The Hungarian EP elections–time for reassessment and reflection

The gloom is palpable. The greatest disappointment is in SZDSZ. Gábor Fodor, who usually is optimistic and rosy-cheeked, looked positively sick on election night. Tamás Bauer, one of the founders of the party, gave an interview tonight on József Orosz's Kontra (KlubRádió) that sounded more like an elegy. He wasn't surprised at what most people think is the end of the Hungarian liberal party. He was only very, very sad. Bauer said that the handwriting had been on the wall for at least fifteen years, but the absolutely erratic political moves of the last three years that practically no one could follow really did them in. As Bauer said, the supporters of SZDSZ fell out of love. MSZP is obviously in big trouble. After all, it barely surpassed Jobbik at the polls. MSZP received 502,607 votes while Jobbik got 427,213. And Fidesz isn't sitting on its laurels. It is true that it received 56.37% of the votes, but it managed to mobilize only 1,630,482 voters. It didn't seem to matter that Fidesz tried to convince people that this election was all-important because if Fidesz wins big the government will fall. Orbán had said that too many times before and nothing happened. It didn't seem to matter that every poster told them that it was "Enough!" and urged them to go and vote; only about half of Fidesz supporters did so. The other reason for the disappointment must be that the main thrust of Viktor Orbán's strategy, criticized by many earlier, failed spectacularly on June 7. The slogan was "One camp, one flag." That meant an absolutely unified right represented by Fidesz alone. It turned out that the right is anything but unified. Orbán tried his darndest to incorporate the moderate, conservative MDF and wanted to be the representative of the extreme right as well. It didn't work. MDF is hanging in there and, although MIÉP is only a shadow of its former self, there is the "new force" as Jobbik calls itself.

And now let's take a look at the actual breakdown of the election results. In order to make it a little easier I attached a map of Hungary that shows the counties.Hungary2 Jobbik did best in the northeastern corner of the country: in Borsod-Abaúj-Zemplén (22.88%), Szabolcs-Szatmár (18.49%), Hajdú-Bihar (18.68%), Nógrád (18.68%), and Jász-Nagykun-Szolnok (19.02%). Most analysts claim that the reason for Jobbik's success in this region is the high concentration of Romas in these counties. However, in Baranya where there are also a lot of Gypsies Jobbik didn't do well at all (10.7%). I couldn't find detailed breakdowns of voter turnout, but in the poor counties of the northeast participation is usually very low, so this may have pumped up Jobbik returns. Fidesz, as usual, did very well in the westernmost counties: Győr-Moson-Sopron, Vas, Zala, Tolna and Bács-Kiskun, the only county lying east of the Danube. All others are situated in Transdanubia. To clarify further, I'm reproducing a series of maps of the spread broken down by parties.EP Those who claim that Jobbik took votes from MSZP base their assertion on the results of the 2006 elections. MSZP was strong in the eastern counties while Fidesz triumphed in counties close to the Austrian border. They point to the fact that in the EU elections Jobbik did worse in Fidesz territories than in the country as a whole. However, there is a fairly powerful argument advanced by Zoltán Somogyi (Political Capital) which makes sense to me. Pollsters were wrong about the chances of Jobbik and Fidesz. But they were spot on for some time before the elections about the MSZP numbers. They steadfastly maintained that the party would send no more than four representatives to Brussels. At the same time they predicted sixteen or seventeen seats for Fidesz. Jobbik would get one, at most two. Since their predictions for MSZP turned out to be accurate, most of the Jobbik votes must have come from Fidesz. Of course, neither Somogyi nor I claim that no former MSZP supporter voted for Jobbik on Sunday, but I think that by and large Jobbik's gain was Fidesz's loss.

Although Viktor Orbán allegedly told his associates not to spend their time worrying about Jobbik because their win was so spectacular, he immediately convened a two-day pow-wow to "analyze the results." One doesn't need a vivid imagination to figure out the main topic of the meeting. Even István Elek, a staunch supporter of Fidesz in the past, wrote an analysis in Népszabadság in which he called Fidesz's performance a failure (kudarc). Success, according to Elek, would have been a two-thirds majority instead of 56.37%, and it would have been a source of great satisfaction if Jobbik hadn't been able to send a single delegate to Brussels. Fidesz's message to voters on the right not to "waste" their votes on Jobbik seems to have fallen on deaf ears. Some people predict that Jobbik will build on its success in the EU elections.  According to some analysts 10% of Fidesz voters sympathize with the radical right, and that is a big chunk. What if at next year's national elections more former Fidesz voters defect to Jobbik? The question now is what Fidesz is planning to do.

According to Elek, Orbán has no choice but to move toward the middle. After all, if he wants to be accepted by the Western European Christian Democratic parties he cannot join Gábor Vona's and Krisztina Morvai's Jobbik. As it is, a lot of people in liberal and socialist circles blame him for the strong showing of Jobbik. After all, it was he who picked Gábor Vona as a promising young man and took him under his wings. Krisztina Morvai has a more checkered ideological past, but her strictly political career began under Fidesz tutelage in the fall of 2006 when she, together with Zoltán Balog, a Calvinist minister and member of parliament, began a frontal attack on "police brutality." Critics also mention that Fidesz introduced a political culture (if one can call it culture at all) to Hungarian public discourse that led straight to the language Krisztina Morvai and Gábor Vona use. As Tamás Bauer said, everything that Jobbik's leadership says today was already said by Orbán and Fidesz but they did it more carefully and not in such a vulgar manner.

Some people argue that Jobbik's success is simply part of a European trend and highlight the British and Dutch examples. But the extreme right-wing parties of Western Europe focus most of their attention on immigration. Jobbik, by contrast, is racist and increasingly antisemitic. Krisztina Morvai has managed to stir up antisemitism among those who used to spend their time celebrating the glory of pagan Hungary and intimidating Gypsies. Morvai has reframed the debate. Her favorite comparisons are to Israel and Palestine. Jobbik "will not allow Hungary to become a second Palestine," and "Hungarians will not be second-class citizens in their own country." No foreigners will be allowed to buy cheap Hungarian land as happened in Palestine. Morvai's most recent "not for prime time" performance took place on the Internet. As it turns out, there is a conservative Hungarian political discussion group to which Morvai belongs. On that list a man who called himsef a proud Hungarian Jew objected to something Krisztina Morvai said. Morvai answered: "I would be glad if those who call themselves proud Hungarian Jews in their spare time would play with their tiny little circumcised tails instead of abusing me. Your kind expect that if you fart our kind stands at attention and caters to all your wishes. It's time to learn: we no longer oblige! We hold our heads high and no longer tolerate the terror your kind imposes on us. We are taking our country back!" In Morvai's language, of course, "our kind" means Christians and "your kind" means Jews. Well, our conservative gentlemen were horrified! Géza Jeszenszky, foreign minister under József Antall and ambassador to Washington under Viktor Orbán, was flabbergasted: a woman! How can she? A woman? That's not the real problem, is it? (A footnote for those who don't know: Krisztina Morvai is married to a Jew and they have three daughters. Relations between the couple are obviously strained; as she said recently, they believe that "the best thing for the children is when both parents are there for them, but we no longer live together as a couple. We live in the same house, but in two separate households.")

In today's Népszava a cartoon appeared that says a lot about Fidesz's predicament. The background is as follows. About a year ago Viktor Orbán after having a few glasses of wine became expansive and described his "real" plans to a group of young political scientists, students of László Kéri. It was a revelation. While in public he never talked about an austerity program, he told the students that the future under Fidesz would not be as rosy as he was leading people to believe. Then a student asked him what he was planning to do with the Hungarian Guard and the extreme right. Horthy pofon He jokingly said that he would do the same as Miklós Horthy, governor of Hungary between the two world wars, did: he would slap them around a bit and that would take care of things. When Orbán's private conversations with the students leaked out, Fidesz's support dropped precipitously. At least for a couple of months. Commentators at the time pointed out that Orbán's knowledge of history left something to be desired because it is a well known fact that in the end the Hungarian Nazi party, the Arrow Cross Party, came into power in the fall of 1944 with German help. Horthy's slapping them around didn't work. The caption reads: "Er! How did our Father Horthy handle this situation with a couple of smacks in the face?" Well, indeed. It's a dilemma.

Sort by:   newest | oldest | most voted
Mark
Guest
“Pollsters were wrong about the chances of Jobbik and Fidesz. But they were spot on for some time before the elections about the MSZP numbers ….. Since their predictions for MSZP turned out to be accurate, most of the Jobbik votes must have come from Fidesz.” I don’t think this argument adds up at all. Firstly, even if it is correct it only explains why the opinion polls did not predict the result accurately – it doesn’t explain the overall movement of votes from one election to another. Secondly, we know that opinion polls everywhere are imperfect predictors of elections – what they can identify for us are general trends. Therefore it is a mistake to make an argument about actual votes purely on the basis of “errors” in the opinion polls. Thirdly, if one reads the opinion polls as identifiers of general trends – this result is perfectly compatible with their findings. The opinion polls since Christmas have revealed several general trends. Firstly, that the MSZP is in free-fall. Secondly, that opinion against the MSZP among a number, including its former voters has been hardening. Thirdly, this hardening extends to all other non-right wing parties, i.e. the SZDSZ. Fourthly,… Read more »
whoever
Guest
The sheer incompetence and complacency of the MSZP never fails to amaze me. It’s like they never saw this coming. Let’s look at how the labour movement in the UK dealt with the National Front in the 70s. Yes, the NF were weaker – but people saw the threat emerge earlier in their localities. First question: Why did the MSZP not identify the far-right threat in these localities – and then take action – years ago? On a local level? That is a crucial question, and I can only think that the MSZP have lacked local activists – and credibility – for a long time. Jobbik are growing out of the MSZP’s decay. Secondly, legal recourse – Hungary has a German-type legal system and I cannot believe that the Hungarian Guard are still allowed on the streets as a legal entity. They are simply TERRORISTS and that is how they should be treated. Legal action against the NF was not available in the UK in the same way as Germany, where authorities have constantly harried the far-right into new formations and thereby prevented prolonged electoral strength emerging. Thirdly, contest for control of the streets. Creation of an anti-fascist organisation that… Read more »
Mark
Guest
whoever: “It’s like they never saw this coming.” They didn’t. My conversations with MSZP members suggest that they didn’t take Vona seriously, and thought that the presence of the Magyar Gárda would be politically useful as a stick to beat FIDESZ. They ignored some obvious warning signs of the move of some of their natural supporters to the right – like Gaskó’s victories in the MÁV works’ council elections. They don’t have the grassroots activists on the ground – but they haven’t had for many years now, and the centre-left in Hungary just doesn’t do, or believe in, the kind of grassroots campaigning that would have enabled them to pick the problems up. They are too elitist and paternalist in their political practice. I think they did start to wake up after the Ferencváros by-election, and I hope they realize now that unless they start to address both the far-right and what has underpinned it they could come third behind Jobbik in parliamentary elections next year. The problem is that I don’t see them doing that unless they are able to behave as a populist opposition party themselves and start addressing left-wing themes, especially social justice. Of course, the problem… Read more »
Mark
Guest
Éva: “That’s very true but the Hungarian election laws make such grassroot activities very difficult.” That is certainly true for election campaigning, but I think it is more important for a party to consider its ongoing presence in local communities between elections. If a party doesn’t have roots in the community – if it doesn’t talk to people at work, to the parents picking their kids up from school, at the shops – it doesn’t know what is going on, and re-inforces a sense of its own distance. I suspect, if it is like other industrial communities I know better, that the MSZP in Ózd is made up predominantly of retired local officials from the previous system, and a few local businessmen. I’m sure the despite the support the MSZP has enjoyed in Ózd in the last four parliamentary elections, its people don’t feel that the party they have chosen represents them effectively at local or national level. In fact given the social disaster that has unfolded in the town since the late 1980s (which has been documented by Tamás Almási in his series of films on the town), if the MSZP had some life at the grassroots, and its… Read more »
Andras
Guest

Mark, MSZP was a ruling party for decades of a dictatorship, and governing party for 11 years out of 19 of the democratic period. No wonder that it lacks grassroots connection of a left-wing party, which may endured several decades of opposition, and only could fall back to her roots for support. The best, what you may expect from such reformed party is a kind of combination of statist welfare policies with “enlighted” pro-european, pro-business policies within the framework of the democratic system.

Mark
Guest
András: “MSZP was a ruling party for decades of a dictatorship, and governing party for 11 years out of 19 of the democratic period. No wonder that it lacks grassroots connection of a left-wing party.” Of course, you’re absolutely right – but there are two things here worth considering. The crisis of grassroots activism is not confined to the post-communist left, but is present across north-western Europe (when you compare the vote share of the MSZP to its British or Dutch sister parties its result looks positively good). These problems seem to be independent of the pasts of given parties, but are very much related to disappointment, the lack of a distinctive message from the top, and a dependence on media-based campaigning, which has shaped a consumerist, rather than a participatory approach to democracy. Again, especially noteworthy across Europe is the serious problem of credibility that social democratic parties have in their former strongholds in ex-industrial areas. It is striking that in the UK for example, in the city – Barnsley – where the miners’ confrontation with the Thatcher government in 1984 began – the far right British National Party scored over 17 percent of the vote (one of its… Read more »
Andras
Guest
Mark, when I wrote about the dead weight of he dictatorship, I meant that that the backbone of the cadre-pool of MSZP had been, or possibly has been in elite positions for decades, thus no wonder that has low affinity to grassroots activities. The other factor, namely, being in governing position for such a long time, also hindered the grassroots remaking of the party from below. After 2010, it is likely, that MSZP, finally, would have time to reinvent herself and search and find her grassroots. None the less, the last few years made so much damage for the party, that even I am not sure whether they could continue credibly in the present form. Even I am not sure that the present, diametrically opposed interests groups within the party, are ready to work together after 2010. But this is the story of the future. On the elections results. I did saw coming these results. If you remember, I argued in this forum late autumn last year, that MSZP should convene early elections to avoid the kind of disaster what happened in these elections. Still, I was surprised to see that Jobbik did get such a high vote, some at… Read more »
Gábor
Guest
I would doubt whether the cadres of MSZP inherited from MSZMP bears this wight the way András suggest. The former party was organized for decades along lines of a centralized but structured party in wich issues of politics and ideology were discussed, members that way prepared etc. Either it was effective or not, yieled more real knowledge for members or only some ideoloigzed distortion of the world, it has a tradition. And in many cases MSZP organizations with leftover MSZMP members, based on these traditions were quite effective after 1989. But it is true that those people are slowly disappearing, getting older etc. On the other hand the many from the elite in the Mszp rather fears this kind of model for a party. Either because they “fought” agianst this “undemocratic” model as members of the so called Reform Körök, or simply because it is more convenient for their political aims to divide the party between themselves into separate dominions. Many politicians has their own followers, organized into separate elements of the party, many times chairmen of territorial party organizations align themselves with those politicians, make alliances etc. And it is rather problematic to have an active, open, involving grassroot… Read more »
Mark
Guest
András: “None the less, the last few years made so much damage for the party, that even I am not sure whether they could continue credibly in the present form.” I think we agree ….. 1. We both know, I suspect, that the MSZP in industrial towns was organized predominantly from the former middle-managament of the big state companies. I saw this happen in the 1990s. As the social identities of company loyalty have become increasingly irrelevant, i.e. as the companies that sustained them have disappeared, I suspect even the local presence is vanishing. 2. Early elections are the lesser of all of the evils. The longer they hang on, the worse this is going to get. When their cuts are actually implemented and felt in peoples’ pockets their vote will go down further. If they went for elections now they might just be the main opposition party; if they stay until next year they will probably take third place. 3. MSZP suffers from a fundamental trust problem and this will not be solved easily. What everyone now has to consider seriously is the nightmare scenario, because it has become more likely as a result of the elections. FIDESZ wins… Read more »
Mark
Guest

Gábor: “On the other hand the many from the elite in the Mszp rather fears this kind of model for a party.”
This is a fascinating point. If only because one cannot fail to notice reading the minute books of party base organizations from the period of the Kádár era in the archives, the degree of criticism of the regime and government from the left that was expressed by the membership. The MSZP is very much the product of the “reform socialist” project of 1968, and we know that the “leftism” of the party apparatus was blamed by reformers for the partial reversal of reforms in the early 1970s. Your comment sheds light on aspects of the pre-history of the MSZP that are relevant to its failures post-1989 that are really important.

nwo
Guest
The debate is worthwhile and interesting. Make take away from it is: (1) The MSZP leadership at its core acts like and has for a long time considered itself an elite vanguard. As such, it is not an inherently democratic organization, and therefore has not acted in a way that is necessarily responsive to its base. (2) The MSZP was also fundamentally dishonest with its voter base. It desired to be seen as a mass party looking after the economic and social interests of the mass, but in reality it has become a party focused on and protecting the interests of a smaller group of business interests and people well connected with the Party (See the activities of the MFB). This contradiction is no longer tenable. (3) As we all know from recent history, the political specturm is really shaped more as a circle and not a straight line. As such, the far left and the far right often converge politically. Lets face it, Jobbik was often saying more socialistic things that the MSZP. (4) Finally, the conclusion must be that the sad reality of this country is that the vast majority of the people want some form of left… Read more »
Andras
Guest
1) I do not think that MSZP was fundamentally dishonest and only served interests of small groups of clients and business leaders. 2) I think, MSZP 2002 onwards really tried to have a European style welfare state. They really expanded welfare provisions. Yes, at the same time, they also had their own clients, corruption etc, but name one political party, which do not have such issues. The problem was that they did the expansion of the welfare state in a very incompetent way. They did not calculate with the long term effects of the measures. 2) 2006 was the moment when EU and international creditors forced a policy change and required MSZP to have a U-turn. The Gyurcsany-package was a rather half-hearted restructuring. Instead of cutting welfare state, it taxed business, further reducing competitiveness, in order to lower budget deficit to meet the requirements of EU. The half hearted measures were the consequence that MSZP as a party is not a neo-liberal inclined party with pro-business “secret agenda”, but exactly the opposite of such policy. 3) What is amazing is the incompetence of MSZP. Incompetence in both periods of governance as far as management of the economy concerned. They did… Read more »
Mark
Guest
András: “I do not think that MSZP was fundamentally dishonest and only served interests of small groups of clients and business leaders.” Dishonesty is too strong, but there is an institutional corruption about the MSZP, manifested most clearly by the Gyurcsány phenomenon that revealed an unhealthy fusion of political power and wealth, and considerable toleration of personal corruption (all those paper members). But, I think this happened not because of any well worked out plan, but because of the lack of a political strategy on the part of the party, i.e. they never articulated what it meant to be a mass-party of the centre-left under post-socialist circumstances. Because of this – and I think here NWO is absolutely right – they became a “party focused on and protecting the interests of a smaller group of business interests and people well connected with the Party”. András: “I think, MSZP 2002 onwards really tried to have a European style welfare state. They really expanded welfare provisions.” Expanding welfare provision is not the same as creating a European welfare state. The basic principles of the European social democratic welfare state – if we look at Sweden in the 1930s, or the UK a… Read more »
Mark
Guest
András: “Emergence of the cigánykérdés (gipsy issue). Sociological surveys since the early nineties are reporting about that a clear majority of non-gypsy population is rejecting the gypsy-population.” This is a much more deep-rooted problem. In the early 1960s, a journalist András Faludi produced a series of reports and a book dealing with the situation of Roma across Hungary. It is worth quoting what he wrote (in 1964!): “Here (in Hungary – M.P.) it is a widely held view, that the gypsy doesn’t like work. For this reason, immediately after citing the earlier data we have to note: there are a considerable number of them who would happily work, but they are hindered in realizing their intention by the fact that some of the factories and farms are not prepared to employ gypsies, and agricultural producer co-operative take them on only with difficulty. And it is a general phenomenon, that those who are taken on by factories, and farms, and collectives, get the worst jobs – often without reason, sometimes because of a lack of skill, or because they are illiterate. As a result they earn less well than the average, in most cases doing the most difficult work”. (András Faludi,… Read more »
whoever
Guest

“They did insanely loose budgetary policy between 2002-2005, and did not employ a more efficient, pro-business reforms after 2006. ”
The MSZP have always been pro-business – pro THEIR businesses. Fidesz will follow suit. The often unwritten history of the Horn government’s privatisations, the re-direction of EU money – the MSZP loves businesses. Some of them – their own. This is a government employing Veres – for goodness sake – there’s a man with integrity.
Medgyessy gets to carry the can, but my understanding is that the MSZP made these huge spending commitments in the run-up to 2002. He actually delivered on these -and then immediately had to tighten up the purse-strings. I remember 2004 being noted for the start of austerity measures – dropped by Gyurcsany, and then re-introduced in the most amateurish way possible in 2006 by the same man who’d dropped them.
In this sense I can understand Medgyessy’s schadenfreude in regards to the MSZP’s and SZDSZ’ current situation.
There’s no business like politics, after all.
Jobbik in this situation are the wild card. What are they after? If they are genuine uncorruptable radicals, one could imagine Fidesz will be feeling the heat somewhat.

Mark
Guest
Whoever, quoting András: “They did insanely loose budgetary policy between 2002-2005, and did not employ a more efficient, pro-business reforms after 2006. ” It is worth noting that there is nothing leftist about “insanely loose budgetary policy”. If my memory serves looking at historical statistics one of the Hungarian governments that consistently ran the largest budget surpluses since 1867 was Mátyás Rákosi’s between 1952 and 1953. In pracice debt-financed expansion and neo-liberalism go together, and this is simply because monetarist, neo-liberal policies, left to their own devices, in practice produce stagnation and low growth. In democratic states, i.e. outside Chile between 1973 and 1990, this proves only to be sustainable for a short-time and they need a policy change to keep the show on the road. The “politically correct” way for neo-liberals to ignite growth is to deregulate finance and create a private sector credit boom – like the Thatcher government did in the mid-1980s in the UK. But as we know from the economic history of the USA under Ronald Reagan and more recently under George W. Bush they do “insanely loose budgetary policy” too. Though I concede the public spending was on the military, and not social spending,… Read more »
NWO
Guest
Mark While the two of us no doubt have different visions as to what would constitute a succesful long term economic and fiscal policy for Hungary, you are 100% correct in stating that policy has been about redistribution and not full employment, and this has been the fatal flaw in the system. What has made this worse (like the debate about SSI in the States) is that in Hungary most of the redistribution has been seen as a middle class entitlement and not a safety net (see the debates over the HUF 300 medical visits and school fees). Where I suspect we probably disagree is in our views as to how much the State could or should have done to create jobs in the poorer parts of Hu. I still believe the best route would have included (1) strict budget discipline thereby allowing for lower HUF interest rates, (2) tax policy condusive to job creation-lower personal and corporate income taxes, substantially smaller tax wedge but higher consumption abd asset/property taxes, (3) regulatory streamlining and reform and (4) investment in elementary and middle and high school education and infrastructure investment focused on less developed regions (and not on bs like the… Read more »
Mark
Guest
NWO: “While the two of us no doubt have different visions as to what would constitute a succesful long term economic and fiscal policy for Hungary.” There are differences, but I don’t think we’re as far apart as you might think. The best social policy in a market economy is the one that allows the greatest number to secure the benefits of economic growth. This means ensuring that the largest number of people possible can improve their circumstances through their own efforts, i.e. working for a decent income, and providing adequate social insurance for illness, unemployment, old age, and support for the bringing up of children (I think this had been the stated aim of the MSZP and they had pursued policies consistent with it, the crisis they have suffered since 2006 would have been a more recoverable period of difficulty). I can, though, see sense in some redistribution as there comes a point at which economic inequality acts as a break on equality of opportunity, and thus on social mobility (though one should beware of mindless levelling). However, what happened in Hungary wasn’t even this. We know that in 2001, the MSZP had no vision but were desperate to… Read more »
New World Order
Guest
In the years 2002-2006, Government spending replaced FDI. Domestic capital formation and investment (other than in the real estate sector) has always been poor. I remember the NBH President telling me in 2006/2007 that as far as the National Bank could determine the natural rate of growth in Hungary was 2-3% due to so many lack of investment in capital and human capital. Due to the lack of competitiveness (strangely this really started post-2004 and EU accession), strategic investors that had invested previously in the country instead of reinvesting profits were repatriating profits and investing in other emerging markets or domesticaly. Part of the reason at least in the CEE was that before EU accession, Hungary and the Cz Republic were socially and politically the safest destinations in the CEE (much more so than Poland, Slovakia and the Balkans). After the first wave of Accession, Poland and Slovakia (and even Romania from the outside looking in) were deemed safe by investors, and so this big advantage Hu had enjoyed disappeared overnight. In this way, ironically, when one sees polls showing that Hungarians believe they have not benefitted from EU accession (something I 99% disagree with) there is some kernel of… Read more »
Mark
Guest
NWO: “In the years 2002-2006, Government spending replaced FDI.” This is exactly how I read the evidence, and I think you are right to point out the way in which the decision of the EU to go for a “big enlargement”, rather than a small one destroyed Hungary’s earlier advantage. Hungary’s position is an extreme example of a more general difficulty with FDI in CEE. If you look at the EU as a whole whereas in the mid-1990s most of was in manufacturing, the transformation of technology has led to a major shift in its balance towards services. The big western European economies (the UK and France especially) seem to lead the way. None of this kind of investment seems to find its way to CEE, which is still concentrated in manufacturing, and on the eve of the onset of the crisis there were signs that the growth of FDI in the region was reaching its limit. What is more here improvements in the relative market shares of states seem to be being achieved at the expense of other CEE states, suggesting that there is competition based on costs for FDI which is a kind of “zero-sum” game. What I’m… Read more »
NWO
Guest

Mark
You are correct, but there is ABSOLUTELY nothing that can be done about this. Increasingly, except for some specialized manufacturing, the CEE will not be competitive against Asia, North Africa etc. This is all the more true as the EU imposes substantial costs on a country and these are not counter balanced by better trade terms. Moreover, I disagree somewhat on your point on the service sector. There is room for countries like Hungary to compete, but this is hampered by poor education and the lack of free competition in the service sector in the EU. Ironically, again, Hungary made a real effort to get ahead of the other CEE countries in being competitive in the service sector (e.g., improving the telecommunications infrastructure much earlier than other countries in the region) but they have for various reasons not benefitted as much as they had hoped from these efforts. Anyway, call centers and other out sourced services that can be provided from Hungary only provide limited (though important)opportunities and are concentrated in Budapest.

Pal Marosy
Guest
Interesting debate. MSZP has faced one of its most humiliating loss. It is clear that a big number of former MSZP voters have voted for JOBBIK. The map of Hungarian votes shows that some of the strongholds of MSZP have been “taken over” by Jobbik. This reminds me the after WWII years when Hungarian Nazis have been co-opted in the communist party. Now is the other way around. Former MSZP voters join the Nazi party. I think that MSZP has a huge share of responsibility for the migration of votes to the far right. This is putting at risk Hungary’s democratic future. I have to agree with Mark’s analysis in his first post (thanks for your unbiased analysis), most of the Jobbik voters come from MSZP. I have to agree with Andras that the öszöd speech was one of the root causes of the defeat of MSZP. When I have listened to that speech I could not believe my ears. I have realized that it is a genuine recording only after Gyurcsany confirmed. Who can trust someone who says: “We lied morning, night and evening.” “A footnote for those who don’t know: Krisztina Morvai is married to a Jew and… Read more »
wpDiscuz