Viktor Orbán’s playground: State financing of football clubs

By special request, today I’m going to look at the generous contributions made by the government and state companies to sports establishments, mostly football clubs.

Let’s start with the proposition that Viktor Orbán is, if not a de jure autocrat, definitely a de facto one in the sense of someone “who has undisputed influence or power” (Webster’s) or who is “a domineering or dictatorial person” (Collins English Dictionary). He built up unlimited power within his own party and through his party’s overwhelming majority in parliament unlimited power within the country. This power will not last forever, but for the time being it remains the case.

Even within his innermost circle the final word is always his. László Kövér might have opposed the nomination of Pál Schmitt to be president, but he was nominated. Mihály Varga most likely would prefer serious negotiations with the IMF, but he is being vetoed by Viktor Orbán. We don’t know what Rózsa Hoffmann actually thinks about the nationalization of schools, but I’m almost certain that the instructions come from Viktor Orbán himself. The cockeyed idea about learning foreign languages also comes from Orbán’s personal convictions, which he is carrying out within his own family. An autocrat can simply translate his personal wishes and ideas into legislative action. There is no one to stand in his way. His obsequious followers rush to please him. Eventually, this unlimited power distorts the workings of the entire government and can lead the country into an abyss.

An autocrat looks upon the country he governs as his personal domain, which he can shape according to his own vision. Moreover, he can make the country his personal playground. A place where he can foist upon the country not only his vision of the world but also his hobbies. Thus, if he is a man whose passion in life–besides intrigue–is football, then billions can be spent on pleasing the autocrat. The expenses incurred to advance this hobby are mostly covered by public funds, even as the country’s economic situation is truly dire.

The nationalization mania reaches even football. Ferencváros (Fradi), whose fans are the worst football hooligans around and who also played a part in the attack on the public television station on September 17, 2006, was purchased by the Hungarian government for 5 billion forints. In addition, the government allocated 10 billion to build a new clubhouse and a new stadium. To top it off, Gábor Kubatov, party director of Fidesz, was named the new chairman of Ferencváros in February of 2011. But that’s not all. The investigative journalists at atlatszo.hu learned that the state-owned company Szerencsejáték Zrt., which runs the state lottery operations, generously gave 100 million forints in 2011 and just lately another 250 million to the club! And I suspect that there were other occasions when Fradi received large sums of money because it is a well-known fact that Ferencváros had a history of serious financial problems. In those days there was no unlimited help coming from the Hungarian state.

An even more peculiar arrangement exists with Viktor Orbán’s favorite team, Videoton. The team, under different names, dates back to the 1940s. Since I know nothing about football, I will simply list Videoton’s accomplishments. It has been playing in the Hungarian League since last year and has already won one Hungarian League title, one Hungarian Cup title, three Hungarian League Cup titles, and two Hungarian Super Cup titles. It all sounds rather grand, but when I read that “Videoton is best known in Europe for reaching the UEFA Cup final in 1985,” I started having my doubts.

It seems that Videoton has had financial problems throughout its history and that the club changed hands several times in the last decade or so.  The current owner, István Garancsi, purchased the club in 2007 when it was teetering on the verge of bankruptcy. Garancsi managed to inject 180 million, but Videoton owed 1 billion forints. Eventually, he managed to settle with some of the players.

A couple of weeks ago a brief news item appeared in one of the Hungarian papers about a generous gift from the Hungarian government to Videoton to build seven new football fields, two of which have artificial turf. However, the club needed to match the grant with 500,000 forints of its own, which it seems it didn’t have. At this point Puskás Akadémia made an outright gift of half a million forints to the football club.

György Bolgár subsequently had a conversation with the spokesman of the academy and found out that Videoton and Puskás Akadémia are intimately linked–though just how is not yet clear. According to the spokesman, in the last four or five years the two entities have been working closely together. The academy not only trains players for Videoton; the financial and legal ties between the two organizations are blurred. The spokesman had no idea whether this half a million forint gift came from the 2.5 billion received from the government (the tax-free gifts) or from the private purse of the foundation, which Orbán himself established with some of his own money. (Of course, it’s since “grow’d” like Topsy.)

All in all, I wouldn’t be surprised if Viktor Orbán turns out to be in one way or another part owner of Videoton. The whole thing sounds fishy. Perhaps Orbán, who didn’t quite make it as a football player, now wants to be the owner of a football team. With the Hungarian treasury behind him, he can satisfy his dreams. His son already plays for Videoton, mind you only second string. Perhaps eventually he can fulfill his father’s dreams and daddy can cheer him on from the owner’s box.

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40 comments

  1. Haven’t you missed something here, Eva? What about the grant of 2.8 billion forints by the government just recently?

  2. petofi :

    Haven’t you missed something here, Eva? What about the grant of 2.8 billion forints by the government just recently?

    I don’t think I did. I mentioned it when talking about Bolgár’s question about where the money came from exactly. From the foundation’s own money or the grant money they just received.

  3. I have read somewhere that Gy. Budai, who is now an undersecretary in Orban’s cabinet was the liason between the Fidesz leadership and the football hooligans who attacked the building of the public television in 2006.

    Have you heard more about this?

    One thing we know: Fidesz moved to annul any verdict against these hooligans and even to compensate them as soon as they took power in 2010.

    If you burnt a car or committed any other crime in 2006 on behalf of Fidesz, the courts were ordered by law in March 2011 to declare their own rulings against you null and void (“semmis”) retroactively.

    This bill was submitted by Mr Balsai, who was awarded with a seat in the enlarged Constitutional Court in three months.

    http://galamus.hu/index.php?option=com_content&view=article&id=57221:az-orszaggyles-elfogadta-a-balsai-fele-semmissegi-toervenyt&catid=79:kiemelt-hirek&Itemid=115

    Balsai became a judge in the Constitutional Court without the required qualification of having previous experience as a judge.

  4. Eva: And I suspect that there were other occasions when Fradi received large sums of money because it is a well-known fact that Ferencváros had a history of serious financial problems. In those days there was no unlimited help coming from the Hungarian state.

    You are wrong. In the first VO government, the minister for Agriculture, Mr. Torgyan Jozsef (TJ), was financing via the MFB (Hungarian Development Bank) and the Agricultural Ministry guarantees and/or loans in the amount of at least HUF 130 mio.

    This was stopped after TJ was blackmailed into resigning from his position, after which FTC was sold to a foreign investor. From that moment on the troubles started for FTC.

  5. Ron :

    You are wrong. In the first VO government, the minister for Agriculture, Mr. Torgyan Jozsef (TJ), was financing via the MFB (Hungarian Development Bank) and the Agricultural Ministry guarantees and/or loans in the amount of at least HUF 130 mio.

    This was stopped after TJ was blackmailed into resigning from his position, after which FTC was sold to a foreign investor. From that moment on the troubles started for FTC.

    Correct but in the intervening years it was sold to a Hungarian with an English name. Something like George Hemingway!!! Original isn’t it? I remember an interview with him. He refused to discuss his name.

  6. The government helps several clubs and coaches. On one hand, this Ferencvaros is excessive. On the other hand, the government sponsors youth training and several clubs in less popular sports would fall apart if there wasn’t government assistance. The austerity measures the government wants to put in place/ has put in place suggest an issue with priorities though.

  7. George Hemingway has been here for ages. I think he’s an American with Hungarian roots. He used to own a chain of gift stores in Budapest called “Bonbon Hemingway,” but they seem to be gone now. He also owns (owned?) several chains of American fast-food restaurants like KFC and the like, plus a few other random places. I guess he’s involved in football now.

  8. buddy :
    George Hemingway has been here for ages. I think he’s an American with Hungarian roots. He used to own a chain of gift stores in Budapest called “Bonbon Hemingway,” but they seem to be gone now. He also owns (owned?) several chains of American fast-food restaurants like KFC and the like, plus a few other random places. I guess he’s involved in football now.

    Correct here is the website of his company: http://hemingwaygroup.com/europe.htm

  9. The botto

    bourciertm :
    The government helps several clubs and coaches. On one hand, this Ferencvaros is excessive. On the other hand, the government sponsors youth training and several clubs in less popular sports would fall apart if there wasn’t government assistance. The austerity measures the government wants to put in place/ has put in place suggest an issue with priorities though.

    The problem is not with the idea that the government should support sport activities. THe problem is with the proportions that one sport or one team receives above another team or sport. Also, when government support or private support (encouraged by tax write-offs) start to filter in from one organizations to another, it raises many question like why doesn’t the money was directed to the final recepient directly?
    We were able to read dozens of articles lately on how some of our amateur sport players (even with Olympic medals) have to abonden the country as they cannot make a living, so why is that football receives such huge money. Can anyone tell us how much money some of the sport activities trageted at women receives?

  10. According to these troglodytes, the only sports activities women should be involved in are watching the games their sons (who serve as both the woman’s gift to the fatherland, and the means by which she maintains a happy, non-abusive home life) teams play.

  11. London Calling!

    Ms KKA!

    Don’t you mean you are meant to stay at home and ‘produce’ the football team? – and “Just get the dinner, Woman!”

    Regards

    Charlie

  12. I note with interest that Ceausescu’s son also played for a domestic football team, which was heavily supported by the government of the time.

    I’m going to add this to my growing list of Ceausescu-Orban coincidences.

  13. “You’re right, it wasn’t Hemingway but Kevin McCabe who owed FTC. If it goes like that I will be soon an expert!!!!”

    As a West Ham fan, the name Kevin McCabe arouses the same feelings in me that many on here feel about Orbán Viktor! But that’s rather OT, and still gets me more than a little angry, so I’ll pass on explaining all that.

    As for McCabe and his relationship with Fradi – he was the owner of Sheffield United Football Club, at the time a member of the English Premier League, and for a few years, it was fashionable amongst top UK football clubs to buy foreign clubs, or set up relationships with them. The other club became a ‘junior’ associate* of the big club and (hopefully) a feeder club – the most promising of the foreign clubs players would be considered for transfer to the ‘senior’ club’s academy. In other words, a relatively cheap way of picking up potentially good foreign players, who would hopefully go on to be the stars of tomorrow.

    This idea didn’t really work out and seems to have been abandoned by most clubs, although I think some of these junior/feeder arrangements still exist. McCabe no longer owns Sheffield Utd and I’m fairly certain that he/Sheffield Utd no longer own Fradi, or are associated with them (but I can find very little definite information about this).

    Incidentally, he didn’t buy Ferencvárosi TC, as such, but just the football side (Ferencvárosi run a number of other clubs/sides, many of which have nothing to do with football). At the time he bought the club, there were said to be plans to build a new 25,000 seater stadium, but the current plans to build a new 28,000 seater stadium don’t seem to have any connection with the McCabe era plans.

    As far as I know McCabe is no longer involved in football in the UK (for which I, for one, are very grateful!).

    *My apologies for describing Fradi as a ‘junior’ club, but, such is the state of Hungarian football, that I’m afraid this is all too true. The days when a Hungarian club could win a prestigious European title, or the National side could shame England by thrashing us at home, are sadly long gone. (Although things have improved a lot in the last few years – several Hungarian players now play in the English Premier and Championship leagues, and the national side has improved to the point where many expect them to qualify for international tournaments in the near future – OV could be on for a nice bit of nationalistic propaganda here.)

  14. OT but relates to funding: I just heard from a friend that Category 6, Independent Contemporary Dance and Theater Companies are having their funding cut by 1/3 this year. None have received any monies this year, and it may be that there will be NO money at all.
    Goda Gabor (Artus) and Szabo Reka (Tunet) have said they will be disbanding their companies. Hungary has had a lively culture of contemporary dance and this sounds like a death-knell. If anyone reading this knows more about this situation, I for one, would like to know about it.

  15. Gretchen :
    OT but relates to funding: I just heard from a friend that Category 6, Independent Contemporary Dance and Theater Companies are having their funding cut by 1/3 this year. None have received any monies this year, and it may be that there will be NO money at all.
    Goda Gabor (Artus) and Szabo Reka (Tunet) have said they will be disbanding their companies. Hungary has had a lively culture of contemporary dance and this sounds like a death-knell. If anyone reading this knows more about this situation, I for one, would like to know about it.

    Hi Gretchen. Is is not new. I posted an item on October 28, 2012 at 12:21 pm | #14
    As irtwas a very long post I will not copy and paste.
    28https://hungarianspectrum.wordpress.com/2012/10/27/crowds-the-imf-and-the-hungarian-budget-a-follow-up/comment-page-1/

    There was a letter drafted at the time by prominent professionals
    To read most of his letter and more on the subject (in Hungarian only, unfortunately) visit
    http://www.stop.hu/belfold/orban-valaszolt-a-tancmuveszeknek-a-politika-is-muveszet/1086064/

    Eva also posted a link at the time to an interview with Markó, who’s group received the substantial money. See his interview on HirTV
    http://szinhaz.hu/szinhazi-hirek/48844-kain-levette-alarcat-marko-a-hir-tv-ben-jart

  16. Some1–thanks! I saw your letter, but didn’t at the time (even though Goda’s name was there) connect it with contemporary dance. I sent your comment to my friend.

  17. Eva S. Balogh :

    Bowen :
    I note with interest that Ceausescu’s son also played for a domestic football team, which was heavily supported by the government of the time.
    I’m going to add this to my growing list of Ceausescu-Orban coincidences.

    Then you should read this piece about Nicu and Viki
    http://www.pupublogja.hu/2012/11/tonkretett-sorsok.html

    As I read this piece, my blood pressure rose with each sentence. It’s not the sickness of Orban and what he visits on his children that worried me: what got to me
    where the hundreds of thousands of ‘believers’ who think that he’s touched by greatness, if not the finger of god himself. I’m especially angered because this all touches me through my wife’s grandchildren because the father’s parents are rabid Fideszers. I no longer can talk to them, but I wished I had asked them some pointed questions:
    –What sort of a world they imagine for their 8 grand-children in Orban’s reality?
    –Did they fancy sycophancy rather than merit as the rule for their grand-children’s future?
    –Are they at all happy that Hungary is referred to as “Christian Hungary” thereby relegating all non-Christians to second-class status?
    –Can they stomach that the Hungarian Catholic Church is not a beacon of enlightenment and fair play–which, by the 21st century, they ought to be–but rather the fawning servants of a petty dictator, concerned only in keeping and enlarging the Church’s advantages?

    But as my former neighbor (recently deceased..may she rest..) said to me: What do you care, you got a Canadian pension! Yup, a good pension and finding myself in the 7th circle of Hell.

  18. Fidesz finalized the campaign rules today. The opposition will not have too much wiggle room.

    1.
    Advertising in public places – Fidesz can ban opposition advertisements because most space belongs to a private firm, owned by Fidesz’s own oligarchs.

    2.
    Advertising in commercial television or radio – banned

    3.
    Advertising on public television – government+Fidesz-KDNP will probably get 75% (like now), Jobbik 10%, democratic opposition combined 15% air time.

    4.
    Advertising on internet – banned

  19. Let us say the opposition wants to call for a demonstration suddenly during the election campaign. First, most good places are already reserved by the government or fenced off for alleged construction, more than one year before the election.

    The opposition will not be able to spread its call in commercial television – they will not take any ads. The same goes for internet sites, but some sites will be fined for good measure (what is and ad on internet?).

    Public television run by party apparatchiks will not give time to announce a demo against the government. Fidesz oligarchs will not post ads in the streets for an anti-Orban demo either.

    1984+30 has arrived.

  20. tappanch :
    Let us say the opposition wants to call for a demonstration suddenly during the election campaign. First, most good places are already reserved by the government or fenced off for alleged construction, more than one year before the election.
    The opposition will not be able to spread its call in commercial television – they will not take any ads. The same goes for internet sites, but some sites will be fined for good measure (what is and ad on internet?).
    Public television run by party apparatchiks will not give time to announce a demo against the government. Fidesz oligarchs will not post ads in the streets for an anti-Orban demo either.
    1984+30 has arrived.

    As I said the other day, he can do what he likes, no one can stop him. And he WILL do anything he needs to do to win in 2014. This is only a starter.

    I feel like some sort of lonely, half-mad, doom-sayer on here, because (almost) everyone else seems to think that fairy dust and democracy will save Hungary. But I really don’t understand why others can’t see what Orbán’s up to and what he will do.

    He isn’t a reasonable person, he isn’t going to stop before it gets too bad, the cavalry are not going to come charging down the hill at the last moment, the EU/IMF/US are not going to step in and stop him.

    It’s too late now, what opportunities there were to stop him have been missed. The only end to this will be total economic collapse or bloody revolution. Failing those two – if he somehow manages to keep things just ticking over – then we’ve got him until Fate intervenes. It’s going to be a long, dark night.

    And if you think it’s not, then tell me how?

  21. @ Paul

    ” And if you think it’s not, then tell me how?”

    His own Felcsutian roots, that’s how. If my guess is right, he will de-camp before (hopefully), or after, the next elections. He’ll take his multi-millions (euros not forints) to some safe haven.

  22. @Petofi: Orban lives for power, not for money. He’ll never “retire” to enjoy his millions, as he’ll never let go of power. He’ll never resign or withdraw from politics willingly, he’ll need to be removed. Paul is right, removing him through elections in 2014 will be close to impossible given the machinations he is capable of. But I wouldn’t give up on that, though, without trying.

  23. tappanch: “Fidesz finalized the campaign rules today. The opposition will not have too much wiggle room.”

    Unbelievable…

    And the EU and all the human right organizations are quiet.

  24. gdfxx :
    tappanch: “Fidesz finalized the campaign rules today. The opposition will not have too much wiggle room.”
    Unbelievable…
    And the EU and all the human right organizations are quiet.

    I think in order to the EU to even react, someone needs to officially raise the issue. I am not sure how that has to be done, but I cannot imagine that the opposition will nit act.

  25. Don’t forget another dictator’s son whose success in football was not at all down to merit: Saadi Gadaffi.
    Not that Hungary is anywhere near that level of corruption and nepotism, but it is hardly the most salubrious company for young Orbán.

  26. Thank you, An. But I hope you don’t think I was giving up, or advocating giving up. We need to put as much pressure on OV as possible and ensure that his activities are as widely known as possible. It won’t get rid of him in 2014, but it will help towards his final removal when it does come.

    But I also think we need to recognise the reality of situation and not waste our time fighting battles we can’t win. The opposition needs to take a long hard reality check and formulate a plan based not on what we CAN do under normal circumstances, but recognise that these are no longer normal circumstances, and plan on the basis of what we will HAVE to do to make OV’s reign as short and harmless as possible.

    We are at a similar stage to the ANC when they realised that civic action and protest was never going to remove the SA apartheid regime and Mandela reluctantly accepted that guerrilla war (sabotage, etc) was necessary. It was illegal, it would bring criticism from some of their supporters outside SA, and it would give the regime a propaganda victory, but it was the only way of raising the profile of their struggle internationally – without which they would never succeed.

    The comparison with Hungary may seem melodramatic, but realistically it isn’t. We are at a critical juncture – we need to recognise that we can’t win using legal, democratic methods and either give up, or take a different, and more radical, course.

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