Hungary and the European Union

Anyone who thinks that Fidesz politicians–and here I think mostly of Viktor Orbán and his bosom buddy László Kövér–have been using unacceptable language about the European Union only lately is wrong. Among my notes I found a few choice words from the not so recent past. László Kövér, for example, described European politics as “gang warfare” and members of the European Union as “ignominious dregs.” Lajos Kósa compared José Manuel Barroso to “an absolutely undistinguished coach of a football team in the second tier of the national championship. Just read Karinthy. It is about Barroso.” [Frigyes Karinthy (1887-1938) was a writer of satirical pieces that are great favorites in Hungary.] As for the seriousness of the Commission, “its work can be compared to that of  a provincial fishing club.” All these quotes are from March 2012 when the Hungarian government pretended that it actually wanted to have a deal with the IMF and claimed that it was only the European Commission that stood in the way of an agreement.

A year later, in February 2013, it was time for a different tactic. Herman Van Rompuy was visiting Hungary and Viktor Orbán went out of his way to be ingratiating. He begged the European Union to be understanding toward poor Hungary, a country that had been cut off from the world for forty years and had suffered under communism. In February he still had to worry about the excessive deficit procedure and had to convince the officials in Brussels that his unorthodox handling of the economy would bear fruit. He assured Van Rompuy that economic growth would be much more robust than predicted and proudly pointed to a very low deficit. (Since then it has become obvious that economic growth is still practically nonexistent. Moreover, in the first five months of the year the deficit was 3.8%.) Orbán said that the success of the European Union is vital for Hungary, and therefore he promised support for the proposed banking union. (He hasn’t had to deliver on his promise yet.)

After February Viktor Orbán’s attitude changed. Orbán decided to return to his old game of  biting the hand that feeds him. Because, let’s face it, without the EU subsidies the economic situation of the country would be even more disastrous than it is now.

I just read a short article that appeared on the Internet site fn.24. It gives exact figures on the subsidies Hungary has received from the convergence program that is designed to help the less developed countries catch up with the richer countries in the West. The numbers are truly staggering.

In five years Hungary paid into the common EU treasury about 5 billlion euros, about 0.9-1.0 billion every year. But in 2007 it received 2.4, in 2008 2.0, in 2009 3.6, in 2010 3.6, and in 2011 2.4 billion euros. The difference in Hungary’s favor amounted to 9.3 billion euros. That means that every Hungarian citizen, including babes-in-arms, received 280,000 forints from the European Union between 2007 and 2011.

Tons of money by pfala / Flickr

Tons of money by pfala / Flickr.com

Fn24’s reporters tried to find out how much the honorable members of Hungary’s parliament know about the size of these subsidies. They didn’t manage to get any answer that even came close. In fact, most of the parliamentarians had no clue at all. They didn’t even dare to guess.

Now let’s see what is happening in foreign investment. You may recall that József Szájer had the temerity to lie straight into the face of his fellow MEPs when he claimed that Hungary has never received as much foreign investment as it did this past year. The truth is just the opposite. Ever since 2007 fewer and fewer foreign companies have been investing in Hungary. In 2007 foreign investment was still quite high: 4.4 billion euros. A year later it shrank to 3.1 billion and in 2009, in the wake of the financial crisis, it dropped dramatically to 1.3 billion. By 2011, two years into the Orbán administration, it is still only 1.1 billion euros. In the last three years EU subsidies were about triple the amount of direct foreign investments.

Meanwhile one can hear the most incredible claims belittling the amount of money Hungary is receiving from the European Union. The latest example comes from Bence Rétvári, a Christian Democrat and undersecretary in the Ministry of Administration and Justice, in an interview with Olga Kálmán of ATV. Actually, it is worth watching this exchange if for no other reason than to get a glimpse of this unctuous fellow who is in many ways a prototype of the young Christian Democrats who received high positions in the administration. In vain did Kálmán insist that Hungary received a great deal more money than it contributed to the common purse. Rétvári wouldn’t buy it. According to him, as a result of Hungary’s membership in the EU it loses sizable revenues that it was able to collect before. I assume he means export and import duties, but I have no idea what that would have amounted to in five years.

Hungarian politicians’ harsh words on the European Union and all the disadvantages Hungary’s membership entail reminded the author of the article I relied on for the figures of EU subsidies of The Life of Brian (1979). Specifically the perhaps most famous scene when the members of the Judaean People’s Front try to incite the people to revolt against the Romans. I recommend it for a hearty laugh.

Indeed, the advantages so outweigh the alleged disadvantages, and not just in economic terms, that EU membership really shouldn’t be a topic of discussion. But then, Hungary’s membership in the European Union might prevent Viktor Orbán from introducing outright dictatorship. And I guess that’s a colossal disadvantage.

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39 comments

  1. The total net contribution of the eu to hungary was 4.4 billion euros in 2011 and about 5 billion euros in 2012 (i have seen the 2012 figures in huf so far; so the five billion is my estimate)

  2. London Calling!

    Is that the ‘What have the Romans ever done for us?’, Eva?

    I’m afraid your link doesn’t work for me.

    Try this?

    Regards

    Charlie

  3. London Calling!

    These politicians can respond with bare-faced lies – without even bothering to give the facts which any politician worth his salt would have to hand.

    Just sheer arrogance – believe what I say, even if it is a pack of lies.

    The faithful just take their word for it.

    And the servile press don’t bother challenging it either – or are too afraid to for fear of losing advertising revenue.

    Astonishing.

    Regards

    Charlie

  4. btw – if he does mean import and export duties – then it’s a nil sum gain – at least.

    If Hungary’s not in the EU they would have to pay more in export duty than they receive in import duty.

    Those Alice in Wonderland economics again!

  5. I have on several occasions pointed out that Hungary cannot be chucked out of the EU and that Orbán knows he will sink like a stone if he leaves the EU on his own volition.

    But there is one weakness the EU clearly has: It doesn’t sell itself well (although there are reasons for that, too). Although all information is easily available – you have to pull it yourself. Hardly anybody I know – and virtually nobody of the EU skeptics – has any idea how much it costs (only 1% of the GDP of a member country), how much it spends on very helpful funding (as a result, most members are net receivers), why what is regulated (most often requested by commercial organisations – ref. the straight cucumber), how big the administration is (smaller than that of tiny Switzerland).

    Most younger people have grown up with it and take everything for granted – what is worse – don’t even know why it exists. My generation still remembers why it was founded and cannot forget the big strides it made over the decades.

    And I am downright proud that on my passport “European Union” is above the name of my country, that I can pay with one currency in most countries – and last but not least, that the European Parliament has such a fine man as Tavares!

  6. @Minusio — The GUARDIAN, the TELEGRAPH — visit the website, search for Tavares. Musicians, footballers. Nothing about Rui Tavares and his report. If the EU is paying press officers for item placement, they’re not getting value for money.

  7. @Wondercat. I don’t think that the EU is paying press officers. And I have no patent solution handy to remedy the apparent lack of information about the real EU in most countries.

    The information is given out freely and daily. But if the media doesn’t take it, what can you do?

    There is one big hurdle, though: It is difficult – or impossible – for the EU to campaign for itself in member countries. All you see is the big signs at some project “85% financed by the EU cohesion (coherence; structural, etc.) fund”. That’s about all the publicity the EU gets in its member countries. I have seen a lot of that several years ago in Barcelona, much less in Budapest or anywhere else in Hungary. Perhaps they use them as billboards for Fidesz…

  8. Wondercat :
    @Minusio — The GUARDIAN, the TELEGRAPH — visit the website, search for Tavares. Musicians, footballers. Nothing about Rui Tavares and his report. If the EU is paying press officers for item placement, they’re not getting value for money.

    Would there be more truth to the report if the person was more famous? Do you think Brad Pitt would have made a bigger impact?

  9. @Mutt. Ironically, you have a point there. Despite my appreciation of people like Tavares, Schulz, Verhoefstadt, Cohn-Bendit, Reding, Rehn and a few others, many people in the European Parliament and, indeed, the European Commission are “second choices” or politicians sent to pasture or just out of the way. Merkel does not suffer rivals near her. So she heaved Barroso into the saddle. He is certainly a likeable man, but no match for a Jacque Delors.

    But these days we seem to have “personnel” problems everywhere and on every level.

  10. @Mutt — “Would there be more truth to the report if the person was more famous? Do you think Brad Pitt would have made a bigger impact?” The questions seem to me remarkably pointless. Answers: 1) There would not. 2) Yes.

  11. Meanwhile, poor Tavares is being confronted with the craziest questions. To all who understand Hungarian, I cordially recommend this: http://hvg.hu/velemeny.nyuzsog/20130707_Hir_TV_Hollandiaban_verik_a_nemeteket . Briefly: a reporter of the HírTV has found out that the Dutch constitution is much more discriminative than the Hungarian one, but the EU is doing nothing, ha! (The reporter had read the English translation which says that “the right of every Dutch national to a free choice of work shall be recognised”. And interpreting the word “national” in the East European way, he believed that it refers to ethnic Dutchmen.) So, you will see the reporter trying to grill Tavares with this question (as for Monty Python references, this strongly reminds me of the “Spanish Inquisition” scene) and poor Tavares trying to understand what the %&/€ this is all about.

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  13. May I ask where the figures for Foreign Investments come from ?

    Both the OECD and UNCTAD give a different trend, see for instance :
    http://www.oecd.org/daf/inv/FDI%20in%20figures.pdf

    Now, OECD doesn’t include “Special Purpose Entities” while Eurostat does. But I couldn’t find the latest Eurostat figures for Hungary. 😦

    PS: one must remember that the bigger investments are spread over several years… so one Government may profit from decisions made under another one. That’s life!

  14. @Minusio
    Although the process is conducted behind closed doors, the rumor has it that Barroso was appointed after 8 rounds, begging the question whether he was lowest common denominator.
    Daniel Cohn-Bendit asked Barroso after his first speech why he was not the first candidate if he was the best.

  15. “…poor Tavares trying to understand what the %&/€ this is all about.”

    Knowing the language will not give Tavarese a true sense of the diabolical madness and ill will with which the Hungarian mind is harnessed. So, he can wait to expect ‘intellectual fair play’ from an Orban-controlled media outlet like HirTv: the reporter is out burn him anyway he can. Taverese better learn that and save his time by not responding to M1, M2, Duna, HirTV, Echo etc.; and of course, that goes triple for radio stations like Kossuth Radio.

  16. “I have on several occasions pointed out that Hungary cannot be chucked out of the EU and that Orbán knows he will sink like a stone if he leaves the EU on his own volition.”

    First off, Minusio has committed the ‘Orban-Error’:
    “I am the country: the country is I”

    So then, the country will sink but not Orban.

    All this aside, commentators here seem to take for granted one great assumption: that Orban DOES NOT
    want the country to sink.

    As a mental exercise, if nothing else, people ought to start thinking of Orban’s continuous goading of the EU as wanting to push the EU to evict Hungary…and to bring on the inevitable consequences of that.

    Why is everyone so sure that this isn’t what Orban wants to do?

  17. I also reported on this HirTV-affair last night in one of my comments. One must watch the video (link provided by HVG). Too bad that Tavares cannot “enjoy” the stern announcement of the anchor but I guess he got a glimpse of the methods HirTV reporters use: “Answer me: yes or no!” he said to Tavares.

  18. Time to Get the International Press on the Case

    Enikő Győri has just dutifully posted an attack on the Tavares Report in the Financial Times Blog. according to Orban’s latest parliamentary dictate:
    Anyone interested in the truth about all this should read Rui Tavares’s fair and thorough report on how Hungary’s current Fidesz government has been using its supermajority power to systematically dismantle democracy, justice and constitutionality in Hungary: http://j.mp/TavaresReport

    What is really going on in prime minister Viktor Orban’s Hungary today could have been illustrated with any one of the Tavares Report’s many trenchant examples of abuses of power. Here, for those who have no idea, is just a whiff, via the ongoing tobacco scandal. I call it “Orban’s Hungary Through Smoke Rings”. It is this sort of thing, over and over, that Enikő Győri is defending in her FT article with the familiar tactics that are so successful with the press-controlled Hungarian populace but rather more transparent in the rest of the world: Everyone is misunderstanding Hungary; everyone is picking on Hungary; it’s all just an anti-Hungarian plot by former communists and the left-liberal opposition (in a curious alliance with the world banking and industrial lobby)…

    Ring 1: 2012: …

    [skipping rings already posted in HS]

    Ring 12: Orban uses Fidesz supermajority power (yet again) in a Hungarian parliamentary vote that declares the EU parliamentary vote a biassed, illegal and anti-Hungarian conspiracy of the EU Green/liberal/left under the influence of the international business and bank lobby opposed to Fidesz’s utility expense rebate to Hungarian voters…

    Enikő Győri’s FT article is a spin-off of that latest parliamentary vote. Many have begun concluding that Fidesz is becoming more and more like a mafia, using its control of the media to systematically transform much of the Hungarian populace into a brainwashed cult, convinced that it is being abused by an ant-Hungarian world along the lines described by Enikő Győri for foreign consumption (but stated much more aggressively in Hungarian for domestic consumption).

    My own awareness of these alarming goings-on in Hungary began about two years ago with the “philosopher affair,” involving character assassination via press and police harassment of distinguished members of the philosophy section of the Hungarian Academy of Sciences who had been publicly critical of the Fidesz government: http://j.mp/PhilosopherAffair

    What is very much needed now is much more extensive international press scrutiny of the goings-on in the country, beginning with detailed and sustained coverage of the remarkable Tavares Report and its implementation as it unfolds — a historic event deserving of worldwide attention. International press scrutiny is the best hope of freeing the Hungarian populace from the controlled-media trance in which they are being held by the government-controlled media. A Hungarian-language Radio (and TV and Web) Free Europe would also be a great help.

    Stevan Harnad
    External Member, Hungarian Academy of Sciences
    http://mta.hu/english/
    Member, Canadian-Hungarian Democratic Charter
    http://www.hungariancharter.com/

  19. petofi :
    “I have on several occasions pointed out that Hungary cannot be chucked out of the EU and that Orbán knows he will sink like a stone if he leaves the EU on his own volition.”
    First off, Minusio has committed the ‘Orban-Error’:
    “I am the country: the country is I”
    So then, the country will sink but not Orban.
    All this aside, commentators here seem to take for granted one great assumption: that Orban DOES NOT
    want the country to sink.
    As a mental exercise, if nothing else, people ought to start thinking of Orban’s continuous goading of the EU as wanting to push the EU to evict Hungary…and to bring on the inevitable consequences of that.
    Why is everyone so sure that this isn’t what Orban wants to do?

    @petofi. I repeat, Hungary cannot be evicted from the EU. Its voting rights can be suspended and certain funds can be withheld.

    If Orbán were to take Hungary out of the EU, all the money he distributes amongst his cronies will dry up the same day (this is not only EU money but everything his regime gets in terms of taxes from the foreign-owned companies and their employees, as the latter would pull up stakes once Hungary is no longer part of the single market). This I think would be the first instance where his followership will question his power. But as we know that power is all he wanted and wants to keep, this way of action is very unlikely to my mind.

  20. Although it attracts remarkably little discussion, a Fidesz-Jobbik coalition (a co-operation at a national level that already exists locally) STILL looks like one of the more likely election outcomes. And I simply cannot believe that EU suspension would not follow that. There is precedent with regards to Austria a few years ago, but I think reaction would be even stronger towards Hungary as it would be seen as an umpteenth transgression, the straw that broke the EU’s back. Such a threat would not stop such a coalition – as national power is clearly seen as more of a grail than national well-being, at present.

  21. @Minusio, Re Orban and pulling out of the EU

    “…this way of action is very unlikely to my mind.”

    Of course, it is against Orban’s best interest to pull out of the EU, because of its dire financial consequences. The question is, how insane he is.. he may well reach the point when showing “who is boss” is more important to him than rational considerations…he is losing touch with reality very fast.

  22. An :
    @Minusio, Re Orban and pulling out of the EU
    “…this way of action is very unlikely to my mind.”
    Of course, it is against Orban’s best interest to pull out of the EU, because of its dire financial consequences. The question is, how insane he is.. he may well reach the point when showing “who is boss” is more important to him than rational considerations…he is losing touch with reality very fast.

    I guess, he passed that point a while ago. Remember, there is no rational explanation of financing the country from the markets on a significantly higher interest rate as opposed to getting money from IMF – apart from his self imposed freedom-fighter image and his vanity, never reconsider, never retract, just like any bully.

    Pride has it’s price, so does the reign of a Pride Minister…

  23. @Spectator: True, but in 2010-11 he had at least some sense of reality and realized that he at least need to pretend negotiating with the IMF to avoid immediate financial meltdown. I think his megalomania had gotten worse since then, and it may reach a point when even an imminent disaster won’t stop him from doing something crazy. And reaching that point will be his downfall.

  24. I repeat (and this ‘wall’ seems to be too high for many to climb’)….it’s time to consider Orban’s Nuclear Option: in other words, he’s not in it to do what’s best for the country; on the contrary…

  25. @petofi. Except for the few trolls on this blog nobody denies that Orbán doesn’t give a hoot about the welfare of the country and the majority of its people. But you can’t overlook that he will do everything to stay in power.

    I cannot yet exclude the possibility that he has lost touch with reality, or is in denial of reality – as are his many followers. But that won’t keep him from winning the next elections hands down, and probably the next ones, too (if there are any). So in essence, it doesn’t really matter.

  26. Of course Orbán doesn’t want to pull Hungary out of the EU. He may be mad, but he’s not stupid.

    The EU is a godsend to Orbán – a whipping boy and scapegoat that just carries on giving and giving (in both senses). It’s just too good not to use. And it’s classic distraction politics – the worse things get at home, the more you ratchet up the anti-EU hysteria (and the anti-Roma, anti-Jew, anti-multinational, anti-foreigner, etc rhetoric).

    Orbán isn’t anti-EU – he loves all the money he gets and he loves having an easy target (that never fights back) to blame and attack.

    And, of course, the more we concern ourselves with his anti-EU campaign, the more we play into his hands. It’s the same as the way we ‘deal’ with trolls on here – they know, as well as we do, what’s wrong – they exist only to distract us and waste our time, not to debate or learn. No matter how many times we point out they are wrong or mad, it makes no difference at all, it’s just wasted energy.

    We should be ignoring all this anti-EU nonsense and concentrate instead on informing the world (and the poor bloody Hungarians) of what Orbán is doing to Hungary.

  27. Minusio :
    I have on several occasions pointed out that Hungary cannot be chucked out of the EU and that Orbán knows he will sink like a stone if he leaves the EU on his own volition.
    But there is one weakness the EU clearly has: It doesn’t sell itself well (although there are reasons for that, too). Although all information is easily available – you have to pull it yourself. Hardly anybody I know – and virtually nobody of the EU skeptics – has any idea how much it costs (only 1% of the GDP of a member country), how much it spends on very helpful funding (as a result, most members are net receivers), why what is regulated (most often requested by commercial organisations – ref. the straight cucumber), how big the administration is (smaller than that of tiny Switzerland).
    Most younger people have grown up with it and take everything for granted – what is worse – don’t even know why it exists. My generation still remembers why it was founded and cannot forget the big strides it made over the decades.
    And I am downright proud that on my passport “European Union” is above the name of my country, that I can pay with one currency in most countries – and last but not least, that the European Parliament has such a fine man as Tavares!

    Thank you, Minusio, for this wonderful and heartfelt defence of such a vital institution. Those of us who understand how important the EU is should be telling the world what we think, not keeping quiet because it’s unpopular to be pro-EU.

  28. Paul :
    Of course Orbán doesn’t want to pull Hungary out of the EU. He may be mad, but he’s not stupid.

    He will initiate the pullout when the EU will revoke Hungary’s voting rights. He will owe this much to the brainwashed believers. Until then the EU is part of the money machine.

    After Hungary suspends the EU membership things will get worse and he will lose on the next elections and the game will be over.

  29. @Paul: Want to make a bet? Orban may be smart, but he is not rational. And he is going to act against his best interest, by making some really dumb move, because of that.

    You may not consider the topic worthy of discussion and you are entitled to your opinion. But I don’t think we were distracting anybody from having a discussion on any other topic of interest. Go ahead, bring up one.

  30. @Mutt. Nobody of Orbán’s believers will know what the suspension of voting rights will mean (not much, anyway, as Hungary’s vote doesn’t count that much). And again, this is not a “suspension of EU membership”.

    There are two reasons why the EU does not evict member countries when they ‘misbehave’: (a) It’s not part of the treaties; (b) The EU also thinks of the population, the opposition, etc. So they actually make a distinction between a government and its people.

    Orbán will never initiate a pullout. – I think that his government isn’t even able to fill in all the forms it takes to do this.

  31. But, keeping things Central Europe, the Belarus election model must also be quite a tempting alternative … just in terms of miraculously maintaining power?

  32. London Calling!

    Minusio et al

    I think you underestimate the next steps of the EU and the ‘Copenhagen-thanks-to-Hungary Commission’.

    They will not throw Orban out – that is not their style; but the long slow burn of inexorable pressure will box him into a corner like a cornered rat.

    And they cannot compromise on their principles.

    You have gone on record as believing that he will win in 2018 – although you appear to have softened on this above – and I have gone on record as saying he won’t.

    I believe the electorate will be fed up with him by this time.

    I believe that Orban’s fate has already been sealed.

    But the EU must go slowly slowly to catchee monkey.

    The EU needs to hone their processes to stop the region festering – and they will.

    And they want to take the initiative – or be seen to – before Helsinki reports.

    ********

    O/T Just to add to Eva’s Life of Brian clip – for the not-so-sensitive viewer – this is another favourite which chimes so true to political life when political factions split. And completely nothing to do with Orban.

    Warning – Adult Humour!

    Regards

    Charlie

  33. @CharlieH. “I believe the electorate will be fed up with him by this time.”

    Pray, what electorate?

  34. @charlieh from what i can see, the electorate are already fed up, they just don’t see a viable alternative so to @minusio question, what electorate. I run into people who did vote for Fidesz but are now just simply confused, almost dispondant.

  35. London Calling!

    Maybe I should have said ‘thoroughly fed up’ – enough to be actively fed up – rather than passively fed up….

    Regards

    Charlie

  36. LwiiH: “I run into people who did vote for Fidesz but are now just simply confused,”

    If I may ask, how do they express this? Is there any wish to learn more about why the situation is as it is or are these people confused because they are still sure that nothing is worse than (Gyurcsany, Bajnai, MSzP or EU, foreigners, liberals… pick any)?

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