DK

Mysterious trips of Viktor Orbán and János Lázár to Switzerland

Today I will have to pull up my socks if I want to give even a semi-coherent summary of the growing scandal surrounding a company called MET Holding A.G. with headquarters in Switzerland. The holding company, established only a couple of years ago, is partially owned by MOL (40%) and partially by Hungarian individuals–people formerly employed by MOL and businessmen with close ties to Viktor Orbán.

First of all, it’s hard to decipher the company’s structure which is, as is often the case with enterprises like MET Holding, extremely complicated. Second, since it is likely that MET Holding, in addition to its regular activities, also serves as a money laundering operation for Fidesz as well as Viktor Orbán and his friends, those involved do everything in their power to conceal the company’s business activities, ownership, financials, and so on.

I should go back a few years to February 2010, only a month before the national election and the birth of the two-thirds majority, when the U.S. Embassy in Budapest compiled a report entitled “Allegations of political corruption surround unbundling law.” From the lengthy report we learn that “it is an open secret in Hungary that MVM and MOL provide significant funding to the two main political parties, with MVM rumored to favor the Socialists and MOL favoring Fidesz.”

MET Group predated this U.S. report. According to its promotional material, it began operating in 2007 “in the natural gas retail and wholesale sector benefiting from the market liberalization starting in 2004.” Currently it is active in wholesale gas trading in the European market as well as in the retail sale of natural gas to industrial customers in Hungary, Slovakia, Romania, and Croatia. Five years later, in 2012 MET Holding was established with the objective of being “a central holding organization to manage and support all the subsidiaries of MET Group.” (If you want to know why MET Holding might have been layered on top of MET Group, I suggest you take a look at “How a Holding Company Works.”)

Shortly after the election in 2010 Orbán promised cheaper energy to consumers. In order to lower prices the state-owned MVM (Magyar Villamossági Művek) was allowed to dip into its gas reserves which it could then replenish with cheaper gas from the open market. MVM could have bought the necessary gas directly from Austria, but instead it purchased gas through MET. According to the figures that are available about the transaction, MVM gained little while MET made about 50 billion forints on the deal.

The owners of MET, in addition to MOL, are István Garancsi, a personal friend of Viktor Orbán and owner of Orbán’s favorite football team, Videoton, and György Nagy, one of the founders of Wallis Asset Management Co., a private equity/venture capital firm. Both men have close ties to Zsolt Hernádi, the beleagured CEO of MOL who is accused of bribery in Croatia, and to Sándor Csányi, his deputy and the CEO of OTP, Hungary’s largest bank. Heading MET Holding is Benjamin Lakatos. He expects sales this year to total some 3.8 billion euros.

Most likely nobody would have cared about this Hungarian company with headquarters in Zug, Switzerland, if Hungary’s prime minister hadn’t been so involved in negotiations with Putin as well as with Russian energy companies, in particular Gazprom and Rossatom, the Russian company that specializes in building nuclear power plants. Rossatom was chosen to construct two extra reactors at the Paks power plant. Given the widespread concern over Viktor Orbán’s dealings with the Russian autocrat, Swiss journalists started probing into this mysterious MET. A  well researched article appeared on November 3 in TagesAnzeiger, which was later reprinted in Basler Zeitung. According to the Swiss paper, MET Power, MET Marketing, MET International, and MET Holding all share the same Zug address. Benjamin Lakatos is the CEO of all of them. Zug, by the way, is about 20 km south of Zurich.

I understand that the company’s management is made up of former MOL employees who know the energy business inside out but who found greater opportunities outside of MOL. Lakatos is very proud of his achievement of building MET Holding in two years from practically nothing to a sizable player in the energy business, though one cannot help but be suspicious of a such a sudden rise in fortune. Moreover, given the cozy relationship in the past between MOL and Fidesz, one wonders what role MET may play in the possibly continued reliance of Fidesz and Viktor Orbán on MOL as a source of illicit money. With István Garancsi’s name in the cast of characters, one becomes doubly suspicious since he is often portrayed in the Hungarian press as Orbán’s front man.

And now let’s move to more recent events that might have something to do with MET Holding. I’m patching the story together from several sources. You may recall that the editor-in-chief of Origo, an online news portal, was dismissed because one of the reporters of the internet site was too curious about a couple of very expensive trips János Lázár, the most important member of the Orbán government after the prime minister, made to Great Britain and Switzerland. Lázár for a long time resisted revealing any details of these trips but eventually after a court order the prime minister’s office released some information. Among the bits and pieces of information that Origo received, there was one item that might be relevant. Origo was informed that János Lázár during his Swiss trip “held conversations with a German citizen about German-Hungarian and Russian-Hungarian relations.”

More than a year later there was another trip to Switzerland. This time it was a private affair. Viktor Orbán and his wife and János Lázár and his wife spent a weekend in Zurich. First they stopped in Germany to visit a “family friend” and then off they went to Zurich, allegedly to attend a concert given by a children’s choir from the Szekler areas of Romania. Quite a lame excuse for traveling to Zurich because earlier this same group gave three concerts in the Hungarian Parliament in Budapest. There was also a side trip to visit a friend in Germany. Is he perhaps the same man Lázár held talks with in March 2012?

About a week ago Viktor Orbán made another trip to Switzerland. This time the occasion was a family visit (including his wife and their two youngest daughters) with Rachel, who is enrolled in a fancy, expensive hotel management course in Lausanne. Since, again, this was a private visit, the prime minister’s office refused to release any information about the trip. However, thanks to an eagle-eyed person, Orbán was spotted at the  Zurich railroad station having a beer with an unidentified man. Since the Orbáns decided to travel back to Hungary by train, a stopover in Zurich was unavoidable since there is no direct train from Geneva, a forty-minute train ride from Lausanne. But why did he choose to go by train from Lausanne all the way to Budapest, a trip that takes altogether 16 hours and 22 minutes? He said that wanted to spend more time with his children. Well, I could imagine many more pleasant ways of spending time with my family than sitting in a second-class train compartment. Suspicious Hungarians already have their own theory: for one reason or other, Orbán chose to travel by train because there is no inspection of either persons or luggage on trains. I find that difficult to believe. I hope that we are not at a point that the country’s prime minister is carrying millions of euros in his suitcase.

Although one can probably discard such speculation, one should take more seriously the information received by the Demokratikus Koalíció that while in Zurich Orbán met representatives of Credit Suisse and Pictet Bank. Pictet is a private bank which in 2012 was the target of a U.S. probe into the use of foreign banks by wealthy Americans seeking to avoid paying taxes. Pictet specializes in “wealth management.” As for Credit Suisse, which is one of the most powerful banks in the world, it also had its problems with the law. In July 2014 Credit Suisse reported a loss of $779 million because of the settlement of a tax evasion case in the United States. Zsolt Gréczy, the spokesman for DK, emphasized that they are not accusing Orbán of anything; they simply want to know whether he met with representatives of these two banks as the prime minister of Hungary or as a private individual.

All in all, the picture that emerges from the few pieces of information we have is not pretty. Orbán has enough trouble as it is. Tonight another 10,000 people demanded Ildikó Vida’s resignation–and his as well.

The future of MSZP: The Ferenc Deák Circle versus József Tóbiás

The municipal election results were barely tallied when Népszabadság published a proclamation in the  name of the Ferenc Deák Circle. This group was formed on July 15, a few days before MSZP held its congress in the wake of Attila Mesterházy’s resignation as chairman of the party. Who would succeed Mesterházy was never in question. There was only one candidate, József Tóbiás. But the members of the Ferenc Deák Circle–twenty-one prominent and less prominent, older and younger members of the socialist party–feared that under Tóbiás’s leadership the party would not choose the best path. The group hoped to influence the congress and thus the future of the party.

Who are the member of the Ferenc Deák Circle? First and foremost, Ildikó Lendvai, former chairman of the party. There are several former ministers: Ferenc Juhász, Mihály Kökény, János Veres, Ime Szekeres. The successful mayor of District XIII, József Tóth. Among the younger generation and newcomers, Kata Tüttő and Anna Lendvai from the Budapest MSZP, who have served as members of the city council in the last four years, and Róbert Braun, a newcomer who made a good impression on me in his television appearances. Ildikó Lendvai stressed that 14 of the 21 members of the Circle have no desire to hold any office. She herself, in fact, received several nominations but turned them all down.

The members of the Ferenc Deák Circle had fairly modest demands. They wanted greater transparency within the party; they also wanted to curtail the power of Mesterházy’s men. As it was, most of the people who were put forward as parliamentary candidates were close associates of the former chairman. The group suggested that the majority of the board members of the party not be members of parliament. Ildikó Lendvai was hopeful that their suggestions would be well received by the congress. The group hoped that the congress would vote in favor of a new program, new by-laws, and a new organizational structure. Well, none of these hopes of the group materialized.

Magyar Nemzet reported after the congress that “the members of the Ferenc Deák Kör who urged an opening toward the liberals failed.” The congress stood by József Tóbiás’s ideas of a move farther to the left and voted for the party’s total independence. Tóbiás, after being elected with 92% of the votes, gave a ten-minute speech in which, while not mentioning either DK or Együtt-PM by name, announced that “I will not measure on an apothecary scale how much liberalism, moderation or law and order are necessary for success.” He said he was building a left-wing party, not a “rainbow coalition.” As is evident from Tóbiás’s subsequent utterances, he hasn’t changed his mind on the subject.

Now, after a few months of hibernation, the Ferenc Deák Circle is back in the news. The text of its proclamation appeared in yesterday’s Népszabadság. Although it does not mention Tóbiás by name, it states that “we need a new political strategy; we have to do something else and that differently.” The ideas expressed in the proclamation echo to some extent those of Bálint Magyar and his study group, especially the claim that “one needs a party of the left that wants more than a change of government. We need regime change.” The new left should put an end to mafia methods. “We need new agreements, new concepts, new methods.” The proclamation calls for extensive discussions among the different groups “on the democratic side” to figure out together the practical and ideological bases of the opposition to the regime (rendszerellenesség). But it goes even further. It advocates “the coordination of the parliamentary and local presence of the democratic forces.” Surely, that means close cooperation among all democratic parties. It suggests the creation of “alternative legitimacy,” meaning an independent civil network of think tanks as well as scientific and cultural workshops. In connection with this “alternative legitimacy,” there is a reference to the necessity “to signal to our European and American friends the freedom loving voice of the Hungarian nation.” In my reading this means cooperation with European and American organizations in defense of Hungarian democracy. Finally, the proclamation states that “the concept of the leading party of the left” is over. In plain English, MSZP should give up the idea that it is the leading force of the opposition.

left-right

And, expanding on the proclamation, Ildikó Lendvai, one of the signatories of the proclamation, posted a letter on her Facebook page yesterday. I will focus here only on the passages that add to the contents of the proclamation. In her opinion, Budapest could have been won. Lajos Bokros’s 36% was a pleasant surprise despite the fact that he became a candidate only two weeks before the election. Budapest could have been won if MSZP had not sent conflicting messages about Bokros’s nomination and its support for his candidacy.

What are the lessons?

(1) One is that in modern large cities the dividing line is no longer between left and right. “Today in Hungary that line is between openness toward Europe and inwardness, between progress and boorish conservatism.” In plain language, Tóbiás is out of touch with reality.

(2) “It would be a huge mistake if MSZP kept an equal distance between Fidesz and the democratic parties. This is András Schiffer’s road and it does not lead to a governing position.”

(3) The left does not equal MSZP. “Gergő Karácsony is an impressive politician of the left. Whether we like it or not, Gyurcsány’s party will stay although it showed the limits of its growth.” In brief, MSZP must make peace with them and cooperate.

I think that in the next few months MSZP’s leadership must decide what road to take. I’m almost certain that Tobiás’s answer will lead nowhere. Moreover, if he and his friends insist on the present course, a fair number of the leading MSZP politicians and even the membership will leave the party to join perhaps a new formation composed of democratically-minded people, which should include members of the Ferenc Deák Circle.

The Budapest elections and politics of the democratic opposition

The appearance of Lajos Bokros as the official candidate of DK, Együtt, and MSZP of Budapest under the leadership of Ágnes Kunhalmi has redrawn the political landscape on the left, despite protestations to the contrary. Ágnes Kunhalmi can send the message to Magyar Nemzet, the paper that said she would decamp to Ferenc Gyurcsány’s Demokratikus Koalíció after the election, that “I love my party,” but the fact remains that she and the people around her decided to defy the central leadership of the socialist party. And that might have serious repercussions in the future.

Ágnes Kunhalmi is a relative newcomer on the political scene, having joined MSZP only in 2006. Until 2010 she served as a member of the Budapest City Council. In 2010, because of the female quota, she was chosen to be a member of the top party leadership. From there on she was the face of MSZP on matters of education. Her day arrived during the 2014 national election when, as a last-minute replacement candidate in the 15th electoral district, she lost the election by only 56 votes. This performance showed that Ágnes Kunhalmi is someone to reckon with inside the party.

Since I know next to nothing about the internal workings of the socialist party, I have no idea how this sudden fame of Ágnes Kunhalmi was received by the top leadership. I’m almost certain, however, that the Budapest MSZP leaders’ decision to endorse Lajos Bokros and thereby go against the wishes of József Tóbiás, the new party chairman, couldn’t have gone over too well. Although Tóbiás keeps repeating that local politics should be left to the local party leadership, I’m sure that this open defiance didn’t endear Kunhalmi to the more leftist leaders of MSZP.

But the real bone of contention, in my opinion, is not so much Lajos Bokros and his conservatism as it is Ferenc Gyurcsány, who allegedly masterminded the retirement of Ferenc Falus and secured the democratic parties’ support for Lajos Bokros. Thus, I suspect, in the eyes of József Tóbiás and his men Ágnes Kunhalmi is a traitor to the socialist cause not because she decided to stand behind Bokros but because she sided with Ferenc Gyurcsány. MSZP leaders suspect, not without reason, that Gyurcsány wants to gobble up MSZP. And the other smaller parties on the left are convinced that he wants to amalgamate them into one large “union party,” which would mean their disappearance.

Ferenc Gyurcsány and Ágnes Kunhalmi

Ferenc Gyurcsány and Ágnes Kunhalmi

One doesn’t have to be an eagle-eyed political scientist to come to that conclusion: Gyurcsány makes no secret of his plans. In fact, he repeats on every possible occasion that, given the political landscape and the current electoral law, there is no hope of winning an election against Viktor Orbán without one large party that includes all anti-Orbán forces. Although there are people, for example Gábor Demszky, who believe that even the formation of such a single party can’t dislodge Viktor Orbán’s mafia state, it looks as if Gyurcsány still believes that one “does not have to stage a revolution, one just has to go and vote.”

What are the chances of forming one big democratic umbrella party in Hungary? At the moment nil, but Gyurcsány is thinking long-term. If I understand him correctly, he would like to see an inclusive democratic party established well ahead of the next national election in 2018. Can it be done? At the moment there are only a handful people who think so, but I would wait until we learn the results of the upcoming municipal elections. Not that I anticipate some spectacular victory or even progress as far as the fortunes of the democratic opposition are concerned, but after the elections we will be able to weigh the relative strength of the different democratic parties. Most observers are convinced that Együtt-PM, together and separately, has a very short life expectancy. MSZP has been losing voters since the national election in April. If, however, DK repeats its outstanding performance in the European Parliament election, Gyurcsány may be able to expand his base among the democratic forces.

One of the people who believes that “Gyurcsány has a chance” is Endre Aczél, a veteran journalist and a good political analyst. He thinks that deep down the ordinary MSZP membership believes that it is only Gyurcsány who can save the party, and Gyurcsány, who understands the thinking of members of the party’s lower echelon, makes sure not to alienate them. In fact, a fair number of these people have already deserted MSZP in favor of DK. Aczél wouldn’t be surprised if some “big fish” was also caught by Gyurcsány. He wouldn’t be surprised if both Kunhalmi and Bokros eventually ended up in DK. After all, Gyurcsány’s party is already an interesting political mix: former members of MSZP, SZDSZ, MDF, and previously unaffiliated voters who are against Orbán’s mafia state.

Perhaps, but at the moment DK is still a very small party. Only the collapse of MSZP and the disappearance of the other two small parties would give Gyurcsány a chance to create the kind of party he has been envisioning ever since 2006.

Gábor Demszky on the illegitimacy of the Orbán regime and on civil disobedience

With municipal elections to be held this Sunday, I decided to devote a post to the political reactivation of Gábor Demszky, lord mayor of Budapest between 1990 and 2010.

After Demszky’s fifth term ended, he not only left political life, he left the country. Prominent members of former administrations learned soon after the 2010 election that avenues for gainful employment in the public sector were blocked. Demszky therefore applied for grants and scholarships abroad and spent three and a half years in Germany, the Netherlands, and the United States. Once he returned, he decided to share his opinions on the present state of politics in the country and in the city.

In early August, when Lajos Bokros was just one of the many candidates for the mayoralty of Budapest, Demszky announced that he would support him since he considered Bokros the best person for the job. Then in Élet és Irodalom he gave a long interview to Eszter Rádai just a couple of days before the democratic parties decided on Bokros as their candidate instead of their original choice, Ferenc Falus. Here he not only talked about why he considers Bokros to be the best man for the job, he also elaborated on the political importance of the mayor of the capital city in the regime change that will eventually take place. In addition, he talked about his conviction that the present regime can be removed only through civil disobedience. Finally, he did not hide his contempt for most of the opposition parties.

So, where should we start? In Demszky’s opinion, the candidate for the job of lord mayor of Budapest must not promise much to the electorate because under the circumstances the city is entirely at the mercy of the central government. The situation was also bad during the first Orbán government between 1998 and 2002, but then at least the city still had some assets. By now, the city has been stripped of all its former wealth as well as its autonomy. What we have now, instead of self-government, is “a modernized form of the council system” that existed in the Kádár regime.

Yet the role of the mayor of Budapest is an important one because the post can be used as a bully pulpit, which gives the mayor an opportunity to represent the opposition toward the central government. He will have to act as a kind of ombudsman who stands up for the interests not only of the inhabitants of Budapest but of all citizens. The mayor of Budapest can have a powerful voice, which gives the man who holds the position political leverage. If the next mayor is a spokesman for the opposition, he might be able to challenge Viktor Orbán for the premiership four years later. And it is only Lajos Bokros who would be able to do that. After all, he once saved the country from bankruptcy. He is an internationally known economist who is strong enough to take up the fight against the mafia state.

Lajos Bokros and Gáboe Demszky at the book launch of Hungarian Octopus, vol. 2

Lajos Bokros and Gábor Demszky at the book launch of Hungarian Octopus, vol. 2

At this point Eszter Rádai reminded Demszky that Viktor Orbán in this case would make a second Esztergom out of Budapest. Esztergom is the place where an independent mayor was chosen instead of the Fidesz candidate for mayor in 2010. The city was punished for it. Not a penny came from the central government to rescue the city that had become hopelessly indebted under Fidesz management in the previous years. Demszky’s answer was that Viktor Orbán did the same thing with Budapest between 1998 and 2002 and yet it was Budapest that won the election for the opposition in 2002. Demszky is not exaggerating. I remember vividly that Fidesz was leading all through the early hours when the votes were pouring in from outside of Budapest but then the late Budapest results started coming in and suddenly everything changed. Fidesz lost the election. Viktor Orbán certainly did not forget the disloyalty of the city.

The conversation moved on to the opposition. In Demszky’s opinion, “the opposition is an integral part of this regime” and all of its sins because it has not stood behind its twenty years of democratic achievements. Since it is not ready to take responsibility for its past, it does not have a future either. It accepts the Fidesz narrative of the “muddled twenty years of transition,” the way Viktor Orbán likes to describe the period between 1990 and 2010. This is the greatest sin a political opposition can commit in confronting a dictatorship. Giving up the praise of democracy and freedom. It denies its most important tradition, liberalism. In fact, the leaders of the opposition want to free themselves of the liberals. The opposition parties “only act as if they are the representatives of the democratic opposition while they have nothing to do with either democracy or opposition.”

Out of the five opposition parties Demszky considers three to be Fidesz appendices: Jobbik, MSZP, and LMP. I guess the relationship of Jobbik and LMP to the governing party does not need further elaboration, but I think MSZP’s inclusion in this category does. In Demszky’s opinion MSZP is not really a party of the left. It never was. The MSZP leaders united only to grab power, but once they lost it they became helpless. That leaves only two parties, Demokratikus Koalíció and Együtt-PM, that Demszky considers bona fide opposition parties. Együtt-PM is so small and weak that it cannot be taken seriously while DK will be, in his opinion, unsuccessful in the long run because it is led by Ferenc Gyurcsány, who is the most divisive politician of the opposition. Gyurcsány is correct when he emphasizes the necessity of a unified opposition party, but one needs more than that.

Those who believe that the Orbán government and its mafia state can be removed by ordinary parliamentary elections are wrong. Naturally, Demszky does not advocate the violent overthrow of the government, but he recommends civil disobedience. One should study Mahatma Gandhi as the Polish opposition did in the 1980s. One must realize that Orbán’s regime ruined the constitutional order, took away political and individual rights, and ruined democratic institutions. The present political system has thus been rendered illegitimate. One needs more than a change of government; just as after Kádár, Hungary needs a regime change.

Demszky admits that at present very few people are ready to stand against the regime openly, but he is convinced that the situation will get to the point that people in large numbers will be ready to resort to civil disobedience. Poverty will only grow and, although at present there are no political prisoners, there will be. Dissatisfaction with the regime will grow. Demszky excludes the possibility of Fidesz’s tight ranks breaking up under the weight of outside pressure: “what holds these people together is power and fear because they know that they could lose everything. They put all their money on one card.”

I think most of us can agree with Gábor Demszky–and Bálint Magyar–that the opposition must concentrate on regime change because by now Viktor Orbán’s system has solidified into a full-fledged regime that Magyar calls a post-communist mafia state. Many of Hungarian Spectrum‘s readers, to judge from the comments, have a very low opinion of MSZP and few believe in its survival. However, when it comes to Lajos Bokros’s role in the regime change, few would bet on him as a contender to replace Viktor Orbán as prime minister of Hungary. Not because he would not be an outstanding prime minister but because a political career cannot be built without a viable political party and Bokros at least at this moment does not have such a party behind him.

But when it comes to Demszky’s main thesis about the illegitimacy of this government and Orbán’s state he is certainly right. The opposition forces should pay serious attention to this fact. As long as they collaborate with the government and with Fidesz in parliament they only help to ensure the survival of the regime.

A new opposition candidate for mayor of Budapest, a rift in MSZP

It was about a week ago that I wrote about the Budapest municipal election. At that time there were seven candidates running against the incumbent István Tarlós, Fidesz’s choice in both 2006 and 2010. At that junction Ferenc Falus, the candidate of the joint democratic opposition, was trailing behind Lajos Bokros, former finance minister (1995-1996) and EU member of parliament (2009-2014), a man who calls himself liberal conservative. Együtt-PM, the party whose nominee Falus was, tried to convince Bokros to withdraw in Falus’s favor, but Bokros refused, saying that he was ahead of Falus in the polls. If anyone should withdraw it is Falus. At this point it looked that neither man would budge, and therefore I predicted that Bokros would be the scapegoat of the united opposition if István Tarlós wins the election by a large margin. Well, I was wrong. Yesterday Falus withdrew in favor of Bokros. György Magyar, an independent, followed suit.

So, what happened? Well, that’s not exactly clear. Here is Lajos Bokros’s side of the story. He received a telephone call from Viktor Szigetvári, co-chair of Együtt-PM, allegedly speaking in the name of all four parties–MSZP, DK, Együtt and PM–who informed him that they were ready to support him and drop Falus’s candidacy. A meeting was arranged, to be attended by representatives of all four parties, but to Bokros’s dismay only Szigetvári of Együtt and Ferenc Gyurcsány of DK showed up. Szigetvári was again asked about his authority to speak in the name of those who were absent. Szigetvári assured him that he had the authority. Falus later joined the meeting, and the participants decided to make the announcement yesterday at noon.

It turned out that Szigetvári did not in fact have the authority to speak in the name of MSZP and PM. MSZP’s Budapest executive board got together in a hurriedly called meeting as did the national executive board at a separate gathering to decide the matter. After a lengthy discussion Ágnes Kunhalmi, chair of MSZP’s Budapest board, announced last night that they support Bokros’s candidacy. A few minutes later József Tóbiás, chairman of MSZP, made a short statement. Although he did not say that the party is not endorsing Bokros, he stressed that for them it is not enough that somebody is a democrat, as Bokros surely is; he must be “a social democrat.” He expressed his great sorrow that voters of socialist convictions cannot vote for a leftist candidate. It is a shame. They had a good candidate in Csaba Horváth, who in 2010 received 35% of the votes, but on the insistence of the other three parties they sacrificed him for the sake of Együtt’s candidate, Ferenc Falus. PM earlier announced its refusal to support a liberal conservative candidate because the party can’t expect him to fully represent their green-socialist agenda.

Ágnes Kunhalmi, chairperson of the Budapest MSZP

Ágnes Kunhalmi, chairperson of the Budapest MSZP

With less than three weeks to the municipal elections at least we have two fewer candidates vying to unseat István Tarlós. It was always clear that András Schiffer’s LMP would have nothing to do with any of the other democratic parties because he is convinced that within a few years his party will be able to unseat Viktor Orbán and Fidesz singlehandedly. As far as Jobbik is concerned, the democratic opposition wants nothing to do with an anti-Semitic and racist party. That leaves only the candidate of the Magyar Liberális Párt (MLP). This is the party, if you can call it that, of Gábor Fodor, who in the last hours of SZDSZ served as its chairman. Although he makes a very good impression in interviews, people who know him say that his main concern is his own advancement.

Gábor Fodor’s behavior in the last year and a half supports his critics’ contentions about his character. In April 2013 he established his own liberal party and a year later, thanks to the intervention of Ferenc Gyurcsány, he received the #4 place on the party ticket of the united opposition. I assume Gyurcsány thought that after the election Fodor would join the DK parliamentary caucus out of gratitude. Indeed, if Fodor had done this, DK today would have a separate delegation. But once Fodor was safely ensconced in parliament representing practically nobody except himself, he had no intention of joining anyone. He decided to remain independent.

Fodor’s second move was to present his own candidate for the mayoralty of Budapest, Zoltán Bodnár, a former deputy governor of Hungary’s central bank. Considering that the party is not supposed to have any money, Bodnár’s campaign seems to be extraordinarily well financed. His posters are all over town, which has made the other democratic parties suspicious. It is widely believed by opposition politicians as well as voters that it is Fidesz who stands behind the lavish liberal campaign. This suspicion was reinforced yesterday when Zoltán Bodnár announced that he has no intention of withdrawing because he is “the only serious candidate.” At the same time, with no support for his contention, he accused Ferenc Gyurcsány of orchestrating Falus’s removal from the campaign. In his version it was Gyurcsány who “forced Falus’s withdrawal.”

In any case, at the moment it looks as if Bokros will have four opponents: István Tarlós (Fidesz-KDNP), Gábor Staudt (Jobbik), Antal Csárdi (LMP), and Zoltán Bodnár (MLP). According to Nézőpont Intézet’s poll, Csárdi and Staudt will each receive 3% of the votes. Bodnár’s name did not appear on Nézőpont’s list, but “Other” polled at 2%.

I consider the most important political development of the last couple of days to be the open split of the socialists. We have always known that within the party there is a left and a right wing. The right wing has been more open to cooperation with non-socialist but democratic parties and groups. In the Budapest MSZP these people seem to be in the majority. They think that getting rid of Tarlós in Budapest is more important than any party consideration. They feel comfortable with people in DK, among whom there are a number of former SZDSZ politicians as well as people from the moderate conservative MDF.

As far as I can recall, this is the first time that the MSZP leadership has split so openly and unequivocally. This rift may have serious repercussions–in the most dire scenario leading to the eventual breakup and possible demise of MSZP. If that happens, the hard-liners will have nowhere to go. The moderates, by contrast, have already established networks that may lead to some kind of association or even merger with other parties. The next couple of years might be more exciting than we think right now.

An unexpected turn of events: Tibor Navracsics has to be satisfied with the post of education, culture, and youth

Today around noon Jean-Claude Juncker, future president of the European Commission, made his final decision on his “cabinet” or, in EU speak, the “college.” EurActiv published an excellent and telling infographic that depicts the structure of the cabinet as well as the relative importance of the commissioner-designates. Juncker will have seven deputies, the most important of whom is Frans Timmermans of the Netherlands who will be “first vice-president.” He will be in charge of “better regulation, inter-institutional relations, rule of law and charter of fundamental rights.” The other six come from Italy, Bulgaria, Estonia, Slovenia, Latvia, and Finland. So, as you can see, the new member states are well represented. One must also keep in mind that the future president of the European Council will be the Polish Donald Tusk.

In the infographic the seven vice-presidents are followed by the rest, not in alphabetical order but by what seems to me a ranking of the importance of the posts. Hungary’s nominee, Tibor Navracsics, who to everybody’s surprise got the post of commissioner of education, culture, youth & citizenship, is in the penultimate place, just before Cyprus’s Christos Stylianides (humanitarian aid & crisis management).  Most papers published in Brussels dealing with European affairs describe the post as lightweight. According to Euobserver, “the least weighty dossiers have gone to Belgium’s Marianne Thyssen (employment) and Hungary’s Tibor Navracsics (citizenship). ” The paper added that “the latter may face difficulties in the EP, which has to hear all commissioners, because he belongs to the increasingly authoritarian government of Viktor Orban.” The Hungarian-language Bruxinfo also pointed out that “the portfolio does not belong to the most heavyweight ones” but notes that Navracsics’s staff is huge, the second largest within the commission. As for his possible difficulties in the European Parliament, Benedek Jávor, the Együtt-PM EP member, reported on his Facebook page that, according to rumors in Brussels, Navracsics might be drilled hard at his hearing and there is a possibility that he will not be confirmed.

Navracsics himself was also surprised, and most likely disappointed, with the post because he was hoping for a job that has something to do with foreign affairs. But he put on a good face. Naturally, for Fidesz the position was elevated to one of the utmost importance. As a Fidesz official statement said, the future of Europe depends on Navracsics’s work in the next five years. Indeed, education is very important and it is true that many European countries could do a great deal better in that department. The problem is that education is the domain of the member states, and therefore Navracsics will not be able to make a substantial difference in educational policies across the EU.

Navracsics and his fight with Vice-President Vivien Reding was not forgotten

Navracsics and his fight with Vice-President Vivien Reding was not forgotten

Juncker initiated a major structural change, whereby the vice-presidents will be the overseers of the rest of the commissioners. In his letter to Tibor Navracsics he described the new system this way:

I will entrust a number of well defined priority projects to the Vice-Presidents and ask them to steer and coordinate work across the Commission in the key areas of the Political Guidelines.  This will allow for a better focus and a much stronger cooperation amongst Members of the College, with several Commissioners working closely together as a team, led by the Vice-Presidents, in compositions that may change according to need and as new projects develop over time.

In Navracsics’s case this will entail close cooperation with  the Finnish Jyrki Katainen, vice-president for jobs, growth, investment and competitiveness; with Latvia’s Valdis Dombrovskis, vice-president for euro and social dialogue; and with Estonia’s Andrus Ansip, vice-president for digital single market. Keep in mind that under Navracsics’s short tenure as foreign minister Hungary closed its embassy in Tallinn. Juncker emphasized in the letter than the vice-presidents have his total trust and their decisions on certain projects are final. They speak in his name. The success of the Juncker Commission will largely depend on these “über-commissioners,” as Eurobserver called them.

Navracsics gave a press conference for Hungarian journalists where he admitted that “it is possible that education in comparison to the portfolio of internal market is considered to be less weighty but every job is worth as much as we manage to make of it,” which is certainly true. The commissioner for internal market, industry, entrepreneurship & SMEs is the Polish Elźbieta Bieńkowska, and the fact that Navracsics mentioned this particular post I think says something about the frustration of the Hungarians. There are all those others in the region who did much better.

According to the new government spokesman, Éva Kurucz, Navracsics’s post is about the future and his nomination to the post is an “outstanding success.” Fidesz’s EP delegation agrees. The youth of Europe is of the utmost importance and Navracsics has twenty years of academic experience behind him. Of course, there is nothing surprising about Fidesz and the government extolling the importance of Navracsics’s new job, but the enthusiasm of LMP’s András Schiffer is hard to understand. Perhaps he would like to get a few more brownie points from Viktor Orbán and a few more invitations to Fidesz and government functions. According to him, the education portfolio is strategically more important than any of the others that had been mentioned in the last few weeks, which is patently not true.

The opposition parties’ opinion of the post was predictable. Jobbik blamed the Orbán government for not lobbying harder for a more important post. MSZP’s József Tóbiás blamed the Orbán government and Viktor Orbán himself for getting this lowly portfolio. According to him, the fault lies not with the Hungarian people but with Viktor Orbán and his regime. “It is a slap in the face for Orbán but it is we Hungarians who feel the pain.” DK’s spokesman, Zsolt Gréczy, called this particular portfolio the weakest of the twenty-eight. After all, the EU has no common educational or cultural program. He added that DK will not support Navracsics’s candidacy. That means that DK’s two delegates in EP’s socialist delegation will vote against him. MSZP, as far as I know, hasn’t decided yet.  Benedek Jávor, the sole representative of Együtt-PM, rightly pointed out that it will be difficult for Navracsics “to promote cultural diversity while at home his government dictates what real culture is, how youth should be educated, and wants to make self-organization of the citizenry impossible.” All very true.

Final approval of the Juncker Commission will take place in October at the plenary session of the European Parliament in Strasbourg. I agree with some of the commentators: there might still be surprises concerning Navracsics’s appointment. If I were Viktor Orbán I would hold my tongue for a couple of more months. Otherwise, “the slap in the face” might be even harder and more painful than it is now.

Reactions to Viktor Orbán’s speech to the ambassadors

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

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

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

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

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

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

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

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

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

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

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

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