Viktor Orbán and the gathering storm clouds in the East

Meetings of the heads of EU member states usually last much longer than anticipated. At eight in the evening participants were still discussing who will replace Herman Van Rompuy as European Council president and Catherine Ashton as foreign policy chief.  They finally determined that the former post will be filled by Polish Prime Minister Donald Tusk and the latter by Italian Foreign Minister Federica Mogherini.

It seems, however, that the decision on further sanctions against Russia will be postponed for at least a week, although a draft of such sanctions dated August 27 exists which says that the bloc “stands ready to consider further steps” against Russia due to the “reported participation of Russian armed forces in operations on Ukrainian soil.” Petro Poroshenko, who was present at the discussions about his country, indicated that further sanctions are likely. The EU only wants to wait on implementation to see how Russia reacts to his attempt to revive a “peace plan” next week.

If Vladimir Putin’s threatening remarks are any indication, further sanctions and an increased Western military presence in Eastern Europe are indeed likely. Putin told the press that “Russia’s partners … should understand it’s best not to mess with us,” adding: “I think no one is thinking of unleashing a large-scale conflict with Russia. I want to remind you Russia is one of the leading nuclear powers.” Nuclear threat or not, the number of NATO troops in Poland and Romania has doubled already, and NATO is planning to send an additional 1,ooo troops to the region. And Britain and six other states are planning to create a new joint expeditionary force of at least 10,000 personnel to bolster NATO’s power.

Meanwhile a rather frightening map was published by the Russian weekly Expert that showed the sphere of influence Russia is attempting to create. The green line indicates the reach of Soviet dominance, the red the current situation, and the orange Russian hopes for an expanded sphere of influence. That would include Estonia, Lithuania, and Latvia.

Observers of Russia and its plans might be also interested in reading a statement by Kazakhstan’s 74-year-old dictator Nursultan Nazarbayev. Let me quote it verbatim from Kazakhstan’s official English-language website Tengri News.

If the rules set forth in the agreement are not followed, Kazakhstan has a right to withdraw from the Eurasian Economic Union. I have said this before and I am saying this again. Kazakhstan will not be part of organizations that pose a threat to our independence. Our independence is our dearest treasure, which our grandfathers fought for. First of all, we will never surrender it to someone, and secondly, we will do our best to protect it.

Of course, he added that nothing of the sort can possibly happen because “there are three representatives from each country [Russia, Belarus and Kazakhstan] and three Vice-Prime Ministers. They also make their decisions together.”

Putin’s response to Nazarbayev’s statement called Kazakhstan’s future independence into question. Yesterday he said that Kazakhstan, although large, is only one-tenth the size of Russia. He also explained that Nazarbayev “created a state on territory where no state had ever existed. The Kazakhs had never had statehood. Nazarbayev created it. In this sense, he is a unique person for the former Soviet space and for Kazakhstan too.” But, Putin continued, underscoring his expansionist intentions, Kazakhstan is better off in the “big Russian world.”

Meanwhile Viktor Orbán, as his wont, gave a press conference upon his arrival in Brussels. Interestingly enough, he is usually driven to these meetings in his own Volkswagen minibus, an odd choice for such occasions. According to normal protocol, the hosts provide vehicles for visiting dignitaries, but for one reason or another Orbán insists on his own bus. One must wonder how this vehicle gets to Brussels. Is it driven or transported there ahead of time? Or, perhaps he has several identical vehicles?

It is also hard to know whether only Hungarian reporters are interested in what the prime minister has to say or whether journalists from other countries are also present. I suspect that only Hungarian reporters attend these events. On one of the pictures taken at the press conference I could see the mikes of only MTV and HírTV.

In Orbán’s opinion, today’s meeting was organized only for “the review and correction of the current political situation.”  The discussion centers around whether “the sanctions have reached their desired goals” but for that “we should know what the desired goals are.” He is convinced that sanctions will not work. Sanctions until now have not been successful and it would be self-deception to think that more of the same would end the conflict.

Finally, I would like to say a few words about the Conference of Western Balkan States that took place in Berlin on August 28, 2014. Participating were representatives of the European Union, Germany, Austria, Serbia, Croatia, Slovenia, Albania, Bosnia-Herzegovina, Montenegro, and the Republic of Macedonia. It was called together by Chancellor Angela Merkel, who also chaired the meeting.

The idea for the conference came in response to the celebration of the 100th anniversary of the beginning of World War I. The intention was to show commitment to the process of future enlargement of the European Union as well as to shore up relations with Serbia as a strategic partner of the EU, especially in light of the problems in Ukraine.

Serbia has, since the second half of the nineteenth century, been a close friend and ally of Russia. Its negotiations with the European Union for membership have been going on for a long time, but Serbia’s chances have been strengthened by what is going on in Ukraine. Because, as Adelina Marini of euinside.eu points out, “if Serbia becomes part of the EU, Russia will lose its influence in the Balkans or, at least, it will be significantly limited.”

However, Serbia apparently wants to have its cake and eat it too. Although it desperately wants to join the European Union, it also wants to keep its special relationship with Russia. Brussels is unlikely to accept such a “special status” for Serbia. But if Russia becomes a real threat to Europe, Serbia’s membership in the EU might help block the spread of Russian influence.

Diplomacy in Europe and especially in Eastern Europe and the Balkans is a much more complicated enterprise than it was a few years back when these countries did not have to worry about the Russian bear. Orbán’s idea that diplomacy can be pretty much replaced by foreign trade is patently wrong. The current situation is complex, negotiations are difficult, and a bad outcome would be very dangerous for Europe. And even as storm clouds are gathering in the East, Hungarian diplomacy is being guided by Péter Szijjártó, who is totally unfit for the job.

“Coup from above”? Anti-federalist forces in the European Council

Anyone who took Magyar Nemzet seriously would think that Viktor Orbán is not only the strongman of Hungary but also of Europe. A great statesman who is jealously guarding the rule of law in the European Union. According to Magyar Nemzet, Jean-Claude Juncker’s bid for the presidency of the European Commission is down the drain. On the other hand, several commentators (for example Julian Priestley, the former secretary-general of the European Parliament) think it likely that in the final analysis Juncker will be in charge of the European Union for the next five years. We can, however, expect a protracted political fight between the European Council and the European Parliament.

The issue, as far as I can see, brings into focus two vitally important issues: first, the supremacy of the elected European parliament vs. the heads of member states and, second, the very future of the European Union itself.

This is the first time that the European Parliament has an important role to play in the elections and the choice of candidates for president. The leading members of the European Parliament wanted to democratize the election process and run a campaign with the names and pictures of the candidates (commonly known as “Spitzenkandidaten”) heading the party lists. In early March the European People’s Party chose Jean-Claude Juncker, former prime minister of Luxembourg, as their man while Martin Schulz was chosen by the socialists. Since as the result of the election the EPP will again be the largest party in the European Parliament, the assumption in parliament is that it will be Juncker who will lead the Union. All the party leaders of the European Parliament stand behind his candidacy.

Enter the European Council, composed of the twenty-eight heads of the member states. The president of the Council is Herman Van Rompuy. Last night these people gathered to discuss the results of the election, and it turned out that there was at least four countries that opposed Juncker’s nomination: Great Britain, Sweden, the Netherlands, and Hungary. Viktor Orbán announced immediately after the election results became known that Hungary cannot support Junker’s presidency. Hungarian sources claim that the real instigator of the anti-Juncker move was not Orbán but either David Cameron, prime minister of Great Britain, or Angela Merkel, chancellor of Germany. My hunch is that it was Cameron who was most opposed to Juncker, who is known as a “federalist.” Cameron believes in a union of nation states. During the meeting Merkel, as is her wont, sat on the fence, not committing herself one way or the other. The only agreement to come out of the meeting was that the president of the European Council will negotiate with leading members of the European Parliament and the heads of states about the future president of the EU.

So, on one level the fight that is developing is between the federalists and the “states rights” advocates, while on another it is a struggle between the European Council and the European Parliament. An Austrian paper called the move coming from the European Council a “coup from above.” The coup may not succeed. As EuroActiv reported, Van Rompuy after the meeting said that this first discussion had been “useful,” which is a diplomatic euphemism for inconclusive. However, he also made it clear that he would not embark on a collision course with the European Parliament. According to a source who seemed to have been present at the meeting, Merkel apparently announced that “she is still supportive of the Spitzenkandidaten system and of Juncker,” but made no strong statements to discipline the dissidents. On the Council doorstep Merkel declared: “Jean-Claude Juncker is our Spitzenkandidat.”

Jean-Claude Juncker and Viktor Orbán are great friends here

Leading members of the European Parliament are outraged, including Joseph Daul, leader of the EPP group, who told Die Welt after Viktor Orbán announced his intention to pick another candidate that one simply cannot pull a new candidate out of the hat. Hannes Swoboda, leader of the Socialist and Democrats group, tweeted that it  is “absurd that Juncker has our backing to start negotiations but is blocked in the European Council by his own EPP family!” Julian Priestley expressed the opinion of many that “only if the negotiations between the European parties and the parliament fail does it become conceivable that the European Council might have to reach out for a candidate outside the election process. But they have every incentive to succeed, because what’s at stake is bringing the direction of the EU within the parliamentary system.”  And let me add that in my opinion it is essential that the anti-federalist forces are defeated on this issue and that a man is elected who wants “a more perfect union.” The British Nigel Farage, leader of the UK Independence Party (Ukip), said of Juncker, “there is nobody more fanatical about building the United States of Europe.” That certainly does not make Juncker a friend of David Cameron and Viktor Orbán.

What is happening at the present in the European Parliament is a “grand coalition between right and left which is taking shape, with the aim of isolating the Eurosceptics.” Not only does Schulz support Juncker, but the leader of the third largest group, Guy Verhofstadt of the liberals, also wants to join them. He emphasized that for the election of the next president they need “a stable majority, that means more than 400 seats. Otherwise it will depend on the backing of parties such as those of Mr. Orbán or Mr. Berlusconi.”

There is at least one Hungarian commentator, Gyula Hegyi, who claims  in his article “Juncker-Orbán 2:0” that Cameron and Orbán lost this match. Hegyi used to be a socialist MEP, but in the last five years he has been working for László Andor, commissioner for employment, social affairs, and inclusion. In his interpretation it is true that at the Tuesday night meeting no decision was reached, but those present admitted that the results of the election must be taken into consideration. They also took cognizance of the fact that Juncker is unanimously supported in the European Parliament. So, as far as Hegyi is concerned, it is a done deal. Juncker will be the candidate and will likely be elected by a large majority.

My feeling is that Hegyi and Priestley are right, but given the business practices of the European Union, it will most likely take a whole month, until the very last minute, to agree on the candidacy of Jean-Claude Juncker.

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.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.

In the opinion of many, Hungary is no longer a democracy

If Viktor Orbán were as talented at governing as he is at political maneuvering he would be an excellent prime minister. But his brain power is spent on devising devious traps for his opponents whose imagination can’t possibly measure up to his, with his bag full of tricks. Dirty tricks, dishonest tricks, shameful tricks. Fortunately there are not too many people on this earth who can surpass his moral turpitude. He is a man who thinks that in politics anything goes. I don’t blame the political opposition for being duped by him once again.

So, what happened? The head of the press department of the Prime Minister’s Office said that Viktor Orbán would deliver a speech before the day’s parliamentary agenda. The announced title of the speech was “Magyarország nem hagyja magát!” (Hungary doesn’t give in!). Considering that the vote on the amendments to the constitution was scheduled for today, everybody assumed that the prime minister would talk about his government’s decision to go ahead with the scheduled vote despite requests from Brussels and Strasbourg to postpone it. The title of the speech certainly suggested as much.

MSZP had already decided to boycott today’s session. Their empty seats were decorated with huge exclamation points. Only their leading spokesman for the day, József Tóbiás, was in the chamber ready to deliver his answer to Orbán’s speech. Then came the surprise. The speech was not about the constitution and about the request of the Council of Europe and the European Commission to postpone the vote. It was about a recent court decision that allowed utility companies to pass on to their customers the added expenses that they have to endure because of extra taxes mandated by the government.

He was most indignant. He said that he can “hardly find words fit for polite society” to describe what he thinks of the Hungarian judiciary. The decision rendered is “scandalous.” And he went on and on about the poor Hungarian people who pay too much for utilities and about those foreign companies that earned very handsome profits in the past. He asked all Hungarians “to raise their voices so these companies would realize that they are facing not only the government but the whole nation.” Among other adjectives, he used “impudent” (arcátlan, a favorite word of Fidesz politicians) in connection with the courts. Ferenc Gyurcsány rightly considered Orbán’s attack on the courts “a very serious and unacceptable violation of judicial independence.” For good measure he added that “it is not the courts that are impudent but Viktor Orbán, who doesn’t seem to understand the very basis of democracy.”

József Tóbiás, after a few sentences in which he complained that the prime minister had nothing to say about the most important issue at hand–the amendments to the constitution, surrendered his right to speak and left the chamber.

The Hungarian prime minister could thus demonstrate to the electorate that he is their advocate, battling with the utility companies and the courts that are supporting these awful capitalists, while the MSZP delegates didn’t even bother to show up. What kind of mind can come up with such a scenario? Moreover, even if he achieved his immediate goal he also demonstrated that the fears of the European Union and the Council of Europe are not without foundation. Today the Hungarian prime minister again proved that the country he transformed over the last three years is no longer a democracy. A woman member of parliament cried out during the speech: “Dictator!” while four members of DK held up a banner that read: “Önkényuralom,” a synomym of “Dictatorship!” I think it was a high price to pay for a fleeting moment of victory.

DK’s banner that reads “Dictatorship” / Photo Simon Móricz, Népszabadság

Shortly after 5:00 p.m. the amendments were passed. There were only 309 members of parliament present. 265 voted for the amendments, 11 against, and 33 abstained. Most of the Jobbik MPs abstained, but Mrs. Loránt Hegedűs, Péter Schön, and Tamás Sneider said no. The Schiffer wing of the former LMP was there and voted against the bill. So did Katalin Szili, formerly MSZP but now an independent. The Jávor wing of LMP refused to participate in the charade and so did members of DK in addition to the MSZP delegation.

The opposition’s last hope is President János Áder, who is in Berlin at the moment. According to former president and chief justice of the Constitutional Court László Sólyom, in his legal interpretation the president is empowered to veto the bill. Sólyom wrote an article on the subject that appeared in Népszabadság. What an irony, this man who was Fidesz’s choice to become president and who never hid his disdain for the socialists and his support of Fidesz today is able to publish an article only in Népszabadság. I might add that there are a couple of very critical opinion pieces in right-of-center publications like Heti Válasz and Mandiner. Tomorrow I’ll concentrate on Sólyom’s arguments and the writings of these right-wing critics.

Meanwhile, more and more people are expressing their concern about the amended constitution. They point out that the changes are so fundamental and extensive that the original document is unrecognizable. Journalists are calling this new document “Constitution 2.0.” José Manuel Barroso again expressed his worries and so did Herman Van Rompuy, Thorbjørn Jagland, Hannes Swoboda, Martin Schulz (president of the European Parliament), and many others.

There has been only one official Hungarian response to all this. Hungarian Foreign Minister János Martonyi announced that “Hungary is open to dialogue with anyone on the subject and Hungary will ask the opinion of the Venice Commission on this newly amended document.”

And finally, here is the letter Barroso wrote to Orbán on Friday. It didn’t do any good.

Another round of talks between Viktor Orbán and José Manuel Barroso

Viktor Orbán had a full schedule today: a lecture in Brussels and three important meetings with José Manuel Barroso, president of the European Commission; Herman Van Rompuy, president of the Council of Europe; and Martin Schulz, president of the European Parliament. A pretty exhausting schedule, especially since tomorrow the Hungarian prime minister is flying to Moscow to have a discussion with Vladimir Putin. The meeting will be brief, only half an hour, but the topics to be covered are weighty: setting natural gas prices for the next ten years and possible Russian involvement in the extension of the Paks Nuclear Plant.

In anticipation of the Orbán visit to Brussels, commentators differed in their assessment of what Viktor Orbán could expect in his negotiations. Some predicted difficult negotiations while others contended that after the two-year-long “freedom fight” it was time for Hungary to mend fences and normalize relations. Interestingly enough, Magyar Nemzet‘s commentator predicted a tough time, especially in light of the IMF-EU report released on January 28. The IMF officials predicted that in both 2013 and 2014 Hungary’s deficit will exceed 3%. If the European Commission takes the report seriously, their opinion might adversely influence Ecofin’s decision about lifting Hungary’s Excessive Deficit Procedure (EDP). And Viktor Orbán’s political future might depend on this decision. If the EDP is lifted, the Hungarian government could spend more freely in 2013 and early 2014 in anticipation of the election sometime in April of that year. Otherwise, further austerity measures must be introduced.

Viktor Orbán’s meeting with  Herman Van Rompuy was also more than a courtesy visit. As it stands, the European Union is planning to reduce the subsidies to Hungary by 30% over the next seven years. Considering that the little investment there is in the country comes from the EU convergence program, a 30% reduction could be devastating to the Hungarian economy.

Orbán began his Brussels schedule with a lecture at the Bruegel Institute, a European think tank specializing in economics. HVG somewhat sarcastically entitled its article about Orbán’s appearance at Bruegel “Orbán teaches economics to his audience in Brussels.” The very idea of Viktor Orbán giving a lecture on “work-based economies” to a group of economists working for this think tank borders on the ludicrous. I also wondered what his listeners thought when he boasted about his government’s achievements and called his economic policies a “true success story.”

The meeting between Barroso and Orbán took place in the afternoon and lasted a little longer than expected. At the subsequent joint press conference Barroso told the reporters that they talked about the upcoming EU summit in early February, about the 2014-2020 EU budget, and naturally the present state of the Hungarian economy. For the time being the Commission has no definite opinion about the past performance of the Hungarian economy, but by February 22 their recommendations to Ecofin will be ready. There was one sentence here that I think needs more clarification: “We also discussed the quality of the economic adjustments.” To me this means that Barroso and the Commission are aware that the way the Hungarian government achieved the low deficit may not be optimal.

Viktor Orbán and José Manuel Barroso at the press conference,
January 30, 2013

Viktor Orbán was more exuberant. “It was an excellent meeting,” he announced. They discussed matters that had created friction between the the Commission and Hungary in the past. He claimed that on the issue of the Hungarian National Bank they came to an agreement quickly. He admitted, though, that there are outstanding issues. Orbán indicated that he has no intention of backing down: the European Court of Justice will decide those issues he refuses to address himself. I might add here that cases the Commission sends to the Court usually go in the Commission’s favor.

Barroso sent a message to the Hungarians about the “rights and duties of the European Commission to insist that all national governments respect the laws of the Union.” The Commission tries to be impartial and objective. The Commission, like an umpire, must enforce the rules and regulations. This comment was most likely prompted by last year’s anti-European Union demonstrations instigated by the Orbán government.

Viktor Orbán might claim that the meeting was successful, but serious differences of opinion remain between the European Union and the Hungarian government over economic policies. The IMF-EU delegation predicted that further budget adjustments will be necessary to hold the deficit under 3%. Viktor Orbán disagrees, but I would be surprised if in the next few months, sometime before April, György Matolcsy didn’t announce another new tax in order to boost revenues.

All in all, at least on the surface, the meeting was friendly, or at least the two men pretended that it was. However, both Barroso and Orbán were careful in formulating their thoughts. In fact, Orbán opted to speak in Hungarian instead of his customary English, ostensibly because most of the reporters present were from Hungary. I suspect that the real reason was to avoid any imprecise formulation of his carefully worked out statement.

Whether Viktor Orbán was hoping for a public promise of support with regard to the Excessive Deficit Procedure I don’t know, but he didn’t get it. Olli Rehn, the commissioner in charge of finance, will have to mull over the details of the IMF report as well as the 2012 economic data submitted by the Hungarian Statistical Office. In my opinion, the 2013 budget belongs in a Brothers Grimm collection. The question is what the experts in Brussels will think of it.