Mária Vásárhelyi on the “media octopus” in Hungary

Yesterday I talked about the state of the Hungarian media. In today’s Galamus, Zsófia Mihancsik, who is a very good journalist, suggested to her colleagues that it would be a good idea if they learned to read. But, as some of you suggested, the slanted reporting on certain “sensitive” topics might be the result not so much of careless reading or writing but of a willful distortion of the facts. This is definitely true about media under the direct or indirect control of the governing party.

So, I think it’s time to look around a little in the world of the Hungarian media. Here I’m relying heavily on Mária Vásárhelyi’s essay “The Workings of the Media Octopus–Brain and Money Laundering” that appeared in the Bálint Magyar-edited volume, The Hungarian Octopus.

According to Vásárhelyi, Viktor Orbán’s psyche was crushed in 1994 when he  managed to lead his party with a 40% chance of winning the election into almost total ruin with 7.7% of the votes. Before that fiasco Orbán was the darling of the press, but subsequently he became the pariah of the then still mostly liberal Hungarian media. He decided right then and there that the goal is not to be liked by the existing media; rather, a smart politician should strive for a loyal media he can easily influence. In Vásárhelyi’s estimate Fidesz had the lion’s share of responsibility for the 1996 media law that turned out to be neither liberal nor democratic.

Once Fidesz won the election in 1998 Viktor Orbán made a concerted effort to build a media empire with the use of private and public money. Billions of public money were spent on establishing Heti Válasz and on the “rescue” of the heavily indebted Magyar Nemzet. And right-wing oligarchs like Gábor Széles, Tamás Vitézy (Orbán’s uncle by marriage), Zoltán Spéder, István Töröcskei, and Lajos Simicska put large sums of their own money into media outlets that were anything but profitable. They were hopeful that their investments would serve them well one day when Viktor Orbán again returned to power.

Between 2002 and 2010 the preponderance of media outlets shifted to the right. Moreover, by 2008 the liberal media’s financial situation was dire. Companies strapped for funds cut their advertising budgets, and the liberal media outlets had no rich oligarchs who could ensure their continued existence during the hard times. Since 2010 the lopsidedness between right and left in the field of media has only become worse. According to Mária Vásárhelyi, “only those messages which the government party wants to deliver reach 80% of the country’s population.”

Studying the changes in the political orientation of radio stations is perhaps the most fruitful and most telling because it is here that the Media Council, made up entirely of Fidesz appointees, can directly influence the media. It is in charge of allocating radio frequencies. As the result, in the last five years the radio market became unrecognizable. Every time existing radio stations had to reapply for frequencies, the frequencies were given to someone else. The new stations were owned by companies or non-profits preferred by the government party, and in consequence government advertisements immediately poured in. Between 2010 and 2012 some 50 local and regional radio frequencies changed hands. Of these Mária Rádió (Catholic Church) got seven frequencies all over the country and Lánchíd Rádió (also close to the Catholic Church) got five. Európa Rádió, which is close to the Calvinist Church, by now can broadcast on three frequencies. Magyar Katolikus Rádió has two local and two regional frequencies. All these stations are considered to be non-profit and therefore they don’t pay for the use of the frequencies.

Zsolt Nyerges has built a veritable media empire: he is behind “the three most valuable radio frequencies in the country.” During the same time the liberal stations have been disappearing one by one. Radio Café, very popular among Budapest liberals, lost its frequency in 2011. So did another popular liberal station called Radio1. Of course, Klubrádió is the best known victim of Viktor Orbán’s ruthless suppression of media freedom. Klubrádió began broadcasting in 2001 and could be heard in a radius of 70-80 km around Budapest. By 2007 the station had acquired eleven frequencies and could be heard in and around 11 cities. Soon enough Klubrádió was the second most popular radio station in Budapest. Today, Klubrádió after years of litigation moved over to a free but weaker frequency that it already had won before the change of government in 2010. Out of its 11 provincial stations there is only one left, in Debrecen, and we can be pretty sure that as soon as its contract expires Klubrádió will no longer be able to broadcast there either.

As for the public radio and television stations, let’s just call them what they are: state radio and television stations as they were during socialist times. But then at least the communist leaders of Hungary didn’t pretend that these media outlets were in any way independent: the institution was called Hungarian State Television and Radio. They were at least honest. The only difference was that in those days state television and radio aired excellent programs, especially high quality theatrical productions and mini-series, all produced in-house. Now I understand the programming is terrible and only about 10% of the population even bothers to watch MTV, and most likely even fewer watch Duna TV. Their news is government propaganda: on MTV more than 70% of the news is about government politicians and the situation is even worse at Magyar Rádió.

These state radios and television stations have a budget of over 70 billion forints, a good portion of which ends up in the hands of Lajos Simicska. How? MTV and Duna TV no longer produce shows in-house but hire outside production companies. Thus, public money is being systematically siphoned through MTV and Duna TV to Fidesz oligarchs. The programs are usually of very low quality and complete flops.

Most Hungarians watch one of the two commercial stations: RTL Klub and TV2. Both are foreign owned but as Orbán said not long ago, “this will not be so for long.” And indeed, a couple of weeks ago TV2 was sold, allegedly to the director of the company. Surely, he is only a front man. An MSZP politician has been trying to find out who the real owner is. Everybody suspects the men behind the deal are Lajos Simicska and Zsolt Nyerges.

And finally, the print media is also dying, which is not surprising given the worldwide trend. But right-wing papers are doing a great deal better than liberal and socialist ones for the simple reason that public money is being funneled into them through advertisements by the government and by state-owned companies. Even free newspapers are being brought into the right-wing fold. There was a very popular free paper called Metro owned by a Swedish company. But Orbán obviously wasn’t satisfied with its content. So, the government severely limited the locations where Metro could be stacked up, free for the taking. Thus squeezed, the Swedish owner decided to sell. And who bought it? A certain Károly Fonyó, who is a business partner of Lajos Simicska. The paper is now called Metropol and, in case you’re wondering, is doing quite well financially.

Napi Gazdaság was sold to Századvég, the think tank that was established by László Kövér and Viktor Orbán when they were still students. As I mentioned earlier, Népszabadság was sold recently to somebody who might be a front man for Tamás Fellegi, former minister of national development who had financial interests in the world of the media before he embarked on a political career. The paper was owned by Ringier, a Swiss company that wanted to merge with the German Axel Springer, which owns a large number of provincial papers in Hungary. Although in many European countries the merger was approved with no strings attached, the Hungarian government set up an obstacle to the merger. The merger could be approved only if Ringier first sells its stake in Népszabadság.

Fidesz hasn’t been so active online. Most of the online newspapers are relatively independent. What keeps the party away from the Internet? Vásárhelyi suspects that it is too free a medium and that it doesn’t comport with Fidesz’s ideas of control. Surely, they don’t want to risk being attacked by hundreds and hundreds of commenters. Index, however, is owned by Zoltán Spéder, a billionaire with Fidesz sympathies. After 2006 it was Index that led the attack on Ferenc Gyurcsány and the government. Vásárhelyi predicts that Index will turn openly right sometime before the election.

The scene is depressing. There is no way to turn things around without the departure of this government. And even then it will require very strong resolve on the part of the new government to stop the flow of public money to Fidesz media oligarchs. The task seems enormous to me.

Corruption and conflict of interest in Hungarian politics

Although Medián came out with a new poll on voters’ party preferences, it tells us practically nothing new. Fidesz is still leading and the united opposition has no more support than before even though a majority of people would like a change of government.

So let’s move on to two embarrassing cases, both involving leading MSZP politicians. The first is the easier to deal with. Gábor Simon, one of the deputy chairmen of the party, is accused of having two bank accounts, totaling €700,000, in an Austrian bank which he didn’t reveal in his financial statement. At the time Simon deposited the money he told the bank officials that the money was acquired by selling a piece of real estate and a firm he owned. The problem is that Simon didn’t own or sell any real estate or a company.

It was only on Monday that Magyar Nemzet published this explosive story, the timing of which was most unfortunate for MSZP. Attila Mesterházy, József Tóbiás, and Csaba Horváth are currently in the United States, but word already reached Budapest that Simon must give up all his important positions within the party. Simon, realizing his untenable position, “suspended his party membership.” A few days ago he was still a candidate in electoral district XIII, but according to rumors Ágnes Kunhalmi will run there in his stead.

Up to this point one could say that Simon was a bad apple and MSZP an innocent victim, but the situation is a bit more complicated. The prosecutor’s office has been investigating Gábor Simon in another case ever since last March. This particular case involved little money, only 300,000 forints. But his immunity was suspended despite MSZP’s protestations in committee. Although the two cases are not connected, the MSZP leadership should have been more cautious early on and not just say that it was a baseless accusation against one of the leading politicians of MSZP.

Apparently Simon’s downfall was caused by his wife, whom he divorced recently. (One has to be careful with estranged wives. Just think of the former wife of Attila Szász, Aranka, who spilled the beans about Viktor Orbán’s questionable business deals in Tokaj.)

The second case is a great deal more complicated. It involves István Józsa, an important MSZP politician who is the energy expert of the party. The background is as follows. Fidesz desperately wants to prove that MSZP always wanted to build one or two more reactors in Paks and that they also wanted to use Rosatom and Russian technology. This is what, they contend, Gyurcsány, Bajnai, and Mesterházy said before 2010, but now that the Orbán government made this fabulous deal with the Russians they are suddenly against it. Yesterday Fidesz came out with another “discovery.” István Józsa, who had a 42% share in a company called Gépkar Kft., received 6.6 billion forints worth of orders from Paks between 2000 and 2010. The Fidesz politician György Balla charged that Józsa’s opinions on Paks changed with his financial interests. Before 2010 he was for building the new reactors but now he is against it.

Józsa, who gave an interview to Hír24 on the fly in one of the many corridors of the parliament building, sees nothing wrong with his company getting work from the state-owned Paks nuclear plant. He pointed out that in 2002 when he became a member of parliament he withdrew from the actual management of the company. The company got the bulk of its orders from Paks between 2000 and 2002 when Fidesz was in power. Moreover, the sum of 6.6 billion forints in ten years may sound like a lot of money but anyone who is familiar with this industry knows that it is not considered to be a large amount. In 2010 they sold the company because they no longer got any orders. Zsolt Nyerges, a close business partner of Lajos Simicska, made their situation untenable. The man who bought the company eventually went bankrupt; under the circumstances the business was no longer viable.

The reporter inquired from Józsa several times whether selling his stake in the company wouldn’t have been more appropriate once he became an MP, but the politician indignantly refused the suggestion. He is upright man; he had nothing to hide; he didn’t do anything illegal; the company received work from Paks through competitive bidding. He doesn’t understand what’s wrong. I fear Józsa is not the only one who seems to be unable to grasp the inappropriateness of such arrangements.

On this score one could congratulate the Orbán government’s decision to forbid outside business or professional activities for members of parliament. However, as we know, in the political structure Viktor Orbán set up members of parliament are not the ones who truly matter. Fidesz MPs currently function as puppets or robots and most likely will do so in the future as well. The money and power are elsewhere, in the financial and economic circle of oligarchs around Viktor Orbán. They are the ones who matter.

Tomorrow I will investigate a case involving close friends of the prime minister in one of the shadiest business dealings of late.