador to Bratislava. And he offered a view of immigration that will undoubtedly raise hackles in Brussels.

European and American politicians are accustomed to Viktor Orbán’s “peacock dance.” At home he is belligerent while in Brussels he rarely raises objections and votes dutifully with the majority. Jean-Claude Juncker’s nomination was an exception and turned out to be a mistake. It is very possible that if it comes to further sanctions against Russia, Orbán will again support the majority. And the “peacock dance” continues.

Reactions to Viktor Orbán’s speech to the ambassadors

I simply cannot get over the ineptitude of the Hungarian opposition parties. It is hard to pick the biggest loser among them. Here we are before the Budapest municipal elections where the stakes are high since with good candidates and a good campaign the democratic parties have a chance of replacing István Tarlós and perhaps even receiving  the majority of the district mayoralties. The chief MSZP negotiator was Ágnes Kunhalmi, a young woman with little political experience who, it seems, had difficulties keeping the local party bosses in line. As a result, in several districts the democratic parties will run not only against the Fidesz candidates but also against each other. A sure way of losing.

And what did the brand new party chief, József Tóbiás, do during these tense weeks of constant intra-party negotiations? He went on vacation! In his opinion he has nothing whatsoever to do with local Budapest affairs. The locals will take care of local affairs! As for the common candidate for the lord mayoralty, when asked what he thought of him, Tóbiás without batting an eyelash answered that Ferenc Falus must be a good candidate if all three parties agreed on his nomination. When pressed, he admitted that he does not know Falus, but after he meets him he will form an opinion. As far as I know, the meeting has been postponed several times since. Tóbiás is too busy.

The parties’ reactions to Viktor Orbán’s speech to the ambassadors yesterday were also poor. Perhaps the most feeble was Együtt-PM’s statement. It was penned by Nóra Hajdu, who is not exactly a household name in Hungarian politics. I managed to find her in tenth place on Együtt-PM’s list for the EU election. At that point E-PM was hoping to send three people to Brussels, but in the end they received only a single mandate.

Her statement began by expressing the party’s disappointment over Orbán’s failure to remedy the mistakes he committed in his “illiberal” speech because these mistakes “are accompanied by serious international consequences.” Disappointment? Couldn’t she find a more forceful and apt word for this speech? Hajdu expressed her surprise that Orbán instructed the ambassadors to represent “his mistaken policies.” I don’t know what else Nóra Hajdu expected. That is what ambassadors are supposed to do. At the end she did mention the unacceptable turn of phrase about “the half-witted nations” who follow a foreign policy based on universal liberal values.

Tóbiás wasn’t exactly hard-hitting either. He talked in general about mistaken policies and an alternative reality that exists only in Orbán’s head. But the most surprising part of the announcement was that, in his opinion,”the ambassadors should represent the Hungarian nation and not Viktor Orbán’s parallel world.” I really don’t know what to think. Ambassadors represent the government they serve. If someone cannot in good conscience do that, he should resign.

Szabolcs Kerék-Bárczy of DK spoke somewhat more forcefully about his and his party’s objections on ATV’s Egyenes beszéd where he stressed the unacceptability of a foreign policy based exclusively on material gain. In his interpretation Orbán “gave the order” to lead Hungary further toward eastern dictatorships.

In addition to these official statements, Viktor Szigetvári, who by now has assumed the leading role in E-PM, wrote a long post on his own blog. Of course, this is not the best place to air his reactions to Orbán’s latest since few people will find it. It is, however, a surprisingly good analysis, which indicates to me that Szigetvári is most likely a better political analyst than a politician. After all, he was trained as a political scientist.

Szigetvári rightly points out that “in all mistaken analyses there are several real and factual elements.” For example, it is true that the European Union struggles with the problems of the protracted economic crisis.

According to Szigetvári, Orbán is also right about the necessity of conducting “intelligent Realpolitik.” In the classical meaning of the word, it means a diplomacy that is primarily based on power and material considerations rather than ideological or ethical premises. Such a foreign policy, however, presupposes individual, absolutely sovereign states who can play a power game on the chessboard of the world. Hungary cannot conduct that kind of Realpolitik since it is part of a larger unit, the European Union, and is a country without complete sovereignty. Therefore, the kind of Realpolitik Orbán advocates is unrealistic and doomed to failure.

Unless, of course, Orbán is contemplating a series of moves that would end in Hungary’s either leaving the European Union on its own or being forced out of it. András Vértes, an economist and chairman of GKI Gazdaságkutató Zrt, is convinced that, in spite of what everybody says, Orbán’s final goal is saying goodbye to Brussels. Orbán suggested in his speech that 50% of Hungary’s exports should go to countries outside the European Union. “That is an astonishing wish…. The overwhelming majority of investment in Hungary comes from EU sources and EU countries, but we send the message that Russian and Chinese capital is more important for us…. That kind of talk will frighten away the few investors who are still interested.”

Thus, there is something very wrong with Orbán’s version of Realpolitik. It doesn’t seem to serve the interests of the country. Orbán urged the ambassadors to entice investors to Hungary, but Vértes is right. Given the political and economic climate in Hungary, the ambassadors’ attempts cannot be successful.

As for the overall assessment of the speech, there seem to be two schools of thought. One is that Viktor Orbán retreated from his resolve to develop an “illiberal state” and the other is that he simply reiterated and strengthened the messages of his speech in Tusnádfűrdő/Băile Tușnad. Given Viktor Orbán’s penchant for delivering talks that are anything but clear, both groups will find plenty to support their contentions. But more about that tomorrow.