The current Hungarian political situation

Huge disappointment, if not panic, exists in left-liberal circles nowadays in Hungary. The latest polls indicate that Ferenc Gyurcsány's departure from office didn't help to restore the population's trust in MSZP. On the contrary, the socialists lost further ground. And that is difficult to believe because the party's popularity was stuck at such a low level, around 16-18%, in the last few months. The Progressive Institute/Publicus tested the political waters by conducting a survey between March 23 and April 7. Among eligible voters MSZP's popularity was 10% as opposed to 16% in October! Absolute panic on the left. Indeed, this is very low. According to some it is the lowest recorded figure ever, with the possible exception of 1990.

Being a half full kind of person, I will concentrate on the brighter sides of things that, in my opinion, are significant and somewhat mitigate those stark figures. The first and perhaps most interesting finding was that support for Fidesz among eligible voters didn't grow. On the contrary it shrank: from 33% to 30%. The second even more significant result, I believe, is that 39% of those asked are unsure for which party they would vote. I would venture to say that most of these unsure people at the last elections voted for MSZP or SZDSZ and are at the moment fed up with both parties. Another figure we ought to take into consideration is that Progressive/Publicus noted the very high percentage of those who claimed that they would definitely would go and vote if elections were held next Sunday: 62%. It is very unlikely that such a high percentage of people would actually vote in a hypothetical election in a week's time, but a lot of people think that it is their civic duty to vote (and, of course, they are right) and therefore they say what they think is expected of them. Another bright spot for MSZP supporters, at least in the short run, is the breakdown by age. Fidesz supporters are younger, MSZP voters are older. The older folks are more likely to go to the polls than the younger ones.

Meanwhile, let's look at the reactions of "political scientists." With notable exceptions the majority of them think that the sinking popularity of MSZP will result in the socialist parliamentary members' abandonment of the Bajnai government. These commentators claim that they will refuse to support the austerity measures and will throw in the towel: let's have early elections with lots of promises because otherwise MSZP will find itself in the same position as the Polish socialists. I find such predictions outright irrational and I simply can't understand how anyone in his right mind could come up with that kind of scenario. Elections at the time when the party is at a "historic low"?  My assessment is diametrically opposed to the above so-called analysis. The worse the news for the party the greater the cohesion will be because it will be obvious to those who are able to think rationally that retreating from Gordon Bajnai means immediate elections and certain defeat. However, I can already hear the answers of those who have made up their minds that the Bajnai government will not last until 2010. According to these people there is a group of socialist parliamentary members who are also mayors. If national elections were held this year, local elections would be still in October 2010. By that time Fidesz, surely the victor in the national elections, having inherited the economic and financial crisis and having imposed its own austerity program, will be just as unpopular as MSZP is today. Thus MSZP will win big at the local elections a year later! Doesn't that sound perfect? But considering that there are only a handful of socialist parliamentary members who are also mayors, it is unlikely that this group would be strong enough to achieve its aim. That is, if this is their aim. I suggest instead that it is the figment of the fertile imagination of the Hungarian "political scientists."

Then there is the last card. According to the so-called analysts if the internal opposition of MSZP does not succeed in ruining the Bajnai government, SZDSZ will surely manage to wreck the present solid support behind Bajnai. These people point to József Gulyás's latest: abstaining at the committee hearing of Ádám Ficsor and thereby wrecking the one-man majority of the socialist-liberal side. However, Gulyás's act was roundly condemned by other SZDSZ members and out of the nineteen-member caucus sixteen are solidly behind Bajnai and his program. Moreover, one of the SZDSZ members today demanded that the three who refuse to follow party discipline be stripped of their membership in the caucus. I don't think it will get that far, but Gulyás's colleagues consider his behavior unacceptable; he hurts the party and, more importantly, does a disservice to the country. But let's say that these three who are hailed as "heroes" by Fidesz actually remain adamant in refusing to support Bajnai's government, what will happen then? Not much. Sixteen votes are more than enough and I didn't even count the two votes from the independents. So it doesn't matter how we look at it, it is very unlikely that MSZP-SZDSZ support for Bajnai will collapse any time soon.

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“Meanwhile, let’s look at the reactions of “political scientists.” With notable exceptions the majority of them think that the sinking popularity of MSZP will result in the socialist parliamentary members’ abandonment of the Bajnai government.” With all due respect to the “poliical scientists” I too think they are missing the point and they should focus more on the medium-term constraints, rather than the more unpredictable realm of short-term events. Bajnai is essentially implementing the programme of the Reform Alliance, which is about removing Hungary structural imbalances through severe deflation. The key point here is a macro-economic one; it is irrelevant whether any of the individual reforms proposed will be beneficial in isolation – the real issue is that the state and its role in the economy is being reduced severely at a time when the size of the economy will contract rapidly (Bajnai’s 5.5-6% in 2009, with stagnation in 2010 seems realistic to me). With exports contracting sharply (30% year-on-year), and agriculture hit by falling commodity prices this process of restriction will increase the speed and depth of the contraction. If Hungary is lucky the Bajnai austerity package will lead to a new round of cuts in the spring; if… Read more »

At the same time MFB, the house-bank of the government has loaned 25 billion forint to Demján to prop up his Russian lotto business!
Unfortunately, the MSZP – SZDSZ coalition not only had a disastrous and incompetent economic policy, but was also prey of rent-seeking and corruption of oligarchic political and economic interest groups. Most likely, that the price for this “lost” eight years will be the complete disintegration of secular-liberal-left. Maybe this will offer the opportunity for the rebuilding of the left without the burden of the socialist past.
Without cutting the clout of political class, cutting the rent-seeking of oligarchic political and economic interest groups, clientelism, corruption and waste and at the same time rebuilding competent government machinery there won’t be way out of the current crisis.Worrying sign that in Italy, a similar collapse of the traditional elite in early nineties led to the rise of Berlusconi, without too much change how the system works.

András: “At the same time MFB, the house-bank of the government has loaned 25 billion forint to Demján to prop up his Russian lotto business!” This is the key point about the legitimacy of austerity, and generalized declarations about the country “needing to live within its means”. Not all Hungarians want to pay the price of Hungary living within its means, and generally those people are those best able to contribute to the burden. Maybe Bajnai and the MSZP-SZDSZ would be in less trouble if they demanded that the likes of Simor open the books of their offshore companies in places like like Cyprus to APEH. Perhaps before they cut social spending they might look at the suggestions made say, by the Austrian Greens over the border that for the period when the economy contracts only a “solidarity tax” would be introduced by which all income over the level of the annual salary of the Prime Minister be taxed at 70% as a gesture to the unemployment to foster consensus behind reform. This is especially appropriate given that it has been the reckless expansion strategies of businessmen like Csányi in growing the OTP in Ukraine and Serbia that has contributed… Read more »