Month: December 2010

Happy New Year to All


The proposal governing the media became law

Just as some of you already reported in the "Comments," Pál Schmitt signed the media law. He signs anything put under his nose. Mind you, I believe that if he had received instructions from above not to sign, then he wouldn't have. In my opinion there may even have been a brief telephone conversation between Orbán Viktor and the president during which the former explained why it is absolutely necessary to sign.

As usual, commentators see the event from a variety of perspectives. There are those who never for a moment doubted that he would sign, and there are those who still expected to see some rational thinking in the leadership of Fidesz. As I mentioned a few days ago, instructing Schmitt not to sign but to send the proposal back to parliament would have been a masterstroke in my opinion. Orbán would have beeen able to demonstrate that Schmitt is not after all just the brainless puppet everybody thinks he is. In addition, he could save face. After all, only a few days ago he swore up and down that he would not change a word in the law, but now he has to because of this independent-minded Schmitt. That would have given Orbán an opportunity to make amends with the European Union and the all-important ally, Germany.

He didn't choose this easy escape route. A friend of mine's answer to my proposal was that Viktor Orbán even under these circumstances can't "lose." He always has to win. If Schmitt didn't sign, perhaps he would be hailed as a man of reason who after all behaved in a statesman-like fashion. Orbán couldn't stand such an outcome.

In any case, we will see what happens if anything. One thing is sure. The German government is keeping an eye on Budapest. The Frankfurter Rundschau published an interview with Werner Hoyer, undersecretary in the Foreign Ministry, who just today expressed the German government's hope that "the Hungarian government hasn't spoken the last word on the subject." Well, it looks as if it has. From the interview it is also clear that the European Commission is investigating and that the German foreign ministry is well informed. Hoyer explained that initially Neelie Kroed, the commissioner responsible for the media, was supposed to lead the investigation, but it looks as if Justice Commissioner Viviane Reding will also be involved.

It seems that the rotating presidency is not in danger, but it is problematic to have a country leading the European Union that is in violation of democratic principles. How can a country like that preach about freedom of speech to other countries, like Belorus or Iran? Hoyer emphasized that a piece of legislation must be written in precise legal language. It should specify all the details. It is not enough to say that "we will look at the practical application of the law later to see whether it works or not. This is unacceptable!" I assume what Hoyer had in mind was Navracsics's feeble explanation concerning the details of the media law.

This morning on Hungarian public radio (MR) the Hungarian foreign minister, János Martonyi, repeated what Tibor Navracsics said about a week ago: let's wait. We'll see how the media law works in practice. However, if this answer was unacceptable from Navracsics, it will be equally unacceptable coming from Martonyi. Martonyi emphasized that he hopes that "the unofficial investigation of the European Union will be objective." The last sentence of MTI's report on Martonyi's interview puzzled me a bit. He said that "the international criticism shouldn't cast a shadow on Hungary's EU presidency beginning January 1." But the criticisms haven't stopped. Even the German Christian Democrats have raised their voices. And if that is the case, how can Hungary's presidency be effective and successful?

Gábor Török, a political analyst who has a successful blog, wrote his most recent piece on Pál Schmitt under the title "Null komma null" (zero point zero). Török prides himself on being absolutely unbiased, but most people considered him to be closer to Fidesz than to the socialist-liberal side. In the last few months, however, he has been exhibiting a decided shift away from Fidesz. His portrait of Schmitt is really devastating. Loyalty is a nice thing, says Török, but what Schmitt is doing is actually injurious to both the institution of the presidency and his reputation. He is making the office of president insignificant. As for the question of reputation, Schmitt should think of the future. What will happen when he appears in high school textbooks as a ridiculous and pitiful puppet? When people talk about him with contempt? It seems that Török is no longer trying to look "objective." He decided that what this government is doing is indefensible.

Chinese financing of Hungarian projects and sovereign debt

At the beginning of November I wrote about Viktor Orbán’s trip to Shanghai where he met the Chinese prime minister. In a fairly short meeting Orbán expressed his desire to expand economic and financial relations with China. A month later Tamás Fellegi, minister of national economic development, was named commissioner in charge of Chinese-Hungarian affairs. I might even have made a crack about this appointment’s being rather unfortunate. Earlier Fellegi was named commissioner in charge of the Russian-Hungarian negotiations and see what happened there. A disastrous visit by Viktor Orbán to Moscow, several postponed trips to the Russian capital by Fellegi. And today’s news is that the Russian oil company Lukoil is retiring from its wholesale business in Hungary because of the extra tax levies that it finds too high, making its operation a losing proposition. They are keeping about 100 filling stations, however.

So, anyway, Fellegi went off to Beijing on December 6. He was entrusted with expanding Chinese-Hungarian economic and commercial cooperation. He was to pay special attention to Chinese investment in Hungary. Fellegi spent four days in the Chinese capital, and on his return he gave a very optimistic account of the negotiations and the prospects. The Hungarians tried to convince the Chinese to import “Hungarian technology.” For the life of me I can’t think of any specifically Hungarian technology the Chinese might need. But surely the main emphasis had to be on Chinese investment in Hungary. Indeed, there were “difficult negotiations” concerning MALÉV, the Hungarian airline that was just rescued from a bankrupt Russian company. Although negotiations were difficult, the optimistic Fellegi continued, “they are on the road to success.” They talked about Chinese investment in the Hungarian railroads that are in truly rotten shape. The Hungarian delegation also met with the chairmen of four large construction companies with expertise in building airports.

At the time that the MTI report appeared the last sentence escaped my attention, but now I remember that one of the sanguine Hungarian ministers talked lately about developing the most important air traffic hub in the region in Budapest. And there was something else that didn’t mean much to me at the time. The chairman of the Center for Sovereign Debt, Gyula Pleschinger, was a member of the four-man delegation to Beijing.

Today it all became clear when Tamás Fellegi gave an interview to Index, an Internet paper. Fellegi’s name appears often enough in the papers but this is the first time that I encountered an interview with him. What is my impression? Not the best. He is brusque, antagonistic, and not at all diplomatic. However, he seems to be devoted to Viktor Orbán. When the journalist pressed him for his opinion on the media law, he could have avoided answering the question by saying that it is not his bailiwick. But no, he decided to defend it. When he was asked whether he agreed with every move of the government in the last six months, his answer was an unqualified yes. I guess a member of the cabinet cannot say anything else, but I think there are ways to avoid giving straight answers. Most likely a more experienced politician would have been able to do so, but Fellegi is not an experienced politician.

Tamás Fellegi


As the matter of fact, I don’t think that he has any real background in such delicate international economic and financial negotiations. Especially not with such old hands at the game as Russia or China. After finishing law school in Hungary, he got a Ph.D. in political science at the University of Connecticut. His connection to Viktor Orbán and Fidesz goes back a long way. As a young instructor at the Budapest Law School he taught courses in the college where Fidesz was born. He was one of the editors of the periodical published by the students called Századvég. After his return to Hungary in the mid-1990s he embarked on a business career. He bought shares in several media outlets. But I don’t think that negotiating about Chinese-Hungarian financial strategic cooperation is his strength.

What else is not his strength is giving judicious interviews. When asked about the rumors circulating that Hungary is hoping to involve China in the financing of Hungary’s sovereign debt, he decided to expand on his negotiations in Beijing. According to Fellegi, the topic of “strategic financial cooperation” between the two countries was first brought up by the Chinese prime minister. Viktor Orbán welcomed the idea and thus the main thrust of the Chinese-Hungarian negotiations was defined. He told his interviewer that he also met the chairman of the Chinese Central Bank, the president of the Chinese Export-Import Bank, and the chairman of the Chinese State Investment Bank. A Chinese delegation will be coming to Budapest in January where the negotiations will continue. When the journalist inquired whether it is a good idea to give special privileges to the Chinese in purchasing Hungarian sovereign debt that might make Hungary too dependent on China, Fellegi snapped back: “Why? Is China any worse than any other country?” He reiterated that Hungary, which earlier broke off talks with the IMF, wants to finance its debt from the markets.

A few hours later two Chinese journalists were at the doorstep of the Chinese Central Bank where they inquired whether China is actually planning to be a major player in Hungary as Fellegi indicated.  Reuters explained that “Hungarian Development Minister Tamas Fellegi was quoted as saying on a local news website on Wednesday that China may buy Hungarian debt following talks between Hungarian Prime Minister Viktor Orban and his Chinese counterpart Wen Jiabao in Shanghai in late October” but “China’s central bank declined to comment on a report that it is considering financing various Hungarian projects, including buying some Hungarian government debt.”

China is extremely eager to invest in Europe. On December 23, 2010, a Chinese Foreign ministry spokeswoman said that the country was willing to help countries in the euro zone return to economic health and will support the International Monetary Fund bail-out package for the zone. The whole of Europe is of interest to China because after all the European Union is a huge market for Chinese goods.

China is sitting on outsized foreign-exchange reserves (a total of $2.648 trillion at the end of September) and is looking for ways to diversify out of U.S. Treasuries and earn a higher return. European debt, especially marginal debt, is particularly attractive to the Chinese. Last week they agreed to invest four to five billion euros in Portuguese bonds to help Portugal refinance 15 billion euros worth of debt due to expire in April.

Moreover, China is looking for investment deals all over the world, so I have no doubt that Hungary remains on its radar screen. But the Chinese are very tough negotiators, and I fear that in comparison Tamás Fellegi is a babe-in-arms.


Viktor Orbán’s views on the media law

Foreign journalists and politicians continue to press their case against the Hungarian media law. Let me call your attention to two pieces that appeared in The Washington Post yesterday and today. Yesterday's was an editorial entitled "Putinization of Hungary." Today an article appeared on the Op/Ed page by Anne Applebaum, Pulitzer Prize winning journalist and author specializing in Eastern Europe who happens to be the wife of Radoslaw Sikorski, foreign minister of Poland. The piece is entitled "Jeopardizing democracy in Hungary."

Naturally, Viktor Orbán has felt it necessary to respond to some of the negative reactions. On December 23 the Hungarian prime minister gave a fairly lengthy interview to Anette Szabó of HírTV. A day later Magyar Nemzet published an interview with Péter Csermely. In both cases the controversy surrounding the new media law figured prominently.

Anette Szabó began her interview on HírTV by inquiring about the opinion of two politicians, the German chancellor and the foreign minister of Luxembourg, both of whom warned Hungary that the media law is not acceptable in a democratic country belonging to the European Union. Orbán referred to them as two unfortunate characters. "The poor German chancellor" said nothing about the Hungarian media law. It was her "deputy spokesman" who spoke. Orbán tried to make his listeners believe that the spokesman simply conveyed his personal opinions. As for the foreign minister of Luxembourg, he really doesn't count because "the Luxembourg Socialist Worker's Party delegated him to the government." According to the prime minister of Luxembourg, Orbán continued, he didn't speak in the name of the government. Since then the foreign minister, who is also deputy prime minister, reaffirmed that what he said was not his private opinion.

To the question of whether he is considering changing this controversial media law the answer was a decided no: "We don't even dream of such a thing." The piece of legislation is a thoroughly European law, "there is not one paragraph in it that cannot be found in other European media laws." But if that is the case, why all this negative reaction, came the next question. "The reason is that very many people hate the idea that a right-wing Christian national party received a two-thirds majority in Hungary." This is their real problem even if they are talking about the media law. This kind of "noise" is normal. "Criticism from afar or from western Europe doesn't frighten us." Fear of foreign criticism "is characteristic only of countries that lack self confidence. We are not one of those." He is not a weak-kneed type, he added.

He continued in Magyar Nemzet with Péter CsermelyOrbán emphasized that he is willing to talk about the media law, but only in concrete terms. "But until now I have seen only bilious political attacks. There is no sensible discussion, no concrete objections." When Csermely brought up the fact that the members of the Media Council were all nominated by Fidesz, which might cause some consternation, Orbán's answer was his usual one: Fidesz has a two-thirds majority by the will of the people. Certainly they will not appoint people who sympathize with MSZP or LMP because after all they have to take responsibility for all the decisions. (It's interesting that he left out Jobbik as an opposition party.)

The next question concerned the supervision of the Internet. According to Csermely some people find the whole idea ludicrous, displaying an ignorance of the net. "We will see. This will be the responsibility of the Media Authority. The only thing we can do is to give them the opportunity to be successful." As for the print media, Csermely pointed out that the financial situation of newspapers is very bad as it is and therefore huge fines will mean financial ruin for most of them. Orbán's answer was evasive. He brought up some lurid examples of a sports magazine where children interested in sports are confronted with naked women. The follow-up question was an obvious one: If it is just a question of public morality, why didn't the law limit itself to specific instances of wrongdoing? Orbán denied that the law is too vague. "The goals of the media law are clear and unambiguous."

All in all, these two interviews showed a man full of self-confidence. Someone who cares not a wit what the world thinks of him. Yes, there is noise but he remembers what awful noise there was about the alleged lack of freedom of the media during the Antall government in the early 1990s. This upheaval is nothing in comparison. What Orbán didn't add was that Hungary's situation is very different today than it was almost twenty years ago. Today Hungary is a member of the European Union. Although Hungarian liberals complained a lot about József Antall and his ideas about the future of Hungary, Viktor Orbán simply cannot be compared to Antall, who with all his faults was a firm believer in the rule of law.

As for Hungary's status within the European Union, "the poor foreign minister of Luxembourg" today reaffirmed that the European Council is already studying the Hungarian media law. We of course don't know what is happening in the background. We have no idea what the Orbán government knows or suspects about the intentions of the Council. In any case, this morning Péter Szijjártó–and we must assume that he is speaking on behalf of the prime minister unlike his German counterpart–seemed to indicate that the Hungarian government "is willing to discuss the media law if the objections are presented in concrete and not in general terms." I don't know whether this is simply a reiteration of the prime minister's statement in the Magyar Nemzet interview or whether it presages a partial retreat on the media law. It will be interesting to see how all this plays out.


Hungary in the eyes of the concerned outsider, by S.K.

Last night I had dinner with a professor of demography and a historian. It was impossible to avoid discussion of what is happening in Hungary and what consequences can be expected from the developments there. The majority opinion was that the actual events themselves, as they unfold one by one, may not give cause for alarm, but in their combined effect they will certainly lead to some calamitous outcome.

The opinion of the demographer was that such departures from basic, established democratic practices will inevitably force the European Community to distance themselves from Hungary at large: there is simply no place in the Union for such an authoritarian country. Punishment will inevitably follow. The historian agreed. I defended the country, saying that the fault lies with the government, therefore an entire country and its population should not be subjected to punishment for the misdeeds of a few.

Not so! Argued the demographer. They, the overwhelming majority, elected this government, supplied the constitutional grounding for their rampages, so why should they be spared the consequences? In fact, chimed in the historian, they very much should face the universal repudiation from Europe, because they must face the consequences of their choice. I protested: the electorate of Hungary is not versed enough in democratic practices to anticipate the consequences. That is why they may deserve a bit of an allowance.

Hogwash! Jumped in the demographer. When Hungary accepted the terms of the European Union, they also agreed to follow European practices. The Union simply cannot afford to have amongst its members a dictatorship, nor does it have any actual interest in tolerating such people. Nor is it conceivable that the Union should leave such despicable conduct unpunished. That would completely undermine the credibility of the institution. Yeah, protested I again, but the Union has no mechanism to get rid of distasteful members. It is assumed that once a country is in, she will remain a member no matter what.

Don’t worry, my companions assured me. Europe will sooner find a way out for Hungary than to tolerate those pesky deal breakers. Europe has enough problems already with the financial complications, the last thing they need is an anti-democratic “saboteur” in their midst to complicate their headaches. Not to mention that the way Hungary is going, soon they will also come to Europe with their hat in hand, asking for financial support. Why should the Union finance the country that wouldn’t even respect the minimum requirements of democracy? They would be idiots to agree, there are more worthy candidates for that elsewhere.

All right, I pulled in some of my sails, nevertheless it would be unfair to punish the entire population, because they elected this government democratically, but the elected are abusing the privilege and that is not the people’s fault. Absolute bloody nonsense! said the demographer, who, besides being German, was never famous for her mild manners, Hitler was also elected democratically. As soon as not all the parties agree to play by the rules, the fate of democracy is sealed, no further expectations are justified. Hungary soon will be an outcast in Europe and it is actually in the best interest of the population to get there as soon as possible. They must come to realize that their electoral decisions come with serious consequences, and the sooner they recognize those consequences, the sooner they will turn out the offending government. Yes, it is true that there will be a high price to pay for their idiocy, but it is unavoidable. Next time they will just have to be more careful.

I admit I ran out of arguments at this point. It was impossible to defend any longer the indefensible.

Self-censorship at MTI

Although I've written quite a bit on the new Hungarian media law, I didn't touch on the part that deals with a peculiar new way of delivering news in the public, state-financed media. MTI, the official Hungarian news agency, will not only gather news but also edit the news and distribute it to Magyar Televízió (MTV), Duna Televízió, a station that serves the Hungarian disaspora, and Magyar Rádió (MR). Everything will be centralized. The same news can be heard on all three public media. Only the anchors will be different.

People who know something about editing news consider this arrangement unworkable because editing the news for radio and television requires entirely different skills. Even the new head of MTI admitted that the task will not be easy. Well, that's their problem. I'm much more worried about what kind of news MTI will deliver. The new president made it clear to the staff that MTI "must be loyal to the government." This is a concept that is unimaginable in democratic countries and bears a suspicious resemblance to the good old days of the dictatorship.

The staff at MTI is rapidly adjusting to the new requirements. Only two days ago Hírszerző, an online newspaper, noticed that MTI's reporting of foreign news leaves something to be desired. The journalists at Hírszerző discovered that MTI changed the tone of a statement of a German Christian Democratic politician to sound much more favorable to the Hungarian government than the German original was. According to the MTI version, Manfred Grund found it "a total impossibility" that anyone should question Hungary's loyalty to Europe. Grund, they continued, emphasized that the negative opinions of Hungary's media law reflect "superficial attitudes formed along party lines." According to MTI, Grund considers it "especially absurd that anyone can question the rotating presidency of Hungary." In the original, as it turns out, Grund simply said that "it is inappropriate" to talk about depriving Hungary of the presidency. Moreover, he added that "a free and not always pleasant reporting is part of democracy," which MTI didn't mention. Grund didn't talk about either a "total impossibility" or "superficial attitudes formed along party lines." MTI added these phrases to make a CDU politician's support of the Orbán government look stronger than it actually was.

Then a couple days ago I found that MTI had falsified the contents of an article "EU presses Hungary on media law" that appeared in the Financial Times on December 24, 2010. The article informs the readers that Neelie Kroes, one of the European Commission's vice-presidents, wrote a letter to Hungary's deputy prime minister. I will use red for the Financial Times's original text and blue for the corresponding Hungarian text.

Financial Times: The European Union official in charge of overseeing media freedoms has asked the Hungarian government to defend its controversial new press law, ratcheting up a potentially fraught EU investigation into the measure.

MTI: Neelie Kroes, vice-president of the European Union who is responsible for media, inquired about the media law passed this week in parliament.

Financial Times: Neelie Kroes, one of the European Commission’s vice-presidents, wrote to Hungary’s deputy prime minister, Tibor Navracsics, on Thursday asking him to send the text of the law to her so that she can determine whether it complies with EU law governing media freedom.

MTI: From the article entitled "EU presses Hungary on media law" one can learn that the Dutch commissioner in her letter to Tibor Navracsics among other things asked to send the text of the bill to her in order to determine whether it complies with the Union's regulations governing the freedom of the press.

Financial Times: Her letter comes less than two weeks before Hungary is scheduled to take over the EU's six-month rotating presidency, which gives Ms Kroes’ inquiry added political tension. Ms Kroes will be joining her fellow members of the 27-person European Commission for its first meeting in Budapest in the first week in January. Mr Navracsics also serves as justice minister in the centre-right government of prime minister Viktor Orban. The law was passed by Hungary’s parliament, overwhelmingly controlled by Mr Orban’s Fidesz party, earlier this week.

MTI: Completely left out from the report.

Financial TimesAccording to people who have seen the letter, it raises questions about the independence of the powerful new media regulator set up by Mr Orban’s government, which will have nominees of Fidesz in all five seats.

The media council has the right to investigate, judge and fine publishers and broadcasters which it deems to have hurt “human dignity” or “caused offence” to nationalities, churches or minorities.

According to people who have seen the letter, Ms Kroes details EU protections regarding press freedoms, adding she has heard concerns that the “act risks jeopardising these rights”. It also says Ms Kroes has received complaints that the language governing the new media council “does not seem to guarantee its independence”.

MTI: The article quotes people who are familiar with the contents of the letter. According to them Kroes recites the guarantees of the Union concerning media freedom and mentions worries that reached her that there might be the risk that these guarantees might be endangered.

Financial Times : In addition, the letter questions whether the new law’s provisions violate EU directives barring countries from regulating broadcasts from other member states. According to an official involved in the EU inquiry, the Hungarian law appears to put new restrictions on broadcasts coming into Hungary from abroad.

The law has already received harsh international criticism. Earlier in the week, the top media official at the Organisation for Security and Co-operation in Europe issued a statement in which she said the law violated “media freedom standards” and that it “endangers editorial independence and media pluralism”.

Ms Kroes’ action, however, could have more serious repercussions. The EU has already opened a so-called “infringement action” against Hungary for its failure to live up to the EU’s media regulations, and Ms Kroes could take the case to the European Court of Justice to force Budapest’s hand.

In recent days, senior Fidesz politicians have made some unusually conciliatory noises, without indicating they would back down. The party’s leader in parliament said earlier this week that he was open to amending the law if the new media council implemented it incorrectly. Hungary has showed no signs of relenting in a separate dispute with the ECB over its central bank's independence.

MTI: The letter is asking questions concerning the independence of the new media control authority. In addition, the letter doubts that the provision that would regulate media originating from other member countries complies with union rules.

The Financial Times reminds its readers that the media law received severe international criticism. It also quotes the person responsible for media in the Organisation for Security and Co-operation in Europe.

I don't think that one has to add anything to this. A comparison of the two texts speaks for itself.