Lajos Simicska

Elemental rearrangement on the Hungarian right?

Over the past few years we often heard that the regime Viktor Orbán built in the last five years can be dismantled only from the inside. Internal dissatisfaction with the leadership will one day reach such proportions that it will force the retirement of Viktor Orbán and his closest associates. Until recently, however, we didn’t see any such movement within Fidesz, despite its steady loss of sympathizers and supporters. We do know that there are insiders, including Fidesz members of parliament, who would like to get answers to their questions and who complain to reporters that they have been waiting a long time for an opportunity to discuss the problems the party is facing, without any success. Still and all, I don’t see any serious cracks in the solid political wall of Fidesz.

The right-wing media is another matter. Although some talking heads predict that the Simicska affair will blow over in no time, I disagree. I believe that the Simicska-Orbán falling out will have serious repercussions in the media world, signs of which have already appeared. My bold prediction, admittedly mixed with a large dose of wishful thinking, is that the fomentation in the media will facilitate the collapse of the Orbán-led political edifice.

On what do I base this prediction? First of all, there are signs that Lajos Simicska means business. He will use his considerable talent and financial resources to build a media empire that can take on state television and radio, a task that is, let’s face it, not terribly difficult. He began by appointing Péter Tarr to be one of the directors of HírTV. Tarr worked for Radio Free Europe until 1994 when he moved over to MTV. In 1997 he became the first managing editor of RTL Klub. In that capacity he was influential in exposing some of the corruption cases of the 1990s. According to Esti Újság, Tarr is gathering a fantastic staff at HírTV that should be able to produce the best news television in Hungary. The plan is to produce a program that “would restore the pillars of democracy and the power of the media.” Well, one could say that this is far too optimistic a scenario and that Simicska is not the most obvious man to lead the fight for democracy and against corruption. Admittedly, but he seems determined to ruin his old friend Viktor Orbán. People who know both men, like Gábor Fodor, a former friend from college days, are certain that this fight will last until only one of them is left standing.

So, what are the signs that encourage me to predict real changes on the mediascape? First of all, the report from the far-right wing media that half of the reporters of Magyar Nemzet and HírTV had quit turned out to be premature. For instance, Szabolcs Szerető, one of the people who quit last Friday, has already changed his mind and returned to the fold. He was the editor of the Monday edition of the paper.

Second, one can already detect substantial changes both in news reporting and in the opinion pieces in Magyar Nemzet. Let’s take a piece of news that has occupied the Hungarian media in the last two days. The chairman of Fidesz’s youth branch (ifjúsági tagozat) was caught with €30,000 of counterfeit currency. Fidesz immediately tried to distance itself, claiming that the young man had been removed from the party way back in 2012. The proof they presented was specious. In the past Magyar Nemzet would have supported the Fidesz position regardless of how ridiculous it was. But not this time. Let’s start with the headline: “He didn’t pay his membership fee and therefore was expelled?” The article continues with an honest description of the case and leaves no doubt that the Fidesz version is most likely untrue. In fact, when the article refers to the culprit as the “former chairman” of the organization, the writer or the editor put a question mark after the word “former.”

The same is true of Zsuzsanna Körmendy, who used to write the most vicious editorials about the opposition and was always supportive of the government and Fidesz. Zsolt Bayer predicted that “everybody from Csaba Lukács to Zsuzsanna Körmendy will quit because they will not be ready to write articles” demanded by Simicska. Yet today Körmendy wrote a piece titled “Self-examination never hurts.” Here Körmendy confronts her readers with the steady decline in Fidesz support and calls on the party “to examine its decisions thoroughly.” From here on the government should make wiser and more thoughtful decisions because “there is nothing more pitiful and destructive than taking back in full or in part earlier decisions. One ought not to experiment with citizens who have been losing their patience.” This kind of language is new in Magyar Nemzet. So it’s no wonder that Policy Agenda, a think tank, is certain that “after five years of governing Fidesz has lost its media,” which will be deadly for the future of the party.

But that’s not all. The most faithful Gábor Borókai, editor-in-chief of Heti Valóság, who served Viktor Orbán’s government as its spokesman between 1998 and 2002, stood by Lajos Simicska and against his former boss in an editorial that appeared today. For Borókai it is obvious that with the Simicska-Orbán duel “an unpredictable tectonic shift began that will turn into an elemental rearrangement on the right.” According to him, that kind of change has been long in coming. In plain language, the performance of the third Orbán government is dismal. In the past year Viktor Orbán has been preoccupied with his balancing act between Merkel and Putin while at home everything is falling apart. People have had enough of a government that wants to rearrange every facet of their lives. They want to be left alone.

Collapse

Of course, Borókai is still a man of the right, but not the kind that Orbán surrounds himself with these days. He is yearning for the “western, strong, sovereign and ‘polgári’ Hungary which Viktor Orbán wanted to build in 1998.” In 2010 Orbán set out to fulfill this wish, and he did rebuild a devastated economy, but “since then everything around us has changed for the worse. While searching for new solutions one shouldn’t forget the original goal. Otherwise, the chandelier will fall on us.” Borókai’s piece is full of contradictions, but it must be difficult to admit that his assessment of Viktor Orbán and his ideology has most likely been wrong all along. Even in 1998 when he decided to represent the first Orbán government. At one point he claims that “it is not too late” for Fidesz to find itself, but elsewhere he talks about an elemental reorganization of the right. Eventually these right-wing journalists will sort out their ideas, but at least they have begun writing as individuals instead of media servants of the government.

Meanwhile Reporters Without Borders published its World Press Freedom Index, 2014. In the last four years Hungary’s ranking dropped from 23d to 64th out of 180 countries. While the situation in Poland, the Czech Republic, and Slovakia is considered to be good, in Hungary there are “noticeable problems.” Even the Romanian press is freer than the Hungarian. Hungary is in the cluster with Croatia, Serbia, Kosovo, Macedonia, Greece, and Albania. Nothing to be proud of. But perhaps there will be a revolt of the right-wing journalists and with it will come a freer press and perhaps even political change.

Advertisements

Putin’s visit: “Strategic impetus” for future Russian-Hungarian relations?

Yesterday the Russian ambassador to Hungary, Vladimir Sergeyev, when asked about Russian President Vladimir Putin’s visit to Hungary, basically repeated what Prime Minister Viktor Orbán has been telling the Hungarians in the last few days. Putin’s visit to Budapest is nothing out of the ordinary. The main topic of the talks will be “the extension of a long-term contract” that will ensure the uninterrupted flow of natural gas from Russia to Hungary. The contract is due to expire this year, hence the urgency of the negotiations. Sergeyev emphasized that Putin’s visit has nothing whatsoever to do with “the overall situation in the world and the tension we now observe.” In addition to energy questions, the two leaders will discuss “cooperation in tourism and culture.” All this sounds utterly innocent until we get to the last sentence: that the talks are designed “to give a strategic impetus” to the future development of relations.

Viktor Orbán, although he is usually quite tight-mouthed, also indicated, perhaps unwittingly, that “over and above the question of energy, we must strive for a truly balanced relation. That’s why we invited and welcome President Putin.” These sentences indicate that the conversations will go beyond economic relations. Suspicion is growing in Budapest that the “urgent issue of the gas supply from Russia” is only an excuse for a visit by the Russian president. The real reason is what Ambassador Sergeyev called a “strategic impetus” for closer relations between the two countries. And that is a political, not an economic issue.

Let’s return briefly to Lajos Simicska, the oligarch to whom Viktor Orbán owes his rise to power but who is no longer Orbán’s friend. In his interview with Magyar Narancs Simicska told the reporter that after the April elections he had a long conversation with Viktor Orbán, during which the prime minister outlined his “plans,” which Simicska did not like. Among other things, Orbán shared his views of Russian-Hungarian relations, which Simicska found odious. He expressed his disapproval of Orbán’s scheme, saying: “No, I don’t like it at all. I grew up at the time when the Soviet Union was still here and I don’t have pleasant memories of the activities of the Russians in Hungary. I can’t really see any difference between the behavior of the former Soviets and the political behavior of today’s Russians.” I am sure that Simicska’s anti-Russian feelings are genuine. He was known for his intense dislike of the Soviets even as a high school student. This antipathy most likely had something to do with his father’s involvement in the Revolution of 1956 and the reprisals the family suffered as a result. If his old friend Viktor had talked to him only about economic ties and a secure supply of gas, surely Simicska wouldn’t have reacted so negatively.

A Romanian view: "Putin will visit Hungary: A challenge to the United States Source: Independent.md

A Romanian view: “Putin will visit Hungary: A challenge to the United States”
Source: Independent.md

No, it is becoming clear that the urgent negotiations about a long-term gas contract are only a smokescreen. Although it is true that the current agreement will expire at the end of June, the flow of gas will not stop. According to the present contract, Gazprom is obliged to supply gas to Hungary for at least two more years. Perhaps three. Fifteen years ago, when the contract was signed, energy consumption was higher than it is now. The contract specified a certain amount of natural gas between 2000 and 2015, but that amount hasn’t been used up. So why is this deal suddenly so important to Orbán? Why does he think that he will be able to get the best deal from Gazprom thanks to Putin’s good offices? What did Orbán promise to Putin in exchange for cheap gas? Will he get cheap gas and, if so, at what price? Will Rossatom’s building of the two new reactors at Paks be enough for Putin in return? Or will Orbán be ready to sell or rent the storage facilities he purchased earlier from the German firm E-On to Gazprom? Most important, why is Orbán so keen on a special deal with Gazprom when by now Russia’s monopoly on the gas supply to Europe is broken?

Some observers even claim that it is not to Hungary’s advantage to sign a long-term contract with Russia because the current market price of natural gas is actually lower than what Hungary is paying for Russian gas. Hungary is paying between $350 and $400 for 1,000m³ of gas; on the open market it sells for $300. Moreover, as I already noted, Russia’s gas monopoly is a thing of the past. By now there are alternate pipelines through which western gas can reach Hungary. Although it is true that the completion of the pipeline between Slovakia and Hungary has been delayed due to technical problems on the Hungarian side, it should be ready very soon. Meanwhile gas has been steadily coming into the country from Austria and Croatia.

The Orbán government in the last five years or so was not too eager to work either on alternative pipelines or on reducing the amount of gas used by Hungarian households, which is twice that of Austrian households. The reason is inadequate insulation. European Union directives oblige energy suppliers to improve the insulation of buildings, but for some strange reason the Orbán government is in no hurry to change the Hungarian law to allow such a solution. According to experts, people could save 30 to 50% on their gas bills if this essential repair work on windows and doors were done. Definitely more than the much touted 10% decrease in utility bills legislated by the government.

Orbán has exaggerated the danger of running short of gas. He even indicated that if he is unsuccessful in his negotiations with Putin, Hungarians will freeze to death because there will be no gas to heat their houses and apartments. Of course, this is not only an outright lie but a stupid business tactic. If the situation is so desperate, the negotiating partner will have the upper hand in the negotiations, as several people pointed out.

And with that I return to Russian Ambassador Sergeyev’s mysterious “strategic impetus” for future relations between the two countries. Suspicion is growing in Hungary that Orbán is making some kind of a political deal with Putin which may commit Hungary to a closer relationship in the future. Miklós Hargitai of Népszabadság goes so far as to speculate that “it is not the decrease in our utilities bills that will depend on Putin but Orbán’s hold on power.” For whatever reason, the Russian card seems to be of the utmost importance to Hungary’s gambling mini-Putin.

The Hungarian mafia war

As I reread yesterday’s post, I realized that I failed to capture both the tone and the importance of what happened yesterday in Hungary. Many commentators consider the “media war” between Viktor Orbán and Lajos Simicska to be the most serious political crisis of the last twenty-five years, a crisis that may cost Viktor Orbán his political career. I agree. February 6, 2015 was a critically important day.

Simicska’s outburst offered us an opportunity to peek behind the curtain of Viktor Orbán’s regime. What we see there is devastating. Hungary is being governed by a crime syndicate, something outsiders had told us, but until yesterday we had no inside confirmation. Now we know. If you try to leave, if you fall from grace, you can easily imagine that your life might be in danger. The members of this mafia family are immoral and dangerous thieves, ready to do anything. In fact, they are more dangerous than an ordinary mafia family because in their hands is the entire state apparatus–the power of legislation, the judiciary system, the police, the army. As Ildikó Lendvai said on Facebook, “Media war? Oh no, mafia war… War of gangsters broke out.”

Viktor Orbán in nice company Source: Die Welt / Photo Getty

Viktor Orbán among his friends and comrades
Source: Die Welt / Photo Getty

Yesterday I couldn’t quote Simicska’s exchanges with reporters at any length because of all his obscenities, some of which I simply didn’t know how to translate. The Budapest Beacon, however, took up the challenge and translated the interview between Simicska and József Nagy of Hír24 in its entirety. You might want to take a look.

Simicska seems determined to go all the way with his fight. He doesn’t hide the fact that he knows all the dirt behind the rise of the Young Democrats, the crew from the István Bibó College. If he decided to tell all, Viktor Orbán would immediately fall from grace. But can Simicska reveal everything he knows about the old crew–Viktor Orbán, László Kövér, János Áder, József Szájer, just to mention the top leadership that gathered in the second half of the 1980s? Simicska might be terribly upset at the moment, but once he has calmed down he should realize that he cannot reveal the criminal activities in which these men have been involved over the years without implicating himself. He must also have figured out long before he decided on an open attack that his decision will have severe financial consequences. He can say goodbye to his lucrative business ventures, which have been conducted exclusively with the government. Of course, it is possible that Simicska decided that he is rich enough and therefore no longer needs the prime minister’s help. Perhaps he stashed away his billions somewhere outside of Hungary. In any event, Viktor Orbán seems to have the upper hand here because behind him is the power of the state. But we shouldn’t underestimate Simicska, who is an exceedingly capable fellow and a skilled manipulator. Even his former friend Viktor Orbán had to admit that “Lajos is the cleverest among us.”

For the time being the top leaders of Fidesz decided to act as if nothing happened. They made sure that the state television’s evening news buried the “news of the day.” First they talked about the excellent performance of Hungarian industry. This was followed by a story on the government’s efforts to create more jobs. Next they announced that the government decided to have a “national consultation” to determine whether Hungarians want illegal immigrants or not. Only then came the news that the editors of Magyar Nemzet, HírTV, and Lánchíd Rádió had resigned and that Simicska gave several interviews, but what he said was not reported, allegedly because of the obscenities. Not a word about his disapproval of Orbán’s pro-Russian policies or his accusation that Hungary today is building another dictatorship.

In my opinion, those people, including the Fidesz leadership, who think that this whole thing will blow over are wrong. Their argument is that very few people will even hear about the incident. I disagree. Both Origo and HVG have close to a million readers a day, and the news about the Simicska-Orbán affair has been all over the internet. Those who don’t use the internet will hear the story from colleagues at work, from neighbors, or on the streets. Even a right-wing blog, Jobbegyenes (Straight right), argued that Orbán made a mistake in turning against the right-wing media developed and financed by Simicska. Both the Antall government and the first Orbán government tried to rely exclusively on state television and radio but both had to realize that this was not enough. Once Fidesz loses power, it will also lose MTV and MR and then what? It was Simicska who between 2002 and 2010 created the pro-Fidesz media empire that made the 2010 Fidesz victory possible.

I gather from an interview with Sándor Csintalan, who currently works for Lánchíd Rádió, that a certain percentage of Lajos Simicska’s business profits has been turned over to Fidesz for at least the last fifteen years. It was Simicska’s money that kept Fidesz financially comfortable. A great deal of that money, of course, came from the European Union. The EU not only kept the country afloat economically; it also unwittingly poured money into Fidesz coffers. But now, it seems, Viktor Orbán believes he no longer needs Simicska’s financial help, especially if that assistance comes at a price, meaning political influence.

At the moment Simicska is spending a week abroad while his new editors are working hard to reshape the political messages of his television station and Magyar Nemzet. I watched HírTV ‘s newscast last night, and it seemed balanced and factual. In Magyar Nemzet an editorial appeared written by Attila Kristóf entitled “Whose responsibility?” in which he is critical of the Orbán government’s most recent unfortunate decisions. According to him, “some Fidesz politicians have a lifestyle that alienates some Fidesz loyalists.” There is already disappointment, a sentiment that might change into antipathy. Of course, at the moment there is no alternative to Fidesz. The author pessimistically remarks at the end that “we don’t know what kind of future is awaiting us.”

Neither does Lajos Simicska or, for that matter, Viktor Orbán.

A different kind of media war: Lajos Simicska versus Viktor Orbán

What a day! A shakeup–no, an earthquake–at Magyar Nemzet, Magyar Nemzet Online, HírTV, and Lánchíd Rádió, all part of Lajos Simicska’s media empire.

For those who have been following Hungarian politics over the last few years Lajos Simicska needs no introduction. He was the favorite oligarch of the Hungarian prime minister. His companies won about 40% of all government contracts financed by the European Union. What fewer Hungarians remember about him is that in the early 1990s it was Lajos Simicska who saved Fidesz from financial collapse. As Zsolt Bayer, a friend of both Simicska and Orbán, admitted, “without [Simicska] there would be no Fidesz today.”

This is not the place to go into all the gory details of this financial rescue operation. Suffice it to say that the young democrats received a piece of property from the Hungarian state for a party headquarters, which they subsequently sold. They invested the proceeds in all sorts of business ventures that failed, one after the other, leaving behind millions in company debt and unpaid value added taxes. It was Simicska and a lawyer friend of his, Csaba Schlecht, who came up with the master plan. They “sold” the failed companies to bogus individuals who couldn’t be traced. Among them were homeless people who for a few forints agreed to go to a notary and sign anything that was put in front of them. Two of these people became especially infamous. Simicska and Schlecht got hold of the passports of a Turkish guest worker in Germany, Ibrahim Kaya or, as he is known in Hungary, Kaya Ibrahim, and a Croat named Josip Tot. The scandal broke during the first Orbán government, and naturally the police made no serious effort to find the culprits. One could say that Fidesz was born in sin.

For the better part of a year rumor had it that the relationship between Orbán and Simicska had soured. All sorts of hypotheses were put forth about the reason for their fallout. The most prevalent was that Orbán no longer wants to be beholden to one person and would like to widen the financial circle around Fidesz. Soon enough there were signs of Orbán’s efforts to loosen the ties with Simicska, and of Simicska’s response. By last fall a number of journalists who were absolutely devoted to Viktor Orbán were sacked at Magyar Nemzet. In early January we learned that Orbán no longer wants to help the Simicska media empire with advertisements by state companies. These media outlets have to stand on their own feet; he will throw his financial support behind the state television and radio. It was clear that something was brewing, but what really brought matters to a head was the announcement yesterday that the Hungarian government will substantially lower the advertisement tax on RTL Klub and, instead, every media outlet, even the smallest ones, will have to pay a 5% tax on their advertising revenues. That was the last straw for Simicska, who went on a rampage today.

Source: Magyar Narancs / Photo: Dániel Németh

Source: Magyar Narancs Photo: Dániel Németh

First, Simicska got in touch with Népszava last night and told the social democratic paper that “the media war will most likely become total” from here on. He told them that he considers the government’s proposed tax on advertisements “the latest attack against democracy.” In an interview with Origo he claimed that it is not money that is his first consideration, but “what will happen if one day Viktor Orbán scratches his head and decides that he will double the tax?” In brief, he is complaining about the same thing the German businessmen did to Angela Merkel.

When Simicska really lost his cool was early afternoon after he learned from his own paper, Magyar Nemzet, that Gábor Liszkay, editor-in-chief of Magyar Nemzet and CEO of HírTV; Ottó Gajdics, editor-in-chief of Lánchíd Rádió; Gábor Élő, editor of Magyar Nemzet On Line; Péter Szikszai, deputy CEO of HírTV; Péter Csermely, deputy editor-in-chief of Magyar Nemzet; and Szabolcs Szerető, deputy editor-in-chief of Magyar Nemzet, had resigned. Their conscience, they said, does not allow them to work for a paper not in the service of Viktor Orbán.

Well, at that point Simicska went berserk. The man who in the last twenty years hardly ever appeared in public and who never gave an interview suddenly gave interviews to everybody who phoned him. He answered the phone himself and, in response to questions, spewed an array of four-letter words. First he talked to József Nagy of Hír24 and allowed him to publish their recorded conversation. He accused Viktor Orbán, whom he repeatedly called “a prick,” of being behind the resignation of his top management. He also talked about a war between two men, one of whom will fall and that fall can be “physical,” which may mean death, but he is ready even for that. “They can kill me! They can shoot me or there will be a hit-and-run accident.” From an interview with Origo we learned that Simicska and Orbán haven’t talked to each other since last April.

Perhaps the most revealing interview with Simicska was conducted by Magyar Narancs. Here he insisted that he “maximally disapproves of the government media policy” which in another interview he explained involves dividing media outlets into three categories: those who are absolutely loyal to Viktor Orbán and the government; those who here and there are critical; and the enemies. Of these three Orbán can tolerate only the absolute loyal ones and will systematically eliminate all the others.

Apparently Simicska doesn’t like Viktor Orbán’s pro-Russian foreign policy either. And let me quote him verbatim on the topic. “No, I don’t like it at all. I grew up at the time when the Soviet Union was still here and I don’t have pleasant memories of the activities of the Russians in Hungary. I can’t really see any difference between the behavior of the former Soviets and the political behavior of today’s Russians.”

At this point the interviewing journalist interrupted and reminded Simicska that, according to rumors, his disagreement with Orbán has more to do with business than anything else. For example, he was left out of very profitable business transactions connected to Russian natural gas. But Simicska insisted that “there are more important things in life than money.” He and Orbán initially got together “to dismantle a dictatorship and the post-communist regime. It turned out that this is not an easy task. One must work at it. But I did not join Orbán to build another dictatorship to replace the old one. I’m no partner in such an enterprise.”

After the journalist reminded him that he and Orbán have been close friends for thirty-give years and therefore it must be hard to part in this way, Simicska said, “I must admit that it is a great disappointment. I thought he was a statesman, but I had to come to the conclusion that he is not.”

Simicska didn’t have much time to waste. As he said, Magyar Nemzet must be published tomorrow and he has to appoint a completely new top management. Moreover, Gábor Liszkay, editor-in-chief of Magyar Nemzet and CEO of HírTV, was a shareholder in these companies. Simicska had to buy him out. Within a couple of hours the deal was completed. Simicska apparently paid Liszkay 100 million forints or “thereabouts.” Gábor D. Horváth, the only top journalist who didn’t quit, became the editor-in-chief of Magyar Nemzet, and Simicska himself took on the role of CEO of HírTV. And who became the editor-in-chief of Lánchíd Rádió? You won’t believe it. The same old Csaba Schlecht who managed to “sell” the bankrupt Fidesz companies to Ibrahim Kaya and Josip Tot.

I’m looking forward to seeing the articles published in the “new” Magyar Nemzet tomorrow and the days after. Will the pro-Russian and anti-American articles still appear, or will there be a noticeable change in the coverage of Hungary’s relations with Russia, the European Union, and the United States? If yes, then Simicska’s claim to having serious disagreements with Viktor Orbán’s foreign policy can be taken seriously. Otherwise, it is just a lot of hot air.

Viktor Orbán no longer needs the oligarchs’ right-wing media

It was on January 9 that I wrote a post about the reorganization of the state media. I used the word “state” instead of “public” because by now Hungarian public television and radio are no more than government propaganda tools. I also wrote about Viktor Orbán’s vindictiveness, which is manifesting itself in plans for a state TV channel devoted exclusively to news. With this move Orbán is creating an alternative, backed by the state budget, to Lajos Simicska’s HírTV, which until recently faithfully served his and Fidesz’s policies. The two men had differences, however, and in Simicska’s media empire, of which HírTV is only one outlet, a few mildly critical programs and articles have appeared of late. For Orbán such disloyalty cannot go unpunished. Hence the new state news channel.

By an uncanny coincidence, on the very day I posted my article a “secret” meeting took place in the parliament building. Not until a week later, on January 15, did the public learn that Viktor Orbán had called together the editors-in-chief of right-wing, pro-government papers “to discuss and evaluate the work of the last year with them.” That is, to talk about how well the “media lackeys,” as one blogger called them, did their jobs last year. It wasn’t that we were unaware of the close cooperation between the government and the right-wing media, but it was still something of a shock to discover that this meeting was actually an annual affair. Apparently, every January the “lackeys” and the prime minister get together to discuss the successes or failures of the these media outlets’ work in the past year.

So, there was nothing unusual about the gathering itself, but what apparently transpired during the two-hour meeting was something else. Although not all those present told the same story, it seems that Orbán informed the editors-in-chief that from here on he will rely exclusively on state television and radio for government propaganda and therefore the generous subsidies to right-wing media outlets in private hands will be curtailed or may even cease. The subsidies to these government papers and television stations came in the form of advertisements from state companies. Just in the first seven months of last year Magyar Nemzet had ad revenues of 191 million forints from the Hungarian National Bank, 91 million from MVM, and 146 million from the state lottery Szerencsejáték Rt. If state advertisements stop, the right-wing media will be in the same boat as the socialist-liberal papers and the single left-leaning radio station (Klubrádió). This would impose a heavy financial burden on the owners, for example on Lajos Simicska.

ujsag

Orbán apparently made it clear that he was not satisfied with their work last year. There was still too much criticism of the government, which makes the electorate uncertain about the wisdom of the government’s decisions. According to the very detailed description of the meeting by Népszabadságthe prime minister was of the opinion that these newspapers and HírTV can manage on their own by now. Talking specifically about Magyar Nemzet and HírTV, both belonging to the media empire of Lajos Simicska, Orbán noted that being financially independent will free them from the quandary of identity. They can be both right-wing and government-critical in good conscience.

According to some of those present, the message did not come as a complete surprise. Gábor Borókai of Heti Válasz and spokesman of the first Orbán government (1998-2002) told Népszabadság that any casual reader of the right-wing media can see that since last fall “there have been very few ads from state companies and absolutely nothing on the current campaign of the prime minister’s office.” What surprised the editors, however, was how openly Orbán talked about the government’s goals with respect to the media. He did not hide his intention to use the “public media” for government propaganda. I guess he doesn’t care that soon enough Hungary’s allies, the European Union and the United States, will hear his candid words about the connection between the government and the public media reaffirmed by some of the participants who were present at the meeting. Of course, it is possible that even this revelation will not move the European Union to act, although one of the most controversial pieces of legislation of the Orbán government was the law on the media, eventually toned down on EU insistence.

Is Orbán’s move wise? Does it make sense to alienate the right-wing media and to bet the farm on an untried news channel of state TV, which has only 10% of total viewership? I see no compelling rationale for it, even from Orbán’s point of view. Mind you, he has done so many crazy things lately that perhaps I shouldn’t be surprised that he decided to take on the until now loyal press. For a government there can never be enough good press, and turning on journalists can be lethal. Viktor Orbán knows this better than most. At the end of his first term at the beginning of 2002 he bemoaned the fact that during his four years in office he had not paid enough attention to building up a friendly media. So, what then? Is he that sure of himself? That is also hard to believe given the incredible loss of popular support for his party and for himself.

There can be only one explanation for this seemingly crazy move: he really thinks that the journalists in question are totally devoted to the right-wing ideology of Fidesz and that even without extra subsidies they will not turn against him and his government. Although I don’t think that all journalists working for the right-wing media outlets are so devoted, there is a hardcore of true believers. It is unlikely that they would start writing critical articles about the government. RTL Klub was different. It was neither a right-wing nor a left-wing television station. Its editors just decided to leave out a lot of news that showed the government in a bad light. They did not want to irritate Viktor Orbán. From this neutral position it was easy to shift the newscasts to include items that previously would have been omitted.

Even if the people working for, let’s say, Magyar Nemzet abandoned their right-wing ideology, the editor and owner of a paper must also think of the readership that is accustomed to and demands a certain political stance. These papers cannot suddenly change their content although, according to ATV, Lajos Simicska, who owns HírTV, Magyar Nemzet, and Lánchíd Rádió, wants a shift in political orientation to appeal to the conservative center. The question is whether there is such a thing in Hungary. I don’t believe there is at the moment, unless as a result of Viktor Orbán’s move to the far right a more traditional center will emerge in the coming months.

All in all, Orbán might be correct in not worrying too much about the pro-government orientation of these newspapers in the future. If that turns out to be the case, the new state news channel will be just an added bonus for those folks who don’t have cable and who from force of habit watch nothing but state television. After all, this is what they did in the good old days when there was but a single TV channel. It satisfied them then and it satisfies them now.

Fidesz insiders think Orbán’s days are numbered

The week between Christmas and New Year’s Day usually offers little sustenance for news junkies. But today I discovered a front-page article in Népszava with the titillating title “Does Orbán have only months left?” The paper’s “sources close to Fidesz” claimed that “Orbán is already finished” and the only “question is who will take his place.”

The article was met with skepticism, especially in pro-government circles. Válasz described the article as sci-fi and “entertaining.” Gábor Török, the popular political scientist, wanted to know what his Facebook “friends” thought about the appearance of such items in the media. Do government politicians actually say such things to reporters of an opposition paper or are the reporters only giving voice to their wishes? The comments that followed were a mixed bag but a reporter, András Kósa, who also receives information from dissatisfied Fidesz politicians, didn’t think that the article was fantasy, although it might be exaggerated. Here and there commenters thought that Fidesz will collapse as soon as Viktor Orbán is gone, but most “friends” of Török considered the article humbug. I’m less skeptical than most of Török’s friends because I’ve usually found Népszava to be reliable when it reports on information coming from unnamed sources.

So, let’s see what Népszava heard from “sources close to Fidesz.” They claim that Orbán’s “system” has no more than a few months before it collapses. Apparently Fidesz politicians are increasingly avoiding the limelight because “the fall is inevitable. In their opinion Orbán started down a road from which there is no return. Not only will he himself be the victim of his own mistakes but also his party and the country itself.”

The problems that beset the work of the government emanate from the character flaws of the prime minister: inconsistency, impenetrability, and unpredictability. Most government and Fidesz officials have no idea what course they are supposed to pursue. Orbán trusts fewer and fewer people, and the ones he still does give him wrong advice. He apparently is looking for enemies everywhere, and this is one of the reasons that government decisions are not preceded by any discussion. It often happens that Orbán himself changes his mind in the last minute, which makes consistent communication nearly impossible. Underlings parrot a line that has been superseded by a new brainstorm of the prime minister. More and more people would like to save themselves from such embarrassments.

According to these informants, serious problems within Fidesz are not new although they are only now becoming visible. Signs of trouble began to surface when Orbán decided, sometime before the April elections, to change the “structure” under which Fidesz had been functioning very well for over twenty years. Until then, Lajos Simicska was in charge of the party’s finances, but “from the moment that Orbán decided to take over economic decisions” the old dual structure collapsed and with it the well-functioning system. When Orbán again managed to receive a two-thirds majority, he completely lost his sense of judgment. As months went by, anti-Orbán murmurs in the party began to proliferate, and the Christian Democrats, realizing that Orbán was losing his grip on the party, decided to put pressure on the beleaguered prime minister. That’s why Orbán had to give in on the unpopular law that forces stores to be closed on Sundays.

What observers see is no longer a “system” but a political process based on day-by-day ad hoc decisions which, according to the saner Fidesz leaders, cannot be maintained because “it is incapable of self-correction.”

The informers seem to have less information about actual attempts to topple Viktor Orbán. Names were not mentioned, but they indicated that the people they had in mind “would be quite capable of taking over the reins of government without changing political direction.” Népszava‘s sources consider Angela Merkel’s planned visit to Budapest in February a date of great importance. I guess they think that Merkel will tell Orbán that he is persona non grata as far as the European People’s Party and the European Commission are concerned.

CalendarNépszava‘s description of the strife and chaos within Fidesz is most likely accurate. The question is what Orbán is planning to do to forestall the outcome described by Népszava‘s sources. For the time being, as we learned from the interviews of János Lázár, Viktor Orbán, and László Kövér, he will fight to hold onto power by convincing his Peace March troops that the “fatherland is in danger.” I’m almost certain that internal polls are being taken to gauge support. Would it be possible to turn out 100,000 people to defend the prime minister against foreign and domestic intrigues? I assume that the size of the planned anti-government demonstrations on January 2 will also influence Orbán’s decision about the next step to take to combat his opponents inside and outside the party.

In any case, for the time being it was Antal Rogán who was called upon to announce a countermeasure that might take the wind out of anti-government sails.  It is called the “National Defense Action Plan.” The details are secret for the time being, but it most likely includes some kind of answer to the United States’ decision to bar six Hungarian citizens from the United States due to corruption. It is also likely that a huge propaganda effort will be launched to discredit the U.S.-EU free trade agreement that until now the Hungarian government has welcomed. According to government and Fidesz sources, the “National Defense Action Plan” was put together in the prime minister’s office by Viktor Orbán, János Lázár, Antal Rogán, Péter Szijjártó, and Árpád Habony (who neither holds an official government position nor has national security clearance). These are the people who make most of the decisions in the Orbán government.

Meanwhile what are the anti-Orbán political forces doing in this fluid situation? Ferenc Gyurcsány decided to ask those followers who have been at the anti-government demonstrations all along to bring party posters and flags to the January 2 demonstration. József Tóbiás, leader of MSZP, did not respond to Gyurcsány’s request to follow DK’s lead. But István Újhelyi, an MSZP MEP, announced today a socialist “diplomatic offensive” against the Orbán government. Orbán must be stopped because his “Russian roulette” will have tragic consequences.

At the beginning of the new year there will be at least two important events. First, the mass demonstration planned for January 2 in front of the Opera House. Three years ago a gigantic anti-government demonstration also took place there, and for a whole month newspapers kept asking how long Orbán could last. We are again asking the same question. Since Orbán not only survived but thrived in the last three years, some people might come to the conclusion that the Hungarian prime minister will always triumph, even in the most perilous circumstances. But I would caution the pessimists. Three years ago the pressure came only from the inside. This time Orbán has embroiled himself and the country in a high stakes international power play in addition to alienating about 900,000 of his former supporters.

The second event will be Orbán’s new “remedy,” the “National Defense Action Plan.” Will it work? Is Orbán strong enough to rally his troops for another supportive Peace March as he did in 2012? And even if he manages, will anybody care?

How do European Union funds end up in the hands of the Orbán family?

The European Union has been, wittingly or unwittingly, enriching members of the Orbán family. Today, in what is undoubtedly only one story of many, I’ll focus on Viktor Orbán’s eldest daughter, Ráhel.

The last time Ráhel, Rasi to her family and friends, was in the news was more than a year ago when she got married with great fanfare to István Tiborcz, a 27-year-old businessman with a law degree. In 2008 Tiborcz and a friend started a small business dealing with electrical and energy supplies. In 2009 the business had a modest profit of 8 million forints on which they paid 2 million in taxes. Two years later the annual profits of the groom’s business were over 2.5 billion forints.

Ráhel is in the news again. This time on account of her spending a year at the École Hôtelière de Lausanne in Switzerland where she is working toward “an Executive MBA in Hospitality Administration.” Why the interest in Ráhel’s studies? The reason for all the fuss is the high tuition fee she has to pay for the two semesters she is spending in Lausanne. The cost is 60,000 Swiss francs or 15 million Hungarian forints. Because of the recent focus on alleged widespread corruption among Hungarian politicians, this tuition fee prompted questions about the source of the money. Journalists pointed the finger at Rasi’s father, Prime Minister Viktor Orbán. How can he plop down 60,000 Swiss francs?

I, who followed the research done by Atlatszlo.hu at the time of the wedding and reported about the sudden enrichment of István Tiborcz, couldn’t quite understand why Hungarian journalists assumed that it had to be Orbán who footed the bill when Rasi has been married for over a year to a young man who since 2010 has become quite wealthy.

Ráhel became tired of all the questions and accusations and decided to speak up on her Facebook page. She said that she and her husband are paying her tuition, not her father. I’ll bet she regrets that decision now because her Facebook note prompted Atlatszlo.hu to look into Tiborcz’s more recent business affairs. And what they found is not pretty.

The happy couple

The happy couple

Of course there is nothing wrong with being a successful businessman, but István Tiborcz’s success most likely has nothing to do with his business acumen. Before Viktor Orbán became prime minister he owned a very modest business. The meteoric rise in his fortunes can be compared only to that of Lőrinc Mészáros: from 8 million in revenues in 2009 to 3 billion in 2011.

How did he achieve this incredible feat? In 2010 one of Közgép’s divisions purchased the majority of shares in Tiborcz’s business and used it as yet another of its conduits for EU cohesion funds. The customers of E-Os Innovatív Zrt., as the business was renamed, were almost exclusively municipal governments with Fidesz mayors. They contracted with E-Os to do work that was funded by cohesion funds from Brussels.

For reasons that are unclear, in 2012, according to publicly available information, Tiborcz’s business was renamed Elios Innovatív Zrt. and Közgép no longer had a majority stake. Two companies bought out Közgép, one of which, Green Investments, was owned by a former partner of István Tiborcz, Endre Hamar. The change in ownership had a decidedly negative impact on the company’s revenues. In 2012 Elios Innovatív Zrt. grossed only 20 million forints. Three weeks after the 2014 national election, however, Tiborcz bought out his former partner Endre Hamar, and from there on business boomed.

Tiborcz’s firm installs street lighting. Atlatszo.hu lists 2.9 billion forints worth of contracts with different municipalities: Hévíz, Balatonfüred, Kecskemét, Szekszárd, Dunaújváros, Sopron, Hatvan, Kalocsa, Bicske, just to mention a few. Most of these revenues (2.1 billion) were the result of a tender issued by the Nemzeti Fejlesztési Ügynökség (National Development Agency) and financed by the European Union. Local governments could apply for grants to reduce their energy costs; if successful, they received large sums of money to have the appropriate work done.

There are strict EU guidelines that the Hungarian authorities must follow. The most important rule is that the firm that prepares the technical details must not in any way be connected with the successful bidder. However, as Atlatszo.hu discovered, most of the tenders Tiborcz’s firm won were prepared by his former partner, Endre Hamar, who owned another company called Sistrade Kft. It is likely that Hamar and Tiborcz acted in collusion, making Tiborcz’s bid fraudulent. In fact, Atlatszo.hu notes that the arrangement was so bizarre, and presumably illegal, that Hamar was still an owner of Elios Innovatív Zrt. at the end of April 2014 when the firm signed the contract with the city of Héviz.

Atlatszo.hu did a yeoman’s job in trying to make sense of the company’s shifting identity and ownership structure. Unfortunately, many questions remain. One that baffles me is the role of Simicska’s Közgép. I find it more than a little odd that Simicska’s Közgép shows up to support the fledgling business of István Tiborcz, already known to be Ráhel’s boyfriend, only to withdraw from the firm after its spectacular growth. Közgép is not, as far as I know, active in venture capital or private equity. And, as the next year’s revenues showed, Tiborcz’s company was not ready to stand on its own.

I think it would be high time for Brussels to take a harder look at some of the businesses–and individuals–that profit from its largesse. Let’s not forget that in this case we are talking about the daughter and son-in-law of the prime minister. Surely, the goal of the EU convergence program is not to make the Orbán family rich.