János Lázár’s fight with Budapest and Norway

Until now I don’t think too many people ever heard of Nándor Csepreghy, who originally hails from Cluj/Kolozsvár, Romania. In 2002 he moved to Hungary to enroll as a student at the University of Szeged, where he majored in history. A year after his arrival he was already heavily involved in Fidesz politics. His political career began in Fidelitas, the youth organization of Fidesz. As a party activist he was full of rather innovative ideas, some of which, like a video called Gyurcsány Twister, did in fact manage to twist the truth quite a bit. In 2008 he was sent to the United States to study campaign strategies, where he obviously learned something. In 2010 he was the campaign manager for a Fidesz candidate for parliament who easily defeated the MSZP mayor of Szeged, László Botka. In 2012 he was at last rewarded with an important government position. He became undersecretary in charge of government investments “of special importance.” It is in this capacity that Csepreghy has been in the limelight recently.

He has two uncomfortable tasks to deal with. He is negotiating in Brussels with the office handling the Norwegian funds, and he has the unpleasant job of telling the citizens of Budapest that the government will not award the city funds to upgrade the metro. Without these funds metro line #3 may have to be closed because it so old and technologically behind the times that it has become outright dangerous.

In addition to his degree in history Csepreghy also majored in communication, “concentrating on public relations.” Again, he learned well. He talks in full sentences and usually has ready answers to uncomfortable questions. It is perhaps not his fault that he has to deliver messages from his boss, János Lázár, that turn out to be politically unwise, which later he is obliged to cover up.

This is what happened in the case of the Budapest convergence funds. He explained that Budapest cannot receive anything from these funds because they are meant primarily for underdeveloped regions. And, of course, everybody knows that Budapest and Pest County are the most developed regions in Hungary. The inhabitants are  better educated and average salaries are the highest in the country. There was only one problem with this explanation: there are no such regional restrictions on funds in the convergence program. In an interview he helpfully suggested that perhaps the city of Budapest could take out a loan, which the government would guarantee.

Surely, Csepreghy is too low on the totem pole to make announcements of this sort on his own. I’m certain that he was just a messenger of János Lázár, who a couple of days later sent another message to Mayor István Tarlós through Csepreghy: he should lobby in Brussels for more money just as his predecessor Gábor Demszky did.

János Lázár and istván Tarlós

János Lázár and István Tarlós

Once Olga Kálmán of Egyenes Beszéd (ATV) pointed out to Csepreghy that the allocation of funds is entirely up to the government, he had to take a different tack. So, he continued this way: It is true that one-fifth of Hungarians live in the capital, but the government has an equal obligation to areas outside of Budapest. Therefore, the government decided to allocate the money to needier areas, which is only fair.

A day later Csepreghy came up with another story. No decision was made that “all financial resources would be taken away from the capital.” But the amount will be less than would be necessary for the modernization of Budapest’s transport system.

Meanwhile  news reached the public that János Lázár has a fairly grandiose plan of his own for his birthplace, Hódmezővásárhely, where he was mayor between 2002 and 2012. He would like to build a tram-train between Hódmezővásárhely and Szeged (23 km). Tram-train is a light-rail public transport system where the train functions as a streetcar in urban centers but between cities uses railway lines. Whether this is the best way to spend billions, I am not sure. I read that currently very few people use the train between Hódmezővásárhely and Szeged; most of the people use the bus. Apparently daily there are only about 8,000 trips between the two cities. Some people pointed out that no town exists anywhere in the world with a population as low as 40,000 that has its own streetcar system.

After about three days of silence Tarlós decided to say something about the grim news. He tried to be conciliatory, stressing that he and Viktor Orbán would find the necessary funds for the #3 metro line. Up to now Budapest has received 635 million forints, but the renovation would cost about 200 billion. The city sent detailed plans and financial estimates to the government. János Lázár, however, claimed in a public forum in his home town that they had received nothing from Tarlós’s office. Who is telling the truth? I’m almost certain that Lázár isn’t.

The question is why the government would want to pick a fight with Tarlós and why they would strip Budapest of all the money promised in 2013. It makes no sense to alienate the population of the city a few months before the municipal election. Well, perhaps Viktor Orbán and his minions think that, thanks to the new electoral law that was dutifully signed by President János Áder today, the election results are sewn up. With the new provisions the opposition won’t have a chance. Or it might be that the government is trying to curry favor with the rural population who are hurting and who think the inhabitants of Budapest get far too big a slice of the common pie. In any case, Brussels favors upgrading Budapest’s transportation system.

As for Csepreghy’s other unpleasant task, negotiations with the Norwegians are not going very well. The government had to accede to the demand of the Norwegian government and abandon the idea of outsourcing the distribution of the funds to a private firm. According to Csepreghy, there was an understanding between the two sides concerning the fate of the larger amount handled by the Hungarian government. However, Csepreghy continued, no agreement was reached about the funds distributed by the NGO Ökotárs Alapítvány (Hungarian Environmental Partnership Foundation).

I am not at all sure that Csepreghy is telling the whole truth. Let me quote a Norwegian source, which I trust more. Here is the Norwegian government’s position: “Norway and Hungary have still not reached an agreement on lifting the suspension of the EEA and Norway Grants to the country…. Hungarian authorities have initiated an audit of the EEA Grants-funded NGO program strengthening civil society in Hungary. Responsibility for the program and any potential audits lies with the donor states. … Hungary must meet the requirements stipulated in the agreements, which means that the audit must be halted. At the same time, a solution must be found on the issue of the transfer of the implementation and monitoring of the Grants scheme out of the central government administration. Norwegian authorities have as a precondition that these outstanding issues must be resolved before the suspension of the EEA and Norway Grants is lifted. The Norwegian Ministry of Foreign Affairs is waiting for a response from Hungarian authorities before deciding if and how further meetings will take place. ” According to this summary, nothing has been resolved. Both the EEA Grants handled by the government and the Norway Grants handled by the NGO program are still suspended, waiting for a satisfactory response from the Hungarians.


  1. Orbans are operating on the monkey wrench way. They are ruthlessly terrorizing the partners of the Norwegian Fund. The many NGOs supported by Norway have been ultimately paralyzed.

    They will need lot of luck to recover.


    They will need good lawyers to file lots of claims against the orban regime, to get compensation for the blatant harassment.

    As expected, most ordinary citizens remained silent in this affair.

  2. “They will need good lawyers to file lots of claims against the orban regime, to get compensation for the blatant harassment.”

    No point as they have no chance of getting justice through Orban’s courts.
    And certainly the regime’s terror campaign (*strange* phone-calls at 2 o’clock in the morning, *strange* football hooligan types hovering around the entrance, not so *strange* NAV raids) will continue. But… for most of them, this is nothing new, Orban’s *war* against civil society began the day after he got elected in 2010 and the harassment and threatened violence, shortly after.

    The majority will, however, survive, by hook or by crook simply because the majority (unlike the rest of the cowards in the country who surrended to the Fidesz thugs without a whimper) actually believe in the work they are doing.

    “As expected, most ordinary citizens remained silent in this affair.”

    As they did when the regime stole their pensions, raped their judicial system, closed down their free press. But that shouldn’t and won’t stop the small miniority in their fight for demeocracy.

  3. Also interesting to see that Blikk has a typical trashy tabloid story about Mr Lazar’s “preference” for tax-payer financed trips to the French Riveira during his time as a local government mayor.

    On the basis that Blikk takes no chances against the regime, this looks to be another internal attack on Lazar. He is too much of a liability now for the business wing of the Fidesz Mafia?

  4. OT but concerning Blikk’s taking on certain members of the Fidesz elite:

    Late last month Blikk published an open letter from Terry Black, a somewhat notorious transsexual here in Hungary, to Kerényi Imre, the loudmouthed homophobe discussed earlier in this blog. In the letter, Terry claims to have had a 2 month relationship with Kerényi and names 2 other male lovers he supposedly had.

    Makes you wonder how much the current regime actually has on it’s highest members and how far they are willing to go to keep them in line (a tactic they likely adopted from their predecessors).

  5. Eva I am unclear about how the Norway Fund fits into Hungarian urban transportation. From what I understand almost all the external money going to Hungary comes from the European Regional Development Fund (ERDF) controlled by the European Commission. Moreover, the ERDF actually invests very little money into urban transportation projects, from 2007-2013 the total for all EU states was only EUR 7 billion, your essay indicates that just the #3 line project would cost 200 billion HUF or close to 10% of all ERDF expenditures for a six year period of time.

    The entire EU Reference Framework for European Sustainable Cities (RFSC) is really what can be called an aspirational document because there is no serious funding for the vision especially in larger Central European cities. It really doesn’t matter what the EU wants or what is ecologically prudent for Budapest, no matter how funds are shifted between rural and urban projects, no matter the containment of Hungarian corruption in the area of urban development projects that has existed under also under MSZP rule, there is simply not enough money for Hungary and other Central European States to even begin to implement the RFSC.

    Then we have the problem of global warming for a city like Budapest which I experienced again just last week. It was to be honest exactly like Chicago in the sense that it stayed way too hot at night and air conditioning is becoming a necessity, while one’s vision of the past is always distorted none the less I did not recall Budapest staying relatively hot at night like Chicago. The long term perspective is really not good and I would recommend looking at a 2010 report called the VAHAVA Report (www.unisdr.org/files/18582_thevahavareport08dec2010.pdf) While the EU talks the talk in relation to sustainable urban development it does not provide anywhere near enough incentive money for Hungary really to begin to implement EU policies in this area. It is much the same here in the US with so called federal urban development funding.

  6. Caprice Goldberg
    June 18, 2014 at 4:29 am
    OT but concerning Blikk’s taking on certain members of the Fidesz elite:

    Late last month Blikk published an open letter from Terry Black, a somewhat notorious transsexual here in Hungary, to Kerényi Imre,

    Please do not bring this blog down to the level of Blikk reporting that Fidesz uses for its PR too.

  7. @Istvan, you must have misunderstood me. I am talking about two different tasks this young Csepreghy has to deal with. One is the funds for Budapest which indeed has nothing to do with the Norwegian Fund and the other which is all about the suspension of the Norwegian Funds.

  8. @Some1

    Reread my post. It was in no way an attempt to lower the journalistic integrity of the blog, rather a comment on Fidesz’s own usage of Blikk to warn/tame its own – following D7 Democrat’s similar statements.

  9. Éva, I know, but the link “a norwegian source” is broken. Just helping 😉 Since this is my tax money, it’s important for me that the Norwegian government make a clear statement in this case.

  10. Not too much OT:

    A scathing tale by David Landry, an American journalist who lived in Budapest the last 19 years:

    I especially liked the term “Gulyás Dictatorship” – never heard it before, but it sounds very logical as an equivalent of the Gulyás Communism of the 80s.

    He describes many problems of Orbán’s Hungary like we discuss them here – it’s almost uncanny!

    I almost wanted to write “I enjoyed the article very much …” but of course that would be silly – I’m grateful that others see Hungary’s problems as we do.

  11. @Wolfi

    Thanks for Landry’s piece. I’m not sure who he meant by the MSZP turncoat in 2006. Was this the supposed person who turned the Oszod tapes over? Confusing.

    Of course, Orban is frightening, but less so than the disgusting nature of Hungarians who haven’t
    seen an opportunity for betrayal or self-profit-at-the-expense-of-fellow-citizens…that they haven’t
    happily undertaken. If a very deep circle of Hell is reserved for Orban, than his ‘servants’ are
    booked for someplace even lower. The lack of decency and integrity in the Hungarian political culture is sickening.

    But let’s not leave out the mewing, sheep-like, fantasizing masses–their lack of curiosity and ignorance of civil procedure; of fairness; of a desire for an egalitarian society…and their Germanic, 1930’s style of tongue-hanging desire to follow a strutting little megalomaniac is so demoralizing
    to one, like myself, who’s been invested in the Western notion of Progress. To see that the Judeo-Christian idea of improvement could be junked by a leader and a nation so cavalierly is terrifying in its implications.

  12. I too read the Landry’s piece and I totally understand it. Even if I did not share Landry’s optimism in relation to the transformation and development of Hungary in the 1990s, I share his depression after having just been in Hungary. These lines jumped out at me: “Meanwhile, the current prime minister has turned his back on the brain drain that sees this country’s brightest minds seek greener pastures elsewhere (nearly anywhere, really). A recent study showed the average Hungarian citizen living abroad transfers some $5,200 to their home country per year – an amount equal to more than 40% of the average annual salary: An ideal solution to keep anyone who might imagine alternatives away from dangerously influencing friends and family here.We’re now told that Hungarian unemployment is at an all-time low while the fact that some 6.4% of the employed are “fostered workers” drawing a maximum of 35% the already tiny average salary is conveniently obscured by muzzled news sources.”

    I had not been back to Hungary since the full impact of the global recession of 2008 hit the country and the deterioration of the standards of living I saw seemed to me to be significant. The admitted debt loads many members of my extended family seem to have is staggering and they may well be underplaying the situation for their American cousin. The term economists use is “excessive indebtedness of households in foreign currency,” is too sanitary to grasp the situation for some families I think.

    Landry also discussed a future for Hungary stating it may become “a despotic nation of blue-collar workers and anti-intellectualism.” The blue collar nature of Hungary is striking, as are the very low wages for sure Landry has gotten that right.

  13. That piece by Landry is depressing in a way – like many of the discussions here.

    A bit OT:

    I just had three (of course my wife was with me …) with my neighbour and his wife – they are really nice people (though too much in the Fidesz direction for me and my wife …) and sometimes (or rather often …) I wonder how they manage.

    A full time job with lots of extra hours – and a large garden where they grow most of the vegetables (including potatoes!) they need. And that’s a lot of work – every evening maybe two or three hours in addition to the housework/upkeep of the house like painting, insulating, installing new windows …

    And I think they count themselves lucky because both of them have “safe” jobs … So they don’t complain!

    It really reminds me of Germany (West) 50 or even 60 years ago.

  14. RTL has continued its multi-pronged attack on his regime on tonight’s news; Orban surely can not let this continue?

  15. @Wolfi re:It really reminds me of Germany (West) 50 or even 60 years ago.

    ..and this is the real difference between Germany and Hungary. 50/60 years….:-((
    Please do not forget that Germany was a colonising power while Hungary was the lesser power of the Monarchy; thus sort of colonised.

  16. can we describe the sad state of Hungary with daily blog entries without repeating ourselves?

    can we shake up the indifferent and deceived population after all these scandals?

    can we compensate the Hungarian people for all the destructive propaganda of changing regimes, and the brainwashing of various churches?

    who has ever tried to straighten out the fate of this unfortunate nation?

  17. Eva,

    When you tell Kormos that his/her comment is utter nonsense, it would be more useful to give a reason why you think so, e.g. Hungary also possessed an empire, or having an empire doesn’t matter in this regard, or the days of empire were too far in the past, etc.

  18. Kormos has tried to find an explanation for the utter failure of a nation, like I do it sometimes.

    I would put the emphasis on the lies.

    A nation that lives in lies, nurtures lies, will always suffer.

    Kipling hit it very well. Where the fathers lied, the people die.

    Hungarian fathers, leaders, priests, writers will have to refrain from lies, to save this nation from bad future.

    When we all become like Gyorgy Moldova, we will a have a chance.

    So between colonizing others, and colonized by others and themselves, lies have killed the chances of Hungary to become a nation like it was under Ferenc Deak.

  19. EasySilent it seems somethings merit repeating and will appear over and over again. One of those things is the actual deprivation of the mass of Hungarians since the 2008 downturn, because in so many ways as Landry, and posters on this blog including Eva point out the official government line presents a false reality. It is a reality that is difficult to accept so it is avoided.

    Clearly there is no common solution among the contributors to this blog as how to escape the low wage trap Hungary has entered. This was also reflected in the collapse of the left/liberals in the last elections.. What is clear is that Orban and his party play on the deprivation of the masses and blame the EU, former communists, even the Roma people, etc while still allowing the levers of corporate ownership to be transferred to more developed nations like Germany.

    What is really upsetting is that I go back to work here in Chicago and my co-workers ask about my trip to Budapest and extol on the wonders of the 5th district I am too deeply reluctant to explain what is happening there to non-Hungarians. In a way I must admit I am embarrassed and say simple things like some things have gotten better since the fall of communism and other things are the same.

  20. @googly. Yes, you are right but when I did not have electricity for 11 hours and therefore couldn’t upload my daily post I wasn’t quite ready to give a historical explanation to Kormos on this issue. Especially, since it was 11 o’clock at night.

    First, since the Rákosi regime no responsible historian has ever called Hungary a colony of Austria because it wasn’t. Kormos should go back to the history books and learn.

    Second, the problem of the less developed eastern part of Europe is one of history’s mystery, Why, why? Certainly, not because Germany had a few useless African colonies before 1914. The whole thing is utter nonsense.

  21. Yes Ms. Balogh. I have lots to learn. I just learned that there is no difference between Germany and Hungary. Germany was not a significant colonising power and Hungary was never colonised. So mote it be….

  22. @ o’buda

    What is this nonsense about ‘nationhood’ in the 21’st century?
    Why not a valued, respectful member of the greatest community of nations called the EU?
    This ridiculousness of ‘defending ones culture’..! It does not depend on a nation-state.
    Look at jewish culture–it has been maintained, and flourished, despite the people being attacked
    in nearly every venue they lived in. Never a question of the ‘culture disappearing’.

    Hungarians should stop swallowing the rat-poison of Nationalism that people like Orban peddle.

  23. Petofi a balanced perspective on the reality of the EU in relation to Central Europe is also very helpful. I just read Jurgen Habermas’s book titled The Crisis of the European Union and he also gave a lecture on it in Budapest about a month ago. If you keep away from the economic complexities of the EU as Habermas’s does then a United States of Europe looks just wonderful, but when you dig deeper like Zoltan Polgatsa does you see the roots of the revival of nationalism being based on economic inequality within the EU.

  24. But Istvan, even assuming that 2008 was the start of Hungary’s problems (which it was not), what Orban has been doing over the past years is just making matters worse. Yes, Hungary needs a development strategy, yes, Hungary has not lived up to its possibilities of 1989. All true. But how can a strategy based on “poverty theories” improve matters? You need to start first to believe that you are capable of more. And if so, do so. Do not start first to dwell on some colony theory also employed by Kormos, which states that if you were an underdeveloped area once, you will remain so forever. I think that the US certainly testify to the opposite. And the underdeveloped Holy Roman Empire (the colonising Germany before 1806) is a second example. It is the medieval thinking, this mourning about some lost glorious world (which never existed), that stands in the way. It is not too much of the “West” but too little. Too little understanding that for making a government work for you, people have to control it, and learn how to do so (learn from the Western experience). If Hungary was a colony in some sense, then perhaps a colony of its aristocracy. I was very amused to read in a text from Mme Stael from 18something that Hungary is a last example at that time in Europe for a country where there are actually only regional fiefdoms. It was known at that time also that there is some fundamental problem in the mode of government considered as in line with “national traditions”. It is an 1848 revolution that is needed, but without being understood as just one that purifies the nation again. (People will run in even larger numbers.)

  25. @Istvan

    Utter rubbish. Hungarians are master of deflecting criticism and placing blame elsewhere.
    How can one blame the EU? Look at all the developmental money heading this way every year.
    Now, most of the agricultural money seems to head into the pockets of ‘absentee leasers’ like Orban’s cronies. Has anyone considered the loss to the country of all that money that should go to real farmers? Not that I’ve heard of. So, let’s end this nonsense of how the EU is an engine
    of inequality. Hungarians are the worst cry-babies in the world.

  26. Who will Kormos, Johnny and other will fight now? Orban’s newest speech about how he is attacking the communists. lol It turns out that Laszlo Tasnadi, Orban’s handpicked man, the new Secretary of State happened to be a III/II agent for the communists at the time when Orban told his famous speech in 1989. How things change. At the time Orban was against him, and now he pays him form taxpayers money. Maybe as an informer Tasnadi just learned to much. Do not forget that Fides still blocks the release the secret files about who did what under Kadar. Being a Fidesz member I guess now is almost equal to be a member of the Communist Party. All the friends can hang out together, like in the good old days. Kover, Matolcsy,Tasnadi…

  27. petofi I have read this argument about the amazing development funds provided to Hungary and other Central European nations. With the exception of Slovakia and the Czech Republic the promise of relatively equal standards of living have not taken place. In Central Europe as a whole, a third to a half of citizens live below the subsistence minimum. Middle class incomes in the region are equal to the bottom 10 percent of wages in Western Europe. Regional educational systems underperform. Middle classes, can be estimated to constitute less than 10 percent of voters.

    In the case of Slovakia the wage increases were so significant that last year public sector wages were reduced by 2 to 3 percent to try to reduce public sector costs. In March 2008, the Ministry of Finance announced that Slovakia’s economy is developed enough to stop being an aid receiver from the World Bank. Slovakia became an aid provider at the end of 2008. Yet we can still see that even in the Czech Republic the per capita GDP rate is 81% of the European Union average.

    There is more evidence that the positive developments in Slovakia and the Czech Republic are based on where these nations started out at than on the EU development aid they received.

    In relation to Kirsten’s interesting comment, there is no question that an underdeveloped nation can develop or at least enter that pathway. China is an example of that, but it requires breaking in some cases the rules of free trade and establishing various protections from foreign capital penetration. It is also unfortunately requiring a rather ruthless exploitation of Chinese workers for the benefit of the emerging and incredibly wealthy capitalist class of that nation which has now more billionaires than does the USA.

    The United States also did this with various industries and then turned around and became the greatest supporters of free trade and open markets. I also don’t disagree with Kristen’s vision for a new 1848 type of revolution for Hungary. But such a vision of internal development for Hungary will put the nation in many ways at odds with the EU, but in a far more constructive manner than the Orban regime currently is.

  28. Istvan: “It is also unfortunately requiring a rather ruthless exploitation of Chinese workers”

    In Hungary, people are sent to forced labour as a development strategy and the outcome will not even be Chinese style growth. Instead, people that work for foreign firms such as the German car makers do not have to work under circumstances similar to those of the Chinese workers (exploited by their Communist party) and they are nevertheless considered to be “colonised” and “exploited”. Under current circumstances, to become richer you have to catch up in technology. Not exactly a priority of the Hungarian government. So through which type of protection should this catching up growth come about? If a foreign firm invests and employs domestic workers, their skills will improve, and that is indeed what makes the country richer. It increases the likelihood that some domestic business can emerge that will be interesting technologically. If people have to return to manual work where instead machines could be employed, the skill level will perhaps “improve” in this manual work but the income level will most likely not increase. Many industrial products in such circumstances have to be imported but that makes you “dependent” on the richer countries which are able to produce it. So what can such protection achieve in a world in which knowledge and technology are the basis of prosperity? Would Hungary start to spy on other countries to “import” technology instead of embarking on the painful but ultimately more promising path of adopting it through attracting some foreign investments and making the most of it through the skill improvements that it brings and through more wide spread higher education which the Hungarian government can decide to support entirely on its own volition?

  29. Istvan,

    You wrote: “There is more evidence that the positive developments in Slovakia and the Czech Republic are based on where these nations started out at than on the EU development aid they received.”

    Slovakia was much less developed than Hungary at the time of regime change, and as recently as a few years ago their GDP per capita was significantly lower than Hungary’s. Furthermore, Poland has done even better than Slovakia, though from a much lower base. I would say that the two determining factors are EU development aid and government policies, rather than where these nations started out.

    However, even in Hungary living standards are much higher than they were in the 1990’s, and that is due in large part to the huge amounts of aid from the EU, in my opinion. Without that aid, I would say that many years of GDP growth would have been recessionary years, especially immediately after the financial crisis of 2008 and the euro crisis of the past few years.

  30. As someone pointed out, the US was a colony once, as was Canada, Australia, and New Zealand. In fact, so was Taiwan, Korea, and even China, up to a point. Three of the other “BRICS” were also colonies, yet they managed to do well for awhile (India, South Africa and Brazil).

    Saying that a country’s destiny is shaped by whether or not it was once a colony is lazy argumentation. There are many different stories under the heading of colonization. Some scholars argue that Taiwan and South Korea benefited from their time as colonies of Japan, since the colonizer created institutions that survive in some form to this day, and helped in the development of the countries after colonization ended. It doesn’t seem to matter much when the colony gained independence, or how, since Korea and Taiwan were colonies until 1945, when the Allies defeated Japan, and Canada and Australia have only really been independent for less than 100 years, while the US and much of Latin America declared and fought for their independence over 200 years ago. Perhaps the real determining factor regarding development of former colonies lies in the treatment received by the colony during colonization, but Korea was very badly treated by Japan for many years, and China was not treated well by Japan or the “Western” powers, yet there is obviously a great deal of development occurring there, less than 75 years later.

    “Germany had a few useless African colonies before 1914. ”

    I hate to quibble, Eva, but perhaps the colonies being referred to are here in Europe, such as parts of Poland.

    Also, it seems to me that there was some colonization of Hungary occurring during the time spent under the control of the Ottoman and Habsburg empires. I realize that many of the ethnic Germans living here were invited here much earlier, but I imagine that at least some of them were moved here by the Habsburgs, and there’s no doubt in my mind that the Ottomans treated Hungary much like a colony, even if there were not too many Turks who moved here permanently. Colonizers don’t necessarily have to send large numbers of their ethnic groups into their colonies to qualify as colonizers. I don’t see a large residual population of Belgians in the Democratic Republic of Congo, for example, yet there is no question that Belgium (or, perhaps more accurately, King Leopold) colonized that African country.

  31. Kirsten Chinese workers for the most part do not work for the party or state, but rather for private companies many which contract with American and European firms. In the case of China violations of what are called intellectual property rights are common practice and those violations are in many cases used to innovate. It is amazing really what the Chinese are doing, but as I said the working class is being exploited to a big degree. Kristen I have my doubts about the skills many Hungarian workers are gaining by working for foreign firms, but the most intelligent workers will be stealing effective intellectual knowledge to set themselves up in independent businesses. But from what I have seen and read there are not a lot of Banks in Hungary that throw money behind these new ventures. There is some risk aversion in that sector, no doubt also due to the large influence of Austrian banks in that sector. So there is not a lot of venture capital out there.

    In China the state promoted independent capitalists, many of whom are very loyal to the CCP. It is not impossible to take a backward underdeveloped nation forward, but without question China has a very big advantage over a county like Hungary, it has a massive internal market to exploit.

    On another issue altogether I was looking at data from the latest Ipsos survey of adult Hungarian citizens with permanent residence in Hungary discussed in today’s Népszabadság . The survey conducted from June 6 to 13 indicated decreased support for the MSZP showing a decline from 11 to 8 per cent of the voting-age population since the elections. As for support for the MSZP among young people – 20’s and 30’s age groups – it was only 3-4 per cent, but 20 percent of people over 65.

    The data for other opposition parties was equally dismal. Fidesz and Jobbik have effectively hegemonic authority politically within Hungary, there really isn’t any other way to look at this data. Politically a strong nationalist position right now seems the only ticket to elector power in Hungary. It would seem politically prudent for the Hungarian left/liberals to expose in detail the economic ties between both Fidesz and the Jobbik to foreign economic interests, both Russian and German. But that is easier said than done given the situation with the media. Of course many of the left/liberals have similar relationships too and so what goes around can come around as they say.

  32. Responding to google. Using OECD data going back to 1989 I still believe it is more than reasonable to state that both the Czech Republic and Slovakia were more economically advanced than Hungary in total. I think most economists would agree with me on that.

    Each year on July 1, The World Bank revises the classification of the world’s economies based on estimates of gross national income (GNI) per capita for the previous year. The updated GNI per capita estimates are also used as input to the Bank’s operational classification of economies, which determines their lending eligibility. As of 1 July 2013, the World Bank income classifications by GNI per capita are as follows:

    Low income: $1,035 or less
    Lower middle income: $1,036 to $4,085
    Upper middle income: $4,086 to $12,615
    High income: $12,616 or more

    Using the newest data from the World Bank for FY 14 we see Hungary was downgraded from a high income economy to an upper middle income economy with an actual GNI of $12,410 in US dollars, and Poland was still listed using this approach as a high income economy with an actual GNI of $12,660 US dollars. The Czech Republic $18,130 and Slovakia $17,200 are clearly doing better.

    Compare this with these GNI numbers; Germany $45,170, Austria with $47,960, France with $41,850, or even Spain with $29,340 and the problem of the failure of the EU development for the transitional economies is somewhat obvious. If you want to look at this data go to data.worldbank.org

  33. @Istvan: Comparing Hungary, Czech Republic and Slovakia in the early 90s can be tricky, as Czechoslovakia was one country.. with the Czech part more developed than the Slovak.

    Here is an article (in Hungarian) comparing how the average salary changed in Hungary and Slovakia. in 2006 a Slovak worker got 25% less than a a Hungarian, but by 2013 a Hungarian got 10% less than a Slovak,

    The GDP chart is always telling, it shows how the Slovak GDP growth was higher than the Hungarian every year since 2006.

  34. Slovakia indeed had not the best starting position in 1990 or 1993 (at independence). Most of the growth achieved since then is based on large foreign investments either into the car or the steel industry. It is the chosen strategy that matters, because according to the “logic” employed here in the thread, the country should score extremely badly on the account of “colony”: first the Hungarians (for a very long period), then the Czechs (for much shorter). Apparently this has not prevented them from finding a “development strategy” based on more self-confidence and less fear from being “exploited”. If you consider Slovakia a success story, the reasons why they have been successful might be of interest for you. Especially as they have been under Hungarian influence for so long.

  35. An thanks for the article, the salary comparison between Hungary, the Czech Republic and Slovakia were between the years of approximately 2013 and 2006 from my reading of it. This deals with the national response and ability to deal with the Great Recession beginning in 2008. There has been considerable research done on the poor response of the Hungarian government to the downturn along with the debt issues as I suspect you know. The article references some that research indirectly in its criticism of the MSZP government response to the Great Recession. The article never compares wages between any of these Central European nations and the powerhouse nations of the EU, it is a debate about which of the lower wage economies is doing better in 2013.

    I agree that OECD data sets for the take off ability in 1989 of what became the Czech Republic and Slovakia are difficult to separate out. But most researchers I have looked at on the transition to market based economies believe the situation of these two states was considerably stronger than that of Hungary at the point of take off. As we know the Hungarian wage structure under the command economy was higher than that of other Warsaw block states due to the new economic mechanism and borrowing by the Kadar government. But as we know that relative advantage was an illusion not based on the internal development of Hungary, but rather by strategic moves made by the old communist regime.

    An I also thought that the comparisons made by job type were very interesting in the article. But the article also proves that EU development policies have not really attempted to equalize Central European wages to those of the more powerful EU economies. But there is no question that the Czech Republic and Slovakia are doing the best now of all the transition economies, based on the GNI data I don’t see Poland doing as well as many people seem to think it is doing. In fact here in the USA we again are seeing a rise in the number of skilled Polish construction workers illegally working for 6 month periods of time on tourist visas, whereas for the prior two years they had more than enough work back,in Poland.

    We can all cheer up if we compare the Hungarian economy to Romania, or Serbia, that is deprecation on a qualitatively different level. I read Kristan’s comment and it is my understanding that there is more research being done currently on Slovakia and the transition process in comparison to other transition economies. Because I work at a not for profit research center here in Chicago primarily on the economics of disabilities in the USA we do have access to the economic journals and as articles appear fro time to time I will try to reference them, PDF downloads for non-subscribers are really outrageously expensive.

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